United States District Court, M.D. North Carolina
MEMORANDUM OPINION AND ORDER
Catherine C. Eagles, District Judge.
ERISA action, the plaintiffs contend that the defendants
breached their fiduciary duties to the plan by failing to
investigate and include low-cost recordkeeping services and
funds with reasonable fees and by including imprudent
investment funds. They seek certification of a class made up
of current and former participants of the plan. Because the
plaintiffs have established Article III standing and meet the
class certification standards set forth in Rule 23(a) and
Rule 23(b)(1), the Court will grant the motion for class
Employee Retirement Income Security Act imposes fiduciary
duties “on those responsible for the administration of
employee benefit plans and the investment and disposal of
plan assets.” Tatum v. RJR Pension Inv. Comm.,
761 F.3d 346, 355 (4th Cir. 2014). A fiduciary who breaches
ERISA-imposed duties is personally liable for any losses to
the plan resulting from the breach. 29 U.S.C. § 1109(a).
ERISA authorizes any plan participant to bring an action on
behalf of the plan for a breach of fiduciary duty, including
the right to seek associated monetary and injunctive relief.
29 U.S.C. §§ 1109(a), 1132(a)(2).
plaintiffs are participants and beneficiaries in the Duke
Faculty and Staff Retirement Plan. Doc. 72 at ¶¶
13-17; Docs. 70-2, -3, -4, -5, -6. The defendants are Duke
University, the Duke Investment Advisory Committee, and
individuals members of the advisory committee.
plaintiffs assert that the defendants breached their
fiduciary duties to the Plan by failing to monitor and
control the Plan's recordkeeping services, allowing the
Plan to engage in related prohibited transactions with its
record keepers, failing to prudently monitor the Plan fund
options resulting in the inclusion of funds with overly high
expenses and fees and of two allegedly imprudent funds, and
violating the Plan's Investment Policy Statement by
including and retaining the CREF Stock Account fund in the
Plan. See Doc. 72 at ¶¶ 229-63. The
plaintiffs allege that the defendants' breach resulted in
higher Plan recordkeeping costs and the inclusion of lower
performing, higher fee funds as compared to available
alternative investments, all of which reduced the value of
Plan's investments. Id. The plaintiffs seek
equitable and injunctive relief, including that the
■ “make good to the Plan all losses to the Plan
resulting from each breach of fiduciary duty, ”
■ “[r]eform the plan to offer only prudent
■ “obtain bids for recordkeeping and . . . pay
only reasonable recordkeeping expenses, ” and
■ “[r]emove the fiduciaries who have breached
their fiduciary duties and enjoin them from future ERISA
Doc. 72 at ¶ 263.
plaintiffs now move to certify the following class of
plaintiffs under Federal Rule of Civil Procedure 23:
All participants and beneficiaries of the Duke Faculty and
Staff Retirement Plan from August 10, 2010 through the date
of judgment, excluding Defendants.
Doc. 69 at 1. They ask the Court to appoint them as class
representatives and to appoint Schlichter, Bogard &
Denton, LLP as class counsel under Federal Rule of Civil
Procedure 23(g). Id.
class action is an exception to the usual rule that
litigation is conducted by and on behalf of the individual
named parties only.” Comcast Corp. v. Behrend,
569 U.S. 27, 33 (2013). To show that a case falls within the
exception, the plaintiff “must affirmatively
demonstrate his compliance” with Federal Rule of Civil
Procedure 23. Wal-Mart Stores, Inc. v. Dukes, 564
U.S. 338, 350 (2011); see also Thorn v. Jefferson-Pilot
Life Ins. Co., 445 F.3d 311, 318 (4th Cir. 2006)
(“[D]istrict courts must conduct a rigorous analysis to
ensure compliance with Rule 23.”).
threshold matters, the putative class representatives must
show that they are members of the proposed class,
see Fed. R. Civ. P. 23(a) (“One or more
members of a class may sue or be sued as representative
parties on behalf of all members”), and must establish
that the members of the proposed class are “readily
identifiable” or “ascertainab[le].” EQT
Prod. Co. v. Adair, 764 F.3d 347, 358 (4th Cir. 2014).
The plaintiff must then establish that the case satisfies all
four requirements of Rule 23(a) and fits into at least one of
the three subsections of Rule 23(b). Comcast, 569
U.S. at 33-34. As in all litigation, the plaintiffs must have
constitutional standing. Spokeo, Inc. v. Robins, 136
S.Ct. 1540, 1547 n.6 (2016).
the issues in dispute are whether the named plaintiffs have
Article III standing; whether the claims of the named
plaintiffs are common and typical; whether the named
plaintiffs will adequately protect the interests of the
class; and whether the class can be certified under Rule
23(b)(1). Doc. 74 at 14-15, 19, 22, 26-27, 29.
plaintiffs' proposed class includes at least 40, 000
individuals. Doc. 70-1 at 2; Doc. 35-10 at 3; Doc. 51 ¶
12. This “is so numerous that joinder of all members is
impracticable.” Fed.R.Civ.P. 23(a)(1); see Cent.
Wesleyan Coll. v. W.R. Grace & Co., 6 F.3d 177, 183
(4th Cir. 1993) (noting district court's finding
“that some 480 potential class members would easily
satisfy the numerosity requirement”).
proposed class members can be easily identified in
participant account records possessed by the defendants or
the Plan's recordkeepers. See, e.g., Doc. 70-1;
Doc. 35-10 (providing example of detailed recordkeeping). The
class members are ascertainable.
is no dispute that Schlichter, Bogard & Denton, LLP has
extensive experience in ERISA class action lawsuits, has
invested time in investigating and identifying potential
claims in the action, and will commit resources to
representing the class. See Fed. R. Civ. P.
23(g)(1), (2); Doc. 70-7. The Court finds that Schlichter,
Bogard & Denton, LLP will fairly and adequately represent
the interests of the class. Fed.R.Civ.P. 23(g)(2), (4).
order to have standing to sue under Article III of the United
States Constitution, a plaintiff must establish three
elements: (1) that the plaintiff has sustained an injury in
fact that is concrete and particularized; (2) that the injury
is traceable to the defendants' actions; and (3) that a
favorable judicial decision is likely to redress the injury.
Spokeo, 136 S.Ct. at 1547; Friends of the Earth,
Inc. v. Gaston Copper Recycling Corp., 629 F.3d 387, 396
(4th Cir. 2011). “[N]amed plaintiffs who represent a
class must allege and show that they personally have been
injured, not that injury has been suffered by other,
unidentified members of the class to which they belong and
which they purport to represent.” Simon v. E. Ky.
Welfare Rights Org., 426 U.S. 26, 40 n. 20 (1976);
accord Doe v. Obama, 631 F.3d 157, 160 (4th Cir.
2011). There must be a named plaintiff with ...