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Filing Details

Accession Number:: 0000921895-16-005198
Form Type:: 13D Filing
Publication Date:: 2016-07-20 16:07:49

Filed By:: Western Investment Llc
Company:: Deutsche Strategic Income Trust (NYSE:KST)
Filing Date:: 2016-07-20
SEC Url:: 13D Filing

Ownership Summary

Please notice the below summary table is generated without human intervention and may contain errors. Please refer to the complete filing displayed below for exact figures.

Name	Sole Voting Power	Sole Dispositive Power	Aggregate Amount Owned Power	Percent of Class
WESTERN INVESTMENT HEDGED PARTNERS	106,722	106,722	106,722	2.4%
WESTERN INVESTMENT TOTAL RETURN PARTNERS	89,268	89,268	89,268	2.0%
WESTERN INVESTMENT	196,890	196,890	196,890	4.5%
ARTHUR D. LIPSON	196,890	196,890	196,890	4.5%
BENCHMARK PLUS INSTITUTIONAL PARTNERS	61,427	61,427	61,427	1.4%
BENCHMARK PLUS MANAGEMENT	61,427	61,427	61,427	1.4%
ROBERT FERGUSON	61,427	61,427	61,427	1.4%
NEIL R. CHELO				0%
MATTHEW S. CROUSE				0%

Filing

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT

TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO

§ 240.13d-2(a)

(Amendment No. 3)1

Deutsche Strategic Income Trust

(Name of Issuer)

Common Stock, $0.01 par value

(Title of Class of Securities)

25160F109

(CUSIP Number)

ADAM W. FINERMAN, ESQ.

OLSHAN FROME WOLOSKY LLP

1325 Avenue of the Americas

New York, New York 10019

(212) 451-2300

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

July 18, 2016

(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box ¨.

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.

_______________

1 The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

1	NAME OF REPORTING PERSON WESTERN INVESTMENT HEDGED PARTNERS L.P.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 106,722
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 106,722
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 106,722
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.4%
14	TYPE OF REPORTING PERSON PN

1	NAME OF REPORTING PERSON WESTERN INVESTMENT TOTAL RETURN PARTNERS L.P.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 89,268
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 89,268
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 89,268
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.0%
14	TYPE OF REPORTING PERSON PN

1	NAME OF REPORTING PERSON WESTERN INVESTMENT LLC
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS OO, WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 196,890
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 196,890
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 196,890
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 4.5%
14	TYPE OF REPORTING PERSON OO

1	NAME OF REPORTING PERSON ARTHUR D. LIPSON
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS OO
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 196,890
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 196,890
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 196,890
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 4.5%
14	TYPE OF REPORTING PERSON IN

1	NAME OF REPORTING PERSON BENCHMARK PLUS INSTITUTIONAL PARTNERS, L.L.C.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS WC
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 61,427
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 61,427
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 61,427
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.4%
14	TYPE OF REPORTING PERSON OO

1	NAME OF REPORTING PERSON BENCHMARK PLUS MANAGEMENT, L.L.C.
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS OO
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 61,427
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 61,427
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 61,427
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.4%
14	TYPE OF REPORTING PERSON OO

1	NAME OF REPORTING PERSON ROBERT FERGUSON
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS OO
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER 61,427
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER 61,427
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 61,427
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 1.4%
14	TYPE OF REPORTING PERSON IN

1	NAME OF REPORTING PERSON NEIL R. CHELO
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER - 0 -
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER - 0 -
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON - 0 -
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0%
14	TYPE OF REPORTING PERSON IN

1	NAME OF REPORTING PERSON MATTHEW S. CROUSE
2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP		(a) x (b) o
3	SEC USE ONLY
4	SOURCE OF FUNDS
5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)		¨
6	CITIZENSHIP OR PLACE OF ORGANIZATION USA
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER - 0 -
	8	SHARED VOTING POWER - 0 -
	9	SOLE DISPOSITIVE POWER - 0 -
	10	SHARED DISPOSITIVE POWER - 0 -
11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON - 0 -
12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES		o
13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0%
14	TYPE OF REPORTING PERSON IN

The following constitutes Amendment No. 3 (“Amendment No. 3”) to the Schedule 13D filed by the undersigned (the “Schedule 13D”). This Amendment No. 3 amends the Schedule 13D as specifically set forth herein.

Item 3.

Source and Amount of Funds or Other Consideration.

Item 3 is hereby amended and restated to read as follows:

The Shares purchased by WIHP, WITRP and WILLC were purchased with working capital (which may, at any given time, include margin loans made by brokerage firms in the ordinary course of business) in open market purchases, except as otherwise noted. The aggregate purchase price of the 106,722 Shares owned directly by WIHP is approximately $1,105,139, including brokerage commissions. The aggregate purchase price of the 89,268 Shares owned directly by WITRP is approximately $913,408, including brokerage commissions. The aggregate purchase price of the 900 Shares owned directly by WILLC is approximately $9,107, including brokerage commissions.

