UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

______________________________

WILLIAM S. HARRIS, et al., )

)

Plaintiffs, )

)

v. ) Civil Action No. 02-618 (GK)

)

JAMES E. KOENIG, et. al., )

)

Defendants. )

______________________________)

MEMORANDUM OPINION

Plaintiffs William S. Harris, Reginald E. Howard, and Peter M.

Thornton, Sr. are former employees of Waste Management Holdings,

Inc. (“Old Waste” or “the Company”) and participants in the Waste

Management Profit Sharing and Savings Plan (“Old Waste Plan” or

“Plan”). They bring this action on behalf of the Plan’s

approximately 30,000 participants under the Employee Retirement

Income Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1001, et seq.,

against Defendants, all of whom were fiduciaries of the Old Waste 1

Defendants include the “Old Waste Fiduciaries,” which are 1

Old Waste (the Plan’s sponsor), the Waste Management, Inc. Profit

Sharing and Savings Plan Investment Committee (“Old Waste

Investment Committee”), the Waste Management, Inc. Profit Sharing

and Savings Plan Administrative Committee (“Old Waste

Administrative Committee”), the individual Trustee Members of the

Committees, the Old Waste Board of Directors and its individual

members, and fifteen unidentified fiduciaries; and the “New Waste

Fiduciaries,” which are the Waste Management Retirement Savings

Plan (“New Waste Plan”), the Investment Committee of the Waste

Management Retirement Savings Plan (“New Waste Investment

Committee”) and its individual Trustee Members, the State Street

Bank and Trust Company (“State Street”), and fifteen unidentified

fiduciaries.
Plan or are fiduciaries of its successor plan, the Waste Management

Retirement Savings Plan (“New Waste Plan”).2

This matter is presently before the Court on Plaintiffs’

Amended Motion for Class Certification. Upon consideration of the

Motion, Opposition, Reply, and the entire record herein, and for

the reasons set forth below, Plaintiffs’ Motion is granted in part,

and denied in part.

I. Background

This action arises from Old Waste’s announcement on February

24, 1998 that it was restating several of its financial statements

for periods between 1991 and 1997 and that, prior to 1992 and

continuing through the first three quarters of 1997, it had

materially overstated its reported income by $1.43 billion. That

announcement led to the filing of a securities class action in the

Northern District of Illinois, which settled on September 17, 1999

(“Illinois Litigation”). Under the terms of the settlement, Old

Waste and its agents were released from liability for any claims--

including unknown claims--brought by members of the Illinois

Settlement Class. In 1999, after Old Waste’s January 1, 1999,

merger with Waste Services, Inc. to become New Waste, New Waste

announced further after-tax charges and adjustments of $1.23

On January 16, 1998, Old Waste and Waste Services, Inc., 2

merged to become New Waste. On January 1, 1999, the Old Waste Plan

was merged with the USA Waste Services, Inc. Employee’s Savings

Plan to become the Waste Management Retirement Savings Plan (“New

Waste Plan”).

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billion. The announcement led to the filing of other securities

class action complaints against New Waste and certain of its

officers and directors in the Southern District of Texas, which

settled on April 29, 2002 (“Texas Litigation”). Both settlements

included the Plan and its fiduciaries within the scope of the

class. 

On April 1, 2002, Plaintiffs filed the instant action in this

Court, alleging ten counts of ERISA violations pursuant to ERISA §

502(a)(2), codified as 29 U.S.C. § 1132(a)(2). ERISA § 502(a)(2)

provides that a civil action may be brought “by the Secretary, or

by a participant, beneficiary or fiduciary for appropriate relief

under [29 U.S.C. § 1109 (“ERISA § 409”)].” 29 U.S.C. § 1132(a)(2).

Under ERISA § 409(a), fiduciaries found to have breached their

fiduciary duties are personally liable “to make good to such plan

any losses to the plan resulting from such breach . . . and . . .

such other equitable or remedial relief as the court may deem

appropriate . . . .” 29 U.S.C. § 1109. Although participants can

assert claims on behalf of the entire plan or on behalf of their

individual plan accounts, all of Plaintiffs’ claims in this case

are asserted on behalf of the entire Plan. See LaRue v. DeWolff,

Boberg & Assocs., Inc., 552 U.S. 248, 256, 128 S.Ct. 1020, 1026,

169 L.Ed.2d 847 (2008) (explaining that § 502(a)(2) “does not

provide a remedy for individual injuries distinct from plan

-3-
injuries”); Stanford v. Foamex L.P., 263 F.R.D. 156, 164 (E.D. Pa.

2009).

Plaintiffs’ claims were originally divided into three periods.

First, Plaintiffs alleged five ERISA violations related to the

Plan’s purchase of inflated shares of company stock in the first

claim period between January 1, 1990 and February 24, 1998 (Counts

I-V). Second, Plaintiffs alleged four ERISA violations related to

the release of claims by the Plan’s fiduciaries in the Illinois

securities litigation in the second claim period between July 15,

1999 and December 1, 1999 (Counts VI-IX). Third, Plaintiffs alleged

one ERISA violation in the third claim period between February 7,

2002 and July 15, 2002 related to the release of claims by the New

Waste Plan’s trustee--Defendant State Street Bank and Trust

Company--in the Texas securities litigation (Count X). Finally, on

December 14, 2009, Plaintiffs were granted leave to file a

Substitute Fourth Amended Complaint to add Counts XIII and XIV,

which alleged Defendant State Street’s violation of ERISA

§ 406(b)(2) in the Illinois and Texas Litigations. Harris v. 3

Koenig, 673 F.Supp.2d 8, 14-15 (D.D.C. 2009) [Dkt. No. 279].

On January 15, 2010, Defendants filed three Motions to Dismiss

pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6):

The Court denied Plaintiffs leave to add Counts XI and 3

XII, which alleged additional ERISA violations in the third claim

period, because of Plaintiffs’ undue delay in bringing the claims.

