Industry insiders who have been following the excessive fee lawsuit over the Oakmark Funds may want to take a look at Saturday's Wall Street Journal. In the "Intelligent Investor" column, Jason Zweig offers some suggestions on how the United States Supreme Court should rule on the case, Jerry N. Jones et al v. Harris Associates. (Harris advises the Oakmark funds.)

The Supreme Court agreed in March to step in to the case after the Seventh Circuit Court of Appeals in Chicago ruled in favor of Harris, arguing that "the trustees (and in the end investors, who vote with their feet and dollars), rather than a judge or jury, determine how much advisory services are worth." The case currently awaits a hearing before the Supreme Court.

Many fundsters probably won't take a shine to Zweig's suggestions. While he agrees that "the Supreme Court has no business setting fees," he wants the Court to forbid former fund executives from ever qualifying as an independent mutual fund board member for their former firms' funds. Also, he called for mandatory annual reviews of fee breakpoints. In addition, Zweig wants a description of what data boards have to look at to evaluate fees.

Dan Calabria, the retired former president of Templeton Funds Management, offers some insight to Zweig on breakpoints. 

Edited by: Neil Anderson, Managing Editor


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