The Shares purchased by BPIP were purchased with working capital (which may, at any given time, include margin loans made by brokerage firms in the ordinary course of business) in open market purchases, except as otherwise noted. The aggregate purchase price of the 61,427 Shares owned directly by BPIP is approximately $629,119, including brokerage commissions.

Item 4.

Purpose of Transaction.

Item 4 is hereby amended to add the following information:

On July 19, 2016, WILLC issued a press release announcing that it has submitted to the Issuer and another Deutsche Investment Management Fund, Deutsche Multi-Market Income Trust (KMM) (together with the Issuer, the “Deutsche Funds”), proposals, pursuant to Rule 14a-8 of the Securities Exchange Act of 1934, as amended, to declassify the boards of the Deutsche Funds. In the press release, WILLC stated that it is dismayed that the Deutsche Funds have wasted shareholder assets in multiple failed efforts to block or change the proposals and/or statements submitted by WILLC but that it is pleased that the Securities and Exchange Commission has rejected such efforts by the Deutsche Funds. The press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 5.

Interest in Securities of the Issuer.

Item 5 is hereby amended and restated to read as follows:

The aggregate percentage of Shares reported owned by each person named herein is based upon 4,415,736 Shares outstanding, which is the total number of Shares outstanding as of November 30, 2015, as reported in the Issuer’s Annual Report to Stockholders on Form N-CSR, filed with the Securities and Exchange Commission on February 5, 2016.

WIHP

(a)

As of the close of business on July 19, 2016, WIHP beneficially owned 106,722 Shares.

Percentage: Approximately 2.4%

(b)

1. Sole power to vote or direct vote: 106,722

2. Shared power to vote or direct vote: 0

3. Sole power to dispose or direct the disposition: 106,722

4. Shared power to dispose or direct the disposition: 0

(c)

The transactions in the Shares by WIHP since the filing of Amendment No. 2 to the Schedule 13D are set forth in Schedule A and are incorporated herein by reference.

WITRP

(a)

As of the close of business on July 19, 2016, WITRP beneficially owned 89,268 Shares.

Percentage: Approximately 2.0%

(b)

1. Sole power to vote or direct vote: 89,268

2. Shared power to vote or direct vote: 0

3. Sole power to dispose or direct the disposition: 89,268

4. Shared power to dispose or direct the disposition: 0

(c)

The transactions in the Shares by WITRP since the filing of Amendment No. 2 to the Schedule 13D are set forth in Schedule A and are incorporated herein by reference.

WILLC

(a)

As of the close of business on July 19, 2016, WILLC directly owned 900 Shares. WILLC, as the general partner of WIHP and WITRP, may be deemed the beneficial owner of the (i) 106,722 Shares owned by WIHP and (ii) 89,268 Shares owned by WITRP.

Percentage: Approximately 4.5%

(b)

1. Sole power to vote or direct vote: 196,890

2. Shared power to vote or direct vote: 0

3. Sole power to dispose or direct the disposition: 196,890

4. Shared power to dispose or direct the disposition: 0

(c)

WILLC has not entered into any transactions in the Shares since the filing of Amendment No. 2 to the Schedule 13D. The transactions in the Shares by WIHP and WITRP since the filing of Amendment No. 2 to the Schedule 13D are set forth in Schedule A and are incorporated herein by reference.

D.	Mr. Lipson

(a)

Mr. Lipson, as the managing member of WILLC, may be deemed the beneficial owner of the (i) 900 Shares owned by WILLC, (ii) 106,722 Shares owned by WIHP and (iii) 89,268 Shares owned by WITRP.

Percentage: Approximately 4.5%

(b)

1. Sole power to vote or direct vote: 196,890

2. Shared power to vote or direct vote: 0

3. Sole power to dispose or direct the disposition: 196,890

4. Shared power to dispose or direct the disposition: 0

(c)

Mr. Lipson has not entered into any transactions in the Shares since the filing of Amendment No. 2 to the Schedule 13D. The transactions in the Shares by WIHP and WITRP since the filing of Amendment No. 2 to the Schedule 13D are set forth in Schedule A and are incorporated herein by reference.

BPIP

(a)

As of the close of business on July 19, 2016, BPIP beneficially owned 61,427 Shares.

Percentage: Approximately 1.4%

(b)

1. Sole power to vote or direct vote: 61,427

2. Shared power to vote or direct vote: 0

3. Sole power to dispose or direct the disposition: 61,427

4. Shared power to dispose or direct the disposition: 0

(c)

The transactions in the Shares by BPIP since the filing of Amendment No. 2 to the Schedule 13D are set forth in Schedule A and are incorporated herein by reference.

BPM

(a)

BPM, as the managing member of BPIP, may be deemed the beneficial owner of the 61,427 Shares owned by BPIP.

