Ameriprise 2012 Annual Report Download - page 182

In November 2010, the Company’s J. & W. Seligman & Co. Incorporated subsidiary (‘‘Seligman’’) received a governmental
inquiry regarding an industry insider trading investigation, as previously stated by the Company in general media reporting.
The Company continues to cooperate fully with that inquiry, responding to requests for information from both the SEC and
U.S. Attorney’s office. Neither the Company nor Seligman has been accused of any wrongdoing, and the government has
confirmed that neither the Company nor any of its affiliated entities is a target of its investigation into potential insider
trading. The Company cannot reasonably estimate the range of loss, if any, that may result from this matter given the
procedural status of the matter, the difficulty in predicting the direction of the government’s inquiry and the government’s
indication of the Company’s status relative to the investigation.
In October 2011, a putative class action lawsuit entitled Roger Krueger, et al. vs. Ameriprise Financial, et al. was filed in
the United States District Court for the District of Minnesota against the Company, certain of its present or former
employees and directors, as well as certain fiduciary committees on behalf of participants and beneficiaries of the
Ameriprise Financial 401(k) Plan. The alleged class period is from October 1, 2005 to the present. The action alleges that
Ameriprise breached fiduciary duties under ERISA, by selecting and retaining primarily proprietary mutual funds with
allegedly poor performance histories, higher expenses relative to other investment options and improper fees paid to
Ameriprise Financial or its subsidiaries. The action also alleges that the Company breached fiduciary duties under ERISA
because it used its affiliate Ameriprise Trust Company as the Plan trustee and record-keeper and improperly reaped profits
from the sale of the record-keeping business to Wachovia Bank, N.A. Plaintiffs allege over $20 million in damages.
Plaintiffs filed an amended complaint on February 7, 2012. On April 11, 2012, the Company filed its motion to dismiss
the Amended Complaint. The Court denied the motion to dismiss on November 20, 2012, and now the parties will engage
in discovery. The Company cannot reasonably estimate the range of loss, if any, that may result from this matter due to
the early procedural status of the case, the absence of class certification, the lack of a formal demand on the Company by
the plaintiffs and plaintiffs’ failure to allege any specific, evidence-based damages.
In October 2012, a putative class action lawsuit entitled Jeffers vs. Ameriprise Financial Services, et al. was filed against
the Company in the United States District Court for the Northern District of Illinois relating to its sales of the Inland
Western (now known as Retail Properties of America, Inc. (‘‘RPAI’’)) REIT. The action also names as defendants RPAI,
several of RPAI’s executives, and several members of RPAI’s board. The action alleges that the Company failed to perform
required due diligence and misrepresented various aspects of the REIT including fees charged to clients, risks associated
with the product, and valuation of the shares on client account statements. Plaintiffs seek unspecified damages. The
Company was served in December, and there is currently no deadline by which the Company is required to respond to the
complaint. The Company cannot reasonably estimate the range of loss, if any, that may result from this matter due to the
early procedural status of the case, the absence of class certification, the lack of a formal demand on the Company by the
plaintiffs and plaintiffs’ failure to allege any specific, evidence-based damages.
23. Related Party Transactions
The Company may engage in transactions in the ordinary course of business with significant shareholders or their
subsidiaries, between the Company and its directors and officers or with other companies whose directors or officers may
also serve as directors or officers for the Company or its subsidiaries. The Company carries out these transactions on
customary terms. The transactions have not had a material impact on the Company’s consolidated results of operations or
financial condition.
The Company’s executive officers and directors may have transactions with the Company or its subsidiaries involving
financial products and insurance services. All obligations arising from these transactions are in the ordinary course of the
Company’s business and are on the same terms in effect for comparable transactions with the general public. Such
obligations involve normal risks of collection and do not have features or terms that are unfavorable to the Company’s
subsidiaries.
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