Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca2-23-01108/USCOURTS-ca2-23-01108-0/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 

---

1 

23-1108

Singh v. Deloitte LLP

UNITED STATES COURT OF APPEALS 

FOR THE SECOND CIRCUIT

August Term 2023 

(Argued: May 24, 2024 Decided: December 10, 2024) 

No. 23-1108 

–––––––––––––––––––––––––––––––––––– 

RUPINDER SINGH, individually and on behalf of all others similarly situated,

JEFFREY S. POPKIN, individually and on behalf of all others similarly situated, JONI 

WALKER, individually and on behalf of all others similarly situated, JENNY MARK, 

individually and on behalf of all others similarly situated, 

Plaintiffs-Appellants, 

-v.- 

DELOITTE LLP, THE BOARD OF DIRECTORS OF DELOITTE LLP, THE RETIREMENT PLAN 

COMMITTEE OF DELOITTE LLP, JOHN DOES 1-30, 

Defendants-Appellees. 

–––––––––––––––––––––––––––––––––––– 

Before: LIVINGSTON, Chief Judge, NARDINI, and ROBINSON, Circuit Judges. 

Participants in Deloitte LLP’s defined-contribution, 401(k) retirement plan 

brought a putative class action against plan fiduciaries, alleging breach of 

fiduciary duty in violation of the Employee Retirement Income Security Act 

(ERISA). The United States District Court for the Southern District of New York 

(Koeltl, J.) dismissed the action and subsequently denied Plaintiffs’ motion for 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page1 of 22
2 

leave to file an amended complaint on futility grounds. We conclude that the 

district court did not err in concluding that Plaintiffs failed plausibly to allege that 

the Plan’s administrative and recordkeeping fees were excessive and that

Defendants breached their duty of prudence by not obtaining lower fees. 

Accordingly, we AFFIRM the judgment of the district court.

Judge Robinson concurs in part, and concurs in the judgment, in a separate 

opinion.

FOR PLAINTIFFS-APPELLANTS: MARK K. GYANDOH, Capozzi Adler, P.C., 

Merion Station, PA.

FOR DEFENDANTS-APPELLEES: MICHAEL E. KENNEALLY (Jared R. Killeen, 

on the brief, Morgan, Lewis & Bockius 

LLP, Philadelphia, PA) Morgan, Lewis & 

Bockius LLP, Washington, DC. 

DEBRA ANN LIVINGSTON, Chief Judge: 

Plaintiffs Rupinder Singh, Jeffrey Popkin, Joni Walker, and Jenny Mark, 

individually and on behalf of a putative class (collectively, “Plaintiffs”), appeal 

from a judgment entered on July 5, 2023 by the United States District Court for the 

Southern District of New York (Koeltl, J.). The court denied Plaintiffs’ motion for 

leave to file an amended complaint and entered final judgment on the ground that 

further amendment of the complaint would be futile because Plaintiffs’ amended 

complaint, like the original, fails plausibly to allege that defendants Deloitte LLP 

(“Deloitte”), the Board of Directors of Deloitte LLP (the “Board”), and the 

Retirement Plan Committee of Deloitte LLP (the “Committee”) (collectively, 

“Defendants”) violated the Employment Retirement Income Security Act of 1974 

(“ERISA”), 29 U.S.C. 1001 et seq., by breaching their fiduciary duties in managing 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page2 of 22
3 

an employee retirement plan.1 In the underlying action, Plaintiffs, Deloitte 

employees during the putative class period, sued Defendants, fiduciaries of the 

Deloitte 401(k) Plan (the “Plan”), for allegedly violating their duty of prudence by 

failing adequately to manage the Plan’s recordkeeping and administrative fees, 

which resulted in the payment of excessive fees by Plan participants. Reviewing 

the proposed amended complaint de novo, we agree with the district court that 

Plaintiffs have failed to plead sufficient factual matter to support a plausible 

inference that Defendants breached their duty of prudence. Accordingly, we 

AFFIRM. 

