United States Court of Appeals

For the Eighth Circuit

___________________________

No. 13-2709

___________________________

Geoffrey Varga, in his capacity as Official Liquidator of Palm Beach Offshore,

Ltd., and Palm Beach Offshore II, Ltd.

lllllllllllllllllllll Plaintiff - Appellant

v.

U.S. Bank National Association

lllllllllllllllllllll Defendant - Appellee

____________

 Appeal from United States District Court 

for the District of Minnesota - Minneapolis

____________

 Submitted: June 11, 2014

 Filed: August 21, 2014

____________

Before LOKEN, BEAM, and GRUENDER, Circuit Judges.

____________

GRUENDER, Circuit Judge.

Geoffrey Varga, in his capacity as the official liquidator of Palm Beach

Offshore, Ltd. and Palm Beach Offshore II, Ltd. (collectively, “the Palm Beach

Funds”), sued U.S. Bank National Association (“U.S. Bank”) for aiding and abetting

a breach of fiduciary duty, willful and wanton negligence, and gross negligence. 

These claims arose from the Palm Beach Funds’ investment through accounts
maintained at U.S. Bank in what turned out to be a Ponzi scheme. The district court

1

granted U.S. Bank’s motion to dismiss Varga’s amended complaint. Varga appeals,

and we affirm.

I. Background

In this appeal from the grant of a motion to dismiss, we accept as true the wellpleaded allegations in the amended complaint. Loftness Specialized Farm Equip.,

Inc. v. Twiestmeyer, 742 F.3d 845, 854 (8th Cir. 2014).

TomPetters, through his companyPettersCompany, Inc. (“PettersCompany”),

claimed to purchase excess consumer merchandise,such as electronics, fromvendors. 

Petters Company financed these supposed transactions by selling high-yield

promissory notes to investors through Petters Capital, Inc. (“Petters Capital”), a

wholly owned entity of Petters Company. These promissory notes were to be repaid

once the consumer merchandise had been sold to and paid for by retailers, like Sam’s

Club and BJ’s Wholesale Club, in transactions that Petters Company was to arrange. 

This investment structure enabled Petters Company to grow into what appeared to be

a multi-billion dollar operation. But the investment scheme peddled by Petters

Company was entirely illusory: no vendors ever sold consumer merchandise, and no

retailers ever purchased it. Instead, Petters Company generated fake purchase orders

and sales confirmations and kept its scheme afloat by recycling funds that it received

from new investors to pay off the promissory notes of old investors asthey came due. 

The inevitable collapse of Petters’s Ponzi scheme caused investors to suffer

staggering losses.

The Honorable Richard H. Kyle, United States District Judge for the District 1

of Minnesota.

-2-
The PalmBeach Funds, which invested in PettersCompany’s promissory notes

and are now being liquidated, collectively lost over $700 million to Petters’s scheme. 

The Palm Beach Funds’ investment was made through another fund called Palm

Beach Finance Partners II, LP (“Palm Beach Finance”). Palm Beach Finance

received the Palm Beach Funds’ investment in Petters Company’s promissory notes

via an escrow account that was maintained at U.S. Bank and was governed by an

escrow-account agreement.

What happened to the Palm Beach Funds’ money once it was transferred out

of the escrow account forms the heart of this case. The money initially went to a

collateral account that also was maintained at U.S. Bank. The collateral account was

governed bya collateral-account agreement to which U.S. Bank, PalmBeach Finance,

and Petters Capital, among others, were parties. The Palm Beach Funds were not

partiesto the collateral-account agreement. Once the Palm Beach Funds’ investment

reached the collateral account, Varga alleges that a “direct payment system”

prescribed that (a) outgoing funds from the collateral account were to be sent directly

to the vendors that purportedly sold the consumer merchandise to Petters Company

and (b) incoming funds to the collateral account were to come directly from the

retailers that purportedly purchased the consumer merchandise from Petters

Company. This direct payment system, according to Varga, was designed to prevent

a third party from accessing investor funds and to ensure the legitimacy of the

merchandise transactions. Because no vendors or retailers were involved in any

legitimate transactions, the direct payment system was never followed. Instead, the

collateral account played host to the Ponzi scheme with the outgoing funds being sent

to PettersCompany through shaminventory vendors and the incoming funds (i.e., the

investors’ recycled funds) coming from Petters Company.

