MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication
an InvestmentWires' Publication
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MutualFundWire.com
The insiders' edge for 40 Act industry executives!
an InvestmentWires' Publication |
|
Friday, March 22, 2002 W&R Vows to Fight Revenue sharing can get ugly after a divorce. Waddell & Reed is preparing to contest a $50 million judgment to its former sibling United Investors Life Insurance Company (UILIC) levied by a jury this week, reports Reuters. Waddell & Reed was a Torchmark affiliate until 1998. United Investor is still a Torchmark affiliate. The dispute started over the revenue share that Waddell & Reed was to receive for distributing United Investor variable annuities. The two firms signed an agreement covering the deal in July 1999. United Investors claims that Waddell & Reed violated the terms of the agreement when it allegedly switched investors into annuities sold by other firms. Meanwhile, Waddell & Reed is claiming that it is due the revenue share. The insurer has been making a monthly payment to Waddell & Reed on the annuities. The share was a 25 basis point annual cut on annuities that it distributed after January 1, 2000 and a 20 basis point cut on some VAs distributed prior to that date. Those pre-2000 annuity payments had been suspended by an earlier jury decision at the end of April 2001. The two firms have been fighting the terms of their distribution agreement and finally landed in Alabama court. This week a jury ruled that Waddell & Reed pay United Investors $50 million in compensatory damages. The jury decided not to award any punitive damages. Printed from: MFWire.com/story.asp?s=2145 Copyright 2002, InvestmentWires, Inc. All Rights Reserved |