BACKGROUND 

I. Factual Background2

Like many companies, Deloitte offered its employees the opportunity to 

participate in voluntarily-established retirement plans, including the 401(k) Plan 

at issue here, which is a “defined contribution plan” under ERISA § 3(34), 29 U.S.C. 

§ 1002(34), in which all regular full-time employees who are not principals, 

partners, or managing directors at Deloitte could participate.3 Under the Plan’s 

1 The district court’s July 5, 2023 decision followed its January 13, 2023 memorandum opinion and 

order, which granted Defendants’ motion to dismiss Plaintiffs’ original complaint but permitted Plaintiffs 

to move to file an amended complaint if they could explain how doing so would cure the defects warranting 

dismissal.

2 Unless otherwise noted, the factual background presented here is drawn from the First Amended 

Complaint (“FAC”).

3 Deloitte also offered another retirement plan, the Deloitte Profit Sharing Plan (“PSP Plan”), a 

defined-contribution, profit-sharing plan in which partners, principals, and managing directors could 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page3 of 22
4 

terms, participating employees could elect to contribute from one to sixty percent 

of their compensation to the Plan, up to the maximum contribution permitted 

pursuant to the Internal Revenue Code. Deloitte would make a matching 

contribution of twenty-five percent of the employee’s contribution, so long as the 

amount did not exceed six percent of the employee’s annual compensation. 

Pursuant to the terms of the Plan, participants elected to have these contributions 

invested in a range of investment options. 

Plaintiffs allege that the Plan’s quantity of assets under management 

rendered it a “jumbo” plan in the defined contribution plan marketplace. Between 

2015 and 2019, the Plan had between 62,114 and 81,639 participants with account 

balances. During the putative class period, from October 13, 2015 through the date 

of judgment (“Class Period”), the Plan had at least $4.2 billion in assets under 

management, including over $7.3 billion at the conclusion of fiscal year 2020. 

The Plan incurred various expenses associated with its administration, 

including for services provided by third parties. During the Class Period, 

Vanguard provided recordkeeping and administrative services to the Plan. 

Plaintiffs allege that the Plan covered Vanguard’s fees both directly, through 

participate. Plaintiffs challenge only the Defendants’ conduct in managing the fees associated with the

401(k) Plan.

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page4 of 22
5 

payments from Plan assets, and indirectly, in a practice known as revenue sharing, 

from Plan investments. Plan participants paid an annual fixed sum each year for 

recordkeeping services, which the Plan assessed as a quarterly charge against each 

participant’s account. 

Plaintiffs, participants in the Plan during the Class Period, allege that 

“[n]early all recordkeepers in the marketplace offer the same range of services and 

can provide the services at very little cost,” that “[n]umerous recordkeepers . . . are 

capable of providing a high level of service and will vigorously compete to win a 

recordkeeping contract for a jumbo defined contribution plan,” and that there are 

“essential recordkeeping services provided by all national recordkeepers for large 

plans with substantial bargaining power” offered “by all recordkeepers for one 

price (typically at a per capita price), regardless of the services chosen or utilized 

by the plan.”4 FAC ¶¶ 66–69. Additional ancillary services are “normally 

charged” only to participants who use them. FAC ¶ 69.

Plaintiffs claim that the recordkeeping costs for their Plan were higher than 

for comparable peer plans. They allege that from 2015 to 2019, the Plan’s 

4 As recounted by the district court, these include “basic account recordkeeping; multi-channel 

participant and plan sponsor access; daily participant transaction accounting; payroll service; participant 

tax reporting services; participant confirmations, statements, and standard notices; plan-level reporting 

and annual financial package; participant education; and plan consulting.” Singh v. Deloitte LLP (Singh II),

No. 21-cv-8458 (JGK), 2023 WL 4350650, at *1 (S.D.N.Y. July 5, 2023) (citing FAC ¶ 68).

