Sources of conflict
Separately managed account disputes often center on investment guidelines: whether a position exceeded a limit, whether a strategy drifted from the one described, and how losses should be measured if it did. Fund-level disputes tend to involve fees and expenses, valuation of illiquid holdings, redemption gates, or the manager's handling of conflicts between funds. Advisers owe their clients fiduciary duties under federal law, but the advisory agreement and offering documents shape how those duties apply in practice. Disputes with departing personnel raise separate questions about restrictive covenants, client solicitation, and trading models or code the firm considers its own.
Assembling the record
These cases are document-heavy from the first day. The advisory agreement, investment guidelines, offering documents, side letters, and amendments set the baseline. Trade blotters, compliance exception reports, valuation committee minutes, and client reporting show what actually happened. Communications with the client or investor, including quarterly letters and meeting notes, often reveal whether a concern was raised and how it was answered. If a departure is involved, preserve access logs and device records, and route a departing employee's equipment through a careful forensic process rather than an informal look. Regulators may ask for the same records, so a consistent approach to preservation and production helps.
Where the analysis begins
In a first discussion we identify the forum, since advisory agreements and fund documents often contain arbitration clauses, venue provisions, or exculpation and indemnification terms that change the analysis. We look at whether the dispute is mainly contractual or raises fiduciary and regulatory issues that could draw SEC attention. Measuring loss is usually a major subject in its own right, often requiring a retained financial witness to compare actual results against a portfolio that followed the guidelines. For managers, we also weigh client relationships and reputational effects. For clients, we consider which remedy is realistic given what the documents say.
