Western Union 2011 Annual Report Download - page 47

ITEM 2. PROPERTIES
Properties and Facilities
As of December 31, 2011, we have offices in approximately 60 countries, which includes five owned facilities
and approximately 25 United States and 400 international leased properties. Our owned facilities include our
corporate headquarters located in Englewood, Colorado.
Our owned and leased facilities are used for operational, sales and administrative purposes in support of both
our consumer-to-consumer and global business payments segments and are all currently being utilized. In certain
locations, our offices include customer service centers, where our employees answer operational questions from
agents and customers. Our office in Dublin, Ireland serves as our international headquarters.
We believe that our facilities are suitable and adequate for our current business; however, we periodically
review our facility requirements and may acquire new facilities to meet the needs of our business or consolidate
and dispose of or sublet facilities which are no longer required.
ITEM 3. LEGAL PROCEEDINGS
Western Union has received Civil Investigative Demands from certain state attorneys general who have
initiated an investigation into whether the Company took adequate steps to help prevent consumer fraud from
2010 to 2011. The Civil Investigative Demands seek information and documents relating to consumer fraud
complaints that the Company has received and the Company’s procedures to help identify and prevent fraudulent
transfers. Due to the stage of the investigation, the Company is unable to predict the outcome of the
investigation, or the possible loss or range of loss, if any, which could be associated with any possible civil
claims that might be brought by one or more of the states. Should such claims be brought, we could face
significant fines, damage awards, or regulatory consequences, or compulsory changes in our business practices,
that could have a material adverse effect on our business, financial condition, and results of operations.
In October 2011, Elektra del Milenio de C.V. (“Elektra”), the Company’s largest agent in Mexico, served a
Demand for Arbitration on two of the Company's subsidiaries, alleging that the Company’s subsidiaries
intentionally breached obligations relating to exclusivity in the parties’ International Money Transfer Agreement.
Elektra claimed that the alleged breach caused it to lose profits that it would otherwise have earned from offering
the Company’s services or other money transfer services. The Company’s subsidiaries responded to the Demand
for Arbitration. In February 2012, all claims relating to this matter were resolved through a confidential
settlement in which no party admitted fault.
On July 26, 2010, U.F.C.W. Local 1776 & Participating Employers Pension Fund filed a Verified Shareholder
Double Derivative Complaint and Jury Demand in United States District Court for the District of Colorado,
alleging that the Company’s Board of Directors failed to appropriately oversee the Company’s compliance
program, particularly in regard to the alleged deficiencies which resulted in the Company’s agreement and
settlement with the State of Arizona and other states in early 2010. In addition to naming the Company’s Board
members as individual defendants, the complaint names the Company and its subsidiary Western Union
Financial Services, Inc. as nominal defendants. The complaint seeks damages from the individual defendants for
breach of fiduciary duty and waste of corporate assets and an order requiring various corrective measures. On
September 10, 2010, the United States District Court for the District of Colorado dismissed the complaint for
lack of subject matter jurisdiction. On September 23, 2010, the plaintiff re-filed the complaint in Maricopa
County Superior Court in Arizona. The complaint was removed to the United States District Court for the
District of Arizona. On September 29, 2011, the Court denied Defendants’ motion to dismiss on jurisdictional
grounds. On December 15, 2011, the Company and Western Union Financial Services, Inc. filed a Notice of
Settlement. The terms of the settlement are set forth in a Memorandum of Understanding attached to the Notice
of Settlement and include corporate governance changes that the Company and Western Union Financial
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