Allegedly Misleading Prospectus

Fund shareholders filed a class-action lawsuit against a mutual fund, its directors, its adviser and certain employees claiming statements made in the fund prospectus were misleading because they did not adequately disclose the risks associated with the investment strategy—specifically, that they failed to disclose the percentage of the fund’s investments that were held in high-risk derivative securities. The investors purportedly lost millions of dollars after the price of the securities, which the prospectus had described as “simple and safe,” dropped significantly due to their interest-rate-sensitive nature. Total Cost: More than $12,000,000.