Reserve Funds filed with the U.S. District Court for the Southern District of New York Friday to dismiss a class-action lawsuit originated by Third Avenue Managment over the Reserve Primary Fund. The Third Avenue Institutional Value Fund LP opposed the motion to dismiss on the grounds that Reserve misled investors into believing its once $62 billion Primary Fund was safe despite its $785 million exposure to Lehman Brothers paper.
Reserve attorneys argue that this fund was not the only money market fund to break the buck. However, Peter Crane, president of Crane Data, tells The Wall Street Journal that in 2008 at the start of the credit crisis, the Primary Fund was the only money market fund to fall below a $1 net asset value.
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