After months of tossing a string of new rules and regulations at mutual fund advisors, the Securities and Exchange Commission has suddenly found itself playing defense in a unusual lawsuit being driven by staunch members of the mutual fund industry.

The lawsuit, filed on Sept. 2 by the U.S. Chamber of Commerce in the United States District Court for the District of Columbia, charges that the SEC overstepped its rulemaking authority. The U.S. Chamber of Commerce, the nation's largest non-governmental federation of three million business companies, alleges that the SEC's June vote approving new corporate governance rules for mutual fund boards was not in keeping with the spirit or intent of Congress' adoption of the Investment Company Act of 1940.

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