Several class action complaints have been filed in the U.S. District Courts for the Districts of New Jersey and Colorado. Specifically, the complaints allege that Oppenheimer Funds, Inc. ("OFI") and certain of its Trustees violated the Securities Act of 1933 by issuing prospectuses which misled investors concerning the risks of investing in the Fund. These undisclosed risks are alleged to have been the cause of a severe decline in the value of the Fund's shares, far exceeding the decline of competing municipal bond funds.
The Fund employed strategies which enhanced its reported returns while, at the
same time, exposing the Fund to a greater risk of price declines in the value of its portfolio securities in the event of any illiquidity in the market for municipal securities.
However, in doing so, the prospectuses and other sales materials employed in selling and marketing the Fund failed to disclose that these very strategies exposed the Fund to substantially greater risk of loss due to the company being forced to sell large blocks of portfolio securities at disadvantageous times and prices reduced from those at which the securities were previously carried on the books.
On June 17, 2009, by Transfer Order from Judicial Panel on Multidistrict Litigation, this action and many others were transferred to the District of Colorado, MDL 2063, In Re: Oppenheimer Rochester Funds Group Securities Litigation.
On November 18, 2009, the Court approved the motion to appoint Leonard Klorfine as Lead Plaintiff in the AMT-Free Municipal Fund class actions, and approved his selection of Cohen Milstein as Lead Counsel for the class.
On January 15, 2010, an Amended Class Action Complaint was filed in Master Docket No. 09-md-02063-JLK-KMT (MDL Docket No. 2063), In Re: Oppenheimer Rochester Funds Group Securities Litigation, in relation to In re AMT-Free Municipals Fund. The complaint adds violation of Section 13(a) of the Investment Company Act of 1940, in addition to violations of Securities Act of 1933.