Investment Company Act of 1940 – Sections 2(a)(32), 5(a)(1), 12(d)(1)(A) and (B), 15(a), 17(a)(1) and 17(a)(2), 22(d), and 22(e) and Rules 18f-2 and 22c-1
Innovator Capital Management, LLC, et al.
October 6, 2017
OFFICE OF CHIEF COUNSEL
DIVISION OF INVESTMENT MANAGEMENT
Your letter of October 6, 2017 requests our assurance that we would not recommend that the Commission take any enforcement action under the provisions of the Investment Company Act of 1940 (the "1940 Act") and the rules thereunder covered by three existing exemptive orders ("Existing Orders") issued to Innovator Management LLC ("Innovator"), Innovator ETFs Trust (formerly, Academy Funds Trust) (the "Trust"), and Quasar Distributors, LLC ("Quasar"), as applicable, against any person relying on the Existing Orders as if the Existing Orders extended to Innovator Capital Management, LLC ("Innovator Capital"), as described below.
You state that Innovator entered into an agreement with Innovator Capital pursuant to which Innovator transferred the assets of its investment advisory business and related intellectual property to Innovator Capital (the "Transaction"). You state that the closing of the Transaction (the "Closing") occurred on May 9, 2017 and that Innovator Capital commenced serving as investment adviser to each series of the Trust (each, a "Fund") as of the date of the Closing.
Innovator Capital, the Trust, and Quasar, as applicable, recently filed three applications with the Commission in which they request exemptive orders that would effectively provide the same relief previously granted in the Existing Orders ("Requested Orders").
You state that Innovator Capital, the Trust, and Quasar, as applicable, propose to rely on the Existing Orders pending receipt of the Requested Orders. You further state that Innovator Capital will comply with the terms and conditions of the Existing Orders imposed on Innovator as though such terms and conditions were imposed directly on Innovator Capital. You also state that the Trust and Quasar, as applicable, will rely on each Requested Order when it is granted, rather than continuing to rely on the respective Existing Order.
Based on the facts and representations made in your letter, we would not recommend enforcement action to the Commission under the provisions of the 1940 Act and the rules thereunder covered by the Existing Orders against any person relying on the Existing Orders as if the Existing Orders extended to Innovator Capital until the earlier of the issuance by the Commission of the Requested Orders, or 150 days from the date of the Closing.
This response expresses the Division's position on enforcement action only, and does not purport to express any legal conclusions on the questions presented. Facts or conditions different from those presented in your letter might require a different conclusion. In addition, this letter provides no assurance that the Commission will grant the Requested Orders, or that the Division will not comment upon or seek modification of any application for the Requested Orders.
 Your letter of October 6, 2017 identifies the Existing Orders, which exempt: (1) Innovator and the Trust from sections 2(a)(32), 5(a)(1), 12(d)(1)(A) and (B), 17(a)(1) and 17(a)(2), 22(d) and 22(e) of the 1940 Act and rule 22c-1 under the 1940 Act, permitting the Funds to operate as actively-managed exchange traded funds ("ETFs"), (2) Innovator, the Trust, and Quasar from sections 2(a)(32), 5(a)(1), 12(d)(1)(A) and (B), 17(a)(1) and 17(a)(2), 22(d) and 22(e) of the 1940 Act and rule 22c-1 under the 1940 Act, permitting the Funds to operate as index ETFs, and (3) Innovator and the Trust from section 15(a) of the 1940 Act and rule 18f-2 under the 1940 Act, permitting the Funds to enter into and materially amend subadvisory contracts without obtaining shareholder approval.
 Innovator and Innovator Capital are not affiliated persons of each other.
 This letter confirms oral no-action relief that the staff provided to Jonathan M. Kopcsik of Stradley Ronon Stevens & Young, LLP, counsel to the Trust, on May 5, 2017.
 The staff would not object if third parties rely on this no-action letter to the extent that they find themselves in substantially similar facts and circumstances. In particular, a third party intending to rely on the letter would need to promptly file an application for the relevant exemptive relief. Before doing so, and as a condition to reliance on the letter, the third party would need to confirm with the staff that the staff would support granting such exemptive relief.
The Incoming Letter is in Acrobat format.