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page5 of 22
6 

recordkeeping cost per participant ranged from $59.58 to $70.31, as compared to 

six other plans with at least 30,000 participants, for which the cost per participant 

in 2019 ranged from $21 to $34. Plaintiffs allege that they paid excessive 

recordkeeping fees in connection with the Plan because Plan fiduciaries failed to 

“negotiate favorable rates” based on economies of scale. See FAC ¶ 74. Plaintiffs 

surmise that because the Plan has used Vanguard as its recordkeeper since 2004 

and was allegedly paying excessive amounts during the Class Period, Defendants 

failed to “remain informed about overall trends in the marketplace” for 

recordkeeping fees by conducting a Request for Proposal process at reasonable 

intervals. FAC ¶¶ 79, 92. They claim that “the Plan could have obtained 

recordkeeping services that were comparable to or superior to the typical services 

provided by the Plan’s recordkeeper at a lower cost.” FAC ¶ 113. 

II. Procedural History 

Plaintiffs commenced this action on October 13, 2021 alleging, inter alia, that 

the recordkeeping fees charged by the Plan were excessive and that the Defendants 

had breached their duty of prudence in managing the Plan. Defendants promptly 

filed a motion to dismiss. The district court granted the motion on the ground that 

Plaintiffs failed plausibly to allege that the Plan’s recordkeeping fees “were 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page6 of 22
7 

excessive relative to the services rendered.” Singh v. Deloitte LLP (Singh I), 650 F. 

Supp. 3d 259, 266 (S.D.N.Y. 2023) (internal quotation marks omitted). The 

complaint, the district court observed, “must allege more than just that the 401(k) 

Plan’s recordkeeping fees were higher than those of other plans.” Id. Accepting 

as true Plaintiffs’ allegation that almost all recordkeepers offer the same range of 

services, the district court observed that “plaintiffs still do not allege, with 

specificity, what recordkeeping services the 401(k) Plan received from Vanguard,” 

nor “what recordkeeping services the comparator plans received . . . .” Id. at 267. 

The court also noted that Plaintiffs had “disingenuous[ly]” compared the Plan’s 

combined direct and indirect costs for recordkeeping with only the direct costs of 

the comparator plans. Id. “Because the plaintiffs’ comparison does not compare 

apples to apples, the comparison fails to indicate plausibly imprudence on the part 

of the defendants.” Id. 

Plaintiffs filed their FAC on February 27, 2023. The FAC included additional 

material detailed in the district court’s July 5, 2023 memorandum opinion and 

order, including comparisons between the direct costs of the Plan and comparator 

plans, allegations that Defendants have sole possession of relevant Plan

disclosures, and an expert declaration opining that the Plan charged excessive 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page7 of 22
8 

recordkeeping and administrative fees. Singh II, 2023 WL 4350650, at *1–2 . Upon 

review of Plaintiffs’ proposed amended complaint, the district court denied 

Plaintiffs’ motion to amend on futility grounds, concluding that Plaintiffs had not 

cured the pleading deficiencies in their original complaint. 

As to the comparison of the Plan’s direct costs for recordkeeping with the 

direct costs of comparator plans, the district court noted that this comparison shed 

limited light on the plausibility of Plaintiffs’ allegation that the Plan’s total

recordkeeping costs were excessive given, inter alia, that “plaintiffs’ allegations 

highlight that a plan’s indirect costs may range widely from year-to-year.” Id. at 

*4. More generally, the district court concluded that the proposed amended 

complaint still lacked sufficient factual allegations regarding the type and quality 

of recordkeeping services provided by the Plan and its allegedly less-expensive

comparators: “Without allegations comparing specifically the quality of services 

rendered, or the number of services provided, between the Plan and its 

comparators, the conclusory allegations that ‘[n]early all recordkeepers in the 

marketplace offer the same range of services’ and ‘[n]umerous recordkeepers in 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page8 of 22
9 

the marketplace are capable of providing a high level of service,’” failed to state a 

plausible claim.5 Singh II, 2023 WL 4350650, at *4. This appeal followed.

DISCUSSION 

This Court reviews de novo the district court’s decision to deny leave to 

amend a complaint due to futility. Balintulo v. Ford Motor Co., 796 F.3d 160, 164 (2d 

Cir. 2015). Futility arises when a proposed amended complaint “could not 

withstand a motion to dismiss.” Lucente v. IBM Corp., 310 F.3d 243, 258 (2d Cir. 

