defined contribution plan which is an individual account plan this wendell's claim is an individual claim she has standing to sue only to the extent that she invested  the next day the correct after the announcement right she is claiming that the value of her individual account did fall and on that basis she would present a claim of statutory standing i argument however that she waived her standing to recover for herself for her loss by reason of the general release and covenant not the letter but but it looks like my point is more basic if the secretary of labor can bring this why can't an individual who's a participant in the plan bring in individual who is a participant in the plan can bring a claim for any injury to his or her  there are no planned claims in a defined contribution context distinct from individual claims so for a participant to bring a five or to a to claim for fiduciary breach that participate must have standing that participant must have invested in the fund she must have incurred some kind of loss to her account and she must otherwise not be disable from prosecuting the claim she may be able to prosecute says exactly the opposite says we therefore hold that although five zero two eight two does not provide a remedy for individual injuries distinct from planning injuries that provision does authorize recovery for usually breaches that impair the value of plant assets in a participant individual account and it is a plan point respectfully your honor i believe what lou is getting at with that formulation is to distinguish  contribution case from the defined benefit case was which was that issue in russell because in russell the participants ought to recover for damages outside of the value of the current our current like russell russell was  she had that belief she had occurred in her account where i had to find out just just as just to pick up on what but the majority said you've got justice thomas and the question presented here then is provides for recovery for losses to the plan in graden this certain individuals can bring it individuals can bring it if they otherwise have standing in the plan by reason of an investment that incurred a loss in their individual account put differently mis wendel cannot bring a fiver to a to action on behalf of any other participant she has no legal interest under the roof in the account of any other participant now you can only  decided under eleven ten that the releases were invalid that's correct your honor and that's an error of law with respect to judge hate and all but one other court in the country has held that section four ten does not apply to individual of contract that immunizes all fiduciary is from all future claims but that's not what the release of an individual dispute does and that's why i said a release of an individual dispute it's not she's bringing it on behalf of the plan that again under the structure of a defined contribution plan miss wendel standing is only as to her own account and we think this is consistent with the court's decision in great inverses connection where the court made clear that the loss in a defined contribution context is to the participant sure recovery may pass through the plan is what the court said in great inverse of connection but it must go in a defined contribution plan context back to the account participant in the form of augmented benefits it is it is a traceable claim that just passes through the plan into the individual accounts it's not just for it's in effect many others she seeks to represent many others others who also have to have invested in the stock fund and also have had to experience the loss in their account they didn't invest in the field isn't the sort of the classic claim only that the advisory notes in the supreme court has said fits within the type of case you would want under twenty rule twenty three b your honor there decision it's based on the plain language of section four but worse that is unisys applicable any longer absolutely unisys controls in this case your honor because you've got the secretary of labor taking a different view yes i'm not  good the whole point of for or for c for purposes of the class issue has to do with whether the four foresee inquiry is an individual ised inquiry or is across the board and here all the people who were involved here did exercise control and chose this fund so it's a plan it's a it's a common issue it's not an individual ised issue we don't need to decide whether four foresee applies as such even if so and in fact the complaint things paragraph one ninety c applies and therefore the question becomes and this is clear under unisys this is clear under the own regulations whether or not each participant sloss was the result of his or her control you're not hearing every the four foresee issue here is not an individual eyes issue because everybody did exercise control and pick this fun for class certification purposes that's all we need to know the four or four cs not going to require individual eyes issue everyone did pick the fund if they're a member of the class but that's not the only component for force iran it is also the requirement for the few shiri protection to apply that the loss resulted from that selection process but if you get there if you get there the issue that we have to force recruiting relating to the class you've got an interpretation pretty clear interpretation by the d o l that that  defense does not apply to the initial picking of the types of investments that will be listed in the array that are available to employees the fifth circuit in long back or correctly apply this or got  different sort of law back when you have a for certain people each and and i'm not sure what's going on the seventh circuit and hacker but the it looks like they may be backing off a tad but the point here is that you've got what deference do we owe if we get to this register just not in the c f r right correct it is not entitled to full chevron deference both the fifth and the seventh circuit have made that point out and we did somewhat the same thing in college you go right but sit still gets skidmore deference at the very least doesn't it  whether or not it gets good more deference or simply respect under any different standards or position that the interpretation advance but idea well is an impermissible cut back on the statute itself on the plain language of the statute which has no limitation on the common language of the statute says as determined by the secretary of labor actually the congress authorizes secretary labor only expressly in the statute to develop regulations determined under regulations of the secretary with that couldn't be any more clear but this is not the footnote you clearly have a plausible or don't get me wrong but it looks like the secretary of labor has decided or seventeen