Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_04-cv-01358/USCOURTS-caed-2_04-cv-01358-21/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 29:1145 E.R.I.S.A.

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

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JAMES P. DeFAZIO, et al.,

NO. CIV. S-04-1358 WBS GGH

NO. CIV. S-05-0559 WBS GGH

Plaintiffs, NO. CIV. S-05-1726 WBS GGH

CONSOLIDATED 

v. ORDER RE:REMOVAL OF PLAN

TRUSTEES

HOLLISTER, INC.; et al.,

Defendants.

 ----oo0oo----

At the hearing on June 25, 2007, the parties agreed

that plaintiffs’ motion for partial summary judgment would be

denied without prejudice to its being renewed after resolution of

defendants’ motion to dismiss the third amended complaint. 

However, plaintiffs’ attorneys asked the court to consider their

motion for removal of HolliShare’s trustees.

At common law, a court was empowered to remove a

trustee when it found that continuation as a trustee would harm

Case 2:04-cv-01358-WBS-GGH Document 222 Filed 06/28/07 Page 1 of 2
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the beneficiary’s interests. Donovan v. Mazzola, 716 F.2d 1226,

1238 (9th Cir. 1983). “Under the broad remedial provision of

ERISA courts have also found removal of fiduciaries to be an

appropriate remedy upon findings of imprudence, divided

loyalties, and prohibited transactions.” Id. (citing Freund v.

Marshall & Ilsley Bank, 485 F. Supp. 629 (W.D. Wis. 1979);

Marshall v. Kelly, 465 F. Supp. 341 (W.D. Okla. 1978)). 

Plaintiffs request that the court remove HolliShare’s trustees. 

Plaintiffs argue that “where trustees commit numerous

ERISA violations, the district may (in its discretion) remove

those individuals from their position as trustees of the plan.” 

However, because plaintiffs’ summary judgment motions are no

longer before the court, there is nothing upon which the court

could base any finding of ERISA violations, much less imprudence,

divided loyalties, prohibited transaction, or any other basis for

removing the trustees. Ordering the removal of trustees is

something that the court would only do in extraordinary

circumstances after it was fully informed. 

IT IS THEREFORE ORDERED that plaintiffs’ motion to

remove HolliShare’s trustees be, and the same hereby is, DENIED. 

DATED: June 28, 2007

 

Case 2:04-cv-01358-WBS-GGH Document 222 Filed 06/28/07 Page 2 of 2