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Case Status:    SETTLED
On or around 07/16/2011 (Date of last review)

Filing Date: February 06, 2004

According to the fund's annual report for the fiscal year ending September 30, 2007, More than 400 similar lawsuits against at least 19 different mutual fund companies have been filed in federal district courts throughout the country. Because these cases involve common questions of fact, the Judicial Panel on Multidistrict Litigation (the “Judicial Panel”) ordered the creation of a multidistrict litigation in the United States District Court for the District of Maryland, entitled “In re Mutual Funds Investment Litigation” (the “MDL”). The Judicial Panel then transferred similar cases from different districts to the MDL for coordinated or consolidated pretrial proceedings. Plaintiffs in the MDL filed consolidated amended complaints on September 29, 2004. On February 25, 2005, defendants filed motions to dismiss. The Company’s and its subsidiaries’ motions are currently under submission with the court.

The case was received by the Multi District Panel for the District Court of Maryland on May 14, 2004 where progress in the litigation appears to have stalled. The final substantive activity took place on March 5, 2007 with a motion to stay proceedings against defendant Banc of America Securities, LLC. in light of a pending settlement. No further information regarding this settlement has been released.

According to a press release dated February 9, 2004, the complaint alleges that defendants violated Sections 11 and 15 of the Securities Act of 1933; Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder; and Section 206 of the Investment Advisers Act of 1940. On May 3, 2004, the judge entered an order transferring the case to the District Court of Maryland to be included in the large-scale mutual funds Multi-District Litigation (MDL) proceedings.

Specifically, the complaint alleges that throughout the Class Period, certain of the defendants failed to disclose that they improperly allowed certain favored investors, including Calugar, SBI, and DCIP, to engage in 'timing' of the Funds' securities. Timing is excessive, arbitrage trading undertaken to turn a quick profit and which ordinary investors are told that the funds police. Timing injures ordinary mutual fund investors -- who are not allowed to engage in such practices -- and are acknowledged as improper practices by the Funds. In return for receiving extra fees from Calugar, SBI, and DCIP, and other favored investors, Franklin Resources and its affiliates allowed and facilitated timing activities in the Funds, to the detriment of class members, who paid, dollar for dollar, for improper profits made by Calugar, SBI, and DCIP. These practices were undisclosed in the prospectuses of the Funds, which falsely represented that the Funds actively police against timing and that premature redemptions will be assessed a charge.

The Funds, and the symbols for the respective Funds named in the complaint, are as follows:

