Academic

In the coming months, a wave of interconnected mutual fund litigation will wash upon the higher federal courts and very likely reshape the legal and regulatory contours of these investment funds.  The four most prominent cases have a great number of legal issues, lawyers, and schedules in common.  In fact, these cases are really two pairs of nearly identical claims filed in parallel courts of appeals, the Seventh and Eighth Circuits, and now making their way to the Supreme Court.

The Seventh Circuit Cases
Jones v. Harris
  In Jones, the plaintiffs claim that their investment adviser Harris Associates violated the Investment Company Act's Section 36(b) fiduciary duty by charging excessive fees to manage mutual funds.  Representing the plaintiffs now are Kellogg Huber, while Ropes & Gray are representing Harris Associates.  Certiorari was granted earlier this year, and oral argument is scheduled for November 2, 2009.  Other major dates in the coming weeks include Harris Associates' brief on the merits due August 27, amicus briefs in support of Harris Associates due on September 3, the Jones reply brief, if any, due on September 26 and of course oral argument on November 2.

Hecker v. Deere & Co.
  In Hecker, the plaintiffs claim that Deere & Co. violated its ERISA fiduciary duty by assembling an imprudent array of expensive mutual funds as investment options in Deere?s 401(k) plan.  Representing the plaintiffs now are Kellogg Huber, while counsel for respondents aren't yet certain (though O'Melveny & Myers and Covington & Burling represented them below).  The petition for certiorari is due to be filed by September 22.

The Eighth Circuit Cases
Gallus v. Ameriprise
  In Gallus (as in Jones), the plaintiffs claim that their investment adviser Ameriprise violated the Investment Company Act's Section 36(b) fiduciary duty by charging excessive fees to manage mutual funds.  As in Jones, representing the plaintiffs now are Kellogg Huber, while Ropes & Gray are representing Ameriprise.  Ameriprise filed a petition for certiorari on August 6, 2009, and the Gallus brief in opposition is due on September 5, 2009.

Braden v. Wal-Mart
  In Braden (as in Hecker), the plaintiffs claim that Wal-Mart violated its ERISA fiduciary duty by assembling an imprudent array of expensive mutual funds as investment options in Wal-Mart?s 401(k) plan.  Representing the plaintiffs are Keller Rohrback, while Shook, Hardy & Bacon and Steptoe & Johnson represent the defendants.  Wal-Mart recently won in the district court, but the plaintiffs have appealed to the Eighth Circuit.

One senses that the Supreme Court could have a great deal to say about the way in which most Americans save for their retirement in the coming months.