Sub-Item 77E

The Fund has been named as a counter-defendant in a breach of
contract claim arising out of its preexisting suit for damages
against Goldman, Sachs & Co., Credit Suisse Securities (USA)
LLC, and Morgan Stanley & Co. for violations of California's
securities laws and negligent misrepresentation in connection
with the sale of Washington Mutual Preferred Trust securities to
the Fund.

The action was initiated on December 9, 2010, in the federal
District Court for the Western District of Washington (at
Seattle) by Goldman, Sachs & Co., Credit Suisse Securities (USA)
LLC, and Morgan Stanley & Co, and names as counter-defendants
the U.S. Flaherty & Crumrine Funds, as well as Flaherty &
Crumrine Incorporated.