Bernstein Liebhard LLP filed a class action lawsuit on December 3, 2009 in the United States District Court for the Southern District of New York, on behalf of all persons who purchased or otherwise acquired shares in the UltraShort Basic Materials fund (the “SMN Fund”) (NYSE: SMN), an exchange-traded fund (“ETF”) offered by ProShares Trust (“ProShares”), pursuant or traceable to ProShares’ false and misleading Registration Statement, Prospectuses, and Statements of Additional Information (collectively, the “Registration Statement”) issued in connection with shares of the SMN Fund (the “Class”). The Class is seeking to pursue remedies under Sections 11 and 15 of the Securities Act of 1933 (the “Securities Act”).

The complaint names ProShares, ProShare Advisors LLC, SEI Investments Distribution Co., Michael L. Sapir, Louis M. Mayberg, Russell S. Reynolds, III, Michael Wachs, and Simon D. Collier, as defendants (collectively, “Defendants”). ProShares sells its Ultra and UltraShort ETFs as “simple” directional plays. As marketed by ProShares, Ultra ETFs are designed to go up when markets go up; UltraShort ETFs are designed to go up when markets go down. The SMN Fund is one of ProShares’ UltraShort ETFs. The SMN Fund seeks investment results that correspond to twice the inverse (-200%) of the daily performance of the Dow Jones U.S. Basic Materials Index (“DJBMI”). Accordingly, the SMN Fund is supposed to deliver double the inverse return of the DJBMI, which fell in approximately 52 percent in 2008. Rather than increase approximately 104 percent (double the inverse), the SMN Fund has fallen approximately 3.5 percent in 2008.

The complaint alleges the Defendants violated the Securities Act by failing to disclose the following risks, inter alia, in the Registration Statement: (1) if SMN Fund shares were held for a time period longer than one day, the likelihood of catastrophic losses was huge; and (2) the extent to which performance of the SMN Fund would inevitably diverge from the performance of the DJBMI—i.e., the overwhelming probability, if not certainty, of spectacular divergence.

Plaintiff in the SMN Action seeks to recover damages on behalf of all Class members who purchased or otherwise acquired shares of ProShares SMN. If you purchased or otherwise acquired ProShares SMN shares, and either lost money on the transaction or still hold the shares, you may wish to join in the action to serve as lead plaintiff. In order to do so, you must meet certain requirements set forth in the applicable law and file appropriate papers no later than February 1, 2010.

A “lead plaintiff” is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as lead plaintiff. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Bernstein Liebhard LLP, or other counsel of your choice, to serve as your counsel in this action.

There is also a pending lead plaintiff deadline of December 28, 2009 for investors in ProShares’ Ultrashort DJ-UBS Crude Oil Fund (NYSE: SCO), and January 4, 2010 for investors in ProShares’ Ultra Oil & Gas Fund (NYSE: DIG)

Bernstein Liebhard LLP is also investigating claims on behalf of investors in all other ProShares leveraged funds (see list below).

UltraShort Russell3000NYSE: TWQ
UltraShort MidCap400NYSE: MZZ
UltraShort SmallCap600NYSE: SDD
UltraShort Russell2000NYSE: TWM
UltraPro Short S&P500NYSE: SPXU
UltraShort Russell1000 ValueNYSE: SJF
UltraShort Russell1000 GrowthNYSE: SFK
UltraShort Russell MidCap ValueNYSE: SJL
UltraShort Russell MidCap GrowthNYSE: SDK
UltraShort Russell2000 ValueNYSE: SJH
UltraShort Russell2000 GrowthNYSE: SKK
UltraShort Consumer GoodsNYSE: SZK
UltraShort Consumer ServicesNYSE: SCC
UltraShort Health CareNYSE: RXD
UltraShort IndustrialsNYSE: SIJ
UltraShort SemiconductorsNYSE: SSG
UltraShort TechnologyNYSE: REW
UltraShort TelecommunicationsNYSE: TLL
UltraShort UtilitiesNYSE: SDP
UltraShort MSCI EuropeNYSE: EPV
UltraShort MSCI Pacific ex-JapanNYSE: JPX
UltraShort MSCI BrazilNYSE: BZQ
UltraShort MSCI JapanNYSE: EWV
UltraShort MSCI Mexico Investable MarketNYSE: SMK
UltraShort 7-10 Year TreasuryNYSE: PST
UltraShort 20+ Year TreasuryNYSE: TBT
UltraShort DJ-UBS CommodityNYSE: CMD
UltraShort GoldNYSE: GLL
UltraShort SilverNYSE: ZSL
UltraShort EuroNYSE: EUO
UltraShort YenNYSE: YCS
Ultra Dow30NYSE: DDM
Ultra S&P500NYSE: SSO
Ultra Russell3000NYSE: UWC
Ultra MidCap400NYSE: MVV
Ultra SmallCap600NYSE: SAA
Ultra Russell2000NYSE: UWM
UltraPro S&P500NYSE: UPRO
Ultra Russell1000 ValueNYSE: UVG
Ultra Russell1000 GrowthNYSE: UKF
Ultra Russell MidCap ValueNYSE: UVU
Ultra Russell MidCap GrowthNYSE: UKW
Ultra Russell2000 ValueNYSE: UVT
Ultra Russell2000 GrowthNYSE: UKK
Ultra Basic MaterialsNYSE: UYM
Ultra Consumer GoodsNYSE: UGE
Ultra Consumer ServicesNYSE: UCC
Ultra Health CareNYSE: RXL
Ultra IndustrialsNYSE: UXI
Ultra Real EstateNYSE: URE
Ultra SemiconductorsNYSE: USD
Ultra TechnologyNYSE: ROM
Ultra TelecommunicationsNYSE: LTL
Ultra UtilitiesNYSE: UPW
Ultra DJ-UBS CommodityNYSE: UCD
Ultra DJ-UBS Crude OilNYSE: UCO
Ultra GoldNYSE: UGL
Ultra SilverNYSE: AGQ
Ultra EuroNYSE: ULE
Ultra YenNYSE: YCL
Ultra MSCI Emerging MarketsNYSE: EET
Ultra FTSE/Xinhua China 25NYSE: XPP

If you purchased or otherwise acquired shares in the SMN, SCO, or DIG Funds, or any ProShares leveraged funds, and either lost money on the transaction or still hold the shares, please contact Joseph R. Seidman, Jr. at (877) 779-1414.

Bernstein Liebhard LLP has pursued hundreds of securities and consumer cases and recovered approximately $2 billion for its clients. It has been named to The National Law Journal’s “Plaintiffs’ Hot List” in each of the last six years.

Bernstein Liebhard LLP has also filed cases concerning ProShares’ SRS, SKF, DUG, UYG, and DXD funds. You can view a copy of these complaints on our website, or obtain them from the court. A copy of the SMN complaint can be viewed here.