Opinion ID: 4414424
Heading Depth: 4
Heading Rank: 2

Heading: Banks’ fee-related claims survive 12(b)(6).

Text: Separately from its SLUSA-preclusion argument, Northern’s motion to dismiss the FAC also contended that Banks did not sufficiently plead the fee-related claims under Rule 12(b)(6). To survive a Rule 12(b)(6) motion to dismiss for failure to state a claim, a complaint must offer “more than labels and conclusions,” and instead contain “enough factual matter” indicating “plausible” grounds for relief, not merely “conceivable” ones. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555–56, 570 (2007). Northern argues that because its fees were reasonable, Banks failed to state a claim. Northern also contends the FAC consists of conclusory allegations. The district court did not rule on these arguments because it held SLUSA precluded the feerelated claims. A trustee must administer a trust according to its instrument and the laws of trusts, see Cal. Prob. Code § 16001, and may only incur appropriate and reasonable BANKS V. NORTHERN TRUST 19 costs. See Cal. Prob. Code § 16050. Trustees are under a continuing duty to account for dealings with trust property and to provide those accountings to the beneficiaries on demand. See In re Estate of De Laveaga, 326 P.2d 129, 133 (Cal. 1958); see also Cal. Prob. Code § 16062. A trustee’s violation of its duty is a breach of trust. See Cal. Prob. Code § 16400. The FAC alleged which specific fees were at issue – taxpreparation fees and fees in excess of the fixed-fee allowed by the trust – and explained why those fees allegedly breached Northern’s duty of loyalty. The FAC also alleged that the $900 tax-preparation fee was previously part of the regular trust administration fee but subsequently became a separate cost, without approval by a probate court. The FAC alleged that, “[a]s time has progressed, and despite the benefits of computerization and technology capabilities at Northern Trust, the fees charged have increased” without explanation. The FAC also asserted that Northern did not provide any information about when, how, or why it began charging tax-preparation fees. The FAC contended these combined allegations amounted to breach-of-trust violations: “[t]his uniform practice of charging excessive and improper fees violates the duties of loyalty and prudent administration by placing [Northern’s] own financial interest above the interest of Plaintiffs and members of the proposed Tax Preparation Class.” These detailed allegations meet Twombly’s plausibility requirement and amount to more than conclusory labels.