Introduction

This website will provide information to investors regarding the settlement of private class actions in In re Mutual Funds Investment Litigation, MDL-1586 (D. Md.).  As described in more detail below, this litigation involves a series of cases arising out of allegations of illegal “market timing” and “late trading” of mutual funds in several mutual fund “families.”  

No proposed settlements in the Mutual Funds Investment Litigation have been submitted for Court approval and public notice at this time.  Please check back periodically.

Please note that any settlements in this litigation are distinct from, and not related to, any settlements reached between the United States Securities and Exchange Commission (the “SEC”), or any other federal or state agencies, and various mutual fund families and other parties involving alleged mutual fund market timing and late trading.  For details on those settlements, please check the SEC website, www.sec.gov, and any other available resources.

Background of the Mutual Funds Investment Litigation

The Mutual Funds Investment Litigation involves allegations of wrongful late trading and/or market timing by preferred investors in the following mutual fund families:  Alger, Alliance, AMCAP, Bank of America/Nations Funds, Columbia, Excelsior, Federated, Franklin-Templeton, Invesco, Janus, MFS, One Group, Pilgrim-Baxter, Putnam, RS Funds, Scudder and Strong.  For links with more information about each action, click here. 

“Market timing” is the frequent buying and selling of mutual fund shares to exploit any lag between changes in the value of the fund’s portfolio of securities and the mutual fund’s share price.  “Late trading” is placing orders to buy or sell mutual fund shares after 4:00 p.m. ET, but receiving the price based on the prior Net Asset Value already determined as of 4:00 p.m. that same day, which enables the trader to profit from knowledge of market-moving events that occur after 4:00 p.m. and are not reflected in that day’s mutual fund share price.

Plaintiffs have alleged that the defendants, through market timing and/or late trading, exploited opportunities to enrich themselves and siphoned off long-term investors’ returns, while concealing these activities from the long-term investors.  The plaintiffs in these actions also allege that this misconduct involved the unlawful participation of market insiders such as broker-dealers and hedge funds.

Three federal judges preside over these cases, which are pending in the United States District Court for the District of Maryland:  Judge J. Frederick Motz, Judge Catherine C. Blake and Judge Andre Davis.

Click HERE for the Maryland Court's web site concerning these cases.