Varga alleges that Bruce Prevost and David Harrold, in their capacity as

directors of the Palm Beach Funds, breached their fiduciary duties to the Palm Beach

Funds. Varga additionally alleges that Palm Beach Capital Management, LLC

-3-
(“PBCM”), which managed the Palm Beach Funds, breached its fiduciary duties to

the Palm Beach Funds. In particular, Varga argues that Prevost, Harrold, and PBCM

breached their fiduciary duties to the Palm Beach Funds by failing to ensure that the

direct payment system was utilized while nonetheless continuing to invest in Petters

Company’s promissory notes and by concealing the noncompliance with the direct

payment system from the Palm Beach Funds. Varga settled his claims against

Prevost, Harrold, and PBCM in a separate proceeding.

This case concerns Varga’s further claimthat U.S. Bank’s actions are sufficient

to charge it with aiding and abetting the breach of fiduciary duty by Harrold, Prevost,

and PBCM, willful and wanton negligence, and gross negligence. Varga alleges that

U.S. Bank knew that the direct payment system was not being followed. Varga

further asserts that U.S. Bank understood that the direct payment system was an

important procedural safeguard that was designed to protect the Palm Beach Funds’

investment. U.S. Bank acquired this knowledge, according to Varga, by reviewing

the collateral-account agreement, the PalmBeach Funds’ marketing and due-diligence

documents, and the private offering memoranda for the Palm Beach Funds’

investment in Petters Company’s promissory notes.

In addition to appreciating the importance of the direct payment system, Varga

alleges that U.S. Bank participated in concealing from the Palm Beach Funds the fact

that the direct payment system was not being followed. Varga first alleges that U.S.

Bank participated in a so-called “re-coding scheme” at the direction of two of the

“fund managers” for the Palm Beach Funds—identified in Varga’s brief as Prevost

and Harrold. This alleged scheme, which began no later than December 2006,

involved U.S. Bank re-coding the account statements for the collateral account to

indicate that the incoming funds into the collateral account were being received from

retailers, not Petters Company. However, Varga admits in his amended complaint

that, from 2002 until the re-coding scheme began in approximately December 2006,

the collateral account statements correctly listed PettersCompany asthe source of the

-4-
incoming funds. According to Varga, U.S. Bank also told various individuals

associated with the Palm Beach Funds that the direct payment system was being

followed. The amended complaint includes only one example ofthis alleged practice. 

Varga alleges that Jonathan Spring, a third-party marketer for the Palm Beach Funds

and an investor in Petters Company’s promissory notes, contacted U.S. Bank

employee Thomas Caruth. Caruth, who was Palm Beach Finance’s “main contact”

at U.S. Bank, told Spring that “all wires sent out of U.S. Bank go directly to retailers

and manufacturers” and “wires received come directly from retailers without going

through intermediaries.”

On the basis of these allegations, Varga sued U.S. Bank. U.S. Bank moved to

dismiss the amended complaint for failure to state a claim under Federal Rule of Civil

Procedure 12(b)(6). The district court granted U.S. Bank’s motion. This appeal

followed.

II. Discussion

We review de novo the grant of a motion to dismiss, accepting the well-pleaded

allegations in the complaint as true and drawing all reasonable inferences in favor of

the plaintiff. Id. In addition to the allegations in the amended complaint, we also

may consider “materials that are necessarily embraced by the pleadings.” Mattes v.

ABC Plastics, Inc., 323 F.3d 695, 697 n.4 (8th Cir. 2003). “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)). “A claim has

facial plausibility when the plaintiff pleads factual content that allows the court to

draw the reasonable inference that the defendant isliable for the misconduct alleged.”

Id.

-5-
A. Aiding and Abetting a Breach of Fiduciary Duty

Under Minnesota law, aiding and abetting the tortious conduct of another has

three elements: “(1) the primary tort-feasor must commit a tort that causes an injury

to the plaintiff; (2) the defendant must know that the primary tort-feasor’s conduct

constitutes a breach of duty; and (3) the defendant must substantially assist or

encourage the primary tort-feasor in the achievement of the breach.” Witzman v.

Lehrman, Lehrman & Flom, 601 N.W.2d 179, 187 (Minn. 1999). While the parties

dispute whether Varga alleged a breach of fiduciary duty by Prevost, Harrold, and

PBCM, we assume for purposes of this appeal that Varga has done so. Varga’s

aiding-and-abetting claim nonetheless fails because he has not alleged plausibly that

U.S. Bank knew that Prevost, Harrold, and PBCM’s conduct constituted a breach of

fiduciary duty or that U.S. Bank substantially assisted that breach of fiduciary duty.

