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LITIGATION
9 Months Ended
Sep. 30, 2011
Litigation [Abstract] 
LITIGATION

 

  • LITIGATION

 

There have been no new material legal proceedings and no material developments in specific litigations previously reported in AXA Financial Group's Notes to Consolidated Financial Statements for the year ended December 31, 2010, except as set forth below:

 

Insurance Litigation

 

In Eagan, in June 2011, the Court granted final approval of the settlement between the parties.

 

In July 2011, a lawsuit was filed in the United States District Court of the District of New Jersey, entitled Mary Ann Sivolella v. AXA Equitable Life Insurance Company and AXA Equitable Funds Management Group, LLC (“FMG LLC”). The lawsuit was filed derivatively on behalf of eight funds. The lawsuit seeks recovery under Section 36(b) of the Investment Company Act of 1940, as amended (the “Investment Company Act”), for alleged excessive fees paid to AXA Equitable and FMG LLC for investment management services. Plaintiff seeks recovery of the alleged overpayments, or alternatively, rescission of the contracts and restitution of all fees paid. In November 2011, plaintiff filed an amended complaint, adding claims under Sections 47(b) and 26(f) of the Investment Company Act, as well as a claim for unjust enrichment.  In addition, plaintiff purports to file the lawsuit as a class action in addition to a derivative action.

 

In Dennison, in October 2011, the Court certified a class of certain RISPE participants who will take or have taken lump sum payments after June 2004.

 

Insurance Regulatory Matters

 

AXA Financial Group is subject to various statutory and regulatory requirements concerning the payment of death benefits and the reporting and escheatment of unclaimed property, and is subject to audit and examination for compliance with these requirements. AXA Financial Group, along with other life insurance industry companies, has been the subject of various inquiries regarding its death claim, escheatment, and unclaimed property procedures and is cooperating with these inquiries. For example, in June 2011, the New York State Attorney General's office issued a subpoena to AXA Financial Group in connection with its investigation of industry escheatment and unclaimed property procedures. AXA Financial Group also has been contacted by a third party auditor acting on behalf of a number of U.S. state jurisdictions reviewing compliance with unclaimed property laws of those jurisdictions. In July 2011, AXA Financial Group received a request from the New York State Department of Financial Services, Life Bureau, formerly the New York State Insurance Department, (the “NYSDFS”) to use data available on the U.S. Social Security Administration's Death Master File or similar database to identify instances where death benefits under life insurance policies, annuities and retained asset accounts are payable, to locate and pay beneficiaries under such contracts, and to report the results of the use of the data. On October 31, 2011, AXA Financial Group filed its first stage request results with the NYSDFS. AXA Financial Group expects that the audits and related inquiries will result in payment of death benefits, reporting and escheatment of unclaimed death benefits, potential interest on such payments, and changes to AXA Financial Group's relevant procedures.

 

In addition to the matters described above and in AXA Financial Group's Notes to Consolidated Financial Statements for the year ended December 31, 2010, a number of lawsuits have been filed against life and health insurers in the jurisdictions in which AXA Equitable, MONY Life, and their respective insurance subsidiaries do business involving insurers' sales practices, alleged agent misconduct, alleged failure to properly supervise agents, contract administration and other matters. Some of the lawsuits have resulted in the award of substantial judgments against other insurers, including material amounts of punitive damages, or in substantial settlements. In some states, juries have substantial discretion in awarding punitive damages. AXA Equitable, AXA Life, MONY Life, MLOA and USFL, like other life and health insurers, from time to time are involved in such litigations. Some of these actions and proceedings filed against AXA Financial and its subsidiaries have been brought on behalf of various alleged classes of claimants and certain of these claimants seek damages of unspecified amounts. While the ultimate outcome of such matters cannot be predicted with certainty, in the opinion of management no such matter is likely to have a material adverse effect on AXA Financial Group's consolidated financial position or results of operations. However, it should be noted that the frequency of large damage awards, including large punitive damage awards that bear little or no relation to actual economic damages incurred by plaintiffs in some jurisdictions, continues to create the potential for an unpredictable judgment in any given matter.

 

AllianceBernstein Litigation

 

In connection with its market timing matters, the derivative claim, which was brought by AllianceBernstein Holding unitholders against the officers and directors of AllianceBernstein and in which plaintiffs sought an unspecified amount of damages, has been resolved pursuant to a stipulation of settlement with plaintiffs and the recovery of insurance proceeds totaling $23 million from relevant carriers. In August 2011, the stipulation of settlement was approved by the court.

 

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Although the outcome of litigation and regulatory matters generally cannot be predicted with certainty, management intends to vigorously defend against the allegations made by the plaintiffs in the actions described above and those described in AXA Financial Group's Notes to Consolidated Financial Statements for the year ended December 31, 2010, and believes that the ultimate resolution of the litigation and regulatory matters described therein involving AXA Financial and/or its subsidiaries should not have a material adverse effect on the consolidated financial position of AXA Financial Group. Management cannot make an estimate of loss, if any, or predict whether or not any of the litigations and regulatory matters described above or in AXA Financial Group's Notes to Consolidated Financial Statements for the year ended December 31, 2010 will have a material adverse effect on AXA Financial Group's consolidated results of operations in any particular period.