Bass, Berry & Sims attorney Chris Lazarini outlined the factors courts must consider in determining whether the fees an adviser charges a mutual fund are excessive and in violation of the Investment Company Act. All the...more
On September 27, 2019, following a two-week bench trial, the U.S. District Court for the Southern District of New York dismissed an action brought by mutual fund shareholders under Section 36(b) of the Investment Company Act...more
On August 5, 2019, the U.S. District Court for the Central District of California found for the defendant, Metropolitan West Asset Management, LLC (MetWest), following a bench trial in an excessive fee case brought under...more
Litigation and Enforcement Actions and Initiatives – SECTION 36(b) LITIGATION – Court Finds for Defendant Investment Adviser in Section 36(b) - Excessive-Fee Case – On August 5, 2019, the U.S. District Court for the...more
On July 31, 2019, Judge George H. Wu of the U.S. District Court for the Central District of California released tentative findings of fact and conclusions of law dismissing an excessive fee claim brought under Section 36(b)...more
On March 18, 2019, the U.S. Court of Appeals for the Second Circuit affirmed the dismissal prior to discovery of a complaint filed under Section 36(b) of the Investment Company Act of 1940. The Second Circuit’s decision is...more
New Rules, Proposed Rules, Guidance and Alerts - PROPOSED RULES - SEC Proposes New Rule to Permit Certain ETFs to Operate Without an Exemptive Order - On June 28, 2018, the SEC issued a proposed new rule under the...more
On March 13, 2018, the United States District Court for the Northern District of Illinois entered summary judgment for Harbor Capital Advisors, Inc. (“Harbor”) in consolidated actions brought under Section 36(b) of the...more
On February 14, 2018, the U.S. District Court for the Southern District of New York in Manhattan issued a decision dismissing a complaint brought under Section 36(b) of the Investment Company Act of 1940, as amended, that...more
Following a four-day bench trial, New Jersey District Judge Renee Bumb granted judgment to defendant Hartford mutual fund advisers on "excessive fee" claims brought by fund shareholders under Section 36(b) of the Investment...more
The differences between the respective cost structures of exchange-traded funds and mutual funds and the nature of advisory services provided for each product may require boards to think about the Gartenberg factors...more
Following a four-day bench trial, Judge Renee Marie Bumb of the U.S. District Court for the District of New Jersey ruled in favor of an adviser on claims brought under Section 36(b) of the Investment Company Act by investors...more
On February 28, the court in the mutual fund excessive fee case against Hartford (Kasilag v. Hartford Inv. Fin. Servs., LLC, No. 1:11-cv-01083 (D.N.J.)) issued a 70-page opinion ruling in favor of the fund adviser and against...more
- AXA Prevails at First Post-Jones v. Harris Excessive Fee Trial - Potential Secondary Effects of Regulatory Examinations: Evidentiary Issues and Preclusion in Parallel Litigation - On The Horizon: Global...more
In its 2010 opinion in Jones v. Harris, L.P., the United States Supreme Court embraced the so-called Gartenberg standard for assessing an investment adviser’s fiduciary liability for excessive mutual fund fees under Section...more
In a case closely watched by the mutual fund industry, the federal district court in New Jersey ruled on Thursday in favor of a mutual fund’s investment adviser and against the shareholders who had brought the lawsuit under...more