KORLAND V. CAPITAL RESEARCH AND MANAGEMENT CO.



A shareholder of the EuroPacific Growth Fund, part of the American Funds, initiated a lawsuit against the investment adviser of this Fund, Capital Research & Management Company, and the distributor of Fund shares, American Funds Distributors, Inc. This lawsuit seeks to recover for the Fund excessive and disproportionate Rule 12b-1 fees and investment advisory fees paid by the Fund to the defendants, in violation of their fiduciary duties under Section 36(b) of the Investment Company Act of 1940.

 

This lawsuit was filed in the U. S. District Court for the Central District of California. After briefs were filed on a Motion to Dismiss the case by the defendants, on April 16, 2009, the Court stayed the proceedings in this lawsuit until a resolution of a related case, In Re American Mutual Funds Fee Litigation. On February 19, 2010, the Court ordered a continuation of the stay until the later of: (1) the completion of the appeal to the Ninth Circuit Court of Appeals on the dismissal of the In Re American Mutual Funds case; and (2) a decision by the U.S. Supreme Court in Jones v. Harris Associates.

 

On January 9, 2012, the plaintiff filed a Joint Stipulation with the Court to voluntarily dismiss this case, without prejudice.

  • Joint Stipulation to Voluntarily Dismiss Action
    On January 9, 2012, the plaintiff filed a joint stipulation to voluntarily dismiss this case without prejudice.
  • Plaintiff Files First Amended Complaint
    On March 30, 2009, the plaintiff filed an Amended Complaint with the Court. The Complaint sought to recover excessive and disproportionate 12b-1 and investment advisory fees paid by the EuroPacific Growth Fund to the defendants, who breached their fiduciary duties to the Fund under Section 36(b) of the Investment Company Act of 1940.
  • Defendants File Memorandum in Reply
    On January 12, 2009, the defendants filed a Reply Memorandum with the Court. In their Reply Memorandum, the defendants argue that Rule 12b-1 fees may be used to pay for shareholder services and that the plaintiff has failed to allege facts sufficient to prove that the 12b-1 fees are excessive under the Gartenberg standard.
  • Plaintiff Files Memorandum Opposing Motion to Dismiss
    On November 25, 2008, the plaintiff filed a Memorandum in Opposition with the Court. In his Memorandum, the plaintiff argues that the defendants charged Rule 12b-1 fees to the EuroPacific Growth Fund that were unauthorized by the Rule, excessive, and disproportionate.
  • Defendants File Motion to Dismiss the Lawsuit
    On September 12, 2008, the defendants filed a Motion to Dismiss the lawsuit with the Court. The Motion argues that Rule 12b-1 fees are permitted to be paid for shareholder services by the U.S. Securities and Exchange Commission. The Motion also argues that the appropriate legal standard to evaluate excessive mutual fund fees is the standard articulated in Gartenberg v. Merrill Lynch Asset Management.
  • Media Article Describes EuroPacific Growth Fund Lawsuit
    On July 2, 2008, Ignites published a story describing the shareholder lawsuit against the investment adviser and distributor of the EuroPacific Growth Fund.
  • Shareholder Files Initial Complaint
    On June 18, 2008, Rachel Korland, a shareholder in the EuroPacific Growth Fund of the American Funds, filed her Complaint with the Court. The Plaintiff’s Complaint seeks to recover for the Fund excessive and disproportionate fees paid by the Fund to the defendants, who breached their fiduciary duties to the Fund under Section 36(b) of the Investment Company Act of 1940.
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A shareholder of the EuroPacific Growth Fund, part of the American Funds, initiated a lawsuit against the investment adviser of this Fund, Capital Research & Management Company, and the distributor of Fund shares, American Funds Distributors, Inc. This lawsuit seeks to recover for the Fund excessive and disproportionate Rule 12b-1 fees and investment advisory fees paid by the Fund to the defendants, in violation of their fiduciary duties under Section 36(b) of the Investment Company Act of 1940.

 

This lawsuit was filed in the U. S. District Court for the Central District of California. After briefs were filed on a Motion to Dismiss the case by the defendants, on April 16, 2009, the Court stayed the proceedings in this lawsuit until a resolution of a related case, In Re American Mutual Funds Fee Litigation. On February 19, 2010, the Court ordered a continuation of the stay until the later of: (1) the completion of the appeal to the Ninth Circuit Court of Appeals on the dismissal of the In Re American Mutual Funds case; and (2) a decision by the U.S. Supreme Court in Jones v. Harris Associates.

 

On January 9, 2012, the plaintiff filed a Joint Stipulation with the Court to voluntarily dismiss this case, without prejudice.

Document Title: 
Joint Stipulation to Voluntarily Dismiss Action
Document Desc: 
On January 9, 2012, the plaintiff filed a joint stipulation to voluntarily dismiss this case without prejudice.
Document Title: 
Plaintiff Files First Amended Complaint
Document Desc: 
On March 30, 2009, the plaintiff filed an Amended Complaint with the Court. The Complaint sought to recover excessive and disproportionate 12b-1 and investment advisory fees paid by the EuroPacific Growth Fund to the defendants, who breached their fiduciary duties to the Fund under Section 36(b) of the Investment Company Act of 1940.
Document Title: 
Defendants File Memorandum in Reply
Document Desc: 
On January 12, 2009, the defendants filed a Reply Memorandum with the Court. In their Reply Memorandum, the defendants argue that Rule 12b-1 fees may be used to pay for shareholder services and that the plaintiff has failed to allege facts sufficient to prove that the 12b-1 fees are excessive under the Gartenberg standard.
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Document Title: 
Plaintiff Files Memorandum Opposing Motion to Dismiss
Document Desc: 
On November 25, 2008, the plaintiff filed a Memorandum in Opposition with the Court. In his Memorandum, the plaintiff argues that the defendants charged Rule 12b-1 fees to the EuroPacific Growth Fund that were unauthorized by the Rule, excessive, and disproportionate.
Document Title: 
Defendants File Motion to Dismiss the Lawsuit
Document Desc: 
On September 12, 2008, the defendants filed a Motion to Dismiss the lawsuit with the Court. The Motion argues that Rule 12b-1 fees are permitted to be paid for shareholder services by the U.S. Securities and Exchange Commission. The Motion also argues that the appropriate legal standard to evaluate excessive mutual fund fees is the standard articulated in Gartenberg v. Merrill Lynch Asset Management.
Document Title: 
Media Article Describes EuroPacific Growth Fund Lawsuit
Document Desc: 
On July 2, 2008, Ignites published a story describing the shareholder lawsuit against the investment adviser and distributor of the EuroPacific Growth Fund.
Document Title: 
Shareholder Files Initial Complaint
Document Desc: 
On June 18, 2008, Rachel Korland, a shareholder in the EuroPacific Growth Fund of the American Funds, filed her Complaint with the Court. The Plaintiff’s Complaint seeks to recover for the Fund excessive and disproportionate fees paid by the Fund to the defendants, who breached their fiduciary duties to the Fund under Section 36(b) of the Investment Company Act of 1940.
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