Ingenhutt v. State Farm Investment Management



On July 22, 2015, two shareholders in several State Farm mutual funds filed a lawsuit in U.S. District Court for the Central District of Illinois against the State Farm Investment Management Corporation.  This is an excessive fee lawsuit under Section 36(b) of the Investment Company Act.

 

The plaintiffs' complaint alleges that State Farm is delegating investment management responsibilities for the portfolio of securities held by these funds to an unaffiliated investment manager (BlackRock).  Despite this delegation of responsibilities, State Farm is retaining almost 50% of the advisory fee being charged to the mutual funds and their investors.

 

On August 9, 2016, State Farm filed a motion to dismiss the case, alleging that the plaintiffs cannot state a plausible claim that the advisory fees are beyond what could be bargained for at arm's length.  The plaintiffs filed a response to the motion and State Farm filed a reply brief.  The plaintiffs then filed a sur-reply brief.  

  • Plaintiffs File Sur-Reply Brief
    On November 7, 2016, the plaintiffs filed a sur-reply brief on the State Farm motion to dismiss, arguing that they have alleged sufficient facts regarding State Farm fees and services based on all facts available to plaintiffs without discovery.
  • Stae Farm Files Reply Brief
    State Farm argues in an October 2016 reply brief that the plaintiffs have not met their burden to do more than make conclusory assertions that are not supported by facts.
  • Plaintiffs Oppose Motion to Dismiss
    On September 14, 2016, the plaintiffs responded to the motion to dismiss by stating that cases where a mutual fund adviser has delegated substantially all of its investment management responsibilities to another party but retains a significant fee have routinely survived a motion to dismiss.
  • State Farm Files Motion to Dismiss the Case
    On August 9, 2016, State Farm filed a motion to dismiss the case, alleging that the plaintiffs cannot state a plausible claim that the advisory fees are beyond what could be bargained for at arm's length.
  • Two Shareholders File Complaint Against State Farm Investment Management
    Two shareholders have filed a lawsuit against State Farm, alleging that it is charging excessive fees in managing five State Farm mutual funds. The complaint alleges that State Farm is retaining almost 50% of the annual advisory fee, while delegating all of the investment management responsibilities to an outside investment manager.

On July 22, 2015, two shareholders in several State Farm mutual funds filed a lawsuit in U.S. District Court for the Central District of Illinois against the State Farm Investment Management Corporation.  This is an excessive fee lawsuit under Section 36(b) of the Investment Company Act.

 

The plaintiffs' complaint alleges that State Farm is delegating investment management responsibilities for the portfolio of securities held by these funds to an unaffiliated investment manager (BlackRock).  Despite this delegation of responsibilities, State Farm is retaining almost 50% of the advisory fee being charged to the mutual funds and their investors.

 

On August 9, 2016, State Farm filed a motion to dismiss the case, alleging that the plaintiffs cannot state a plausible claim that the advisory fees are beyond what could be bargained for at arm's length.  The plaintiffs filed a response to the motion and State Farm filed a reply brief.  The plaintiffs then filed a sur-reply brief.  

Document Title: 
Plaintiffs File Sur-Reply Brief
Document Desc: 
On November 7, 2016, the plaintiffs filed a sur-reply brief on the State Farm motion to dismiss, arguing that they have alleged sufficient facts regarding State Farm fees and services based on all facts available to plaintiffs without discovery.
Document Title: 
Stae Farm Files Reply Brief
Document Desc: 
State Farm argues in an October 2016 reply brief that the plaintiffs have not met their burden to do more than make conclusory assertions that are not supported by facts.
Document Title: 
Plaintiffs Oppose Motion to Dismiss
Document Desc: 
On September 14, 2016, the plaintiffs responded to the motion to dismiss by stating that cases where a mutual fund adviser has delegated substantially all of its investment management responsibilities to another party but retains a significant fee have routinely survived a motion to dismiss.
Document Title: 
State Farm Files Motion to Dismiss the Case
Document Desc: 
On August 9, 2016, State Farm filed a motion to dismiss the case, alleging that the plaintiffs cannot state a plausible claim that the advisory fees are beyond what could be bargained for at arm's length.
Document Title: 
Two Shareholders File Complaint Against State Farm Investment Management
Document Desc: 
Two shareholders have filed a lawsuit against State Farm, alleging that it is charging excessive fees in managing five State Farm mutual funds. The complaint alleges that State Farm is retaining almost 50% of the annual advisory fee, while delegating all of the investment management responsibilities to an outside investment manager.