A Pennsylvania law firm has filed suit against MFS Investment Management on behalf on investors who purchased class A shares of certain multi-class MFS stock mutual funds. The suit, filed by Barrack Rodos & Bacine, alleged that MFS knowingly presented class A shares as the best performing share class for the long-term, causing shareholders to choose them when class B and or C shares would have been more appropriate.
The complaints alleged that MFS earned excessive profits through the scheme while the plaintiff and other class members saw decreased returns on their investments.
When approached for comment, MFS spokesman, John Reilly, told the MFWire "MFS believes that this lawsuit is baseless and completely without merit. We plan to defend ourselves vigorously against it."
Company Press Release
PHILADELPHIA, July 28 /PRNewswire/ -- Barrack Rodos & Bacine announces that it has filed a class action lawsuit against MFS Investment Management ("MFS") in the United States District Court for the Middle District of Pennsylvania on behalf of investors who purchased class A shares of certain multi-class MFS stock mutual funds in the aggregate amount of less than $50,000 during the period July 28, 2003 through July 28, 2008 ("Class Period"), and paid a load or commission. The complaint charges MFS, Massachusetts Financial Services Co., and MFS Funds Distributors, Inc. with violations of Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. Sec. 78j(b), and Rule 10b-5, 17 C.F.R. Sec. 240.10b-5. The case is captioned Smith v. MFS Investment Management, et al., and is docketed at 3:08-cv-1407.
The complaint alleges that, during the Class Period, defendants engaged in a scheme to defraud investors by disseminating prospectuses for the following mutual funds that contain incorrect, incomplete and misleading information: Massachusetts Investors Growth Stock Fund (MIGFX); Massachusetts Investors Trust (MITTX); MFS Aggressive Growth Allocation Fund (MAAGX); MFS Conservative Allocation Fund (MACFX); MFS Core Equity Fund (MRGAX); MFS Core Growth Fund (MFCAX); MFS Emerging Growth Fund (MFEGX); MFS Emerging Markets Equity Fund (MEMAX); MFS Global Equity Fund (MWEFX); MFS Global Growth Fund (MWOFX); MFS Global Total Return Fund (MFWTX); MFS Growth Allocation Fund (MAGWX); MFS International Diversification Fund (MDIDX); MFS International Growth Fund (MGRAX); MFS International New Discovery Fund (MIDAX); MFS International Value Fund (MGIAX); MFS Mid Cap Growth Fund (OTCAX); MFS Mid Cap Value Fund (MVCAX); MFS Moderate Allocation Fund (MAMAX); MFS New Discovery Fund (MNDAX); MFS New Endeavor Fund (MECAX); MFS Research Fund (MFRFX); MFS Research International Fund (MRSAX); MFS Sector Rotational Fund (SRFAX); MFS Strategic Value Fund (MSVTX); MFS Technology Fund (MTCAX); MFS Total Return Fund (MSFRX); MFS Union Standard Equity Fund (MUEAX); MFS Util
ities Fund (MMUFX); and MFS Value Fund (MEIAX).
According to the complaint, the defendants, in contravention of their disclosure obligations, knowingly presented class A shares as the best performing share class for the long-term, causing the class members to purchase class A shares of the aforementioned mutual funds, when class B and/or class C shares would have been their best investment choice for any holding period. By making misleading disclosures in, and omitting material information from, the prospectuses for these funds, defendants earned excessive profits while the plaintiff and other class members suffered decreased returns on their investments.
If you acquired class A shares of any of the MFS mutual funds listed above in the aggregate amount of less than $50,000 during the Class Period, and paid a load or commission, you may, not later than September 26, 2008, file a motion with the court seeking to serve as lead plaintiff of the proposed class. To discuss your rights regarding the appointment of lead plaintiff and for additional information about your interest in this class action, or if you purchased class A shares of fund families other than MFS and paid a load or a commission and would like to discuss whether you have a similar claim regarding those other funds, please call: 877-FUND-304 (877-386-3304).
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