McCaffree Fin. Corp. v. Principal Life Ins. Co.

McCaffree 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. View "McCaffree Fin. Corp. v. Principal Life Ins. Co." on Justia Law