In the action, the SEC charged WisdomTree with making certain misstatements and compliance failures regarding its management of three ETFs (the "ESG Funds") registered under the Investment Company Act of 1940 (the "1940 Act"). In particular, the ESG Funds' prospectuses stated that WisdomTree's investment model would exclude the securities of companies with involvement in fossil fuels and tobacco "regardless of revenue measures," and presentations to the ESG Funds' board of trustees included representations regarding WisdomTree's ESG investment approach vis-à-vis the ETF Funds' screening out investment in fossil fuels and tobacco. In part because WisdomTree contracted with third-party data vendors with data sets that allegedly did not screen for ESG in a manner consistent with the ESG Funds' prospectus statements and WisdomTree's board presentation materials, each of the ESG Funds held securities of companies involved in both fossil fuel production and tobacco.