State Street Global Advisors' legal woes continue, with a plumbing distributor filing the latest lawsuit over SSgA's >Yield Plus Fund. F.W. Webb Co. sued SSgA on Monday, along with State Street Bank and Trust Company and ex-sister company CitiStreet over losses incurred by F.W. Webb's 401(k) plan participants.

The 49-page complaint alleged that the defendants misrepresented and mischaracterized the fund as tantamount to a money market fund.

"Defendants further misrepresented, among other things, the true investment risk of the Yield Plus Fund and failed to disclose the dramatic changes that SSgA implemented in the investment strategy of the Yield Plus Fund between 2000 and 2007," the plaintiffs alleged.

An SSgA spokeswoman declined to comment on any specific suit, but said: "We intend to defend ourselves vigorously," A spokeswoman for ING, which acquired CitiStreet for $900 million in a deal that closed in July, declined to comment, citing company policy.

According to the suit, F.W. Webb plan participants invested more in the Yield Plus fund than in any other fund available in the plan as of January 1, 2007, with the fund holding $13.05 million out of $93.61 million of total plan assets. By February 6 of this year, the principal, after netting out contributions and withdrawals, came to $9.47 million.

In March, the plaintiffs wrote to the defendants and made a formal demand for payment and relief but none of them replied within the 30 days, according to the suit.

Boston law firm Lurie & Krupp lodged the suit on behalf of the plaintiffs. 

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