Top of the Agenda - Legal

Vanguard close to $25M settlement in class-action suit

By Hillary Jackson

A federal judge has given preliminary approval to a plan for Vanguard Group to pay $25 million to settle a class-action suit related to misleading statements about its target-date funds. Vanguard and its fund board have faced years of legal and regulatory challenges resulting from the adviser's decision in late ... >> CONTINUE READING <<<

MFDF, ICI push Supreme Court to nix private right of action ruling

By Hillary Jackson

The Investment Company Institute and MFDF this week urged the U.S. Supreme Court to rule against allowing private parties to bring claims that fund contracts violate the Investment Company Act of 1940. Such claims have been used—successfully—by activist investors in recent years to challenge closed-end funds' defensive measures. The Court agreed ... >> CONTINUE READING <<<

Supreme Court to review legality of activist suits

By Hillary Jackson

The U.S. Supreme Court on Monday agreed to consider whether private parties should be allowed to bring claims that fund contracts violate the Investment Company Act of 1940. Such claims have been used by activist investors in recent years to challenge closed-end funds' defensive measures, and the Court will review ... >> CONTINUE READING <<<

Saba v ASA court ruling: Poison pills legal, but extending them violates '40 Act

In what could be considered a victory for closed-end funds, a New York court has ruled that shareholder rights plans, or poison pills, are legal under the Investment Company Act of 1940. However, the court granted summary judgment to Saba Capital Management on its claim for rescission of ASA Gold ... >> CONTINUE READING <<<

Vanguard-SEC deal first step in ending target-date fund woes

Vanguard Group will pay more than $100 million to settle charges with the Securities and Exchange Commission related to misleading statements about its target-date funds. The settlement is a first step toward resolving years-long regulatory and legal troubles for the adviser and its fund board stemming from a decision in ... >> CONTINUE READING <<<

Mass. Superior Court favors Eaton Vance CEFs in Saba fight

By Hillary Jackson

A Massachusetts Superior Court judge this week handed a victory to Eaton Vance in a years-long legal battle with Saba Capital Management. Judge Debra Squires-Lee rejecting Saba's challenge to a by-law amendment related to trustee elections adopted by the funds that Saba said violated the Investment Company Act of 1940. ... >> CONTINUE READING <<<