673 F.Supp.2d at 13-14.

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(1) the Waste Defendants’ Motion to Dismiss Counts I-V and Counts 4

VII-IX [Dkt. No. 294]; (2) the Individual Waste Management

Defendants’ Motion to Dismiss Counts I-V [Dkt. No. 291]; and (3) 5

Defendant State Street’s Motion to Dismiss Counts XIII and XIV

[Dkt. No. 292]. On June 10, 2010, the Court denied the Waste

Defendants’ Motion to Dismiss Counts I-V and VII-IX, and granted in

part and denied in part the Individual Waste Defendants’ Motion to

Dismiss. Defendant State Street’s Motion to Dismiss was granted 6

with respect to Counts XIII and XIV. 

On November 9, 2010, Plaintiffs filed an unopposed Motion for

Leave to File a Fifth Amended Complaint [Dkt. No. 403], which was

granted. In the Fifth Amended Complaint, Plaintiffs withdrew Count

X on the basis that the evidence obtained in discovery was

insufficient to prove the claim.

These Defendants include Old Waste, the Old Waste

4

Investment Committee, the Old Waste Administrative Committee, and

the New Waste Investment Committee.

These Defendants include the individuals on Old Waste’s 5

Board of Directors, the Old Waste Investment Committee, the Old

Waste Administrative Committee, the New Waste Investment Committee,

and the executives who administered the Old Waste Plan.

Counts I-V were dismissed against Defendants H. Jesse 6

Arnelle, J. Steven Bergerson, Dean L. Buntrock, Jerry E. Dempsey,

Dr. James Edwards, Donald F. Flynn, Herbert A. Getz, Roderick M.

Hills, Joseph M. Holsten, Peter H. Huizenga, William P. Hulligan,

Edward C. Kalebich, John J. Machota, Robert S. Miller, Peer

Pedersen, James R. Peterson, John C. Pope, and Phillip B. Rooney.

In addition, Defendants Howard H. Baker, Jr., Dr. Pastora San Juan

Cafferty, Thomas R. Frank, Patricia McCann, Paul M. Montrone, D.P.

Payne, and Steven G. Rothmeier were dismissed from the action. 

-5-
The Fifth Amended Complaint now includes the following claims. 

In the first claim period, Count I alleges that the Old Waste

Investment Committee and any remaining Individual Defendants who

are or were members of that Committee breached their fiduciary

duties under ERISA § 404 by failing to prudently manage the assets

of the Plan; Count II alleges that the Old Waste Administrative

Committee and any remaining Individual Defendants who are or were

members of that Committee breached their fiduciary duties under

ERISA § 404 by failing to provide complete and accurate information

to Plan participants and beneficiaries; Count III alleges that Old

Waste, the Old Waste Administrative Committee, the Old Waste

Investment Committee, and any remaining Individual Defendants who

are or were members of those Committees engaged in prohibited

exchanges of stock between the Plan and Old Waste in violation of

ERISA § 406(a)(1)(A); Count IV alleges that Old Waste, its Board of

Directors, and any remaining Individual Defendants on the Old Waste

Board breached their fiduciary duties under ERISA § 404 by failing

to monitor the fiduciaries of the Plan; and Count V alleges that

all Old Waste Fiduciaries breached their fiduciary duties under

ERISA §§ 405(a)(2) and (3) by enabling their co-fiduciaries to

commit the ERISA violations in Counts I-IV, and by failing to

remedy them.

In the second claim period, Count VI alleges that Defendant

State Street breached its fiduciary duty under ERISA § 404 by

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failing to adequately investigate and preserve the claims in Counts

I-V in the Illinois Litigation and by causing the claims to be

released; Count VII alleges that Old Waste and State Street engaged

in prohibited exchanges of choses in action between the New Waste

Plan and Old Waste in violation of ERISA § 406(a)(1)(A) by

releasing claims in the Illinois Litigation; Count VIII alleges

that the New Waste Investment Committee and any remaining

Individual Defendants who are or were members of that Committee

breached their fiduciary duties under ERISA § 404 by failing to

adequately monitor State Street’s performance in the Illinois

Litigation; and Count IX alleges that State Street, Old Waste, the

New Waste Investment Committee, and any remaining Individual

Defendants who are or were members of that Committee breached their

fiduciary duties under ERISA §§ 405(a)(2) and (a)(3) by enabling

their co-fiduciaries to commit the ERISA violations described in

Counts VI-VIII, and by failing to remedy them.

On June 30, 2010 Plaintiffs filed their Amended Motion for

Class Certification based on the remaining counts in the Fifth

Amended Complaint [Dkt. No. 356]. The proposed class

representatives are William S. Harris, Reginald E. Howard, and

Peter M. Thornton, Sr., all Plan participants who were formerly

employed by Old Waste as truck drivers. Plaintiffs request that

Ellen M. Doyle and the law firm of Stember Feinstein Doyle Payne &

Cordes, L.L.C. and J. Brian McTigue and the law firm of McTigue &

-7-
Veis, L.L.P. be appointed as Co-lead Counsel, and Gregory Yann

Porter of Bailey & Glasser, L.L.P. be appointed as Counsel. On July

30, 2010, the Waste Defendants filed an Opposition to Plaintiffs’

Motion, which Defendant James E. Koenig joined [Dkt. Nos. 368 and

393]. Plaintiffs filed their Reply on August 16, 2010 [Dkt. No.

377].

II. Standard of Review

Federal Rule of Civil Procedure 23(a) requires a plaintiff to

satisfy the following four requirements before a class can be

certified: (1) the class must be so numerous that joinder of all

members is impracticable (“numerosity”); (2) there must be

questions of law or fact common to the class (“commonality”); (3)

the claims or defenses of the representative parties must be

typical of the claims or defenses of the class (“typicality”); and

(4) the representative parties, and their counsel, must fairly and

adequately protect the interests of the class (“adequacy of

representation”). See Fed.R.Civ.P. 23(a). In addition, the

plaintiff must satisfy one of the three requirements of Rule 23(b).

