Earlier this month, the U.S. Court of Appeals for the District of Columbia Circuit upheld an SEC decision about a multi-manager fund exemption. Last March, Fund Democracy, a shareholder advocacy group, petitioned the Securities and Exchange Commission for a hearing in an attempt to prevent Hillview Capital Advisors from receiving an exemption from the Investment Company Act of 1940 to use multiple advisors with its funds.

According to Fund Democracy, some funds seek the exemption for the sole purpose of allocating a greater portion of the management fee to the fund by lowering sub-advisor fees and pocketing the difference. Hillview maintained that the application for exemption was justified and the SEC denied the request for a hearing.

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