2002). “To survive a motion to dismiss, a complaint must contain sufficient factual 

matter, accepted as true, to ‘state a claim to relief that is plausible on its 

face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 

550 U.S. 544, 570 (2007)). In evaluating the proposed complaint, the Court must 

“construe it liberally, accepting all factual allegations therein as true and drawing 

all reasonable inferences in the plaintiffs’ favor.” Sacerdote v. New York Univ., 9 

F.4th 95, 106–07 (2d Cir. 2021), cert. denied, 142 S. Ct. 1112 (2022). However, 

5 The district court also concluded that Plaintiff’s reliance on the expert declaration of Francis 

Vitagliano at the motion to dismiss stage was improper, and that the Vitagliano declaration “is simply a 

conclusory statement of the plaintiff’s argument and . . . does not move the allegations from possible to 

plausible.” Id. at *5–*6. Plaintiffs do not meaningfully contest on appeal the district court’s conclusion that 

their reliance on an expert declaration at the motion to dismiss stage was misplaced. Accordingly, we do 

not consider the declaration’s contents nor review the district court’s conclusion regarding the 

appropriateness of the declaration’s attachment to the complaint. See In re Platinum & Palladium Antitrust 

Litig., 61 F.4th 242, 276 (“[A]rguments not made in an appellant’s opening brief are waived . . . .”(internal 

quotation marks omitted)). 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page9 of 22
10 

“[t]hreadbare recitals of the elements of a cause of action, supported by mere 

conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678. 

ERISA fiduciaries must act prudently in managing an employee benefit 

plan, discharging their duties “with the care, skill, prudence, and diligence under 

the circumstances then prevailing” that a prudent person “acting in a like capacity 

and familiar with such matters would use in the conduct of an enterprise of a like 

character and with like aims.” 29 U.S.C. § 1104(a)(1)(B). The Supreme Court has 

interpreted ERISA’s duty of prudence in light of the common law of trusts, 

explaining that “a fiduciary normally has a continuing duty of some kind to 

monitor investments and remove imprudent ones.”6 Hughes v. Northwestern Univ. 

(Hughes II), 595 U.S. 170, 175 (2022) (quoting Tibble v. Edison Int’l, 575 U.S. 523, 530, 

(2015)). That said, the prudence inquiry is necessarily context specific and “the 

circumstances facing an ERISA fiduciary,” often enough, “will implicate difficult 

tradeoffs.” Id. at 177. Courts must therefore “give due regard to the range of 

reasonable judgments a fiduciary may make based on her experience and 

expertise.” Id. It is not “necessarily sufficient to show that better investment 

opportunities were available at the time of the relevant decisions.” Pension Ben. 

6 Plaintiffs’ claim of excessive fees constitutes an imprudent investment claim. See Young v. Gen. 

Motors Inv. Mgmt. Corp., 325 Fed. App’x 31, 33 (2d Cir. 2009) (per curiam).

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page10 of 22
11 

Guar. Corp. ex rel. St. Vincent Catholic Med. Centers Ret. Plan v. Morgan Stanley Inv. 

Mgmt. Inc., 712 F.3d 705, 718 (2d Cir. 2013) (citing Braden v. Wal-Mart Stores, Inc., 

588 F.3d 585, 596 n.7 (8th Cir. 2009)). 

Evaluating the amended complaint in light of these standards, we agree 

with the district court that the FAC fails to do more than allege conclusorily that 

the Plan’s recordkeeping fees exceeded those of a select handful among the many 

other plans available on the market. But as we said in Young, plaintiffs need 

plausibly to allege that challenged fees “were excessive relative ‘to the services 

rendered,’” or to provide allegations “concerning other factors relevant to 

determining whether a fee is excessive under the circumstances.” Young, 325 Fed. 