The plaintiff bears the burden of proof on each element of

Rule 23. See Amchem Prod., Inc. v. Windsor, 521 U.S. 591, 614, 117

S.Ct. 2231, 2245, 138 L.Ed.2d 689 (1997); McCarthy v. Kleindienst,

741 F.2d 1406, 1414 n.9 (D.C. Cir. 1984). “In considering a motion

for class certification, the Court’s inquiry does not extend to an

examination of the merits of the case. Instead, the legal standard

-8-
is whether the evidence presented by plaintiffs establishes a

reasonable basis for crediting plaintiffs’ assertions.” Kifafi v.

Hilton Hotel Ret. Plan, 228 F.R.D. 382, 385 (D.D.C. 2005) (citation

and internal quotations omitted). A district court exercises broad

discretion in deciding whether to permit a case to proceed as a

class action. Hartman v. Duffey, 19 F.3d 1459, 1471 (D.C. Cir.

1994) (citing Bermudez v. Dep’t of Agric., 490 F.2d 718, 725 (D.C.

Cir. 1973)); see also Gulf Oil Co. v. Bernard, 452 U.S. 89, 100,

101 S.Ct. 2193, 2200, 68 L.Ed.2d 693 (1981) (discussing district

court’s authority to exercise control over a class action).

III. Analysis

Plaintiffs seek to certify the following class:

All participants (and their beneficiaries) in

the Waste Management Retirement Savings Plan

and/or its predecessor plans, including the

Waste Management Profit Sharing and Savings

Plan, for whose accounts the fiduciaries of

the plan acquired the following employer

securities of Waste Management, Inc.:

A) pre-corporate-merger common stock

(NYSE: WMX) on or after January 1, 1990,

through and including July 16, 1998;

and/or

B) post-corporate-merger common stock

(NYSE: WMI) on or after July 16, 1998,

through and including November 9, 1999.7

Only Count X was brought on behalf of those participants 7

for whose accounts the plan fiduciaries acquired post-corporatemerger common stock. Pls.’ Proposed Order on Mot. for Class Cert.

[Dkt. No. 356-2 ¶ 8]. However, Plaintiffs have since withdrawn

Count X. Consequently, Plaintiffs have not carried their burden of

proof with respect to this portion of the class, and certification

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Pls.’ Amd. Mot. for Class Cert. at 1-2.

Defendants raise several arguments against certification of

the class of participants for whose accounts the plan fiduciaries

acquired pre-corporate-merger common stock. First, Defendants argue

that Plaintiffs have not satisfied the commonality, typicality, and

adequacy of representation requirements of Rule 23(a). Second,

Defendants argue that Plaintiffs have failed to show that one of

the three requirements of Rule 23(b) is satisfied.

A. Rule 23(a) Requirements

Defendants do not dispute that the first requirement of Rule

23(a), numerosity, is satisfied. The Plan’s Forms 5500 report an

estimated class size of 21,000 to 33,000 participants during the

relevant period. 5th Amd. Compl. ¶¶ 41-42. The Court agrees that

this class is so numerous that “joinder of all members is

impracticable” and, consequently, that the class action mechanism

serves the interests of judicial economy and efficiency.

Fed.R.Civ.P. 23(a)(1); Freeport Partners, L.L.C. v. Allbritton, No.

04-cv-2030, 2006 WL 627140, at *5 (D.D.C. Mar. 13, 2006).

The main argument advanced by Defendants is that the remaining

uncertainty surrounding the scope of the Illinois release gives

rise to potential conflicts among the putative class members which

preclude a finding of the required commonality, typicality, and

adequacy of representation. In their January 15, 2010, Motion to

of this portion of the class is denied.

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Dismiss, the Waste Defendants argued that Plaintiffs cannot

simultaneously allege that (1) the ERISA claims in Counts I-V are

not subject to the terms of the Illinois Release; and (2)

Defendants committed ERISA violations by releasing those same ERISA

claims in the Illinois Litigation. This Court rejected that

argument in its June 10, 2010, Memorandum Opinion denying the Waste

Defendants’ Motion to Dismiss, concluding that “Fed. R. Civ. P.

8(d)(3) permits plaintiffs to plead inconsistent claims in support

of alternative theories of recovery” and that a fuller record was

required to decide whether the release applies to Counts I-V.

Harris v. Koenig, No. 02-cv-618, 2010 WL 2560038, at *8 (D.D.C.

June 10, 2010) (quoting Fed.R.Civ.P. 8(d)(3) (2009) (“A party may

state as many separate claims or defenses as it has, regardless of

consistency.”)).

In opposition to Plaintiffs’ Motion for Class Certification,

Defendants now argue that, even if Counts I-V and Counts VI-IX may

be brought simultaneously in the Complaint as alternative theories

of recovery, the incentives to pursue either the first or the

second period claims are not the same for all putative class

members. Thus, Defendants argue that Plaintiffs cannot meet their

burden to prove commonality, typicality, and adequacy of

representation under Rule 23(a).

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1. Commonality

To meet the commonality requirement of Rule 23(a)(2),

Plaintiffs must show that at least one issue, the resolution of

which will affect all or a significant number of the putative class

members, is common to the entire class. See DL v. Dist. of

Columbia, 237 F.R.D. 319, 322 (D.D.C. 2006); In re Vitamins

Antitrust Litig., 209 F.R.D. 251, 259 (D.D.C. 2002); Freeport

Partners, 2006 WL 627140, at *5. The commonality requirement is a

“low bar,” and “courts have generally given it a permissive

application.” In re New Motor Vehicles Canadian Export Antitrust

Litig., 522 F.3d 6, 19 (1st Cir. 2008) (citation and internal

quotations omitted).

Plaintiffs argue that several questions of law and fact

concerning the alleged actions and omissions of the Plan

fiduciaries are common to the entire class of Plan participants.

