The U.S. Second Circuit Court of Appeals of New York ruled July 10 that broker-dealers do not have to disclose trailing payments received from fund firms. The court ruled that such fees are already disclosed in funds' prospectuses and statements of additional information.

In a lawsuit against Quick & Reilly, a shareholder, Donald Press, claimed that a trailing fee the fund firm paid to the brokerage, influenced the brokerage's placement of his money into money market funds. Press claimed Quick & Reilly was fraudulent in not reporting the trailing fees, according to Wechsler Harwood Halebian & Feffer of New York, which represents Press.

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