Investment Management Litigation | Capabilities | Skadden, Arps, Slate, Meagher & Flom LLP

The asset management industry is operating in an environment where product innovation, litigation risk and regulatory scrutiny increasingly overlap. Across this evolving landscape, Skadden’s asset management litigators advise and defend clients on some of the industry’s most consequential disputes and investigations.

Our wins include multiple precedent-setting decisions for clients and the industry. These successes were under the Investment Company Act of 1940 and other federal securities laws, as well as the laws of Delaware, Massachusetts and Maryland, where thousands of funds are domiciled.

Most recently, on June 11, 2026, Skadden secured a landmark U.S. Supreme Court victory for ’40 Act registered and regulated funds. In FS Credit Opportunities Corp. v. Saba Capital Master Fund Ltd., agreeing with Skadden, the Supreme Court held that Section 47(b) of the ’40 Act does not create a private right of action. The Court’s opinion is a significant win for the fund industry because it preserves the near-exclusive authority of the SEC to enforce the ’40 Act and prevents private plaintiffs from doing so through suits to rescind fund contracts on the grounds that their performance violates any provision of the ’40 Act.

Drawing on experience honed over decades of leading the asset management industry’s most complex and high-stakes matters, we regularly prevail at the pleadings and summary judgment stages, as well as in arbitrations, jury trials and bench trials. Our team also has a record of success in the state and federal appeals courts. We often proactively resolve disputes before they reach the courts, convincing potential plaintiffs and their counsel to abandon or narrow their claims.

Market evolution — including the “retailization” of alternative assets, developments in the private credit markets and activist disruption — increasingly requires deep experience handling the full spectrum of litigation, regulatory and advisory matters affecting the industry.

Our advantage stems from understanding the unique challenges faced by investment management clients, as well as their funds, structures, management and operations. We represent investment advisers, private and registered funds, fund boards, banks, broker-dealers and other firms. We are adept at navigating issues related to fixed-income and other trading; fund accounting; NAV calculations; mutual fund cost allocation; distribution channels; and subadvisory, custodial and transfer agent services. Leveraging this industry-specific knowledge, our team crafts tailored litigation strategies for matters involving, among other things, prospectus and other disclosure liability, fiduciary issues of all types, closed-end fund activism, excessive fee claims and valuation and liquidity issues.

Marrying our litigation prowess with a deep knowledge of the regulatory regimes for funds, we guide clients through complex regulatory and enforcement matters in front of federal and state regulatory bodies. We regularly represent clients in SEC-related actions and enforcement proceedings, CFTC investigations, FINRA investigations and enforcement proceedings, criminal insider trading and market manipulation investigations, and inquiries by the FDIC, NYSE and state regulators.

Our work has earned our investment management litigators noteworthy accolades from a variety of publications, including the Financial Times, The American Lawyer, The National Law Journal and Massachusetts Lawyers Weekly.

Our investment management litigation team is also part of our broader Litigation Group, which has been widely recognized for our successes on behalf of clients. Skadden was selected as a finalist in The American Lawyer’s 2021 Litigation Department of the Year competition. We were named the New York Law Journal’s 2021 Litigation Department of the Year and shortlisted in its 2026, 2024, 2023 and 2022 Litigation Department of the Year competitions.

Consistent with Skadden’s commitment to taking a collaborative approach to matters, we work closely with the firm’s Investment Management Group, which, for the last three decades, has represented many of the largest asset management firms in matters related to formation, operation, governance, disclosure, transactions and regulations. That institutional knowledge gives our litigators, enforcement lawyers and regulatory counsel added practical understanding of how funds and advisers operate, how investment products are structured and marketed, and how governance, valuation, liquidity, conflicts and disclosure issues are assessed before they become the subject of disputes or regulatory scrutiny. The Investment Management Group’s capabilities have been cited regularly by The Best Lawyers in America, The Legal 500 United States and IFLR1000.