Pls.’ Mot. at 18-21. Specifically, Plaintiffs point to “the

identity of the Plan fiduciaries during the relevant periods, their

responsibilities and duties with respect to investing in Company

Stock, the treatment of the Plan’s claims in the settlement of the

Illinois and Texas Securities, whether the Plan and the class

members’ accounts suffered losses as a result of the fiduciary

breaches claimed, and other matters.” Pls.’ Mot. at 18-19; see also

5th Amd. Compl. ¶ 273.

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Defendants respond that the inconsistent legal theories

advanced by Plaintiffs in Counts I-V and Counts VI-IX defeat

commonality. Because this Court has deferred ruling on the scope of

the Illinois release until the record is more fully developed,

uncertainty remains as to which, if any, putative class members

will be able to pursue Counts I-V and which, if any, will be

limited to pursuing Counts VI-IX if it is found that their claims

under Counts I-V were released. In short, according to Defendants,

“there remains substantial uncertainty about which putative class

members will be able to pursue which of Plaintiffs’ conflicting

theories of recovery.” Defs.’ Opp’n at 13. Thus, Defendants argue,

because Counts I-V and Counts VI-IX raise no common questions,

there would be no common questions among those class members

limited to pursuing Counts I-V and those class members limited to

pursuing Counts VI-IX. 

First, this argument is purely speculative; there is no

evidence in the record to suggest that the putative class will be

split along these lines. In fact, at this early stage, the scope of

the Illinois release is at least one question of law--and it is a

crucial question--which is common to the entire putative class. 

Second, assuming arguendo that the effect of the Illinois

release is to split the putative class into two groups, the Court

does not agree that Counts I-V and Counts VI-IX raise no common

questions. While the first and second claim periods differ as to

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legal and factual issues, the value of the released ERISA claims in

Counts I-V, which depends in part on the merits of those claims, is

relevant to Counts VI-IX. See Defs.’ Opp’n at 2 (“[T]o prevail on

the Second Period claims, Plaintiffs must show that the Illinois

Judgment released the Plan’s First Period claims for inadequate

consideration . . . .”) (emphasis added). Certain issues related to

the merits of Counts I-V are relevant to the value of those claims,

and are therefore common to the entire class. See Trief v. Dun &

Bradstreet Corp., 144 F.R.D. 193, 198 (S.D.N.Y. 1992) (“Commonality

does not mandate that all class members make identical claims and

arguments, only that common issues of fact or law affect all class

members.”).

For these reasons, the Court concludes that the existing

uncertainty regarding the scope and effect of the Illinois Release

does not defeat commonality. Consequently, Plaintiffs have met

their burden to demonstrate that there are common issues of law and

fact which affect the entire class.

2. Typicality

Rule 23(a) next requires a showing of typicality, or that “the

claims or defenses of the representative parties are typical of the

claims or defenses of the class.” Fed.R.Civ.P. 23(a)(3). Typicality

requires that the named plaintiffs have the same motivation as

absent class members to ensure fair and effective representation.

Typicality is shown if each class member’s claim arises from the

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same course of events that led to the claims of the representative

parties and each class member makes similar legal arguments to

prove the defendant’s liability. Baby Neal for and by Kanter v.

Casey, 43 F.3d 48, 58 (D.C. Cir. 1994); see also Freeport Partners,

2006 WL 627140, at *6. The commonality and typicality requirements

of Rule 23(a) tend to merge, since both look to whether each class

member’s claims, including the claims of the representative

parties, arise from the same course of events. Gen. Tel. Co. of Sw.

v. Falcon, 457 U.S. 147, 157 n.13, 102 S.Ct. 2364, 2370 n.13, 72

L.Ed.2d 740 (1982).

The claims brought in the Fifth Amended Complaint are all

based on alleged actions or omissions which were directed at the

Plan. In fact, Counts I-IX are all brought under ERISA § 502(a)(2),

which permits plan participants to bring counts on behalf of the

plan to recover plan injuries, not individual injuries. See LaRue,

552 U.S. 248, 256, 128 S.Ct. 1020, 1026. Thus, Plaintiffs’ claims

in Counts I-IX, as well as the legal arguments in support of the

claims, are typical, if not identical, to the claims and arguments

of the other Plan participants who are putative class members.

Defendants argue, however, that the specter of a conflict

among class members regarding the proper scope of the Illinois

release defeats Plaintiffs’ arguments in support of typicality.

Defendants argue that there is a conflict among the putative class

members because some Plan participants may wish to limit the scope

-15-
of the Illinois release, whereas others may wish to argue it does

not apply at all or even that it applies to the entire first claim

period.8

First, as noted above, this scenario is purely speculative;

there is no evidence in the record to suggest that a certain number

of putative class members have an incentive to limit the scope of

the release, and that a different group of putative class members

have an incentive to interpret it broadly. Such “speculative

suggestion of potential conflict is insufficient to defeat class

certification.” Aliotta v. Gruenberg, 237 F.R.D. 4, 12 (D.D.C.

2006) (quoting Rodolico v. Unisys Corp., 199 F.R.D. 468, 477

(E.D.N.Y. 2001)); see also Cummings v. Connell, 316 F.3d 886, 896

(9th Cir. 2003).

Second, in the event that such a conflict does arise, the

Court has discretion to consider creating sub-classes. See

Fed.R.Civ.P. 23(c)(5) (permitting a class action to be divided into

At times, Defendants suggest that, once the scope of the 8

Illinois release is decided, conflicts would persist among class

members who are limited to Counts I-V and class members who are

limited to Counts VI-IX. The Court sees no reason why this would be

the case. There is no discernible conflict presented by a class

containing both (1) members whose ERISA claims in Counts I-V were

released and who pursue Counts VI-IX on the ground that the release

itself constituted ERISA violations, and (2) members whose ERISA

claims in Counts I-V were not released and who continue to pursue

Counts I-V. The only potential conflict conceivable at this stage

is between those putative class members who might have an incentive

to limit the scope of the Illinois release and other putative class

members who might have an incentive to interpret the release

broadly. However, as explained, the Court deems this conflict

speculative.