years ago the other w how this issue impacts the certification the for foresee yes for foresee because it requires under every circuit court case including unisys as well as the department of labor's own regulation individualized determinations of participant control not only and and and causation therefore the evidence relating to those invite individualized inquiries is going to change from one participant to the next and the decision therefore for c applies to miss wendell let's say which we think it does by the way does not preclude the claim of any other participant and evidence will have to be a deuce as to each participant as to whether their decision then that is the answer to your causation question not know you're on a four or four see if they defense to liability for breaches that are otherwise for which the made this point that fiduciary liability would otherwise exist but for a for a for see defense in cases where for a force the applies and that's know what the class is made up of how do we decide whether she's typical or adequate do we know how many people are there are out there with releases or without releases how big is the class we don't know but we know she's not a typical rep is the only representative and she's sixty she has waived her right to maintain this suit in if she can't maintain the suit under general rule twenty three law she can't represent anybody else but if everyone else has a release also their record although not clear does not suggest that e release this was a one off terminations of miss wendell she was not part of a reduction in force this release that specific to her it disables her from representing a class at a minimum at a minimum it is a unique renders her unsuitable to represent a class under this court's decision and back versus maximus because it's going to become the major focus of any future litigation what happened with the other two plaintiffs they your opposing counsel but with miss wendell it would seem that this is hardly the paradigm for what you want as a good class representative knight the as we say in the you say in the deal world  lot of hair on that i mean can you find someone else there are unquestionably some issues your honor we think that miss wendell is a typical inadequate representative and think that the district court appropriately certified the class what do we know of the class in order for it to be typical and adequate we've got to know who else is in there there was no evidence put forth before the district court your honor on the class certification with respect to the release issue as to whether or not miss wendell is or is not  a typical in that fact that we need that i mean in milonga the district of columbia decided that you can't have someone who has not given a release be an adequate or typical class representative of persons who have given a release so how can someone who has given a release be typical and adequate and you're going to be after blasts we don't know i mean don't we need more under a devil and hydrogen peroxide don't we need more people in the class did not have releases agree with mr vos it that this does appear to be a one off release and not a broader release that was given to all classes and so there we have one person who has signed a release and also coming up to sue and she has come into court because i think we believe we believe to be hand in hand your honor in many ways as we asserted in the district court for the record i will attend to fight was it our ninety seven it pages four and five while we have never contested the validity or the enforceability of the release we do contest the scope of the release as we argued in the district court the release itself does not cover a receipt claims where is that in your brief to us it is not in the principle brief your honor it was raised before the district court and she's the only one with a release she's not going to be typical because there are some things that are going to drag her down that don't relate to the rest of the class well you know we think that the just record appropriately recognize that the release will play no role in this case in light of the fact that this is  by reference the report recommendation of magistrate judge fault which became the opinion of the court and judge fall in the report recommendation didn't fact rely upon the representative nature of a five zero two eight to claim as the basis for finding that the release w upheld the covenant not to sue your honor suffers from the same infirmity as the release or if you will the same distinguishing feature of the release that is that the covenant not to sue does not address the representative nature of a five zero two eight to claim it doesn't accept that out i'd say she can't file and she filed i thought we was there as i won't file anything in connection with any aspect of my employment or terminations and this really wasn't her certainly wasn't take a look at the at the actual release and the separation agreement which is in the record at appendix three twenty nine through three thirty one it's a four page document which consists of an initial cover page and then three pages of the separation agreement the very first page of a separation agreement which just page three thirty of the appendix states that as a result of your terminations employment you will receive and then three all other payments and benefits to which you are entitled under the company's benefit plans this is the contemporaneous document that is part of the release and the covenant not to sue and the evidence is the parties understanding that notwithstanding the broad language of both the covenant not to sue and the release that benefit claims or any claim for payment or benefits to which you would be entitled under the company's benefit plans which this clearly is would not be covered by the release or women you're arguing here that the victim was is the plan correct correct ah so you need someone to bring a derivative claim on behalf of the plan and you go out and get the only person you got is one who says oh by the way i release everything i have against the company relating to my employment or termination which just creates a huge issue right away as to whether she's out and a second issue as to whether she's typical of those others who may be benefited by a derivative suit  reason that i am mixing the two is i think that that it's a standard that you start with the the arista standards and then you go to the rule twenty three and here because it is a derivative action because miss wendell is representing the plan as the hole in the plan is the real party in interest  that's for commonality that's for comedy but it also affects typicality rahner because in light of the derivative nature of the claim the release and the covenant not to sue that she gave in her individual capacity