An aider and abettor’s knowledge that the primary tortfeasor’s conduct

constitutes a breach of fiduciary duty is a “crucial element” of a claim for aiding and

abetting. E-Shops Corp. v. U.S. Bank Nat’l Ass’n, 678 F.3d 659, 663 (8th Cir. 2012)

(quoting Fed. Deposit Ins. Corp. v. First Interstate Bank of Des Moines, N.A., 885

F.2d 423, 431 (8th Cir. 1989)) (applying Minnesota law). Knowledge is evaluated

“in tandem” with the requirement that the aider and abettor substantially assist the

breach of a fiduciary duty. Witzman, 601 N.W.2d at 188 (quoting In re

Temporomandibular Joint (TMJ) Implants Prods. Liab. Litig., 113 F.3d 1484, 1495

(8th Cir. 1997)). Consequently, “where there is a minimal showing of substantial

assistance, a greater showing of scienter is required.” Id. (quoting Camp v. Dema,

948 F.2d 455, 459 (8th Cir. 1991)). Factors that are relevant to whether knowledge

and the requisite degree of assistance exist include “the relationship between the

defendant and the primary tortfeasor, the nature of the primary tortfeasor’s activity,

the nature of the assistance provided by the defendant, and the defendant’s state of

mind.” Id.

-6-
Varga relies on three allegations in the amended complaint to support his

argument that he plausibly pled that U.S. Bank knew of and substantially assisted a

breach of fiduciary duty. First, Varga asserts that U.S. Bank’s review of various

documentsthat purportedly mandated the direct payment system sufficesto establish

U.S. Bank’s knowledge that Prevost, Harrold, and PBCM were breaching their

fiduciary duties to the Palm Beach Funds by failing to ensure that the direct payment

system was utilized while nonetheless continuing to invest in Petters Company’s

promissory notes. The documents alleged to have been reviewed by U.S. Bank

include: the collateral-account agreement; the private offering memoranda for the

PalmBeach Funds’ investment in Petters Company’s promissory notes; and the Palm

Beach Funds’ marketing and due-diligence documents. However, the collateralaccount agreement, which established U.S. Bank’s duties in relation to the collateral

account, does not mandate that U.S. Bank only accept those deposits that come from

retailers. To the contrary, the collateral-account agreement expressly contemplates 2

instances in which the direct payment system would not be followed. In particular,

the collateral-account agreement providesthat U.S. Bank “shall . . . [a]pply and credit

for deposit to the Collateral Account . . . all Collections [defined as “all payments

owing to [PettersCapital] with respect to sales ofinventory”] and other Receipts from

time to time tendered by or on behalf of [Petters Capital] for deposit therein.” As this

excerpt makes clear, not only did the collateral-account agreement indicate that

exceptions to the direct payment system may be made, but it also left U.S. Bank with

no discretion to refuse the aforementioned deposits that were made “by or on behalf

of” Petters Capital, a wholly owned entity of Petters Company. In light of this

contractual provision in the collateral-account agreement, it is implausible to

conclude that U.S. Bank knew that the failure to adhere to the direct payment system

As noted above, when deciding a motion to dismiss, we may consider 2

materials that necessarily are embraced by the pleadings. See Mattes, 323 F.3d at 697

n.4. During oral argument, Varga conceded that the collateral-account agreement,

which was attached to U.S. Bank’s motion to dismiss, is properly before us.

-7-
and continued investments in Petters Company’s promissory notes constituted a

breach of fiduciary duty by Harrold, Prevost, and PBCM. See Iqbal, 556 U.S. at 678.

