Franklin-based investment firm CapWealth Advisors has won a jury trial in an enforcement action brought by the Securities and Exchange Commission.

The SEC alleged in a 2020 civil complaint that CapWealth, principal Timothy Pagliara and representative Timothy Murphy failed to disclose conflict of interest to clients related to 12b-1 fees. The SEC argued that CapWealth was benefitting by directing clients to funds that charged the fees “when share classes of the same funds that presented a more favorable value to the clients were available.”

CapWealth decided to take the case to trial, and a Nashville jury last week unanimously found in the company’s favor. CapWealth called its victory “stunning” in a release.

“We are both thankful for and gratified by the jury’s verdict,” Pagliara said. He added in an interview with Barron’s that he felt “vindicated.”

Gino Bulso of Bulso PLC represented the defendants. SEC representatives declined to comment.