are not relevant but she has to be a typical an adequate class representative and if she if her release is that how valid she maybe she can maintain the case but if her release is valid and if it means that if any monies are obtained by the plan she can get nothing then question is she an adequate representative because of her i mean what if this is a settlement and they want to pay ten cents on the dollar and it's been held that she should get nothing from that but what's her incentive to hold  sixty percent fifty cents on the dollar what your honor it doesn't need to be a showing is typical and adequate yes sure but we believe we believe that in light of the the parties and by parties i mean this wendell and sharing plough in light of their clear and unambiguous understanding that the even if you assume the enforceability of the release even if you assume that the release would be in force and would apply to these actions that the release does not preclude miss wendell acting as a class representative in light of the literally dozens of cases that we cited from district courts both around the country that have said this is a representative nature case this is the five zero two eight two derivative claim any release that you gave in your individual capacity is irrelevant for these purposes aren't so you're saying really for the first time that all this stuff have you the release is totally beside the point because the release specifically allows her to pursue benefits i think argument your honor is is basically three fold one the release itself does appendix say that as a result of your terminations you are entitled to all other payments and benefits to which you would be entitled under the company has benefit plans that you first that's huge the second step your honor is that under the terms of the release itself is releasing only those claims that had accrued as of the date that she signed the document she signed the document in august of two thousand and there's what another seven months the compile your honor the complaint alleges breaches that took place in late two thousand two thousand and one two thousand and two two thousand and three in two thousand and four and as a matter of fact the complaint alleges that the truth about suring plough and its stock didn't even start emerging until two thousand and one so even if the release somehow covered miss wendell's individual right to pursue this action or to pursue or to receive benefits from this action that would not cover any post august two thousand claims which would affect or adequacy or to pick out of the third argument that we make and that we spend the majority of our brief on in retrospect wrong decision issue if she's pursuing sitting on behalf of the plan common issue is the plan and she can she can be the person but it doesn't really it isn't that probative of her typicality and adequacy  doesn't this case have to go back and have a more rigorous understanding alla hydrogen peroxide i mean i you know i i's in burgas you know when in doubt sort of by the class only evidence with three other the only argument other than a deposition testimony which i can get to if the court would like but the only evidence an argument other than the deposition testimony is the release we believe that the district court appropriately discarded the release saying that's not relevant to this kind of a  thousand and the stock dropped came in february of two thousand and one and it's or book law that releases only exist as of the date you really see everything up to the date of the release then then it but when you when you say that even if you say yes to my what i just said to you everything you keep saying after that keeps going back to is but she was filing a derivative claim which is what you breached and then you come to the next point which is how do we know in comparison to anyone else that she is typical of those other people and i suppose the answer to that you might give but i'm not sure it works is that it's everyone who was of the relief provisions sent us and allocate to the plan allocate to the individuals well if she isn't going to be able to get any of that allocation then she's a little different when i've been there ninety nine of the class members and they all are going to be able to get something and she because of the release is not going to be able to get something she's a little different i think his argument is that she will get something because her release predated the stock that is your honor and so we believe that if miss wend release were effective if it were valid and if it would preclude her ability to receive any benefit in the event that this case went to trial or otherwise resolved i would not be standing here but it is our belief that the release one is does not cover these claims to predated the events in the complaint and three don't even come into this kind of a case in light of the representative nature of five events of the breaches of duty not necessarily stock drop that resulted from it that's correct and the of the br duty here you know could happen before two thousand well you know there's an under a risk that there's an ongoing duty to monitor the the prudence of all investment options including the company's stock fund and that duty would have continued well beyond the date of the rel morning may please the court my name is elizabeth hopkins and i'm here on behalf of the secretary of labor as i make a security i in support of the plaintiffs appellants what is your view as to whether four zero four b trepidation given to that for several minutes over a decade and a half by the secretary of labor is that even relevant in the context of talking about sort of filing a class action which is what's on appeal here i think you could probably decide this case without getting to that issue of the four foresee regulation and the deference to the secretary's interpretation in that regulation because as i understand that i mean there can be of course individualized determinations under four or four c but as i understand that what's being alleged here are really you know class wide breaches and what's being alleged with regard to four or four c is that you know because of the alleged information that was not given t participants that for a foresee this really isn't a forum for c plan and under the regulation even assuming that for foresee could apply to the selection and maintenance of an investment option under the plan so i think it it  would be possible for you to decide without getting to the four foresee interpretation by the secretary of labor but although you might say that causation standpoint if let's say twenty percent of these individuals did know the same information that the investment committees and the others did know then the their loss would have resulted not from the breach of duty by