In the wake of Fifth Third v. Dudenhoeffer, a complaint that seeks to hold an ERISA fiduciary liable for failing to divest a plan of employer stock based solely upon publicly available information fails to state a plausible claim. An “independent” fiduciary – by the very nature of his outside status – only has access to public information. For this reason, claims that an independent fiduciary breached his ERISA fiduciary duties in connection with publicly traded company stock necessarily fail post-Dudenhoeffer. In this article, recently published in the Summer 2015 Edition of the Benefits Law Journal, Emily Costin discusses why there is no duty to “disclose” non-public information to independent fiduciaries and how imposing such a disclosure obligation upon appointing fiduciaries would violate the securities laws or the “objectives” of those laws, in direct contravention of the Supreme Court’s reasoning in Dudenhoeffer.
To read the article, click here.