- What is this settlement about?
- Why did I get this notice package in the mail?
- Why is this a class action?
- How did you get my personal information?
- What claims were made by the lawsuit?
- Who are the class members?
- What relief is available under the settlement?
- My spouse, significant other, or relative is an employee of Ameriprise Financial or American Express Financial Advisors. Is it possible that he or she is a class member?
- How many American Express Financial Advisors, Inc. clients does this settlement affect?
- What products are involved in this suit?
- When and where were the lawsuits filed?
- What is the deadline for filing a claim?
- Why did I receive this? I normally have my mailings sent to a different address.
- I believe I am a class member. I did not receive, or I lost, the claim form. How do I get one?
- Do I have to go to court?
- When and where will the Court decide the fairness of the settlement?
- Can I attend the fairness hearing? When will the fairness hearing be held?
- I need a lawyer to explain this to me. Do I need to speak to or hire an attorney?
- How will the lawyers be paid?
- How can I comment in support of, or in opposition to, the settlement?
- What if I have questions about my Ameriprise Financial investment accounts?
- Why can’t I contact my financial advisor about the lawsuit?
- Why did the Defendants settle the lawsuits? Isn’t the proposed settlement an indication that the Defendants are guilty?
- Will all class members be eligible to receive a benefit?
- Will I be taxed? If so, why?
- How can I get payment?
- When will I get my payment?
- How is Plaintiffs' counsel calculating the amount that I will receive? How much do I stand to gain from this settlement?
- What if I have already filed a lawsuit against the Defendants?
- How do I exclude myself from the lawsuit?
- What if I can't get all signatures for the account?
- Can I send in a fax with my signature?
- I'm moving and want you to change my address.
- I am filing the claim on behalf of someone else, what do I need to do?
- I received more than one claim form. Do I need to return all forms?
- All of my accounts which I believe are eligible under this settlement were not identified on the claim form/s. What do I need to do?
- I lost my mailing. Can you send another one?
- The account owner is deceased. Who should sign the claim form?
- Why was the claim form mailed to the deceased client’s address?
- The account owner is unable to sign the claim form because of a disablilty. Who should sign the claim form?
- The account owner is unable to sign the claim form because he or she is mentally incapacitated (legally incompetent). Who should sign the claim form?
- The account owner is a minor. Who should sign the claim form?
- I am hearing impaired, do you have a special TDD line?
The settlement resolves class action litigation arising out of alleged business practices of American Express Company, American Express Financial Corporation (now known as RiverSource Investments LLC), American Express Financial Advisors Inc. (now known as Ameriprise Financial Services, Inc.), and James M. Cracchiolo (“Defendants”). Plaintiffs are individuals who purchased mutual funds, financial plans or fee-for-advice services from Defendants.
YOU ARE NOT BEING SUED.
The “Notice” you received refers to a settlement of a class action lawsuit against American Express Company and certain of its affiliates. You received the Notice because you may be a member of the class and you, or a member of your family, purchased one of the mutual funds, financial plans or fee-for-advice services at issue in this case.
The Notice was provided to you so that you could decide if you wanted to be included as part of the settlement and receive benefits under the settlement, if you wanted to opt-out (exclude yourself) from the settlement class or if you wanted to comment about the settlement.
The Notice package explains the lawsuit, the settlement, your legal rights, what benefits are available, who is eligible for them and how to get them.
In a class action, one or more people, called class representatives, in this case Plaintiffs Leonard D. Caldwell, Carol M. Anderson, Donald G. Dobbs, Kathie Kerr, Susan M. Rangeley and Patrick J. Wollmering, sue on behalf of people who have similar claims. All these people, together, constitute a plaintiff class. This is a class action because one court resolves all class-wide issues for all people who meet the class definition, except for those who exclude themselves from the class.
Your information was provided from the
Defendants' records pursuant to the Federal Court's order. The mailing
will not result in disclosure of your financial or other identifying information. All reasonable efforts were undertaken to mail the Notice only to potential class members. The claim form listing your account information is unique to you and was provided only to you.
In the lawsuit, plaintiffs complain that they were sold financial plans, and/or advice, that, instead of being tailored to their individual circumstances, contained standardized recommendations designed to steer them into investing in Defendants’ proprietary mutual funds, other proprietary investment products and certain non-proprietary “Preferred” or “Select” mutual funds.