Varga responds by pointing to other language in the collateral-account

agreement—for example, that Petters Capital “agreesto direct each [retailer] to make

all payments” to the collateral account. The private offering memorandum quoted in

the amended complaint contains a similar statement. But an agreement that Petters

Capital would “direct” the retailers, who were not parties to the collateral-account

agreement, to make the deposits into the collateral account provides no indication of

whether the retailers had agreed or would agree to this course of action. Varga also

relies on the portion of the collateral-account agreement that states that Palm Beach

Finance “has requested that . . . all collections received from [retailers] and proceeds

ofsuch inventory and accountsreceivable be . . . remitted by wire transfer directly to”

the collateral account. (emphasis added) However, the use of the word “requested”

by Palm Beach Finance—the party through which the Palm Beach Funds’ money

flowed—indicatesthat no agreement had been reached on whether the direct payment

system was, in fact, mandatory. See Webster’s Third New International Dictionary

1929 (2002) (defining “request” as “to ask (as a person or an organization) for

something”). Moreover, neither of the above-quoted provisions impose any duty on

U.S. Bank to ensure that the retailers made their deposits directly into the collateral

account. Consequently, far from mandating the direct payment system, the portions

of the collateral-account agreement and the private offering memoranda on which

Varga relies actually indicate that the direct payment system was not mandatory.

Varga also contends that U.S. Bank acquired knowledge of the breach of

fiduciary duty fromits review ofthe PalmBeach Funds’ marketing and due-diligence

materials. Because these documents are not before the court at this procedural

juncture, Varga asserts that we must accept the truth of his allegation that these

documents “required” the retailers to make deposits directly into the collateral

account. Even if these documents did so state, they would be inconsistent with the

-8-
collateral-account agreement, the document that specified U.S. Bank’s duties in

relation to the collateral account. As noted above, by executing the collateral-account

agreement, Palm Beach Finance and Petters Capital, among others, agreed to allow,

and in fact required, U.S. Bank to accept incoming funds from a source other than a

retailer. U.S. Bank is entitled to rely on the specific provisions in its contract in the

face of alleged statements in ancillary documents, like the marketing and duediligence documents at issue here, to determine what conclusion to draw fromthe fact

that the direct payment system was not being followed. Cf. Witzman, 601 N.W.2d at

188 (providing that “the relationship between the defendant and the primary

tortfeasor” as well as “the nature of the primary tortfeasor’s activity” are permissible

considerations when ascertaining defendant’s knowledge of a breach of fiduciary

duty). Therefore, Varga has not alleged plausibly that U.S. Bank knew from its

review of the documents described above that Prevost, Harrold, and PBCM’s actions

constituted a breach of fiduciary duty to the Palm Beach Funds.

Second, Varga relies on his assertion that, no later than December 2006, U.S.

Bank began re-coding the account statements for the collateral account to identify

retailers, not Petters Company, asthe source of the funds deposited into the collateral

account. U.S. Bank, it is alleged, took this step at the direction of Prevost and

Harrold. From these instructions, Varga contends that U.S. Bank inferred that

Prevost, Harrold, and PBCM were breaching their fiduciary duties by wrongfully

concealing the noncompliance with the direct payment system from the Palm Beach

Funds. We disagree. The context within which the re-coding instructions to U.S.

Bank were made is key. For approximately the previous four years—that is, from

2002 until about December 2006—the account statements correctly reported that

Petters Company, not a retailer, made the deposits into the collateral account. 

Inferring a wrongful scheme to conceal the noncompliance with the direct payment

system when this fact had been fully disclosed for approximately four years without

any questions from the recipients of the account statements is simply not plausible. 

See Iqbal, 556 U.S. at 678. As the district court correctly summarized, under these

-9-
circumstances, “it is hard to understand why U.S. Bank should have understood [the

re-coding] as a breach of fiduciary duty, ‘somehow retroactively conceal[ing]’ the

source ofthe paymentsfromthe [PalmBeach Funds].” (second alteration in original).

Varga further contends that U.S.Bank’s act ofre-coding the account statements

amounted to substantial assistance of a breach of fiduciary duty. In order to provide

substantial assistance, “[t]he defendant must have some degree of knowledge that his

actions are aiding the primary violator.” Camp, 948 F.2d at 460; see Witzman, 601

N.W.2d at 188 (relying on Camp and explaining that “defendant’s state of

mind . . . come[s] into play” when determining whether conduct constitutes

substantial assistance). “[S]ome element of blameworthiness” must be present in the

defendant’s assistance. Camp, 948 F.2d at 460. Consequently, conduct that

inadvertently advances the breach of a fiduciary duty does not amount to substantial

assistance. Id. While U.S. Bank’s re-coding of the account statements might be

consistent with a recognition that it was helping to mislead the recipients of the

account statements or otherwise aiding a breach offiduciary duty, Varga’s allegations

fail to raise more than a sheer possibility of misconduct. See Iqbal, 556 U.S. at 678

(“The plausibility standard . . . asks for more than a sheer possibility that a defendant

has acted unlawfully.” (quoting Twombly, 550 U.S. at 556)); Ritchie v. St. Louis

Jewish Light, 630 F.3d 713, 717 (8th Cir. 2011) (“The facts pleaded . . . do not permit

us to infer more than the mere possibility of misconduct. Thus, [the] complaint

merely alleged, but did not show, that [plaintiff] is entitled to relief.”).

