Supreme Court wades into mutual fund fee disparity
Legal News Center
The U.S. Supreme Court is taking a close look at a question individual investors have long asked about their mutual funds, but the courts have largely ignored: Why am I getting charged twice as much as big institutional clients?
Sure enough, the money-management services that different classes of fund clients get aren't the same. Institutions like pension funds and foundations may not need toll-free customer hotlines. They don't require as many of the prospectuses and other fund reports that individuals often throw away, even though they're printed and mailed at great expense. Individuals move relatively paltry sums in and out of a fund, piling up higher transaction costs than big clients.
Still, the investments a fund makes are often the same for both groups, and the returns similar — though individuals' higher fees take a bigger bite from their results, regardless of whether markets are up or down.
So it can be galling for an individual to pay an expense ratio of, say, 1 percent of cash invested as an annual fee, versus 0.5 percent for an institutional client enjoying what is in effect a bulk rate.
Courts have been reluctant to consider such disparities, and have rarely sided with investors. Instead, the comparisons that courts have allowed focus on whether a fund's fees are so far out of line from what similar competing funds charge as to be unreasonable.
Related listings
-
Ariz. court rules records law covers 'metadata'
Legal News Center 10/30/2009Hidden data embedded in electronic public records must be disclosed under Arizona's public records law, the state Supreme Court ruled Thursday in a case that attracted interest from media and government organizations.The Supreme Court's unanimous dec...
-
Conviction of Berlusconi-linked lawyer upheld
Legal News Center 10/27/2009An appeals court has upheld the conviction of British lawyer David Mills for accepting a bribe to lie in court to protect Silvio Berlusconi.The decision Tuesday is a potential embarrassment for the Italian premier, whose trial in the same corruption ...
-
2 Supreme Court justices taking stage in DC opera
Legal News Center 10/26/2009Two U.S. Supreme Court justices are taking theatrics out of the courtroom — and into to a more suitable venue.Justices Ruth Bader Ginsburg and Antonin Scalia will have nonspeaking roles Saturday night in a production by the Washington National Opera....
New Rochelle, New York Personal Injury Lawyers
If you or a loved one has been injured in an accident, contact Kommer, Bave & Ollman, LLP, in New Rochelle, New York, immediately. We can answer all your questions and work with you to determine if you have the grounds for a personal injury lawsuit. The attorneys at our firm are determined to resolve even the most difficult of cases. We will work closely with you to determine the best course of action to get your claim or case resolved in the most efficient way possible. We will fight for your right to compensation! No one should have to suffer a financial burden from the result of another person’s carelessness. The attorneys at Kommer, Bave & Ollman, LLP will aggressively fight to ensure that justice is served on your behalf.