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subclasses which are treated as a class); In re Ins. Brokerage

Antitrust Litig., 579 F.3d 241, 271-72 (3d Cir. 2009) (discussing

district court’s discretion to divide the class into subclasses in

order to prevent conflicts of interest). The Court therefore

concludes that Plaintiffs have met their burden to prove

typicality.

3. Adequacy of Representation

Finally, Rule 23(a)(4) requires that “the representative

parties will fairly and adequately protect the interests of the

class.” Fed.R.Civ.P. 23(a)(4). Like the typicality inquiry, this

requirement seeks to uncover conflicts of interest between the

named parties and the putative class. See Amchem, 521 U.S. at 625-

26, 117 S.Ct. at 2250-51. “Two criteria for determining the

adequacy of representation are generally recognized: (1) the named

representative must not have antagonistic or conflicting interests

with the unnamed members of the class, and (2) the representative

must appear able to vigorously prosecute the interests of the class

through qualified counsel.” Twelve John Does v. Dist. of Columbia,

117 F.3d 571, 575 (D.C. Cir. 1997) (citation and internal

quotations omitted). In addition, the adequacy of representation

prong requires that the class representatives have a commitment to,

knowledge of, and interest in the litigation, although they need

not have expert knowledge of all aspects of the case. Only a “total

lack of interest and unfamiliarity with [the] suit would be

-17-
sufficient grounds to deny plaintiffs’ motion [to certify class].”

In re Newbridge Networks Sec. Litig., 926 F.Supp. 1163, 1177

(D.D.C. 1996) (citation and internal quotations omitted). 

Plaintiffs’ proposed representative parties include William S.

Harris, Reginald E. Howard, and Peter M. Thornton. These Plaintiffs

had Plan accounts which were invested in company stock during the

period from January 1, 1990 to November 2, 1994 and throughout the

Illinois Class Period (from November 2, 1994 to July 15, 1998).

Pls.’ Reply at 8. Specifically, Harris was a participant in the Old

Waste and New Waste Plans and had invested in the Waste Management

Stock Fund from September 30, 1992 until the filing of the present

Motion; Howard was a participant in the Old Waste Plan who had

invested in the Waste Management Stock Fund from at least January

1, 1992 through February 1, 1999; and Thornton was a participant in

the Old Waste Plan who had invested in the Waste Management Stock

Fund and the ESOP Fund from at least January 1, 1992 through

February 1, 1999. 5th Amd. Compl. ¶¶ 17-19; Decl. of Ellen M. Doyle

in Support of Pls.’ Reply in Support of Amd. Mot. for Class

Certification (Ex. A to Pls.’ Mot. at ¶¶ 5-13); Pls.’ Mot. at 7.

First, Defendants argue that the named Plaintiffs cannot

adequately represent the class because of the potentially

conflicting interests with the unnamed members of the class arising

out of the Illinois release. As discussed above, the Court rejects

this argument on the basis that it is speculative and, in the event

-18-
any conflict arises, there are procedural mechanisms for protecting

all class members.

Second, Defendants argue that the proposed class

representatives are inadequate because they know too little about

the litigation. Defendants point to a number of instances where

Harris, Howard, and Thornton admitted at their depositions to

ignorance of certain details of the case, including the details of

the Illinois and Texas Litigations, the precise composition of the

class, the outcome of Defendants’ Motions to Dismiss, and even the

contents of the Complaint. Defs.’ Opp’n at 20-22. 

However, in complex actions such as this, the named

representatives are entitled to rely on counsel to conduct the

litigation, and are not required to be intimately familiar with the

details of the case. In re Avon Secs. Litig., No. 91-cv-2287, 1998

WL 834366, at *9 (S.D.N.Y. Nov. 30, 1998) (in complex case, “the

qualifications of class counsel are generally more important in

determining adequacy than those of the class representatives”).9

In addition, Plaintiffs cite to portions of the named

representatives’ depositions which indicate that they regularly

consult with class counsel and review all legal documents which are

forwarded to them. Pls.’ Reply at 16-17. The statements cited in

It should be remembered that all three Plaintiffs were

9

employed as truck drivers. It would be absurd to expect them to

understand the intricacies of ERISA and the securities laws, which

sometimes elude even experienced counsel.

-19-
Plaintiffs’ Reply brief also indicate that Harris, Howard, and

Thornton share a strong and genuine interest in litigating the suit

in order to rectify the alleged injury done to Plan participants.

Id. Consequently, the Court concludes that Harris, Howard, and

Thornton are adequate class representatives.

Finally, Defendants failed to oppose Plaintiffs’ proposed

class counsel, so their adequacy may be treated as conceded. D.D.C.

Local Rule 7(b); Fox v. Am. Airlines, Inc., Civ. No. 02-2069, 2003

WL 21854800, at *2 (D.D.C. Aug. 5, 2003), aff’d, Fox v. Am.

Airlines, Inc., 389 F.3d 1291 (D.C. Cir. 2004). Plaintiffs have

therefore met their burden to prove the adequacy of both the class

representatives and class counsel.

B. Rule 23(b) Requirements

In addition to meeting the requirements of numerosity,

commonality, typicality, and adequacy of representation in Rule

23(a), Plaintiffs must show that one of the requirements of Rule

23(b) is met. Plaintiffs seek certification of the class under

Rules 23(b)(1) and/or (b)(2). Rule 23(b)(1) permits certification

when:

prosecuting separate actions by or against

individual class members would create a risk

of: (A) inconsistent or varying adjudications

with respect to individual class members that

would establish incompatible standards of

conduct for the party opposing the class; or

(B) adjudications with respect to individual

class members that, as a practical matter,

would be dispositive of the interests of the

other members not parties to the individual

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adjudications or would substantially impair or

impede their ability to protect their

interests.

Fed.R.Civ.P. 23(b)(1). 

Rule 23(b)(2) permits certification when “the party opposing

the class has acted or refused to act on grounds that apply

generally to the class, so that final injunctive relief or

corresponding declaratory relief is appropriate respecting the

class as a whole.” Fed.R.Civ.P. 23(b)(2).