Plaintiffs allege that Defendants steered clients into the Preferred or Select Funds to obtain fees paid by Preferred or Select Funds in exchange for promoting those funds. Furthermore, the Plaintiffs allege a portion of the fees was charged to investors
Plaintiffs claim that the conflicts of interest inherent in Defendants’ financial plans and/or financial advisory services, and the compensation arrangements between Defendants and the Preferred and Select Funds, were inadequately disclosed to investors. Plaintiffs further allege that Defendants steered investors into their proprietary funds – called AXP Funds (now known as RiverSourceSM Funds) – due to the fees they would receive for managing the proprietary funds.
All persons and entities who, at any time from and including March 10, 1999 through and including April 1, 2006, who:
- paid a fee for financial advice, financial planning or other financial advisory services, as described in the American Express or Ameriprise Financial Advisory Services Brochure and the Financial Advisory Service Agreement;
- purchased any mutual fund in the American Express or Ameriprise Preferred Provider Program, Select Group Program or other similar program, or who purchased any mutual fund sold under the American Express, AXP, or RiverSource brand;
- paid a fee for financial advice, financial planning or other financial advisory services rendered in connection with the American Express or AmeripriseSM Strategic Portfolio Services (SPS) Advantage program, Wealth Management Service program or separately managed account program.
Defendants have paid $100 million into an interest-bearing account. This amount plus interest makes up the settlement fund. After deducting Court-awarded attorneys’ fees and expenses and taxes on income earned by the fund, the balance of this fund will be allocated among all class members who send in a valid proof of claim (included with this Notice).
Defendants will also pay all reasonable costs of notifying class members of the settlement and all reasonable costs of settlement administration. These costs, which are expected to be substantial, will not be charged to the settlement fund.
In addition, Defendants will adopt and implement the remedial measures set out in full in the Notice.
It depends on when your spouse, significant other, or relative was employed by the Defendant entity or agent. People who were employees or agents of any of the Defendants and Nominal Defendants (including financial advisors) at any time from and including March 10, 1999 through and including April 1, 2006 are excluded from the Class.
Approximately 2.4 million accounts.
Products that involved payment of fees for financial advice, financial planning or other financial advisory services rendered in connection with the American Express or Strategic Portfolio Service (SPS) Advantage program, Wealth Management Service program or separately managed account program, all ownerships types for any mutual fund in the American Express or AmeripriseSM Preferred Provider Program, Select Group Program or other similar program, and any mutual fund sold under the American Express, AXP or RiverSource brand. You should assume that clients who paid financial planning or advisory fees, or purchased any mutual fund, from March 10, 1999 through April 1, 2006, might be included in the class.
The Court overseeing the case is the United States District Court for the Southern District of New York. This lawsuit was filed on September 29, 2004.
You must have completed your claim form, attached all of the required documentation and mailed the claim form, so that it was postmarked no later than July 10, 2007.
We were required to mail to the address of record on your accounts.
Claim forms were mailed by March 22, 2007 to all potential class members as identified in the Defendants' records. The time period to file a claim has passed.
No. Whether you want to participate in the settlement, object to the settlement or request to be excluded from the settlement, you do not have to go to court.
The Settlement Fairness Hearing was held on July 13, 2007, at 11:00 a.m. at the United States District Court for the Southern District of New York, Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, New York, New York, in Courtroom 24B.
At the hearing, the Court granted Final Approval of the Settlement.
Please be advised that the Fairness Hearing was held on July 13, 2007. At the Hearing, the Court granted Final Approval of the Settlement.
You may hire an attorney at your own expense or contact one of the Plaintiffs’ attorneys, who filed the lawsuit, and are representing all of the class members at no out-of-pocket cost. The Plaintiffs’ attorneys are available to answer any questions you may have. They do not work for the Defendants. The Court ordered that the class members be represented by 3 law firms, called Plaintiffs’ Co-Lead Counsel:
- Girard Gibbs LLP, 601 California Street, Suite 1400, San Francisco, California 94108, Telephone (415) 981-4800;
- Milberg Weiss & Bershad LLP, One Pennsylvania Plaza, New York, New York 10119-0165, Telephone (212) 594-5300;
- Stull Stull & Brody, 6 East 45th Street, New York, New York 10017, Telephone (212) 687-7230.
