Court Opinion

ID: 4330097
Source: CourtListenerOpinion
Date Created: 2018-11-13 21:01:14.107632+00
Date Added: 2024-06-11T14:16:35.899473
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                        NOV 13 2018
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                           FOR THE NINTH CIRCUIT

CHARLES E. WHITE, Jr.; et al.,                  No.    17-16208

                Plaintiffs-Appellants,          D.C. No. 4:16-cv-00793-PJH

 v.
                                                MEMORANDUM*
CHEVRON CORPORATION and ESIP
INVESTMENT COMMITTEE,

                Defendants-Appellees.

                   Appeal from the United States District Court
                     for the Northern District of California
                   Phyllis J. Hamilton, Chief Judge, Presiding

                      Argued and Submitted October 19, 2018
                            San Francisco, California

Before: HAWKINS and HURWITZ, Circuit Judges, and EATON,** Judge.

      Appellants (collectively, “White”) appeal the district court’s Rule 12(b)(6)

dismissal of their amended complaint for failure to state a claim. White sought relief

under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C.

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
              Richard K. Eaton, Judge of the United States Court of International
Trade, sitting by designation.
§ 1001, et seq. White maintains that the amended complaint alleged sufficient facts

to support a reasonable inference that appellees (collectively, “Chevron”) breached

their fiduciary duties of loyalty and prudence to the beneficiaries of Chevron’s

retirement plan, and engaged in a prohibited transaction. We have jurisdiction under

28 U.S.C. § 1291, and affirm.

      1. Dismissal of a complaint is appropriate if it fails to “state a claim to relief

that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).

That is, “the complaint must allege ‘factual content that allows the court to draw the

reasonable inference that the defendant is liable for the misconduct alleged.’” In re

Century Aluminum Co. Securities Litig., 729 F.3d 1104, 1108 (9th Cir. 2013)

(quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). Where there are “two possible

explanations, only one of which can be true and only one of which results in liability,

plaintiff[] cannot offer allegations that are ‘merely consistent with’ [its] favored

explanation but are also consistent with the alternative explanation.” In re Century

Aluminum Co. Securities Litig., 729 F.3d at 1108 (quoting Iqbal, 556 U.S. at 678)

(emphasis added). “Something more is needed, such as facts tending to exclude the

possibility that the alternative explanation is true, . . . in order to render plaintiffs’

allegations plausible within the meaning of Iqbal and Twombly.”               Id. (citing

Twombly, 550 U.S. at 554).

                                            2                                     17-16208
      2. Applying the plausibility standard here, the facts alleged, viewed in the

light most favorable to White, were insufficient to support a plausible inference of

breach of the duty of loyalty, breach of the duty of prudence, or that a prohibited

transaction took place. Rather, as to each count, the allegations showed only that

Chevron could have chosen different vehicles for investment that performed better

during the relevant period, or sought lower fees for administration of the fund. None

of the allegations made it more plausible than not that any breach of a fiduciary duty

had occurred. See In re Century Aluminum Co. Securities Litig., 729 F.3d at 1108.

Thus, we hold that White failed to state a claim for breach of fiduciary duty.

      3. We also hold that the prohibited transaction claim was time-barred because

the transaction alleged to have violated the statute—hiring Vanguard—is alleged to

have occurred in 2002, and this action was not commenced until 2016. See 29 U.S.C.

§ 1113. In light of the foregoing, White’s derivative cause of action alleging that

Chevron failed to monitor third parties also fails.

      AFFIRMED.

                                          3                                      17-16208