1. Rule 23(b)(1)

Both Rules 23(b)(1)(A) and 23(b)(1)(B) are designed to prevent

prejudice to the parties resulting from multiple suits involving

the same subject matter by certifying a mandatory class. Rule

23(b)(1)(A) seeks to prevent prejudice to the party opposing the

class, while Rule 23(b)(1)(B) seeks to prevent prejudice to other

class members who did not participate in the litigation. Because

breach of fiduciary duty claims under ERISA § 502(a)(2) are often,

as they are here, shared by all Plan participants, the danger of

such prejudice is great. Thus, such claims are “paradigmatic

examples of claims appropriate for certification as a Rule 23(b)(1)

class.” In Re Schering Plough Corp. ERISA Litig., 589 F.3d 585, 604

(3d Cir. 2009); see also In re Marsh ERISA Litig., 265 F.R.D. 128,

142 (S.D.N.Y. 2010).

Defendants argue, however, that neither Rule 23(b)(1)(A) nor

Rule 23(b)(1)(B) applies because there are individual factual

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questions relating to each putative class member’s claims which

eliminate any risk of inconsistent or varying adjudications or

adjudications which would be dispositive of the interests of other

class members. In other words, Defendants argue that the

uncertainty surrounding the Illinois release requires

individualized consideration of the class members’ claims and, as

a result, mandatory certification under Rule 23(b)(1) would be

unwarranted.

The Court disagrees. In the Illinois Litigation, Defendants

released the ERISA claims of the Plan, not the ERISA claims of the

individual participants. Thus, the scope of the release is a single

question of law which does not implicate facts applicable to

specific individuals, and is appropriate for treatment on a classwide basis. Cf. In re Polaroid ERISA Litig., 240 F.R.D. 65, 75-76

(S.D.N.Y. 2006). Defendants’ argument is therefore rejected, and

the Court turns to consideration of Defendants’ other arguments

against Rule 23(b)(1) certification.

a. Rule 23(b)(1)(A)

Defendants first oppose class certification under Rule

23(b)(1)(A) because “there is little, if any risk, of individual

suits by unnamed class members if the class is not certified.”

Defs.’ Opp’n at 24. In support of this argument, Defendants point

to the fact that, to date, no one apart from the three named

representatives have filed suit. Id. However, as Plaintiffs

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respond, there is no reason for other class members to have filed

suit at this point given that this class action is pending.

Second, Defendants argue that the threat of incompatible

standards of conduct is rarely present in suits for monetary

damages, and thus certification under Rule 23(b)(1)(A) is

inappropriate. Plaintiffs seek an order that Defendants restore to

the New Waste Plan all losses occasioned by their breaches of

fiduciary duties and “appropriate relief to enjoin the acts and

practices of the Defendants alleged herein,” as well as “such other

equitable and legal relief as the Court deems just.” 5th Amd.

Compl., Prayer for Relief. It is true, as Defendants argue, that

the relief sought by Plaintiffs is primarily monetary.

Although there is some precedent that ERISA § 502(a)(2) suits

seeking primarily monetary relief are not appropriate for

certification under Rule 23(b)(1)(A), most courts that have

recently ruled on the issue have rejected that conclusion. Compare

In re First Am. Corp. ERISA Litig., 258 F.R.D. 610, 621-22 (C.D.

Cal. 2009) (concluding, on the basis of definitive Ninth Circuit

precedent, that an ERISA § 502(a)(2) suit brought primarily for

monetary damages was not appropriate for Rule 23(b)(1)(A)

certification); and Hochstadt v. Boston Sci. Corp., 708 F.Supp.2d

95, 104 n.11 (D. Mass. 2010) (concluding the same in a footnote);

with Hans v. Tharaldson, No. 3:05-cv-115, 2010 WL 1856267, at *10

(D.N.D. May 7, 2010) (concluding that Rule 23(b)(1)(A)

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certification is appropriate for § 502(a)(2) claim for monetary

relief); Stanford, 263 F.R.D. at 173 (same); Jones v. NovaStar

Fin., Inc., 257 F.R.D. 181, 193-94 (W.D. Mo. 2009) (same); Kanawi

v. Bechtel Corp., 254 F.R.D. 102, 111 (N.D. Cal. 2008) (same); In

re Nortel Networks Corp. ERISA Litig., No. 3:03-md-01537, 2009 WL

3294827, at *15-16 (M.D. Tenn. Sept. 2, 2009) (same); In re Merck

& Co. Inc. Secs., Derivative & ERISA Litig., Nos. 05-cv-1151, 05-

cv-2369, 2009 WL 331426, at *11 (D.N.J. Feb. 10, 2009) (same);

Abbott v. Lockheed Martin Corp., No. 06-cv-701, 2009 WL 969713, at

*9 (S.D. Ill. Apr. 3, 2009) (same).

Those courts which have found certification under Rule

23(b)(1)(A) inappropriate have done so on the basis of Ninth and

Eleventh Circuit precedent concluding that suits primarily for

monetary damages pose no risk of incompatible standards of conduct.

See Zinser v. Accufix Research Inst., Inc., 253 F.3d 1180, 1193

(9th Cir. 2001); Babineau v. Fed Express Corp., 576 F.3d 1183, 1195

(11th Cir. 2009) Significantly, neither Zinser nor Babineau

addressed whether their holdings should apply in the ERISA §

502(a)(2) context. Moreover, these cases involved, respectively,

product liability and breach of contract claims in which each class

member had individual claims against the defendants, and therefore

class certification would pose individual liability issues. Here,

in contrast, the claims are brought on behalf of the entire Plan,

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of which the putative class members are participants, and rulings

on liability will apply to all members of the class.

