The high court agreed [that the funds were separate legal entities and that neither the parent company nor its subsidiary was responsible for the prospectuses and could not be held liable]. It ruled the alleged false statements in the prospectuses were made by an investment fund, not Janus Capital, and that Janus and the subsidiary therefore cannot be held liable in a private securities fraud lawsuit.Keep in mind that, as an investor, you're paying Janus to look out for your interests. Unless someone is paying them more not to, apparently.
The lawsuit was brought on behalf of those who bought Janus stock from mid-2000 through early September 2003.
It alleged that the prospectuses of several Janus funds created the false or misleading impression that the company would adopt measures to curb market timing -- when in fact secret arrangements with several hedge funds permitted such transactions, to the detriment of long-term investors.
"What this ruling says is that as long as there are separate legal entities, even if management totally dominates all aspects, there's no liability," Birdthistle said. "This is going to open the eyes of those not in the funds industry who are going to say: 'Wow, those guys are bulletproof'," he said.
Invest wisely, my friends, if you can... because the Supreme Court no longer believes in the moral hazard.