What is the timeline for the class action lawsuit and potential settlement or judgment?

Timeline of the Easterly ROCMuni class‑action case

• Filing & opt‑in window – The securities‑fraud class‑action complaint was filed in early August 2025 (the PR‑release is dated Aug 11, 2025). Investors who suffered losses in the Easterly ROCMuni High‑Income Municipal Bond Fund (formerly Principal Street High‑Income Municipal Fund) have until mid‑September 2025 (≈ 30 days after the filing) to submit a “lead‑plaintiff” election and to be entered into the lead‑plaintiff roster. After that date the pool of potential lead plaintiffs is closed.

• Discovery & settlement‑preparation phase – Once the lead‑plaintiff list is set, the case moves into the standard 12‑ to 15‑month discovery period. During this window the plaintiffs’ counsel will request documents from Easterly ROCMuni, interview fund managers, and assess the strength of the fraud allegations. Historically, municipal‑bond fund securities cases reach a settlement or a dispositive motion within 12‑18 months after the opt‑in deadline.

• Potential resolution – Assuming the case follows the typical timeline, a settlement offer or a summary‑judgment motion is likely to be filed by the summer of 2026 (≈ 10‑14 months after the opt‑in cut‑off). If the parties negotiate, a final settlement could be executed late 2026 to early 2027. If the case proceeds to trial, a judgment would not be expected until mid‑2027 at the earliest.

Trading implications

• Short‑term: The announcement of the class‑action and the open lead‑plaintiff window adds a near‑term bearish catalyst for RMHIX/RMHVX/RMJAX, as investors may anticipate potential fund outflows or heightened scrutiny. Expect modest‑to‑moderate downward pressure on the fund’s NAV and related municipal‑bond ETFs over the next 2‑4 weeks, especially if a sizable number of investors elect to lead the suit.

• Medium‑term: If the case proceeds to settlement or judgment in 2026, the market will price in a potential payout to affected investors and possible regulatory or compliance costs for Easterly ROCMuni. A settlement announcement (even a modest one) could trigger a short‑term rally in the fund’s price as the uncertainty is removed, while a negative judgment could depress the NAV further. Positionally, traders might consider a short‑term bearish stance (e.g., buying put options or shorting the fund’s shares) until the September 2025 opt‑in deadline passes, then shift to a neutral‑to‑long bias as the case moves toward a settlement that caps the downside.