App’x at 33 (citing Gartenberg v. Merrill Lynch Asset Mgmt., 694 F.2d 923, 928 (2d 

Cir. 1982)).7 For just as “the cheapest investment option is not necessarily the one 

a prudent fiduciary would select,” Albert v. Oshkosh Corp., 47 F.4th 570, 579 (7th

Cir. 2022), reh’g denied, No. 21-2789, 2022 WL 4372363 (7th Cir. Sept. 21, 2022), so, 

7 Plaintiffs contend that Young is inapposite because it applied the Investment Company Act

(“ICA”). But the Young panel did not apply the ICA. The panel simply considered how courts applying 

that Act determine whether a fee is excessive to inform its consideration of a ERISA complaint alleging 

breach of fiduciary duty in the failure to prevent excessive recordkeeping fees. Moreover, Young’s 

observation that plaintiffs in such cases should provide sufficient context to support a plausible inference 

“that the fees were excessive relative to the services rendered,” 325 Fed. App’x at 33, is simply common 

sense. See Mator v. Wesco Distrib., Inc., 102 F.4th 172, 190 (3d Cir. 2024) (“Judges draw on ‘common sense’ 

when ‘determining whether a complaint states a plausible claim for relief.’” (quoting Iqbal, 556 U.S. at 679) 

(alterations adopted)). A buyer cannot determine if he has paid too much for an item without knowing 

what it is that he purchased. 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page11 of 22
12 

too, a prudent fiduciary might select a higher-priced recordkeeping arrangement

depending on, inter alia, the nature and quality of the services provided. Singh II, 

2023 WL 4350650, at *4. We thus examine recordkeeping complaints, as all 

complaints, for their context, to determine whether the facts alleged “give the kind 

of context that . . . move [the recordkeeping] claim from possibility to plausibility.” 

Smith v. CommonSpirit Health, 37 F.4th 1160, 1169 (6th Cir. 2022). See also Matney v. 

Barrick Gold of N.A., 80 F.4th 1136, 1149 (10th Cir. 2023) (“A court cannot reasonably 

draw an inference of imprudence simply from the allegation that a cost disparity 

exists; rather, the complaint must state facts to show the funds or services being 

compared are, indeed, comparable.”); Matousek v. MidAmerican Energy Co., 51 F.4th 

274, 279 (8th Cir. 2022) (“[T]he way to plausibly plead a claim of this type is to 

identify similar plans offering the same services for less.”). 

Here, Plaintiffs allege next to nothing about the recordkeeping services 

provided by the Plan or by the six other large plans that the FAC cites as allegedly 

lower-priced comparators.8 Nor do they provide allegations as to “other factors,” 

as we put it in Young, “relevant to determining whether a fee is excessive under 

8 Two of the comparators, Kaiser Permanente Supplemental Savings and Retirement Plan and The 

Savings and Investment Plan [WPP Group], also use Vanguard for recordkeeping. But, without factual 

context, we have no reason to infer that the services provided by Vanguard to other plans are comparable. 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page12 of 22
13 

the circumstances.” Young, 325 Fed. App’x at 33. Thus, while the FAC 

conclusorily alleges that “[n]early all recordkeepers in the marketplace offer the 

same range of services,” FAC ¶ 66, it is silent on the number of services actually 

provided by either the Plan or its alleged comparators. Similarly, the FAC asserts 

that “[n]umerous recordkeepers in the marketplace are capable of providing a 

high level of service,” FAC ¶ 67, but “does not allege what level of service the Plan 

provided,” nor “whether less expensive comparator plans provided a similar 

quality of service . . . .” Singh II, 2023 WL 4350650, at *4. Plaintiffs suggest that the 

absence of context in the FAC does not matter because “[t]he services chosen by a 

large plan do not affect the amount charged by recordkeepers for [the] basic and 

fungible services” that constitute “essential recordkeeping services provided by 

all national recordkeepers for large plans with substantial bargaining power.” Id.

¶¶ 68, 70. But the FAC’s own allegations, however sparse, show a range of 

recordkeeping fees even among the six large comparator plans, belying the 

implication that the allegation of a cost disparity alone, without some 

consideration of the surrounding context, categorically suggests imprudence. See 

Matney, 80 F.4th at 1148 (noting that while “there is no doubt a claim for breach of 

ERISA’s duty of prudence can be based on allegations that the fees associated with 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page13 of 22
14 

[a] defined-contribution plan are too high compared to available, cheaper 

options,” plaintiff must allege a “meaningful benchmark” to raise inference of 

imprudence) (quoting Meiners v. Wells Fargo & Company, 898 F.3d 820, 822 (8th Cir. 