Franklin AGE High Income Fund (AGEFX, FAHAX, FHIBX, FRAIX, FAHRX)
Franklin Adjustable U.S. Government Securities Fund (FISAX, FCSCX)
Franklin Aggressive Growth Fund (FGRAX, FRAAX, FKABX, FKACX, FKARX)
Franklin Alabama Tax-Free Income Fund (FRALX, FALEX)
Franklin Arizona Tax-Free Income Fund (FTAZX, FBAZX, FAZIX)
Franklin Balance Sheet Investment Fund (FRBSX, FBSAX, FBSBX, FCBSX, FBSRX)
Franklin Biotechnology Discovery Fund (FBDIX)
Franklin Blue Chip Fund (FKBCX, FKBBX, FBCCX, FBCRX)
Franklin California High Yield Municipal Fund (FCAMX, FBCAX, FCAHX)
Franklin California Insured Tax-Free Income Fund (FRCIX, FRCBX, FRCAX)
Franklin California Intermediate-Term Tax-Free Income Fund (FKCIX)
Franklin California Limited Term Tax-Free Income Fund
Franklin California Tax-Exempt Money Fund (FCLXX)
Franklin California Tax-Free Income Fund (FKTFX, FCAVX, FCABX, FRCTX)
Franklin Capital Growth Fund (FKREX, FEACX, FKEQX, FREQX, FKIRX)
Franklin Colorado Tax-Free Income Fund (FRCOX, FCOIX)
Franklin Connecticut Tax-Free Income Fund (FXCTX, FCTIX)
Franklin Convertible Securities Fund (FISCX, FROTX)
Franklin Double Tax-Free Income Fund (FPRTX, FPRIX)
Franklin DynaTech Fund (FKDNX, FDNBX, FDYNX)
Franklin Equity Income Fund (FISEX, FBEIX, FRETX, FREIX)
Franklin Federal Intermediate-Term Tax-Free Income Fund (FKITX)
Franklin Federal Limited Term Tax-Free Income Fund (FFTFX)
Franklin Federal Money Fund (FMNXX)
Franklin Federal Tax-Free Income Fund (FKTIX, FAFTX, FFTBX, FRFTX)
Franklin Flex Cap Growth Fund (FKCGX, FKCBX, FCIIX, FRCGX)
Franklin Floating Rate Daily Access Fund (FAFRX, FBFRX, FCFRX)
Franklin Floating Rate Trust (XFFLX)
Franklin Florida Insured Tax-Free Income Fund (FFLTX)
Franklin Florida Tax-Free Income Fund (FRFLX, FRFBX, FRFIX)
Franklin Georgia Tax-Free Income Fund (FTGAX, FGAIX)
Franklin Global Aggressive Growth Fund
Franklin Global Communications Fund (FRGUX)
Franklin Global Growth Fund
Franklin Global Health Care Fund (FKGHX, FGHBX, FGIIX)
Franklin Gold and Precious Metals Fund (FKRCX, FGADX, FAGPX, FRGOX)
Franklin Growth Fund (FKGRX, FCGAX, FKGBX, FRGSX, FGSRX)
Franklin High Yield Tax-Free Income Fund (FRHIX, FYIBX, FHYIX)
Franklin Insured Tax-Free Income Fund (FTFIX, FBITX, FRITX)
Franklin Kentucky Tax-Free Income Fund (FRKYX)
Franklin Large Cap Growth Fund (FKGAX, FRGAX, FKGCX, FRLGX)
Franklin Large Cap Value Fund (FLVAX, FBLCX, FLCVX, FLCRX)
Franklin Louisiana Tax-Free Income Fund (FKLAX, FLAIX)
Franklin Maryland Tax-Free Income Fund (FMDTX, FMDIX)
Franklin Massachusetts Insured Tax-Free Income Fund (FMISX, FMAIX)
Franklin Michigan Insured Tax-Free Income Fund (FTTMX, FBMIX, FRMTX
Franklin MicroCap Value Fund (FRMCX)
Franklin Minnesota Insured Tax-Free Income Fund (FMINX, FMNIX)
Franklin Missouri Tax-Free Income Fund (FRMOX, FMOIX)
Franklin Money Fund (FMFXX)
Franklin Natural Resources Fund (FRNRX, FNRAX)
Franklin New Jersey Tax-Free Income Fund (FRNJX, FNJBX, FNIIX)
Franklin New York Insured Tax-Free Income Fund (FRNYX, FNYKX)
Franklin New York Intermediate-Term Tax-Free Income Fund (FKNIX)
Franklin New York Limited Term Tax-Free Income Fund
Franklin New York Tax-Exempt Money Fund (FRNXX)
Franklin New York Tax-Free Income Fund (FNYTX, FNYAX, FTFBX, FNYIX)
Franklin North Carolina Tax-Free Income Fund (FXNCX, FNCIX)
Franklin Ohio Insured Tax-Free Income Fund (FTOIX, FBOIX, FOITX)
Franklin Oregon Tax-Free Income Fund (FRORX, FORIX)
Franklin Pennsylvania Tax-Free Income Fund (FRPAX, FBPTX, FRPTX)
Franklin Real Estate Securities Fund (FREEX, FRLAX, FBREX, FRRSX)
Franklin Rising Dividends Fund (FRDPX, FRDBX, FRDTX, FRDRX)
Franklin Short-Intermediate U.S. Government Securities Fund (FRGVX, FSUAX)
Franklin Small Cap Growth Fund II (FSGRX, FSSAX, FBSGX, FCSGX, FSSRX)
Franklin Small Cap Value Fund (FRVLX, FVADX, FBVAX, FRVFX, FVFRX)
Franklin Small-Mid Cap Growth Fund (FRSGX, FSGAX, FBSMX, FRSIX, FSMRX)
Franklin Strategic Income Fund (FRSTX, FKSAX, FKSBX, FSGCX, FKSRX)
Franklin Strategic Mortgage Portfolio (FSMIX)
Franklin Tax-Exempt Money Fund (FTMXX)
Franklin Technology Fund (FTCAX, FRTCX, FFTCX, FTERX)
Franklin Templeton Conservative Target Fund (FTCIX, FTCCX, FTCRX)
Franklin Templeton CoreFolio Allocation Fund (FTCOX)
Franklin Templeton Founding Funds Allocation Fund (FFALX, FFABX, FFACX)
Franklin Templeton Growth Target Fund (FGTIX, FTGTX, FGTRX)
Franklin Templeton Hard Currency Fund (ICPHX)
Franklin Templeton Moderate Target Fund (FMTIX, FTMTX, FTMRX)
Franklin Templeton Money Fund (FMBXX, FRIXX, FMRXX)
Franklin Tennessee Municipal Bond Fund (FRTIX)
Franklin Texas Tax-Free Income Fund (FTXTX, FTXIX)
Franklin Total Return Fund (FKBAX, FBDAX, FBTLX, FCTLX, FTRRX)
Franklin U.S. Government Securities Fund (FKUSX, FUSAX, FUGBX, FRUGX, FUSRX)
Franklin U.S. Long-Short Fund (FUSLX)
Franklin Utilities Fund (FKUTX, FRUAX, FRUBX, FRUSX, FRURX)
Franklin Virginia Tax-Free Income Fund (FRVAX, FVAIX)
Templeton China World Fund (TCWAX, TACWX)
Templeton Developing Markets Trust (TEDMX, TDADX, TDMBX, TDMTX, TDMRX)
Templeton Foreign Fund (TEMFX, TFFAX, TFRBX, TEFTX, TEFRX)
Templeton Foreign Smaller Companies Fund (FINEX, FTFAX, FCFSX)
Templeton Global Bond Fund (TPINX, TGBAX, TEGBX)
Templeton Global Long-Short Fund (TLSAX, TLSBX)
Templeton Global Opportunities Trust (TEGOX, TEGPX)
Templeton Global Smaller Companies Fund, Inc. (TEMGX, TGSAX. TESGX)
Templeton Growth Fund, Inc. (TEPLX, TGADX, TMGBX, TEGTX, TEGRX)
Templeton International (Ex EM) Fund (TEGEX, TGEFX)
Templeton Latin America Fund (TELAX, TLAAX, TLAIX)
Templeton Pacific Growth Fund (FKPGX, FPGCX)
Templeton World Fund (TEMWX, TWDBX, TEWTX)
Mutual Beacon Fund (TEBIX, TEBBX, TEMEX, BEGRX)
Mutual Discovery Fund (TEDIX, TEDBX, TEDSX, TEDRX, MDISX)
Mutual European Fund (TEMIX, TEUBX, TEURX, MEURX)
Mutual Financial Services Fund (TFSIX, TBFSX, TMFSX, TEFAX)
Mutual Qualified Fund (TEQIX, TEBQX, TEMQX, MQIFX)
Mutual Recovery Fund (FMRVX)

