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<TYPE>EX-99.77E LEGAL
<SEQUENCE>4
<FILENAME>r77e.txt
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77E  LEGAL PROCEEDINGS

On June 1, 2004, the Attorney General of the State of New Jersey announced that
it had dismissed PIMCO from a complaint filed by the New Jersey Attorney General
on February 17, 2004, and that it had entered into a settlement agreement (the
"New Jersey Settlement") with PIMCO's parent company, Allianz Global Investors
of America L.P. ("AGI", formerly known as Allianz Dresdner Asset Management of
America L.P.), PEA Capital LLC (an entity affiliated with PIMCO through common
ownership) ("PEA") and PA Distributors LLC ("PAD"), in connection with the same
matter. In the New Jersey Settlement, AGI, PEA and PAD neither admitted nor
denied the allegations or conclusions of law, but did agree to pay New Jersey a
civil fine of $15 million and $3 million for investigative costs and further
potential enforcement initiatives against unrelated parties. They also undertook
to implement certain governance changes. The complaint relating to the New
Jersey Settlement alleged, among other things, that AGI, PEA and PAD had failed
to disclose that they improperly allowed certain hedge funds to engage in
"market timing" in certain funds.

Since February 2004, PIMCO, AGI, PEA, PAD, and certain of their affiliates,
PIMCO Funds: Pacific Investment Management Series (the "PIMS Funds") and PIMCO:
Multi-Manager Series (the "MMS Funds"), have been named as defendants in 14
lawsuits filed in U.S. District Court in the Southern District of New York, the
Central District of California and the Districts of New Jersey and Connecticut.
Ten of  those lawsuits concern "market timing," and they have been transferred
to and consolidated for pre-trial proceedings in the U.S. District Court for
the District of Maryland; four of those lawsuits concern "revenue sharing"
and have been consolidated into a single action in the U.S. District Court for
the District of Connecticut. The lawsuits have been commenced as putative class
actions on behalf of investors who purchased, held or redeemed shares of the
various series of the PIMS Funds and the MMS Funds during specified periods,
or as derivative actions on behalf of the PIMS and MMS Funds.

The market timing actions in the District of Maryland generally allege that
certain hedge funds were allowed to engage in "market timing" in certain of the
MMS and PIMS Funds and this alleged activity was not disclosed. Pursuant to
tolling agreements entered into with the derivative and class action
plaintiffs, PIMCO, the PIMS Funds' trustees, and certain employees of PIMCO
who were previously named as defendants have all been dropped as defendants
in the market timing actions; the plaintiffs continue to assert claims on
behalf of the shareholders of the PIMS Funds or on behalf of the PIMS Funds
themselves against other defendants. The  revenue  sharing action in the
District of Connecticut generally alleges that fund  assets were
inappropriately used to pay brokers to promote the MMS and PIMS Funds,
including directing fund brokerage transactions to such brokers, and that
such alleged arrangements were not fully disclosed to shareholders. The market
timing  and revenue sharing lawsuits seek, among other things, unspecified
compensatory damages plus interest and, in some cases, punitive damages, the
rescission of investment advisory contracts, the return of fees paid under
those contracts and restitution.

Under Section 9(a) of the Investment Company Act of 1940, as amended
("1940 Act"), if the New Jersey Settlement or any of the lawsuits described
above were to result in a court injunction against AGI, PEA, PAD and/or their
affiliates, PIMCO could, in the absence of exemptive relief granted by the
Securities and Exchange Commission ("SEC"), be barred from serving as an
investment adviser to any registered investment company, including the Fund.
The SEC has granted the Applicants a temporary exemption from the provisions
of Section 9(a) with respect to the New Jersey Settlement until the earlier of
(i) September 13, 2006 and (ii) the date on which the SEC takes final action on
their application for a permanent order. There is no assurance that the SEC will
issue a permanent order.

In addition, a putative class action lawsuit captioned Charles Mutchka et al. v.
Brent R. Harris, et al., filed in January 2005 by and on behalf of individual
shareholders of certain open-end funds that hold equity securities and that are
sponsored by PIMCO and certain of its affiliates is currently pending in the
federal district court for the Central District of California. The plaintiff
alleges that fund trustees, investment advisers and affiliates breached
fiduciary duties and duties of care by failing to ensure that the open-end funds
participated in securities class action settlements for which those funds were
eligible. The plaintiff has claimed as damages disgorgement of fees paid to the
investment advisers, compensatory damages and punitive damages. PIMCO believes
that the claims made in the lawsuit against PIMCO and its affiliates are
baseless, and PIMCO intends to vigorously defend the lawsuit. PIMCO believes a
decision, if any, against the defendants is not likely to have a material
adverse effect on the Fund or on the ability of PIMCO to perform its investment
advisory services relating to the Fund.

None of the aforementioned complaints alleges that any improper activity took
place in the Fund. PIMCO believes that these developments will not have a
material adverse effect on the Fund or on PIMCO's ability to perform its
investment advisory services on behalf of the Fund.
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