Considering the facts as alleged by Varga, the only plausible inference to be

drawn from U.S. Bank’s re-coding of the account statementsisthat U.S. Bank simply

was following a customer’s directions for reporting the ultimate source of the

incoming funds into the collateral account. When U.S. Bank agreed to re-code the

account statements, it knew that the recipients of these statements had known for

approximately four yearsthat Petters Company wasthe source of the incoming funds

into the collateral account. Moreover, the collateral-account agreement informed

-10-
U.S. Bank of the fact that Petters Capital, a wholly owned entity of Petters Company,

may be depositing the funds that it received from the retailers into the collateral

account. The collateral-account agreement also describes the incoming deposits to

the collateral account as “all payments owing to [Petters Capital] with respect to the

sales of inventory.” Consequently, in the absence of further allegations about the

substance of the re-coding instructions to U.S. Bank or any allegation about U.S.

Bank’s knowledge of how Prevost, Harrold, and PBCM intended to use the account

statements, U.S. Bank could only plausibly understand that it was assisting its

customer with reporting the ultimate source (retailers), rather than the intermediate

source (Petters Company), of the incoming funds into the collateral account. 

Accordingly, Varga has not alleged plausibly that U.S. Bank inferred that it was

assisting with any sort of concealment or otherwise furthering a breach of fiduciary

duty by Prevost, Harrold, and PBCM. See Iqbal, 556 U.S. at 678.

Finally, Varga relies on his assertion that U.S. Bank employees falsely told

individuals associated with the PalmBeach Funds that the direct payment systemwas

being followed. Although Varga contends that misrepresentations like this occurred

on multiple occasions, the amended complaint identifies only one specific instance:

a misrepresentation by U.S. Bank employee Caruth to Spring, a third-party marketer

for the Palm Beach Funds and an investor in Petters Company’s promissory notes. 

Caruth was Palm Beach Finance’s “main contact” at U.S. Bank. Varga primarily

argues thatCaruth’s misstatement constitutes substantial assistance. However, Varga

has not alleged that Caruth knew that his statement to Spring was false. Absent such

an allegation, Varga’s argument for substantial assistance necessarily fails. See

Camp, 948 F.2d at 460 (explaining that defendant’s conduct must have “some

element of blameworthiness”); E-Shops Corp., 678 F.3d at 664 (“There are no factual

allegations that [the bank] knew the information it processed . . . [was] false at the

time of receipt.”); see also Topchian v. JPMorgan Chase Bank, N.A., --- F.3d ---,

2014 WL 3703995, at *7 (8th Cir. July 28, 2014) (“The facts that [the plaintiff] has

alleged might be consistent with [a bank executive] having known that his statement

-11-
was false, but the alleged facts are equally consistent with a scenario in which [the

bank executive] fully and reasonably believed that his statement was true.”). 

Moreover, even if we can infer that Caruth knew that his statement was false, there

are no allegations from which we can infer that Caruth understood or even should

have understood that his misstatement aided Prevost, Harrold, and PBCM’s breach

of fiduciary duty to the Palm Beach Funds. See Camp, 948 F.2d at 460 (“The

defendant must have some degree of knowledge that his actions are aiding the

primary violator.”).

Varga’s further assertion that, at unspecified times, unnamed U.S. Bank

employees made misstatements to unnamed individuals associated with the Palm

Beach Funds fares no better. Not only does Varga fail to allege that the unnamed

U.S. Bank employees knew that their statements were false, but the amended

complaint lacks any indication of whether these employees had access to records

regarding the collateral account or whether they understood or even should have

understood that their statements were aiding a breach of fiduciary duty by Prevost,

Harrold, and PBCM. These allegations are therefore insufficient to state a plausible

claim. See C.N. v. Willmar Pub. Schs., Indep. Sch. Dist. No. 347, 591 F.3d 624, 634

(8th Cir. 2010) (rejecting allegations that misconduct occurred “on unspecified dates

and under circumstances not described” because “[s]uch vague allegations neither

provide [defendant] with fair notice of the nature of [plaintiff’s] claims and the

grounds upon which those claims rest nor plausibly establish [plaintiff’s] entitlement

to any relief”); Braden v. Wal-Mart Stores, Inc., 588 F.3d 585, 594 (8th Cir. 2009)

(“[S]ome factual allegations may be so indeterminate that they require ‘further factual

enhancement’ in order to state a claim.” (quoting Iqbal, 556 U.S. at 678)).