As the court in Stanford, 263 F.R.D. at 173 (citations and

internal quotations omitted), explained in language that is

applicable to this case:

The issue is not whether plaintiff seeks

primarily monetary damages; rather, the focus

of a Rule 23(b)(1)(A) analysis is on whether

separate actions could lead to adjudications

that establish incompatible standards of

conduct for the party opposing the class. . .

. [T]he court is concerned with the effect of

inconsistent orders with respect to individual

Plan accounts. When raising a plan-wide claim,

a plaintiff is pursing a claim on behalf of

the entire plan, which necessarily includes

discrete accounts within the plan.

Accordingly, if a court entertaining an

individual account claim [pursuant to LaRue,

552 U.S. 248, 128 S.Ct. 1020] were to reach a

different conclusion from a court entertaining

a plan-wide claim, the fiduciaries would be

left with incompatible orders concerning the

same account. . . . Such competing orders lead

to incompatible standards of conduct for the

defendants.

In addition, although Plaintiffs primarily seek monetary

damages in this case, it is not clear why what Defendants term

their “perfunctory” requests to enjoin the acts and practices of

the Defendants could not result in incompatible standards of

conduct if a separate action resulted in a contrary ruling. Defs.’

Opp’n at 27; see In re Merck & Co., Inc., 2009 WL 331426, at *11

(stating that Rule 23(b)(1)(A) “does not require that the varying

adjudications would establish incompatible standards as the

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exclusive or even primary remedy” but only that “varying

adjudications would establish incompatible standards”). For

example, this Court could enter a ruling to restore Plan assets,

remove Plan fiduciaries, or reform Plan investigative practices and

monitoring practices that would directly contradict another Court’s

ruling on the very same issues. In that event, Defendants would be

faced with incompatible standards of conduct with respect to their

duties and obligations toward the Plan.

For these reasons, the Court concludes that there is a risk of

“inconsistent or varying adjudications with respect to individual

class members that would establish incompatible standards of

conduct for the party opposing the class” in this case. Thus,

certification under Rule 23(b)(1)(A) is appropriate.

b. Rule 23(b)(1)(B)

As noted above, Rule 23(b)(1)(B) focuses not on the danger to

defendants of inconsistent rulings, but on the risk that separate

actions might dispose of the interests or rights of other class

members. Historically, § 502(a)(2) actions brought on behalf of the

entire plan have been considered especially appropriate for Rule

23(b)(1)(B) certification. See Ortiz v. Fibreboard Corp., 527 U.S.

815, 833-34, 119 S.Ct. 2295, 2308-09, 144 L.Ed.2d 715 (1999). The

Advisory Committee Notes to the 1966 Amendment of Rule 23(b)(1)(B)

state that certification is especially appropriate in cases

charging breach of trust by a fiduciary to a large class of

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beneficiaries. In addition, Congress’s intent was that ERISA

“actions for breach of fiduciary duty be brought in a

representative capacity on behalf of the plan as a whole.” See

Mass. Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 142 n.9, 105

S.Ct. 3085, 3090 n.9, 87 L.Ed.2d 96 (1985). 

Defendants argue, however, that the Supreme Court’s decision

in LaRue, 552 U.S. 248, eliminated the risk that individual class

members’ rights or interests would be disposed of by § 502(a)(2)

actions. The plaintiff in LaRue sought to bring a § 502(a)(2) claim

against his plan’s fiduciaries for their failure to make certain

changes he requested to his individual account, which diminished

the value of his interest in the plan. The Supreme Court held that,

“although § 502(a)(2) does not provide a remedy for individual

injuries distinct from plan injuries, that provision does authorize

recovery for fiduciary breaches that impair the value of plan

assets in a participant’s individual account.” Id. at 256.

Defendants contend that this holding--that a participant in a

defined contribution plan can bring an individual suit for breach

of fiduciary duty, in addition to the possibility of bringing a

suit on behalf of the entire plan--means that the putative class

members can protect their own interests by bringing individual

suits, whatever the disposition of this litigation may be, making

certification under Rule 23(b)(1)(B) inappropriate. There is some

precedent supporting this interpretation. See In re First Am. Corp.

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ERISA Litig., 258 F.R.D. at 622; In re Computer Sciences Corp.

ERISA Litig., No. 08-cv-2398, 2008 WL 7527874, at *3 (C.D. Cal.

Sept. 2, 2008).

However, most courts deciding class certification motions for

§ 502(a)(2) actions post-LaRue have continued to find Rule

23(b)(1)(B) certification appropriate. See George v. Kraft, No. 08-

C-3799, 2010 WL 3386, at *402 (N.D. Ill. Aug. 25, 2010); In re

Marsh ERISA Litig., 265 F.R.D. at 144; Stanford, 263 F.R.D. at 173-

74; Hochstadt, 708 F.Supp.2d at *104 n.12; Kanawi, 254 F.R.D. at

109; NovaStar Fin., Inc., 257 F.R.D. at 190; Hans v. Tharaldson,

2010 WL 1856267, at *9-10. 

In Stanford, the court acknowledged the appeal of Defendants’

argument, but concluded that Rule 23(b)(1)(B) certification was

still appropriate post-LaRue:

[B]ecause Stanford challenges behavior of

defendants that allegedly injured the entire

Fund, Stanford’s claims would be identical to

any individual account claim that another

putative class member may raise. Indeed, . . .

a participant’s individual account is still a

part of the Plan, and, therefore, an

adjudication as to the Plan will likewise

impact a participant’s individual accounts.

Thus, the availability of an individual

account claim under § 502(a)(2) does not

alleviate the concerns cited by the numerous

courts that have certified ERISA class actions

pursuant to Rule 23(b)(1)(B) in situations

where claims on behalf of the Plan are

identical to those on behalf of an individual

account.

263 F.R.D. at 174.

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Defendants argue that the reasoning in Stanford is

inapplicable because “the claims of each of the class

representatives are potentially very different from those available

to the other class representatives and to absent members of the

putative class.” Defs.’ Opp’n at 31 n.19. As has been discussed,

the Court is not convinced that the uncertainty surrounding the

scope of the Illinois release will result in “very different”

claims for some putative class members. At most, the effect of the

release would be to create two groups of putative class members:

those whose claims in Counts I-V were released, and those whose

claims were not released. Thus, adjudication of the named

representatives’ claims as to the Plan would impact the individual

accounts of those participants who are similarly situated.

