Mutual Fund Sues Broker-Dealer for Alleged Defaming to Investors

Leader Capital Corp. alleges that a broker-dealer and fund it worked with spread confidential and false information that it wasn’t complying with securities laws, causing investors to withdraw from its mutual fund and costing it at least $3.56 million, a new lawsuit says.

FNEX Capital LLC and Maverick Solutions Fund LLC made improper disclosures in retaliation for Leader Capital terminating their sales agreement, the complaint filed Thursday in the US District Court for the Western District of Washington says.

According to Leader Capital, FNEX was required to “use reasonable efforts” to sell and market its mutual funds, and Maverick was ...