NANCY GOODMAN and JACQUELINE PEIFFER (18-3238); CAMPBELL FAMILY TRUST, JACK HORNSTEIN, ANNE H. BRADLEY, CASEY LEBLANC, and VALDERRAMA FAMILY TRUST (18-3239) v. J.P. MORGAN INVESTMENT MANAGEMENT, INC. and JP MORGAN FUNDS MANAGEMENT, INC. - Articles

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NANCY GOODMAN and JACQUELINE PEIFFER (18-3238); CAMPBELL FAMILY TRUST, JACK HORNSTEIN, ANNE H. BRADLEY, CASEY LEBLANC, and VALDERRAMA FAMILY TRUST (18-3239) v. J.P. MORGAN INVESTMENT MANAGEMENT, INC. and JP MORGAN FUNDS MANAGEMENT, INC.

Posted by: Karen Belcher on Mar 30, 2020

Court: 6th Circuit Court (Published Opinions)

Attorneys 1: ARGUED: Andrew W. Robertson, ZWERLING, SCHACHTER & ZWERLING, LLP, New York, New York, for Appellants.

Attorneys 2: ARGUED: Mark Holland, GOODWIN PROCTER, LLP, New York, New York, for Appellees.

Attorneys 3: ON BRIEF: Andrew W. Robertson, Robin F. Zwerling, Susan Salvetti, ZWERLING, SCHACHTER & ZWERLING, LLP, New York, New York, Mathew R. Wilson, Michael J. Boyle, Jr., MEYER WILSON CO., LPA, Columbus, Ohio, for Appellants.

Attorneys 4: ON BRIEF: Mark Holland, Michael K. Isenman, Valerie A. Haggans, Charles A. Brown, Elizabeth S. David, GOODWIN PROCTER, LLP, New York, New York, Steven W. Tigges, Stuart G. Parsell, ZEIGER, TIGGES & LITTLE LLP, Columbus, Ohio, for Appellees. Matthew A. Fitzgerald, MCGUIRE WOODS LLP, Richmond, Virginia, for Amicus Curiae.

Judge(s): MERRITT, GIBBONS, and NALBANDIAN, Circuit Judges

Court Appealed: United States District Court for the Southern District of Ohio at Columbus

JULIA SMITH GIBBONS, Circuit Judge. This case presents the question of whether J.P. Morgan Investment Management Company (“JPMIM”), as advisor of certain mutual funds, has breached its fiduciary duty under section 36(b) of the Investment Company Act (“ICA”) by charging excessive advisory fees.

The district court considered the relevant factors according to Gartenberg and Jones II and determined that they collectively favored JPMIM. We agree. Goodman and Campbell urge us to disregard the implications of certain facts. Instead of comparing the fees JPMIM charged to other mutual funds for its role as adviser, Goodman and Campbell ask us to compare the fees JPMIM charged to other funds for its different role as subadviser. They allege that because JPMIM charges the Funds more than the Subadvised Funds, the fees charged to the Funds are excessive. But this comparison serves only to show that JPMIM charges different fees for dissimilar services with dissimilar risks and responsibilities. Goodman and Campbell thus fail to point to a genuine dispute of material fact. We therefore affirm the decision of the district court.

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