S&P Block

Articles by Fund Democracy: Archives

S&P Asks SEC to Block New Vanguard Viper Fund, TheStreet.com (Nov. 1, 2000).

Abstract: Standard & Poor's has asked the Securities and Exchange Commission to stop Vanguard from rolling out its new Vipers exchange-traded fund that would track the S&P 500 index. S&P and Vanguard have been locked in a trademark dispute since Vanguard first announced the creation of Vipers in May. In its hearing request, S&P argues that if Vanguard loses the trademark lawsuit it might no longer be able to use the S&P 500 moniker, and "a potentially chaotic situation could develop in which many investors might be left holding orphaned shares or perhaps shares that were subject to an unwieldy recall."

S&P may have given Barclays iShares 500 the exclusive right to offer an exchange-traded fund under the S&P 500 name. Vanguard's offering of Vipers 500 therefore might give Barclays the right to renegotiate its deal with S&P, possibly resulting in lower fees for iShares investors. The SEC is likely to reject the hearing request, as it had considered S&P's position prior to announcing its intention to grant the order. (View the full text of this article.)