Plaintiffs’ Co-Lead Counsel asked the Court to award attorneys’ fees from the settlement fund in the amount of $27 million and for reimbursement of expenses incurred in connection with the prosecution of this litigation in the approximate amount of $600,000, plus interest on such fees and expenses at the same rate as earned by the settlement fund. Plaintiffs’ Co-Lead Counsel, without further notice to the class, may subsequently apply to the Court for fees and expenses incurred in connection with administering and distributing the settlement proceeds to class members and any proceedings after the fairness hearing.
PLEASE BE ADVISED THAT THE DEADLINE TO COMMENT ON THE SETTLEMENT HAS PASSED.
If you are a class member, you may comment in support of, or in opposition to, the settlement and/or the application for attorneys’ fees and expenses. The Court will consider your views at the fairness hearing. You do not need to comment in order to participate in the settlement. To comment on the settlement, you must send a signed statement saying that you support or oppose the proposed settlement in In re American Express Financial Advisors Securities Litigation, Master File No. 04 Civ. 1773 (DAB). You must include your name, address, telephone number and your signature along with your statement of the reasons why you support or oppose the proposed settlement. You must mail a copy of your comments to the Court and to Plaintiffs' and Defendants' counsel.
The addresses are provided in Section 18 on page 10 of the Notice and also noted below.
You must mail a copy to each of the addresses so that it is postmarked no later than May 7, 2007. You can review Section 18 on page 10 of the Notice for more information on the requirements and procedures for commenting in support of or opposition to the settlement.
Court
In re American Express Financial Advisors Sec. Lit., Case No. 04 Civ. 1773 (DAB)
Clerk of Court - United States District Court for the Southern District of New York
Daniel Patrick Moynihan
United States Courthouse
500 Pearl Street, Room 2510
New York, NY 10007-1312
Plaintiffs’ Co-Lead Counsel
Girard Gibbs LLP
Daniel C. Girard
601 California Street, Suite 1400
San Francisco, CA 94108
Tel. (415) 981-4800
Defense Counsel
Wilmer Cutler Pickering Hale
and Dorr LLP
Peter K. Vigeland
399 Park Avenue
New York, NY 10022
Tel. (212) 230-8800
You will need to speak directly with a representative from Ameriprise Financial regarding any specific questions that you may have about your accounts. However, they will not be able to answer any questions regarding the lawsuit. The toll free number for Ameriprise is 1 (800) 862-7919.
Defendants' financial advisors are not knowledgeable about the legal terms of the settlement and should not be providing advice about it. However, both the Claims Administrator, The Garden City Group, Inc., and Plaintiffs' Co-Lead Counsel are prepared to discuss the settlement with class members. The Garden City Group, Inc. has been appointed by the Court to answer your questions.
While the Defendants fully deny the allegations in this lawsuit, they made the determination that to settle this litigation was in their best interests. It allows Ameriprise to move forward as a newly independent company unencumbered by the distraction, expense and uncertainty that accompanies such litigation. The Defendants believe the settlement is in the best interests of the newly formed Ameriprise Financial Services, Inc., its shareholders and its clients.
All class members who received a Notice have a choice on whether or not to file a claim to receive a benefit. If you chose to file a claim, you may receive a benefit. If you chose to be excluded from the settlement, you will not receive a benefit. If you failed to file a claim form, you will not receive a benefit.
Unfortunately, we cannot provide tax advice. If your benefit is over $600.00, you will receive a 1099 MISC tax statement. You may want to discuss this with a qualified tax advisor to determine if, in your particular circumstances, any of the benefits would be taxable.
To qualify for payment, you were required to fully complete and submit your claim form so that it was postmarked no later than July 10, 2007.
All appeals regarding the Court's approval of the Settlement have been resolved. Please periodically check this website for updates on the status of distribution.
Plaintiffs have proposed a Plan of Allocation for distributing settlement money among class members. At the fairness hearing, the Court will consider whether to approve this plan as well as the settlement. Under the settlement, the amount available for distribution will be the balance of the settlement fund remaining after deduction of Court-awarded attorneys’ fees and litigation expenses (“Net Settlement Fund”). The Net Settlement Fund will be distributed among those class members who timely submit valid claims. The following description of the Plan of Allocation is qualified in its entirety by reference to the Plan of Allocation itself, attached as Schedule 4 to the Notice.
Under Plaintiffs’ proposed plan, claimants who bought AXP funds will be allocated payments of $20 each and claimants who bought Preferred Funds will be allocated payments of $50 each. If the total amount allocated to these categories exceeds 25 percent of the Net Settlement Fund, then the amount allocated to purchasers of Preferred Funds will be reduced so as to bring the total amount down to the 25-percent limit, and the individual allocation to those claimants will be reduced equally. If, however, the reduction would cause the payment to each Preferred Fund claimant to fall below $30, then more money will be allocated to the Preferred Fund claimants, equal to (a) the amount necessary to bring each payment back up to $30, or (b) 5 percent of the Net Settlement Fund, whichever is less.
