Eric O'Day, et al., Individually and on Behalf of the SunEdison, Inc. Retirement Savings Plan v. Ahmad Chatila, et al.

In Fifth Third Bancorp v. Dudenhoeffer, this Court unanimously held that the question whether a plaintiff had plausibly alleged a claim under the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq., for breach of the fiduciary duty of prudence had to be answered by conducting a “careful, context-sensitive scrutiny of a complaint’s allegations” because the content of the duty of prudence “turns on ‘the circumstances . . . prevailing’ at the time the fiduciary acts.” 573 U.S. 409, 425 (2014) (alteration in original) (quoting 29 U.S.C. § 1104(a)(1)(B)). In the decision below, the court of appeals discarded the core lesson of Dudenhoeffer and imposed a categorical heightened pleading standard on ERISA plaintiffs alleging a breach of the duty of prudence based on the fiduciary’s decision to hold an unduly risky asset despite publicly available information and inside information evincing the asset’s imprudence. The question presented is: Whether Dudenhoeffer’s “context-sensitive scrutiny of a complaint’s allegations” can be met where a court presumes an asset must be prudent if it is publicly traded and presumes that a reasonably prudent fiduciary would never conclude that it “would not do more harm than good” to freeze purchases of a company’s assets based on inside information.