Franklin Resources' legal problems were extended to the tune of a massive class-action lawsuit filed by California investors.

Filed by law firm Milberg Weiss Bershad Hynes & Lerach, the suit alleges Franklin's fund managers permitted favored clients to time a number of its funds at the expense of long-term shareholders.

Investors in Nevada have filed similar charges alleging that the firm allowed Daniel Calugar, former head of the now-defunct Security Investors Inc. to pour $10 million into a Franklin hedge fund in exchange for the ability to market time an estimated $50 million in mutual fund assets.

Beside naming Calugar and Security Brokerage, the California suit also implicates portfolio manager William Post.

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