5th Circ. Told Highland Capital Can't Block Shareholder Suit

Law360 (March 2, 2021, 6:53 PM EST) -- A Highland Capital Global Allocation Fund shareholder on Tuesday urged the Fifth Circuit to reinstate her proposed derivative class action alleging breaches of fiduciary duty, arguing that a Texas federal court wrongly found that fund trustees were qualified to deny her demand for legal action.

Susan Lanotte told a three-judge panel that a Northern District of Texas court applied the wrong Massachusetts state statute when it dismissed her suit against the Global Allocation Fund, its manager Highland Capital Management Fund Advisors LP, and five trustees.

In a May order, U.S. District Judge Barbara M.G. Lynn found the trustees were properly disinterested...

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