Supreme Court Rules on Jones v. Harris Associates

The eagerly anticipated Supreme Court decision in Jones v. Harris Associates came down earlier today.  The case asked whether mutual fund customers could utilize the Investment Company Act to contest excessive adviser fees.  In a unanimous decision, the Court remanded the case to the Seventh Circuit with the instruction to use a standard announced in the 1982 Second Circuit case of Gartenberg.  That standard requires a showing that an adviser charged a fee so large as to bear "no reasonable relationship to the services rendered."

Today's decision is available at http://www.supremecourt.gov/opinions/09pdf/08-586.pdf.

---JSC, 3/30/10