Section 1 Short title
This Act may be cited as the “Mutual Fund Litigation Reform Act”.
Mutual Fund Litigation Reform Act
A BILL
To amend the Investment Company Act of 1940 to provide complaint and burden of proof requirements for certain actions for breach of fiduciary duty.
Sec. 2 Complaint and burden of proof requirements for certain actions for breach of fiduciary duty
Section 36(b) of the Investment Company Act of 1940 (15 U.S.C. 80a–35(b)) is amended by adding at the end the following:
“(7) In any such action brought by a security holder of a registered investment company on behalf of such company—
“(A) the complaint shall state with particularity all facts establishing a breach of fiduciary duty, and, if an allegation of any such facts is based on information and belief, the complaint shall state with particularity all facts on which that belief is formed; and
“(B) such security holder shall have the burden of proving a breach of fiduciary duty by clear and convincing evidence.”