2018)).9 

Nor are our concerns allayed by the allegations that are included in the FAC 

regarding Plaintiffs’ cost comparisons to other plans. While we have recognized 

that “details about a fiduciary’s methods and actual knowledge tend to be ‘in the 

sole possession of [that fiduciary],’” it is also the case that “ERISA imposes 

extensive disclosure requirements on plan administrators.” St. Vincent, 712 F.3d 

at 719–20 (quoting Braden, 588 F.3d at 598). And here, Plaintiffs do not appear to 

draw “apple-to-apple” comparisons even when relying on disclosure documents 

filed by the Plan and its alleged comparators – documents we properly consider 

here, when integral to the FAC. See Chambers v. Time Warner, Inc., 282 F.3d 147, 

153 (2d Cir. 2002) (noting material “integral” to complaint is properly considered 

in resolving Rule 12(b)(6) motion). 

9 The concurrence relies on the Vitagliano declaration to conclude that Plaintiffs sufficiently alleged 

the scope and quality of services provided to comparator plans. See Concurrence at 1–7. Although we have 

found it permissible for “a plaintiff to bolster a complaint by including a nonconclusory opinion to which 

an expert may potentially testify,” an opinion cannot “rescue” a deficient pleading. Ark. Pub. Emps. Ret. 

Sys. v. Bristol-Myers Squibb Co., 28 F.4th 343, 354 (2d Cir. 2022). As already noted, see supra note 5, the district 

court determined that Vitagliano’s declaration is simply a “conclusory statement of the plaintiff’s 

argument.” Even if we were to consider the declaration, we discern no error in this conclusion. 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page14 of 22
15 

First, following the district court’s criticism of the original complaint’s 

comparison of the Plan’s combined direct and indirect recordkeeping costs with 

solely the direct costs of comparator plans, the FAC compares the direct costs of 

the Plan with the direct costs of its six comparator plans. By omitting indirect costs 

from the analysis altogether, however, the FAC fails to compare total 

recordkeeping costs, which Plaintiffs allege comprise both direct and indirect fees. 

As the district court noted, the comparison of direct costs alone provides limited 

insight into whether total recordkeeping fees paid by the Plaintiffs were excessive, 

as compared to other plans. Singh II, 2023 WL 4350650, at *4.10 

Next, the main comparison Plaintiffs make in the FAC is between the Plan’s 

alleged direct recordkeeping costs per participant from 2015 to 2019 (ranging from 

$46.23 to $65.24 per participant annually) and the alleged direct recordkeeping 

costs per participant for the six other large plans in the year 2019 (ranging from 

$21 to $34 per participant annually). But Plaintiffs fail to explain why they 

compare the Plan’s direct recordkeeping costs in each of five years to the 

comparator plans’ direct recordkeeping costs from just 2019, without “otherwise 

consider[ing] or alleg[ing] any facts regarding possible differences in cost between 

10 We note the concurrence agrees that Plaintiffs’ complaint is deficient as to this comparison and 

therefore joins in the judgment. Concurrence at 1, 12. 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page15 of 22
16 

2015 and 2019, the time period relevant to this case.” Singh II, 2023 WL 4350650, 

at *4. This limits our ability to draw inferences about the fee differential over the 

course of the Class Period. 11

Plaintiffs’ remaining allegations also “fail[] to give the kind of context that 

could move this claim from possibility to plausibility.” Smith, 37 F.4th at 1169. 

