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Category Archives: Private Litigation

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Court Tosses ETF Securities Lending Fee Case

Posted in Fund Regulation, Private Litigation

A federal district court in Tennessee dismissed a case brought by two union pension funds claiming that securities lending fees paid by an ETF to its adviser’s affiliate violated  the adviser’s fiduciary duty under Section 36(b) of the Investment Company Act of 1940 (“1940 Act”). The defendants argued that the SEC issued an order exempting… Read More

Court of Appeals Upholds Dismissal of Case Alleging Disclosure Violations by Leveraged ETFs

Posted in Fund Regulation, Private Litigation

The U.S. Court of Appeals for the Second Circuit upheld the dismissal by a lower court of investors’ claims that certain ETF prospectuses failed to adequately disclose the risk of significant losses over an extended period of time. In a July 22, 2013 decision, the court dismissed claims against officers and directors of ProShares Trust… Read More

MMF Executives Sue Independent Trustees for Fraud and Waste of Corporate Assets

Posted in Fund Independent Directors, Private Litigation

In yet another interesting twist in the case of the money market fund that broke the buck, the principals of the fund’s investment adviser sued the funds’ independent trustees, claiming that they had a “substantial, if not controlling, role in almost all the conduct with which [the SEC] takes issue.” The complaint is good reading,… Read More