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Fired Subadviser Not Going Gently into That Good Night

Board IQ

Subadvisers come and go from funds nearly every day, but a firm fired from subadvising two AMG funds is waging a rare legal and proxy battle over its dismissal. Square in its sights are fund directors, with the former subadviser questioning their motivations and independence and whether they breached their fiduciary duties.

Friess Associates is asking shareholders of the funds, formerly known as the AMG Managers Brandywine Fund and the AMG Managers Brandywine Blue Fund, to vote against approving contracts with new subadvisers at a May 18 meeting. At the same time, Friess is scheduled to ask a state judge in Massachusetts today to postpone the meeting and force AMG to turn over fund board materials so it can investigate “possible wrongdoing or mismanagement by the board,” according to an April 13 demand letter attorneys for Friess sent to directors.


Friess’s response to its March 19 termination from funds with a combined $1.1 billion has left some industry attorneys and analysts scratching their heads.

“I don’t remember ever seeing a proxy contest run by a subadviser,” says Thomas Westle, a partner at Blank Rome. “I’ve never seen a subadviser push back and say, ‘You can’t fire me.’”

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“Fired Subadviser Not Going Gently into That Good Night," by Greg Saitz was published in Board IQ on May 4, 2021.