Plaintiffs first allege that the fact that the Plan remained with the same 

recordkeeper, Vanguard, since at least 2004 and paid allegedly “outrageous 

amounts for recordkeeping from 2015 to 2017” provides “little to suggest that 

Defendants conducted a [Request for Proposal] at reasonable intervals.” FAC 

¶ 92; see FAC ¶ 79. Yet this inference about the Defendants’ decision-making

process relies on the assumption that the Plan’s recordkeeping fees were excessive 

relative to the services rendered, a proposition that the Plaintiffs have not 

adequately alleged. Next, Plaintiffs cite a stipulation from recordkeeper Fidelity 

in an unrelated suit, stating that the value of recordkeeping services provided by 

11 In addition, Plaintiffs allege that they frame the allegations in their complaint in reliance on a 

number of available fee disclosures, including Section 404a disclosures and Form 5500s filed with the 

Department of Labor. FAC ¶ 86. Pursuant to Department of Labor regulations, Section 404a-5 disclosures 

provide plan participants with information regarding the annual fees charged for plan administrative 

services, including recordkeeping services. See 29 C.F.R. § 2550.404a-5. The 404(a) disclosures here, 

however, suggest that annual per-participant recordkeeping and other administrative fees for the Plan 

declined or stayed stagnant each year from 2015 ($40) to 2022 ($22), and were lower than the FAC’s fee 

calculations. Supp. App’x 290, 304, 318, 330, 343, 356, 369, 450. We accept as true the FAC’s allegations as 

to the Plan’s direct recordkeeping costs, but note that this discrepancy goes unremarked in the FAC. 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page16 of 22
17 

Fidelity to the plan in that litigation ranged from $14 to $21 per participant. But 

the FAC does not specify the recordkeeping services provided by Fidelity to its 

client, or otherwise provide sufficient context to infer that these services are 

comparable to the services that Vanguard provided here. Finally, Plaintiffs point 

to a 2020 market survey by consulting group NEPC, which allegedly shows that 

the majority of a sample of 121 plans with over 15,000 participants, across the 

corporate, healthcare, and “[p]ublic, [n]ot-for-[p]rofit and other” sectors, “paid 

slightly over $40 per participant” for recordkeeping and related fees. FAC ¶¶ 109–

110. But this allegation, too, lacks sufficient context to infer that the services these

plans provided are comparable to those provided by the Plan here, or that this 

sample otherwise provides a meaningful benchmark for use in assessing the Plan’s 

recordkeeping fees over the course of the Class Period.

Plaintiffs contend that their complaint “easily satisf[ies] the pleading 

requirements of Albert and Smith as clarified by the Seventh Circuit in Hughes.” 

Appellant’s Br. at 36–37. We disagree. In Hughes v. Northwestern University 

(Hughes III), the Seventh Circuit held that the plaintiffs there had adequately 

pleaded an ERISA imprudence claim based on excessive recordkeeping fees. 63 

F.4th 615, 633 (7th Cir. 2023). But the Hughes complaint presents a different picture 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page17 of 22
18 

than the one we are faced with here. Hughes concluded that plaintiffs pleaded a 

plausible claim of breach because they made multiple allegations relevant to 

concluding that the fee was excessive. The plaintiffs contended that “the quality 

or type of recordkeeping services provided by competitor providers [was] 

comparable to that provided by Fidelity and TIAA,” the recordkeepers at issue. 

Id. at 632. The plaintiffs also pleaded that Northwestern had behaved imprudently 

by maintaining a second recordkeeper while other plans consolidated to a single 

recordkeeper for the same services. Id. And they provided concrete examples of 

other university plans “that successfully reduced recordkeeping fees by soliciting 

competitive bids, consolidating to a single recordkeeper, and negotiating rebates.” 

Id. These specific allegations, considered together, provided a plausible “basis 

upon which to infer that” Northwestern paid excessive fees. Young, 325 Fed App’x 

at 33; cf. Matousek, 51 F.4th at 278 (noting that “key to nudging an inference of 

imprudence from possible to plausible is providing ‘a sound basis for comparison 

. . .’ not just alleging that ‘costs are too high, or returns are too low’”) (quoting 

Davis v. Washington Univ. in St. Louis, 960 F.3d 478, 484 (8th Cir. 2020)). Plaintiffs’ 

sparse allegations here are simply not comparable. See Young, 325 Fed. App’x at 

33 (noting importance of such context to plausibility determination). 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page18 of 22
19 

Plaintiffs further urge that we reverse the district court “[b]ecause the [FAC] 

pleads similarly robust allegations” to the complaint in Mator v. Wesco Distribution, 

