McCaffree Fin. Corp. v. Principal Life Ins. Co., No. 15-1007 (8th Cir. 2016)
Annotate this CaseMcCaffree brought a class action suit on behalf of participating employees against Principal, the company with whom McCaffree had contracted to provide a retirement plan’s investment options, alleging that Principal had charged McCaffree’s employees excessive fees in breach of a fiduciary duty Principal owed to plan participants under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. The court affirmed the district court's grant of Principal's motion to dismiss for failure to state a claim because McCaffree failed to demonstrate a valid claim under ERISA. In this case, McCaffree's first argument fails because Principal owed no duty to plan participants during its arms-length negotiations with McCaffree, and the remaining four arguments fail because McCaffree did not plead a connection between any fiduciary duty Principal may have owed and the excessive fees Principal allegedly charged.
Court Description: Gruender, Author, with Riley, Chief Judge, and Bye, Circuit Judge] Civil case - ERISA. In action alleging defendant had charged plaintiff's employees excessive fees for managing the employees' retirement plans in violation of the defendant's fiduciary duties of loyalty and prudence under sections 404(1)(1)(A) and (B) of ERISA, the district court did not err in dismissing the complaint after determining that defendant's enforcement of its contract with plaintiff did not implicate any fiduciary duties; further, plaintiff failed to establish a connection between its excessive fee allegations and any post-contractual duty defendant may have owed the plan participants.
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