Percentage: Approximately 1.4%

(b)

1. Sole power to vote or direct vote: 61,427

2. Shared power to vote or direct vote: 0

3. Sole power to dispose or direct the disposition: 61,427

4. Shared power to dispose or direct the disposition: 0

(c)

BPM has not entered into any transactions in the Shares since the filing of Amendment No. 2 to the Schedule 13D. The transactions in the Shares by BPIP since the filing of Amendment No. 2 to the Schedule 13D are set forth in Schedule A and are incorporated herein by reference.

G.	Mr. Ferguson

(a)

Mr. Ferguson, as a managing member of BPM, may be deemed the beneficial owner of the 61,427 Shares owned by BPIP.

Percentage: Approximately 1.4%

(b)

1. Sole power to vote or direct vote: 61,427

2. Shared power to vote or direct vote: 0

3. Sole power to dispose or direct the disposition: 61,427

4. Shared power to dispose or direct the disposition: 0

(c)

Mr. Ferguson has not entered into any transactions in the Shares since the filing of Amendment No. 2 to the Schedule 13D. The transactions in the Shares by BPIP since the filing of Amendment No. 2 to the Schedule 13D are set forth in Schedule A and are incorporated herein by reference.

Mr. Chelo

(a)

As of the close of business on July 19, 2016, Mr. Chelo, did not beneficially own any Shares.

Percentage: 0%

(b)

1. Sole power to vote or direct vote: 0

2. Shared power to vote or direct vote: 0

3. Sole power to dispose or direct the disposition: 0

4. Shared power to dispose or direct the disposition: 0

(c)

Mr. Chelo has not entered into any transactions in the Shares since the filing of Amendment No. 2 to the Schedule 13D.

I.	Mr. Crouse

(a)

As of the close of business on July 19, 2016, Mr. Crouse, did not beneficially own any Shares.

Percentage: 0%

(b)

1. Sole power to vote or direct vote: 0

2. Shared power to vote or direct vote: 0

3. Sole power to dispose or direct the disposition: 0

4. Shared power to dispose or direct the disposition: 0

(c)

Mr. Crouse has not entered into any transactions in the Shares since the filing of Amendment No. 2 to the Schedule 13D.

The Reporting Persons, as members of a “group” for the purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, may be deemed the beneficial owner of the Shares directly owned by the other Reporting Persons. Each Reporting Person disclaims beneficial ownership of such Shares except to the extent of his or its pecuniary interest therein.

Item 7.

Material to be Filed as Exhibits.

Item 7 is hereby amended to add the following:

99.1

Press Release

SIGNATURES

After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: July 20, 2016	WESTERN INVESTMENT HEDGED PARTNERS L.P.

	By:	Western Investment LLC
		General Partner

	By:	/s/ Arthur D. Lipson
		Name:	Arthur D. Lipson
		Title:	Managing Member

WESTERN INVESTMENT TOTAL RETURN PARTNERS L.P.

By:	Western Investment LLC
	General Partner

By:	/s/ Arthur D. Lipson
	Name:	Arthur D. Lipson
	Title:	Managing Member

WESTERN INVESTMENT LLC

By:	/s/ Arthur D. Lipson
	Name:	Arthur D. Lipson
	Title:	Managing Member

	/s/ Arthur D. Lipson
	ARTHUR D. LIPSON, Individually and as attorney-in-fact for Matthew S. Crouse

BENCHMARK PLUS INSTITUTIONAL PARTNERS, L.L.C.

By:	Benchmark Plus Management, L.L.C.
	Managing Member

By:	/s/ Robert Ferguson
	Name:	Robert Ferguson
	Title:	Manager

BENCHMARK PLUS MANAGEMENT, L.L.C.

By:	/s/ Robert Ferguson
	Name:	Robert Ferguson
	Title:	Manager

	/s/ Robert Ferguson
	ROBERT FERGUSON, Individually and as attorney-in-fact for Neil R. Chelo

SCHEDULE A

Transactions in the Shares Since the Filing of Amendment No. 2 to the Schedule 13D

Date of Purchase/Sale	Shares of Common Stock Purchased/(Sold)	Price Per Share($)

WESTERN INVESTMENT HEDGED PARTNERS L.P.
7/14/2016	(14,000)	11.7730
7/15/2016	(3,100)	11.7758
7/18/2016	(3,900)	11.8008
7/19/2016	(600)	11.7929

WESTERN INVESTMENT TOTAL RETURN PARTNERS L.P.
7/14/2016	(11,700)	11.7730
7/15/2016	(2,600)	11.7758
7/18/2016	(3,200)	11.8008
7/19/2016	(500)	11.7929

BENCHMARK PLUS INSTITUTIONAL PARTNERS, L.L.C.
7/14/2016	(8,132)	11.7718
7/15/2016	(1,766)	11.7702
7/18/2016	(2,200)	11.7963
7/19/2016	(263)	11.7549