According to the Stipulation and Order of dismissal, dated December 12, 1998, from U.S. District Judge Charles L. Brieant of the Southern District of New York, the case was dismissed on the merits, with prejudice, each party to bear his, her or its own costs, and with all rights of appeal waived.

According to a Press Release dated 3/13/98, the Complaint charges that the defendants, Equity Trust, its directors and its investment adviser, Gabelli Funds, Inc., violated Section 14 of the Securities Exchange Act of 1934, Section 20 of the Investment Company Act of 1940, and related state law, by making material misstatements and omissions in soliciting shareholders' proxies to remove Equity Trust's fundamental restriction on the issuance of senior securities, including preferred stock. More specifically, among other things, the complaint alleges that the defendants (i) falsely suggested that the only risk to Equity Trust's shareholders of the issuance of senior securities was the risk associated with leveraging the fund and (ii) failed to disclose the material effect that the issuance of preferred stock would have on the ability of shareholders to control major business decisions of the fund, including the election of directors and any proposal to open-end the fund. The complaint seeks a judgment (i) rescinding the misinformed shareholder vote to remove Equity Trust's restriction on the issuance of senior securities, and (ii) enjoining the issuance of senior securities unless and until the restriction on such securities has been approved by a fully informed vote of the shareholders.