Note: This class action is related to the class action, Kaplan et al. v. Security Brokerage, Inc., and Daniel G. Calugar, CV-S-03-1644-KJD-RJJ, filed in the District of Nevada on December 31, 2003. However, we do not have evidence that these actions are going to be consolidated or managed jointly.

According to a press release dated July 14, 2011, you are hereby notified that proposed Settlements with certain Third Party Defendants (the "Settlements") and a Stipulation and Releases ("Stipulation") have been reached in a securities class action concerning alleged market-timing (including market- timing, late-trading, or short-term or excessive trading of mutual fund shares) in certain of the Franklin Funds, listed above (the "Action"), wherein certain Third Party Defendants are contributing monies for the benefit of the Class (the "Settlement Proceeds"), and the Franklin Defendants are paying certain costs of the notice and administration of the Settlements. This Action was part of lawsuits against various mutual fund families, organized by mutual fund family (known as a "sub-track") and consolidated under the caption In re Mutual Funds Investment Litigation, MDL-1586 (D. Md.).

A proposed partial settlement has also been reached in a derivative action of claims against the Canary and Banc of America Securities LLC ("BAS") defendants only. Depending on (1) whether you owned mutual fund shares in the Class Funds listed above and (2) when you owned them, you may be eligible to participate in the proposed Settlements. A Hearing will be held before the Honorable J. Frederick Motz at the United States District Court for the District of Maryland, United States Courthouse, 101 West Lombard Street, Baltimore, Maryland 21201 at 3:30 p.m., on October 25, 2011 to determine whether: (1) the proposed Settlements and Stipulation should be approved by the Court as fair, reasonable and adequate; (2) the plans for allocating the Settlement proceeds should be approved; (3)


Sector: Financial
Industry: Investment Services
Headquarters: United States


Ticker Symbol: BEN
Company Market: ETF
Market Status: Public (Listed)

About the Company & Securities Data

"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: D. Nevada
DOCKET #: 04-CV-0146
JUDGE: Hon. Philip M. Pro
DATE FILED: 02/06/2004
CLASS PERIOD END: 02/04/2004
  1. Albright, Stoddard, Warnick & Albright
  2. Cauley Geller Bowman Coates & Rudman, LLP (New York)
  3. Federman & Sherwood (Oklahoma City)
  4. Law Offices of Charles J. Piven, P.A.
  5. Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY)
  6. Murray, Frank & Sailer LLP
  7. Reinhardt, Wendorf & Blanchfield Attorneys at Law
  8. Schiffrin & Craig, Ltd.
  9. Stull, Stull & Brody (New York)
  10. The Emerson Firm
No Document Title Filing Date
COURT: D. Maryland
DOCKET #: 04-CV-01286
JUDGE: Hon. Philip M. Pro
DATE FILED: 05/14/2004
CLASS PERIOD END: 02/04/2004
  1. Albright, Stoddard, Warnick & Albright
  2. Milberg Weiss Bershad & Schulman LLP (New York)
No Document Title Filing Date
No Document Title Filing Date