Law Commons^™

New Wave Of Cases Involving Investment Adviser Fees, Francis J. Facciolo, Leland Solon

Faculty Publications

(Excerpt)

Shareholders challenging fees paid to the advisers of their mutual funds in civil lawsuits under §36(b) of the Investment Company Act face steep substantive and procedural challenges, but a recent decision from the federal district of New Jersey holds promise for private plaintiffs in this area. The central allegation in Kasilag v. Hartford Investment Financial Services was that the defendant investment adviser retained sub-advisers to perform substantially all of the investment management services for the defendant’s client mutual funds, and then charged its fund clients much higher investment management fees than what those services actually cost defendant. Based on …