Considering U.S. Bank’s knowledge and assistance in tandem, see Witzman,

601 N.W.2d at 188, we agree with the district court that Varga has not stated a

plausible claim. We consequently affirm the grant of U.S. Bank’s motion to dismiss

Varga’s claim for aiding and abetting a breach of fiduciary duty.

-12-
B. Negligence

Varga also brought claims against U.S. Bank for willful and wanton negligence

and for gross negligence. In order to succeed on these claims, Varga must, among

other things, allege the existence of a duty. See Louis v. Louis, 636 N.W.2d 314, 318

(Minn. 2001). Under Minnesota law, whether a duty exists is generally an issue of

law. See id.

Varga asserts that U.S. Bank had a duty to provide information to the Palm

Beach Funds about the flow of funds in and out of the collateral account. Varga

bases this argument on Klein v. First Edina National Bank, 196 N.W.2d 619 (Minn.

1972) (per curiam), which held that when a bank transacts business with a customer,

the bank “has no special duty to counsel the customer and inform him of every

material fact relating to the transaction . . . unless special circumstances exist.” Id.

at 623. One such special circumstance is “where the bank knows or has reason to

know that the customer is placing his trust and confidence in the bank and is relying

on the bank so to counsel and inform him.” Id.

Relying on Klein, Varga argues only that special circumstances existed here

because U.S. Bank knew or had reason to know that the Palm Beach Funds placed

their trust and confidence in U.S. Bank to counsel and inform them about whether the

direct payment system was being followed. U.S. Bank knew or had reason to know

of this reliance, Varga argues, based on the escrow-account agreement and the

collateral-account agreement as well as U.S. Bank’s role in the Palm Beach Funds’

investment in Petters Company’s promissory notes. The parties’ contracts are of no

help to Varga. Neither the escrow-account agreement, which defined U.S. Bank’s

duties to the Palm Beach Funds, nor the collateral-account agreement, which

specifically disclaimed U.S. Bank’s dutiesto third partieslike the Palm Beach Funds,

evidence the special circumstances contemplated by Klein. Moreover, as noted

-13-
above, the collateral-account agreement expressly required U.S. Bank to accept

deposits that did not comply with the direct payment system.

Nor does the allegation that the Palm Beach Funds referred its investors and

third-party marketers to U.S. Bank to have their questions about the escrow and

collateral accounts answered establish the special circumstances contemplated by

Klein. The relevant contracts establish what can only be described as an ordinary,

arm’s-length commercial relationship between U.S. Bank and the PalmBeach Funds,

and “[c]ourts applying Minnesota law have been reluctant to impose a duty to

disclose material facts in arm’s-length business transactions between commercial

entities.” Driscoll v. Standard Hardware, Inc., 785 N.W.2d 805, 813 (Minn. Ct. App.

2010). Moreover, Varga has not referred us to any Minnesota case law, and we have

not located any on our own, that imposes a duty on a bank to inform its customer of

material information under circumstances that are remotely similar to those present

here. Indeed, the primary case that Varga cites in favor of imposing such a

duty—Klein—actually undermines his argument. The Klein court found that a bank

did not have a duty to inform a customer of material information notwithstanding the

twenty-year relationship between the bank and the customer. 196 N.W.2d at 623;see

Norwest Bank Hastings v. Clapp, 394 N.W.2d 176, 179 (Minn. Ct. App. 1986) (“If

[the Klein plaintiff’s] twenty-year relationship with her banker was insufficient to

establish reliance, certainly [meeting your banker twice and having one short meeting

with him] was insufficient.”). We thus affirm the grant of U.S. Bank’s motion to

dismiss Varga’s negligence claims.

III. Conclusion

For the reasons set forth above, we affirm.

______________________________

-14-