On May 26, 2010, the Honorable Catherine C. Blake of the United States District Court for the District of Maryland granted preliminary approval to the proposed settlements of the consolidated action, styled In re Mutual Funds Investment Litigation [Federated Sub-Track], Civil Action No. 04-md-15861 (D. Md.) (the “Federated Mutual Fund Litigation”). Bernstein Liebhard LLP serves as lead counsel in the securities action, representing investors in Federated fluctuating mutual funds (the “Federated Funds”) during the period October 21, 1998 through September 30, 2003 (the “Federated Class Period”).
The defendants in the Federated Mutual Funds Litigation include Federated Investors, Inc., Federated Investment Management Company, Federated Equity Management Company of Pennsylvania, Federated Services Company, Federated Securities Corporation (the “Federated Defendants”), and Canary Capital Partners, LLC, Canary Capital Partners, Ltd., Canary Investment Management, LLC, and Edward Stern and BAS and Bank of America Corporation (the “Cross-Track Defendants”). Pursuant to the settlements, (1) certain shareholders of the Federated Funds will receive up to $1.84 million (plus interest) to be paid by Federated; (2) $1,557,500 (plus interest) will be paid by the Cross-Track Defendants to certain Federated Funds; and (3) the Federated Defendants will implement significant equitable relief in the form of corporate governance changes to Federated’s internal controls.
The Settlements provide benefits to Federated mutual fund shareholders in addition to what they have received, or will be receiving, from the various settlements of regulatory investigations with the Securities and Exchange Commission and the New York Attorney General’s Office.