Julia D. Corelli Quoted in Privcap Article, 'Fund Manager SEC Action Offers Cautionary Tale'
Julia D. Corelli, a partner with Pepper Hamilton's Corporate and Securities Practice Group and co-chair of its Funds Services Group, was quoted in the December 15, 2015 Privcap article, "Fund Manager SEC Action Offers Cautionary Tale."
These types of issues involving disclosure of expenses or other items in the limited partner agreement (LPA) is "becoming more common," according to Julia Corelli, a partner at Pepper Hamilton LLP. "[The SEC] has gone after a number of them," she adds, citing Blackstone among the most high-profile cases.
As a reaction to the increase in more thorough regulatory exams and actions by the SEC toward PE firms, new funds have started protecting themselves by reporting "more granularity in fund expenses," says Corelli. A provision becoming more common in the LPA is that if the LP triggers an investigation, the LP will bear the full expense rather than the fund manager. "I'm sure the SEC won’t like it when they see it [in the LPA]," she says. "It also makes some LPs unhappy. The majority are starting to say any investigation expense beyond the routine is a fund expense."
Content contributed by attorneys of Troutman Sanders LLP and Pepper Hamilton LLP prior to April 1, 2020, is included here, together with content contributed by attorneys of Troutman Pepper (the combined entity) after the merger date.