these individuals but by their own choice that notwithstanding all these horrible things that were happening and no drugs in the pipe mine and all these other things they chose so i mean there is a possibility and i think there's a possibility but as i understand it though the way this case was plaid and what's being alleged here is that the imprudence was that plan fiduciary silat out the sharing stock to be maintained during this period when they and only they had reason to know that the that the price of the stock that that stock was overpriced and that none of the participants could have known this bet their investors on the market couldn't have known this information and that is true i think they should allow it to be chosen i mean when d herself says well gee if they're allowing me to have fifty percent of my money in it then they must think it's it's ok and they were that decision by the investment committee and the powers that be to to permit it to be in the mix might just take it out of individualizing yes i think it takes it out of the individual eyes inquiry and i think it's interesting that you bring that up because i think that really goes to why the secretary's interpretation of for a four c or one of the reasons why the secretar her petition of more horsy is correct because you know in the context of employer stock of an employee stock claim and especially in the context of a of a claim where the claim is that the fifth you sherry's knew something that the participants could not possibly have no you know it's very it really makes sense to say those losses you know were caused by we're only within the control of the of the fiduciary so we're not within in the control of the plan participants and that's exactly what the secretary is for foresee regulation does and with respect to this argument that that this is only enough footnote in in the preamble to the regulation  the preamble it's in the text of the preamble and i would say it's just an explanation of one particular application of this pretty limiting language that's in the text of the regulation itself which says that you know it has to be independent control over the assets and that has the loss has to be due to has to be the direct and necessary result of the participant or beneficiaries exercise of control on the question of deference and the deference that stu to this whether you look at this as you know this preamble as part of the regulation or not because it was it was part of the notice and comment rule making it was in the notice proposed rule making it was in the final regulation and i think those supported in cases from the supreme court like yellow transportation and versus michigan for giving chevron deference to this kind of explanatory  statement in the preamble to a regulation but even if one says well because it's not published in the code of federal rate regulations that it's not technically part of the regulation at a minimum it's the secretar interpretation of that regulation which under cases like long island care or cisco hour which you know is really probably the seminal case on this is entitle to the same level of deference it may not be called chevron deference but it's entitle to controlling weight deference as an interpretation of my way by with the broad our deference apply here in our of the interpretation was in a brief by the secretary of labor but so long as it's an interpretation of the secretar regulation it's entitle to the highest level controlling weight deference along as it's reasonable and but what it why don't we why don't we just do here what we did in the college eco case which is when you have something in a preamble what you did here yes you know the way you could've gone the way you did yes i think not just plausible not just permissible but really the best reading of the statute for for three reasons at least first arista really places very stringent arrests the statute only exempts producers from liability where their duty when their powers have been properly delegated to an exercised by another party you know as the supreme court put it very well in martin's what it riseth does this allocates liability for plan related misdeeds in reasonable proportion to the respective actors powers to control and prevent the misty it's and here i don't think anyone is arguing or could possibly argue that only the for their share is not plan participants had the power to designate the investment alternatives and third as i as i sort of started out with for i foresee the application of it here would be particularly unfair because this was a basic act of plan management it would leave the fiduciaries to suffer the consequences in the context of a case where the allegation is only or the plan participants to suffer the consequences where only the play and traditions are alleged to have had the adequate information so one can hardly say that they made this independent choice when they didn't know what they were choosing so to speak and that is you know that is the heart of this case an do influence that could be exerted by employers in this context now the secretary didn't take employer stock funds off the table altogether but what the secretary did take off the table was the the selection of maintenance of any kind of investment option including employer stock ok i see my time is up thank you thank you honor for you begin your rebuttal could we ask counsel to address the class period whether that case needs to go back because of that period identified and then we'll let you have your rebuttal when his position on that before we have yours i mentioned  forgot to follow because that that was not the court took the view that it really didn't have to look at that because there hadn't been discovery so the identification of the class is very broad to the  that we filed this case to begin with which of course was issued long before the harajuku of the hydrogen peroxide decision that it was appropriate for both the magistrate in the district court to temporarily certify an open ended class period both opinions recognize that this would not be the case in the future but given the fact that the plaintiffs do not have a merits based discovery at this point and the test is when the stock became prudent again if ever we've basically created an impossible situation in say should be the i mean you don't want to affirm that it's up to the president that doesn't make any sense if the stock drop was in february of two thousand and one at some point there have to be other intervening events that's going to cause this class period to stop i mean that's that's the rigor that's what what's what happens in every case you're on a week i don't know the class period we expect will not certainly not extend to the present at the time of trial the problem is is that we don't have the merits based discovery