Inc., 102 F.4th 172 (3d Cir. 2024). Appellant’s Fed. R. App. P. 28(j) Letter (May 17, 

2024). Again, this is incorrect. The complaint in Mator pled with specificity the 

recordkeeping services provided by the Wells Fargo plan, as well as the similarity 

of these services to those provided by lower-priced comparators. For instance, the 

Mator plaintiffs specifically alleged that the price per person of total recordkeeping 

costs for Wells Fargo was three to four times that of five other plans serviced by 

Wells Fargo itself, even though these other plans received the “same services 

described in Paragraphs 93 and 94 [describing the plan’s services provided to 

plaintiffs and other plan participants] and the same level and quality of 

service.” Second Amended Compl., ¶ 105, Mator v. Wesco Distrib. Inc., No. 2:21-

cv-00403 (W.D. Pa. Apr. 21, 2022). The Mator complaint also compared the Wells 

Fargo plan’s fees to those of 11 other plans serviced by several of the “top 

recordkeepers by number of plans for plans with assets in excess of $200 million,” 

id. ¶ 107, which “all provided identical or similar services of the same quality” to 

those provided by Wells Fargo to the plan, id. ¶ 108. 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page19 of 22
20 

In addition, the Mator plaintiffs provided a comparison of estimated total

fees, as opposed to direct fees alone, and also specifically alleged “that either the 

Plan’s ‘direct fees alone’ or its ‘indirect fees alone’ were ‘unreasonable compared 

to the total fees . . . that other similar plans paid.’” Mator, 102 F.4th at 181. 

Moreover, the plaintiffs alleged that when the plan at issue there switched 

recordkeepers in 2020, it “paid a much lower flat fee . . . per participant” for the 

same services, delivered at the same level of quality. Id. As noted by the Third 

Circuit, the pleading thus contained a nonconclusory, fact-based allegation that: 

when the Plan switched to Fidelity for recordkeeping services, 

lowering fees from about $154 to $54 per participant, there was no 

change in the kind or quality of recordkeeping services provided to 

participants. In other words, Fidelity’s services allegedly were as 

good as Wells Fargo’s, but at a fraction of the price. 

Id. at 189. The Mator court thus reached its conclusion that the fee comparisons at 

issue, considered in context, “nudge[d] the[] complaint across the line from 

conceivable to plausible,” based on “a close examination of the complaint and 

attached documents.” Id. at 185. Using the same approach and considering the 

lack of context and sparse specific factual allegations in the FAC, we reach a 

different result.

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page20 of 22
21 

In sum, we agree with the district court that Plaintiffs’ recordkeeping claim 

fails the “context-sensitive scrutiny of a complaint’s allegations” that we are 

charged to perform on a motion to dismiss. Dudenhoeffer, 573 U.S. at 425. Absent 

greater specificity as to the type and quality of services provided by the Plan and 

its comparators – or absent other allegations providing the context that might 

move this recordkeeping claim “from possible to plausible,” Matousek, 51 F.4th at 

278 – Plaintiffs fail to state a claim for breach of the duty of prudence. Accordingly, 

this claim was properly dismissed. 

Finally, Plaintiffs further charge that Deloitte and its Board failed 

adequately to monitor the other fiduciaries to ensure they adequately fulfilled

their fiduciary obligations and properly managed the Plan in accordance with 

ERISA. Both parties agree, however, that this claim is derivative of the claim that 

Defendants violated the duty of prudence owed to Plan participants. See Coulter 

v. Morgan Stanley & Co. Inc., 753 F.3d 361, 368 (2d Cir. 2014) (explaining that a 

failure to monitor claim “constitute[s] [a] derivative claim[] that cannot survive 

absent a viable claim for breach of a duty of prudence”). Because we agree with 

the district court that the fiduciary duty claim is properly dismissed, it follows that 

the motion to dismiss this derivative claim was also properly granted. 

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page21 of 22
22 

CONCLUSION 

For the foregoing reasons, we AFFIRM.

Case 23-1108, Document 110-1, 12/10/2024, 3638175, Page22 of 22