Thus, the Court concludes that LaRue did not eliminate the

risk that the putative class members’ interests and rights in this

action will be disposed of if separate litigation on the same

subject matter is permitted. Consequently, certification of a

mandatory class under Rule 23(b)(1)(B) is appropriate.

2. Rule 23(b)(2)

Finally, as noted above, a class may be certified under Rule

23(b)(2) if “the party opposing the class has acted or refused to

act on grounds that apply generally to the class, so that final

injunctive relief or corresponding declaratory relief is

appropriate respecting the class as a whole.” Fed.R.Civ.P.

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23(b)(2). Thus, Rule 23(b)(2) certification is appropriate for a

class seeking primarily equitable relief for a common injury, not

a class seeking substantial monetary damages. In re Veneman, 309

F.3d 789, 792 (D.C. Cir. 2002); see also Fed.R.Civ.P. 23(b)(2),

adv. comm. n. (certification under Rule 23(b)(2) “does not extend

to cases in which the appropriate final relief relates exclusively

or predominately to money damages”). 

While Plaintiffs are seeking injunctive and declaratory relief

in this action, their primary goal is, as discussed earlier, to

obtain monetary damages for class members. Thus, the Court

concludes that certification under Rule 23(b)(2) is inappropriate.

C. Rule 23(g)

Finally, a court that certifies a class must appoint class

counsel under Rule 23(g). Plaintiffs request that Ellen M. Doyle

and the law firm of Stember Feinstein Doyle Payne & Cordes, L.L.C.

and J. Brian McTigue and the law firm of McTigue & Veis, L.L.P. be

appointed as Co-lead Counsel, and Gregory Yann Porter of Bailey &

Glasser, L.L.P. be appointed as Counsel. Proposed class counsel

have extensive experience litigating ERISA class actions, and have

demonstrated their commitment to the prosecution of this action.

Pls.’ Mot. at 26; Attn’y Biographies (Ex. Q to Dkt. No. 249). In

addition, Defendants do not oppose certification of Plaintiffs’

proposed class counsel. See Defs.’ Opp’n. Consequently, the Court

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appoints Plaintiffs’ requested counsel as class counsel in this

case.

CONCLUSION

For the reasons set forth herein, the Court concludes that

Plaintiffs have carried their burden to meet the requirements under

Rules 23(a), 23(b)(1)(A), 23(b)(1)(B) for certification of the

class defined as follows:

All participants (and their beneficiaries) in

the Waste Management Retirement Savings Plan

and/or its predecessor plans, including the

Waste Management Profit Sharing and Savings

Plan, for whose accounts the fiduciaries of

the plan acquired the following employer

securities of Waste Management, Inc.:

A) pre-corporate-merger common stock

(NYSE: WMX) on or after January 1,

1990, through and including July 16,

1998.

Plaintiffs have failed to meet their burden, however, to

certify the class of participants (and their beneficiaries) for

whose accounts the fiduciaries of the plan acquired “B) postcorporate-merger common stock (NYSE: WMI) on or after July 16,

1998, through and including November 9, 1999.” In addition,

Plaintiffs have failed to meet their burden to prove that

certification under Federal Rule of Civil Procedure 23(b)(2) is

appropriate. Consequently, Plaintiffs’ Amended Motion for Class

Certification [Dkt. No. 356] is granted in part, and denied in

part. 

The Court certifies the following common questions of fact and

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law for Counts I-IX of the Fifth Amended Complaint:10

• Whether the fiduciaries caused the Plan to acquire shares

of company stock at inflated prices, and whether this

constituted a breach of fiduciary duty under ERISA;

• Whether findings made in other litigation against

Defendant James E. Koenig may be used affirmatively for

purposes of collateral estoppel in this action;

• Whether the representation of the Plan and its

participants by State Street in the Illinois Litigation

was adequate and loyal;

• Whether State Street’s investigation into the claims of

the Plan prior to its agreement to release the claims was

adequate;

• Whether the representation of the Plan and its

participants by the lead plaintiffs in the Illinois

Litigation was adequate when they did not have or assert

ERISA claims;

• Whether additional claims for a recovery under ERISA

could have been but were not made for the Plan during the

Illinois Litigation;

• Whether additional claims for a recovery under ERISA had

any value and, if so, what additional value the ERISA

claims provided; 

• Whether any claims for additional recoveries under ERISA

were within the scope of the Illinois Litigation

settlement release;

• Whether the release in the Illinois Litigation settlement

may be enforced against the Plan and its participants;

• Whether State Street caused the Plan to engage in a

prohibited transaction in the settlement of its claims in

the Illinois Litigation;

• Whether Defendants Koenig and Tobeckson acted to conceal

their breaches of fiduciary duty, thereby subjecting the

This list is not intended as a final or definitive list 10

of the common questions of fact or law in this case.

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Plaintiffs’ claims to ERISA’s six-year statute of

limitations; and

• Whether Plaintiffs and Class members were injured by the

Old Waste Plan Investment Committee Defendants’ alleged

failure to conduct an adequate fiduciary review to

determine whether it was prudent to continue to acquire

Company Stock.

In addition, the Court appoints Harris, Howard, and Thornton

as class representatives. Ellen M. Doyle and the law firm of

Stember Feinstein Doyle Payne & Cordes, L.L.C. and J. Brian McTigue

and the law firm of McTigue & Veis, L.L.P. are appointed as Co-lead

Counsel, and Gregory Yann Porter of Bailey & Glasser, L.L.P. is

appointed as Counsel. An Order will accompany this Memorandum 11

Opinion.

 /s/ 

November 12, 2010 Gladys Kessler

United States District Judge

Copies to: attorneys on record via ECF 

No objection was made as to their appointment. 11

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