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‐ 734

‐ cv

Fletcher v. Convergex Group, L.L.C., et al.

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT.

CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007 IS

PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE

PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A

SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY

MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC

DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING

TO A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT

REPRESENTED BY COUNSEL.

At a stated term of the United States Court of Appeals for the Second Circuit, 1

held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of 2

New York, on the 10 th day of February, two thousand seventeen. 3

4

PRESENT: ROSEMARY S. POOLER, 5

PETER W. HALL, 6

RAYMOND J. LOHIER, JR., 7

Circuit Judges

. 8

‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐ 9

10

LANDOL FLETCHER, 11

12

Plaintiff

‐ Appellant

, 13

14

v. No. 16

‐ 734

‐ cv 15

16

CONVERGEX GROUP, L.L.C., CONVERGEX 17

EXECUTION SOLUTIONS L.L.C., CONVERGEX 18

GLOBAL MARKETS LTD., CONVERGEX 19

HOLDINGS L.L.C., GTRADE SERVICES L.L.C., 20

and “JOHN DOES” 1

‐ 10, 21

22

Defendants

‐ Appellees.* 23

‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐ 24

*The Clerk of Court is respectfully requested to amend the caption as set forth

above.2 FOR PLAINTIFF

‐ APPELLANT: JAMES A. MOORE, McTigue Law 1

LLP, Washington, D.C. (David Steven 2

Preminger, Keller Rohrback, 3

L.L.P., New York, NY, Erin M. Riley, 4

Keller Rohrback, L.L.P., Seattle, WA, 5

on the brief ). 6

7

FOR DEFENDANTS

‐ APPELLEES: MELISSA D. HILL (Brian T. Ortelere, 8

Jeremy P. Blumenfeld, on the brief ), 9

Morgan, Lewis & Bockius LLP, New 10

York, NY. 11

12

13

Appeal from a judgment of the United States District Court for the Southern 14

District of New York (Louis L. Stanton, Judge ). 15

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, 16

AND DECREED that the judgment of the District Court is VACATED AND 17

REMANDED

. 18

Landol Fletcher appeals from the judgment of the United States District Court 19

for the Southern District of New York (Stanton, J.) dismissing his claims against 20

Convergex Group LLC and others (“Convergex” or “Defendants”) for lack of subject 21

matter jurisdiction. Fletcher, a participant in a defined benefit plan (the “Central 22

States Plan” or the “Plan”), brought this putative class action pursuant to the 23

Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1132(a)(2). 24

Fletcher alleges that Convergex engaged in an undisclosed scheme to double charge 25

Plan participants for securities transactions. That conduct, Fletcher claims, 26

“violated ERISA fiduciary duties of prudence and loyalty and constituted prohibited 273 transactions in violation of ERISA,” causing financial losses to the Plan, in violation 1

of 29 U.S.C. §§ 1104(a)(1)(B) & 1106(b). Fletcher seeks to bring the action on behalf 2

of himself and in a representative capacity as a participant of the Central States Plan. 3

He also seeks to represent members of other ERISA plans affected by Convergex’s 4

double

‐ charging scheme. 5

On appeal, Fletcher asserts that the District Court erred in concluding that (1) 6

he failed to establish a cognizable injury in fact sufficient to confer Article III 7

standing in either his individual or representative capacities, and (2) he lacks Article 8

III standing to bring claims on behalf of plans of which he is not a member. We 9

assume the parties’ familiarity with the facts and record of the prior proceedings, to 10

which we refer only as necessary to explain our decision to vacate and remand. 11

We conclude that allegations describing Convergex’s breach of fiduciary 12

duties of prudence and loyalty under ERISA, its violation of ERISA’s prohibited 13

transactions provision, and the resulting financial loss sustained by the Central States 14

Plan are sufficient to confer Article III standing on Fletcher in his representative 15

capacity as a Plan participant. See L.I. Head Start Child Dev. Servs., Inc. v. Econ. 16

Opportunity Comm’n of Nassau Cty., Inc., 710 F.3d 57, 67 n.5 (2d Cir. 2013); see also 17

29 U.S.C. § 1132(a)(2). 184 Having erroneously held that Fletcher did not have standing to represent 1

other members of his own ERISA plan, the District Court understandably also ruled 2

that Fletcher had no standing to represent members of ERISA plans of which he was 3

not a member, without separately analyzing that issue. We therefore vacate that 4

ruling and remand to the District Court to determine in the first instance whether the 5

conduct alleged by Fletcher relating to the Central States Plan “implicates the same 6

set of concerns” as the conduct by Convergex that is “alleged to have caused injury” 7

to putative class members who are not participants in that Plan. NECA

‐ IBEW 8

Health & Welfare Fund v. Goldman Sachs & Co., 693 F.3d 145, 162 (2d Cir. 2012); see 9

also Ret. Bd. of the Policemen’s Annuity & Ben. Fund v. Bank of N.Y. Mellon, 775 10

F.3d 154, 160–63 (2d Cir. 2014), cert. denied sub nom. Ret. Bd. of the Policemen’s 11

Annuity & Annuity & Ben. Fund v. Bank of N.Y. Mellon, 136 S. Ct. 796 (2016). 12

For the foregoing reasons, the judgment of the District Court is VACATED 13

AND REMANDED for further proceedings consistent with this order. 14

FOR THE COURT: 15

Catherine O = Hagan Wolfe, Clerk of Court 16