The following are excerpts taken from articles about key developments in the investment management industry. To read the full articles on these and other topics, please follow this link.

Supreme Court Denies Schwab’s Petition for Review of Ninth Circuit Court of Appeals Decision; District Court Issues Decision Upon Remand

Schwab Investments’ petition to the U.S. Supreme Court for review of an April 2015 decision of the Ninth Circuit Court of Appeals, which allowed common-law claims to proceed against Schwab related to its management of the Schwab Total Bond Market Fund, was denied by the U.S. Supreme Court on October 5, 2015. On that same day, the U.S. District Court for the Northern District of California issued an opinion deciding on a motion to dismiss filed by Schwab.

SEC Settles First “Distribution-in Guise” Case

The Securities and Exchange Commission reached a settlement on September 21, 2015, with First Eagle Investment Management and its affiliate FEF Distributor, LLC which were charged with improperly causing the First Eagle Funds to use Fund assets to pay for services intended to market the Funds and distribute the Funds’ shares outside of a plan of distribution adopted under Rule 12b-1 of the Investment Company Act of 1940 (the 1940 Act).

SEC Proposes Rules to Establish Liquidity Risk Management Programs and Adopt Swing Pricing

In September 2015, the Securities and Exchange Commission proposed a new rule and amendments to its existing rules and forms that are intended to promote effective liquidity risk management throughout the mutual fund industry, Release Nos. 33-9922. The new rule and amendments, if adopted, are expected to enhance the liquidity risk management by reducing the risk that funds will be unable to meet redemption obligations and mitigating dilution of the interests of fund shareholders in accordance with section 22(e) and Rule 22c-1 under the Investment Company Act of 1940.

To learn more about these developments and other investment management news, please contact a member of the Ballard Spahr Investment Management Group or the attorney with whom you regularly work.


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