FS Credit Opportunities Corp. in the milestone case FS Credit Opportunities Corp. v. Saba Capital Master Fund, Ltd., in which the Supreme Court held that Section 47(b) of the Investment Company Act does not create a private right of action.
ASA Gold and Precious Metals Ltd. and its board in successfully obtaining a decision from the Southern District of New York that the fund’s adoption of a shareholder rights plan (poison pill) did not violate the Investment Company Act.
BlackRock in securing a favorable ruling by the Delaware Supreme Court in litigation opposing a shareholder’s nomination of a dissident slate of directors to three of its registered closed-end funds.
Eaton Vance Management and its CEO:
- in securing dismissal of claims that Eaton Vance had, among other things, aided and abetted breaches of fiduciary duty by the board of certain closed-end funds in connection with those funds’ adoption of certain defensive bylaws; and
- in successfully obtaining a precedent-setting trial decision upholding a defensive bylaw under Massachusetts law and the Investment Company Act.
Nuveen’s closed-end funds in connection with litigation challenging the funds’ adoption of defensive bylaws.
The independent directors of Tortoise Capital Advisors’ closed-end funds:
- in a suit challenging the adoption of a defensive bylaw; and
- in providing strategic advice regarding corporate governance, compliance and regulatory matters in connection with activist issues.

BlackRock:
- in securing dismissal on all counts of Section 36(b) excessive fee claims after an eight-day bench trial in the District of New Jersey in a case brought by investors in two of BlackRock’s largest mutual funds, alleging that the funds paid BlackRock up to $1.55 billion in excessive compensation as the investment manager to the funds;
- in successful defense of litigation alleging violation of Section 36(b) of the Investment Company Act on a theory that a majority of fund trustees were interested on the ground they served on multiple BlackRock fund boards; and
- in the successful defense of an action brought by mutual fund investors alleging that securities lending fees charged to mutual funds are excessive in violation of Section 36(b) of the ICA.
Baron Funds in successfully defending litigation alleging excessive 12b-1 distribution fees in violation of Section 36(b) of the Investment Company Act.
MuniEnhanced Fund, Inc. and other municipal bond funds successfully defending an action in federal court in New Jersey alleging violation of Section 36(b) of the ICA.
Putnam Investments:
- in successfully defending market timing litigation alleging, among other things, excessive advisory fees in violation of Section 36(b) of the ICA; and
- in the favorable resolution of an action alleging excessive advisory fees in violation of Section 36(b) of the ICA in light of lower fees charged to institutional clients.

A large adviser in the multiyear SEC, DOJ and CFTC investigations of an alleged $600 million trading fraud by its chief investment officer.
A large recordkeeper in investigations by state and federal regulators regarding revenue sharing agreements.
The independent directors of Fundamental Funds in connection with an SEC investigation relating to the pricing of illiquid securities.
Putnam in SEC proceedings concerning a portfolio manager’s pre-arranged cross-trades in mortgage-backed securities.
A large asset management firm in SEC enforcement proceedings concerning a portfolio manager’s outside business activities and related compliance controls.
Tremont Capital Management in successfully defending multiple investor litigations and regulatory investigations arising out of investments made with Bernard Madoff.
An investment management firm in successfully defending against regulatory investigations and litigation arising out of alleged directed brokerage/“shelf space” arrangements.
A financial services corporation regarding SEC insider trading investigations of portfolio managers and an investigation into performance reporting and performance fees.
A large asset manager in SEC investigations of alleged mispricing, late trading, market timing, disclosure questions and a wide range of other matters.
A financial services corporation regarding an SEC inquiry concerning trading on the Hong Kong Stock Exchange.
A financial services company in SEC and DOJ investigations into alleged “pay-to-play” schemes in order to secure government business.
A client in an SEC investigation related to Guaranteed Minimum Income Benefit Riders and the effect of cash withdrawals taken by contract owners of variable annuities.
Several financial services firms in multiple whistleblower matters.
A special committee of the board of directors of a large custody bank in an independent investigation of pay-to-play allegations.

Fiduciary Duty, Derivative and Business Litigation

Securities Class Action and Disclosure Litigation

Closed-End Fund Activism

Excessive Fee Litigation

Regulatory Investigations

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