According to a press release dated April 29, 2009, the complaint alleges that the Pennsylvania Fund, Oppenheimer Funds and certain of its officers and trustees violated the Securities Act of 1933 and the Investment Company Act of 1940 by departing from the stated investment premise and otherwise injured Fund shareholders. The Pennsylvania Fund is a municipal bond fund yielding interest income exempt from federal and Pennsylvania income taxes. The complaint alleges that during the Class Period, the Registration Statements and Prospectuses misled investors about the Fund's investment objectives, policies and the underlying risk by characterizing its investments as consistent with preservation of capital. In fact, the Fund lost over 33% of its net asset value ("NAV") in 2008 compared with an average peer group loss of approximately 9.5%. The complaint alleges that capital preservation was disregarded as the Fund significantly increased exposure through excessively risky strategies not properly disclosed to investors.
Specifically, the overarching principle of capital preservation was compromised by concentrating large positions in low rated bonds, bonds not reviewed by an independent rating agency and by portfolio concentration in high risk securities including, Tobacco Bonds, Dirt Bonds, and Inverse Floaters.
In June 2009, the case was transferred from the U.S. District Court for the Western District of Pennsylvania to the District of Colorado. The action regarding Oppenheimer Pennsylvania Municipal Fund is being handled in In Re: Oppenheimer Rochester Funds Group Securities Litigation, Master Docket No. 09-md-02063-JLK-KMT.
On November 18, 2009, Dharamvir Bhanot is appointed Lead Plaintiff in the Pennsylvania Municipal Fund class actions, and his selection of counsel, Berger & Montague, P.C., as Lead Counsel for the class is approved.
A Consolidated Class Action Complaint was filed, In re Oppenheimer Pennsylvania Municipal Fund, on January 15, 2010. Motions to dismiss were filed on April 5, 2010.
On January 18, 2012, the MDL Court issued an order on pending motions for reconsideration. The Court granted the motion of certain defendants and denied the motion of a certain defendant. Two days later, the Court issued an Amended Opinion and Order on Motions to Dismiss which reflected the Court's holdings from the January 18 Order.
On March 20, 2013, the Court issued an Order denying Defendants' Joint Motion to Dismiss.
On March 22, 2013, the Court issued an Order denying Defendants' Motion for Partial Summary Judgment on "Leverage Ratio" Claims.