Labaton Sucharow has filed a class-action lawsuit in the U.S. District Court for the Southern District of New York against ProShares, regarding one of its inverse leveraged exchange-traded funds.

The suit claims that the ProShares UltraShort Real Estate fund did not disclose a series of risks, including a “spectacular tracking error.” It claims that the company markets its leveraged funds as simple directional plays.

The fund, like other leveraged ETFs, seeks to deliver juiced up returns against a benchmark. In the case of this fund, it seeks to deliver twice the opposite of the daily performance of the Dow Jones U.S. Real Estate Index. However, last year, the index fell 39%, whereas the fund fell 48%.

ProShare Advisors released a statement to The Wall Street Journal saying, “The allegations reported in the compliant are wholly without merit. We plan to defend against this suit vigorously.”

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