John Hancock Advisers, LLC Provides Statement on Auction Rate Preferred Lawsuit and Related Matters

BOSTON, Aug. 25 /PRNewswire-FirstCall/ -- John Hancock Advisers, LLC announced that on August 24, 2010, a shareholder derivative complaint was filed in the Superior Court of The Commonwealth of Massachusetts, Suffolk County, with respect to John Hancock Preferred Income Fund III (NYSE: HPS), a leveraged John Hancock closed-end fund ("Preferred III"), which had previously received a demand letter from the same law firm on behalf of a putative common shareholder.  The complaint was filed against John Hancock Advisers, LLC, Preferred III's adviser ("JHA"), JHA's parent company Manulife Financial Corporation, and certain of the Trustees, executive officers and portfolio managers of Preferred III in connection with the redemption of auction preferred shares of Preferred III ("APS").  The complaint alleges, among other things, that the named defendants breached their fiduciary duties to Preferred III and its common shareholders by redeeming APS at their liquidation preference and alleges that such redemptions caused losses to Preferred III and its common shareholders.  The plaintiffs are seeking monetary damages for the alleged losses and certain other relief.  

As previously announced, John Hancock Patriot Premium Dividend Fund II (NYSE: PDT), another leveraged John Hancock closed-end fund ("Patriot"), received a substantially similar demand letter from the same law firm on behalf of a putative common shareholder of Patriot.  That demand letter similarly alleged that JHA and certain of the Trustees, executive officers and portfolio managers of Patriot breached their fiduciary duties to Patriot by redeeming Dutch Auction Rate Transferable Securities Preferred Stock at their liquidation preference and demands that the Board of Trustees take action to remedy those alleged breaches.  No shareholder derivative complaint has been filed with respect to Patriot at this time.

About John Hancock Funds

The Boston-based mutual fund business unit of John Hancock Financial, John Hancock Funds, manages more than $54.7 billion in open-end funds, closed-end funds, private accounts, retirement plans and related party assets for individual and institutional investors at June 30, 2010.

About John Hancock Financial and Manulife Financial Corporation

John Hancock Financial is a unit of Manulife Financial Corporation, a leading Canadian-based financial services group serving millions of customers in 22 countries and territories worldwide. Operating as Manulife Financial in Canada and in most of Asia, and primarily as John Hancock in the United States, Manulife Financial Corporation offers clients a diverse range of financial protection products and wealth management services through its extensive network of employees, agents and distribution partners. Funds under management by Manulife Financial and its subsidiaries were Cdn$454 billion (US$428 billion) at June 30, 2010.

Manulife Financial Corporation trades as 'MFC' on the TSX, NYSE and PSE, and under '945' on the SEHK. Manulife Financial can be found on the Internet at www.manulife.com.

The John Hancock unit, through its insurance companies, comprises one of the largest life insurers in the United States. John Hancock offers a broad range of financial products and services, including life insurance, fixed and variable annuities, fixed products, mutual funds, 401(k) plans, long-term care insurance, college savings, and other forms of business insurance. Additional information about John Hancock may be found at www.johnhancock.com.

SOURCE John Hancock Funds