Breach of Fiduciary Duty, Preemption and Liberal Pleading Rules

I obtained dismissal of a breach of fiduciary duty claim, as well as state law claims, against my clients in an opinion filed on Friday. While long time readers know that I won’t comment substantively on rulings involving my clients, the opinion is worth a read on at least two substantive points involving breach of fiduciary duty claims. The first is the requirement of discretion on the part of a defendant for the defendant to become a fiduciary by means of administrative actions relating to an ERISA-governed plan; the second is the question of whether state law claims relating to an ERISA-governed plan are preempted when brought against a party that is not a fiduciary.

Separately, though, because this part of the opinion does not concern my clients, I can comment on a part of the opinion that will be very interesting to anyone who, like me, is a federal procedure geek. The Court engages in a sustained analysis of Federal Rule of Civil Procedure 15(a) and the right to amend as a matter of course, and how it applies in a circumstance where the original complaint, which the plaintiff seeks to amend, was in fact never served. The Court found the right to amend to still exist, regardless of the failure to serve the original complaint. The Court found that the modern rules reject hyper-technicalities when it comes to pleading, and that the rules therefore cannot bar an amended complaint simply because the original complaint was not first served. Interestingly, though, the Court recognized what is in essence a good faith requirement for a plaintiff to be allowed to avoid a bar that might otherwise be created by a perfectly literal reading of the federal rules, noting that its conclusion might be different if it were shown that the plaintiff were taking advantage of the liberality of the pleading rules for purposes of gaming, undermining or otherwise seeking to thwart the inherent purposes of the rules. Fun stuff, I think anyway.