The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:A Federal Judge Rejects a Retaliation Claim Against American Century Not Rated 0.0 Email Routing List Email & Route  Print Print
Wednesday, February 27, 2013

A Federal Judge Rejects a Retaliation Claim Against American Century

Reported by Neil Anderson, Managing Editor

A federal judge in Missouri has dismissed a lawsuit by a former employee of American Century [profile] who alleged retaliation by American Century after he testified in a separate arbitration case see dismissal].

The suit was filed in August 2012 by Tom Kmak, former chief executive of the American Century's Retirement Plan Services Division, which manages about $115 billion in defined contribution plan assets [see second amended complaint]. Kmak declined to comment for this story.

"When he filed the suit last year, we said it was meritless," American Century spokesman Chris Doyle told MFWire. "We're pleased that the judge dismissed the case."

J.P. Morgan bought a 45 precent stake in American Century for $915 million in 1998 and teamed up on the RPS division. J.P. then bought the RPS division outright in 2003 for $100 million. Kmak stayed on after the deal and led the unit at J.P. Morgan before leaving in 2007.

Meanwhile, between 2009 and 2011, J.P. Morgan and American Century were locked in arbitration over a number of issues, in particular whether J.P. Morgan had lived up to its promise to promote American Century's products in retirement plans after buying RPS in 2003. J.P. Morgan ultimately lost $373 million in that arbitration.

Kmak was one of the executives who testified against American Century during the arbitration. In his suit, he alleges that American Century retaliated against him for that testimony by calling back stock that he had purchased from 2003 to 2005. Kmak filed suit in August 2012, asking for $3.27 million in damages.

Ultimately, the justice presiding over the case, district judge Beth Phillips of the Western District of Missouri, disagreed. She issued an order earlier this month throwing the case out. In her conclusion to the order, Case 4:12-cv-01111-BP Document 27, the judge had this to say about Kmak's complaint:
As set forth above, American Century was entitled under the 2003 and 2005 Agreements to call Kmak’s stock for repurchase “at any time” after his employment with the company had ended. As a result, Kmak’s claim for breach of the implied warranty of good faith and fair dealing does not state a plausible claim for relief under Missouri law.

Tommy Fernandez also contributed to this story. 

Stay ahead of the news ... Sign up for our email alerts now

 Do You Recommend This Story?

Return to Top
 News Archives
2022: Q4Q3Q2Q1
2021: Q4Q3Q2Q1
2020: Q4Q3Q2Q1
2019: Q4Q3Q2Q1
2018: Q4Q3Q2Q1
2017: Q4Q3Q2Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Add to My Yahoo!
follow us in feedly

©All rights reserved to InvestmentWires, Inc. 1997-2022
14 Wall Street | 20th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use