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<TYPE>EX-99.77E LEGAL
<SEQUENCE>3
<FILENAME>r77e.txt
<DESCRIPTION>LEGAL
<TEXT>
REGULATORY AND LITIGATION MATTERS

Since February 2004, PIMCO, Allianz Global Investors of America L.P. (AGI)
(formerly known as Allianz Dresdner Asset Management of America L.P.) (PIMCOs
parent company), and certain of their affiliates, including PIMCO Funds (a
complex of mutual funds managed by PIMCO) and Allianz Funds (formerly known as
PIMCO Funds: Multi-Manager Series) (a complex of mutual funds managed by
affiliates of PIMCO), certain PIMCO Funds trustees, and certain employees of
PIMCO have been named as defendants in fifteen lawsuits filed in various
jurisdictions. Eleven of those lawsuits concern market timing, and they have
been transferred to and consolidated for pre-trial proceedings in a
multi-district litigation proceeding in the U.S. District Court for the
District of Maryland; the other four 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 PIMCO Funds and Allianz Funds during specified periods, or as
derivative actions on behalf of the PIMCO Funds and Allianz 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 funds
of PIMCO Funds and Allianz Funds and this alleged activity was not disclosed.
Pursuant to tolling agreements entered into with the derivative and class
action plaintiffs, PIMCO, certain PIMCO 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 PIMCO Funds or on behalf of PIMCO Funds
itself against other defendants. By order dated November 3, 2005, the U.S.
District Court for the District of Maryland granted PIMCO Funds motion to
dismiss claims asserted against it in a consolidated amended complaint where
PIMCO Funds was named, in the complaint, as a nominal defendant. Thus, at
present PIMCO Funds is not a party to any "market timing" lawsuit. The revenue
sharing action in the District of Connecticut generally alleges that fund
assets were inappropriately used to pay brokers to promote funds of the
Allianz Funds and of the PIMCO Funds, including directing fund brokerage
transactions to such brokers, and that such alleged arrangements were not fully
disclosed to shareholders. On September 19, 2007 the U.S. District Court for
the District of Connecticut granted defendants motion to dismiss the
consolidated amended complaint in the revenue sharing action. 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 advisorycontracts, the return of fees paid under those contracts and
restitution.

Two nearly identical class action civil complaints have been filed in August
2005, in the Northern District of Illinois Eastern Division, alleging that the
plaintiffs each purchased and sold a 10-year Treasury note futures contract and
suffered damages from an alleged shortage when PIMCO held both physical and
futures positions in 10-year Treasury notes for its client accounts. The two
actions have been consolidated into one action, and the two separate complaints
have been replaced by a consolidated complaint. PIMCO is a named defendant, and
PIMCO Funds has been added as a defendant, to the consolidated action. PIMCO
strongly believes the complaint is without merit and intends to vigorously
defend itself.

In April 2006, certain registered investment companies and other funds managed
by PIMCO were served in an adversary proceeding brought by the Official
Committee of Asbestos Claimants of G-I Holdings, Inc. in G-I Holdings, Inc.s
bankruptcy in the District of New Jersey. In July 2004, PIMCO was named in this
lawsuit and remains a defendant. The plaintiff seeks to recover for the
bankruptcy estate assets that were transferred by the predecessor entity of
G-I Holdings, Inc. to a wholly-owned subsidiary in 1994. The subsidiary has
since issued notes, of which certain registered investment companies and other
funds managed by PIMCO are alleged to be holders. The complaint alleges that in
2000, more than two hundred noteholders  including certain registered
investment companies and other funds managed by PIMCO  were granted a second
priority lien on the assets of the subsidiary in exchange for their consent to
a refinancing transaction and the granting of a first priority lien to the
lending banks. The plaintiff is seeking invalidation of the lien in favor of
the noteholders and/or the value of the lien. On June 21, 2006, the District
of New Jersey overturned the Bankruptcy Courts decision granting permission to
file the adversary proceeding and remanded the matter to the Bankruptcy Court
for further proceedings. Following a motion to reconsider, the District Court
upheld its remand on August 7, 2006, and instructed the Bankruptcy Court to
conduct a "cost-benefit" analysis of the Committee's claims, including the
claims against the noteholders. The Bankruptcy Court held a status conference
on October 25, 2006 and set a briefing schedule relating to this cost-benefit
analysis.

The foregoing speaks only as of the date of this report. None of the
aforementioned complaints alleges that any improper activity took place in the
Fund. It is possible that these matters could lead to a decrease in the market
value of the Funds shares or other adverse consequences to the Fund. However,
PIMCO believes that these matters are not likely to have a material adverse
effect on the Fund or on PIMCOs ability to perform its investment advisory
services relating to the Fund.
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