The balance of the Net Settlement Fund remaining after these allocations will be divided among claimants who paid a fee for financial advisory services pursuant to a Financial Advisory Service Agreement; or paid a fee in connection with an account in the Strategic Portfolio Service program (“SPS”), Wealth Management Service program (“WMS”), or Separately Managed Account program (“SMA”), for services that included financial advice, financial planning, or other financial advisory services. Generally speaking, these claimants will be allocated payments in proportion to the dollar amounts of the financial advisory service fees or WMS, SMA or SPS fees they paid. The amount of the payment will depend on how many other class members file claims, when the fees in question were paid, whether the claimant also purchased an AXP proprietary product during the Class Period (such as an AXP mutual fund, annuity, or life insurance policy), and other factors.
The distribution to a claimant who falls into more than one of the four categories will be the total of the amounts allocated for each applicable category. Payment will be by check.
You will need to confer with your counsel and review the Release language in the Notice at Question No. 12 as your legal rights in the separate lawsuit may be affected, and you may need to exclude yourself from the class by submitting an exclusion request, postmarked no later than May 7, 2007.
PLEASE BE ADVISED THAT THE DEADLINE TO EXCLUDE YOURSELF FROM THE SETTLEMENT HAS PASSED.
To exclude yourself from the class and settlement, you must mail a written request that clearly states your name, address, telephone number and that you request exclusion from the American Express Financial Advisors Securities Litigation class and settlement. Your request must be signed by you. Your exclusion request must be postmarked no later than May 7, 2007, and mailed to:
AEFA Securities Litigation Settlement
c/o The Garden City Group, Inc.
PO Box 9089
Dublin, OH 43017-0989
If you exclude yourself from the class, you will not be entitled to any payment under the settlement, and you will have no right to comment in support of, or in opposition to, the settlement. If you exclude yourself from the class, you will not be legally bound by anything that happens in this lawsuit, and you may be able to sue (or continue to sue) Defendants and other Released Persons in the future.
You cannot exclude yourself by phone or email or facsimile.
Signatures of each account owner are required for your claim form to be complete.
No, you need to send your response by mail in the envelope provided to you with your Notice.
If your address changes after you have submitted your claim form you must notify the Claims Administrator of your new address in writing.
If you act as an agent, representative, executor, heir, administrator, guardian, custodian, or trustee for an eligible Ameriprise Financial account for which you are making a claim under the settlement, you must complete and sign the claim form on behalf of the person or persons you represent, and state on the claim form:
- the capacity in which you are acting; and
- the name, address, and telephone number of the beneficial owners on whose behalf you are acting.
Additionally, you must provide documentation establishing that you have the authority to act in the representative capacity stated on the claim form.
Yes. If you are named on more than one account with Ameriprise Financial, either as an individual owner, joint owner, or in a representative capacity, you will receive one Notice and Proof of Claim Form package by mail for each account or group of accounts for which the owners of record are different. To receive settlement distributions for all of your eligible accounts, you must complete and sign ALL claim forms sent to you.
The time period to have additional accounts researched for eligibility has passed.
The deadline to submit a claim has passed.
Whomever is authorized to act on behalf of the deceased class member’s estate will need to complete and sign the claim form. Before we can allow someone to act on behalf of the estate in exercising any rights under the proposed settlement, we will need to receive a copy of any documentation that shows that you are authorized to act as the representative of the class member’s estate.
We were required to mail the packet to the address of record for the qualifying accounts.
If the account owner is disabled, he or she must still sign the claim form if possible. If the owner has designated an attorney-in-fact or other legal representative to handle his or her affairs, that person should submit the necessary paperwork.
If a court has declared the owner legally incompetent, then the legally appointed guardian or agent should submit the signed form and a copy of any documentation that shows the person is authorized to act on behalf of the account owner.
If there is a custodian for the minor, that person named as the custodian should sign the form. If the custodian is deceased, then a parent or legal guardian may sign the form on behalf of the minor. The custodian, parent or guardian should state in the form that the child is a minor.
Yes. Hearing impaired class members will be instructed to call toll free at 1 (888) 250-5835.
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