with respect to the zero one date will say that the date that the defendants have put forth the district court rejected as based on in a political securities law principles number one which the defendants have not greece before this court and number two the complaint itself actually does allege acts which would form the predicate of bridges a fiduciary duty through two thousand and four so there was in fact a drop in a one but there were additional drops that happened after a one where the stock dropped from a high of six zero dollars we don't know if the doctor dropped allegedly in result to the clarinex matter or not you could excuse me or we don't know what later fiduciary duty based on both the clarinex and then this illegal kickback scheme by which i guess in response to which shearing i believe i don't have the doctrines of firmly but i believe paid three or four hundred million in fines to the federal government in light of the kick backs which again was information that was kept from the plan participants so and you're saying that this a limited amount of coverage or some agreement could not define we did not get those documents we attempted to open the merits based discovery we did not and so in light of that situation which again predated hydrogen peroxide we believe that it was appropriate for the district court to certify an open ended class period with the understanding that we would be coming back and judge fox report recommendation which again was incorporated into the opinion of the court that he suggests that there will in fact be subject to future modification and the basis of that was the fact that there had merits based discovery had not yet commenced all right thank you thank you thank you the general release and covenant not to sue can be found in a three three one of the records what about the what about the argument that release can only exist as of the date it is given and releases all claims prior to that date it cannot release any future claims that accrue after the date of the release your out of the release applies to claims that accrued as of the date of its signature correct and any continuing effects of those claims going forward and we cited in our brief several cases for that proposition regarding the foreclosure of continuing effect the prior that doesn't it's your releasing claims that you have relating to your employment and terminations as of the date of the release if a cause of action accrues after the date of the release you're not releasing that but that's form of law if it's a new course of action it's not covered by the release but it is covered by the covenant not to sue in this court has held that those covenants have separate legal significance and they foreclose future claims that's the difference between a covenant not to sue and a really you have a covenant not to sue with respect to any causes of action that exist as of od claims that have accrued or will accrue and that's i believe what the language in metron it says that doesn't make sense if i say i'm not going to sue you with regard to actions that you and i had in the past then everything that we've done in the past may fit in but if you then do something to me tomorrow my covenant not to sue cannot apply to well i think it would be helpful to look at miss wendell's covenant she says i will not file a lawsuit against the company which is  include the individual's officers and employees as well in connection with any aspect of my employment or terminations the employment aspect is what is relevant here because employee benefits under ressa relate to her employment benefits there's no such exclusion that's why i wanted to make sure the court had in the record three three one release language it would be able to determine for itself the releases any and all claims there is no exception for benefits where we are what's the reference to benefits that me also ask you back to i'm trying to figure out what i call a cart and horse problem which is if the cart or if the horse is rule twenty three and does  class action your point about for zero four c was that as i understood it but there can't be because i have a defense that as a matter of law should preclude this action from the get go is that correct no it doesn't preclude the action it requires individualized determinations that in this case anyway preclude certification ok because it is a defense to liability in this court in the u p s view whole hide case of just a couple months ago made clear that for purposes of certification it's necessary to look at the entire liability framework you cannot simply deconstruct the statute under which liability is being asserted and find that one  st suitable goodness but the complaint here specifically attacks the defendants making this investment available and keeping it available and that's alleged as cause the direct and necessary cause so the fact that somebody chose later is is beside the point is after the fact literally and figuratively the purpose of says is as a result and later they're claiming and then when you're claiming that the problem here was that you made this available if i may give you shouldn't have kept it available because it was a option to give to people and just shouldn't have been there if i may give one example to illustrate our position as the court noted the stock dropped twenty five percent after the february fifteenth two thousand and one that next day every participant had the decision to make do i buy more stock fund do i sell my stock fund do i hold my stock fund and we submit that any losses that would have accrued after that date would be the result of the decisions that participants made then in there as to what to do with her for what they're saying in january of zero one you knew all the bad stuff and you should have said everybody yet out of this we're no longer making it available and this is why the court makes clear that district courts cannot rely on allegations for purposes of certification it's got to delve behind the pleadings because in fact the underlying allegations relate to manufacturing problems they were widely known were talking about employees who worked at shearing plough not third party investors they were there many of them were involved in fixing the problem so you three thirty one actually has a page two if you look on the very top of it the release is page two of a three page agreement called separation agreement rate the language that i was referring to is on page three thirty which is the immediately prior page  says please review and read the following notice in general least very carefully so it's a three page document is that where the benefit correct on this is on three thirty it's on page three thirty and the separation agreement itself is three thirty three thirty two and then in the record there is an initial cover page