Court Opinion

ID: 4536393
Source: CourtListenerOpinion
Date Created: 2020-05-23 00:00:20.804068+00
Date Added: 2024-06-11T08:45:57.296362
License: Public Domain

Case: 18-20379   Document: 00515426238     Page: 1   Date Filed: 05/22/2020

        IN THE UNITED STATES COURT OF APPEALS
                 FOR THE FIFTH CIRCUIT    United States Court of Appeals
                                                   Fifth Circuit

                                                                           FILED
                                                                     May 22, 2020
                                 No. 18-20379
                                                                     Lyle W. Cayce
                                                                          Clerk
JEFFERY SCHWEITZER; JONATHAN SAPP; RAUL RAMOS; DONALD
FOWLER,

             Plaintiffs - Appellants

v.

THE INVESTMENT COMMITTEE OF THE PHILLIPS 66 SAVINGS PLAN;
SAM FARACE; JOHN DOES 1-10, INCLUSIVE,

             Defendants - Appellees

                Appeal from the United States District Court
                     for the Southern District of Texas

Before HIGGINBOTHAM, SMITH, and HIGGINSON, Circuit Judges.
PATRICK E. HIGGINBOTHAM, Circuit Judge:
      Four participants in Phillips 66’s retirement plan bring this putative
class action against the plan’s Investment Committee for breach of fiduciary
duties under the Employee Retirement Income Security Act. They allege that
the Defendants failed to monitor properly and divest ConocoPhillips stock from
the retirement plan. The district court granted Defendants’ motion to dismiss
for failure to state a claim, and Plaintiffs timely appealed. We affirm.
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                                     No. 18-20379
                                            I.
      In 2012, ConocoPhillips Corporation, a large oil and gas company, spun
off Phillips 66 as a separate, independent company. ConocoPhillips retained
its upstream business, namely exploration and production, while Phillips 66
took on the downstream business, including refining, marketing, and
transportation operations.
      With     the    separation,    12,000      ConocoPhillips    employees      became
employees of Phillips 66. Many of them had held assets in individual
retirement accounts in the ConocoPhillips Savings Plan at the time of the
separation. These accounts included large investments in two single-stock
funds comprised of ConocoPhillips stock. As a result of the separation, each
employee received one share of Phillips 66 stock for every two shares of
ConocoPhillips stock held in their account. Afterward, Phillips 66 employees
had $2.9 billion in ConocoPhillips Plan assets, including $1.1 billion invested
in the ConocoPhillips Funds. The ConocoPhillips Plan transferred these assets
to the Phillips 66 Savings Plan, the newly established retirement plan for
Phillips 66 employees. After the transfer, Phillips 66 Plan participants could
retain or sell their investments in the ConocoPhillips Funds, but could not
make new investments in the Funds.
       As the Phillips 66 Plan is a defined contribution plan, each participant
has an individual account and benefits are based on the amounts contributed
to that participant’s account. 1 Plan participants decide how much to contribute
to their accounts and how to allocate their assets among an array of investment
options selected by the Plan’s Investment Committee. The Phillips 66 Plan
allows participants to invest in two single-stock funds comprised of Phillips 66

      1  A defined benefit plan, by contrast, promises employees fixed payments and retains
full responsibility for investing the plan’s assets.
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stock. 2 Just a few months after the spin-off, the Plan had $1.1 billion invested
in the ConocoPhillips Funds and $0.9 billion in the Phillips 66 Funds.
Together, these funds accounted for 58% of the Plan’s assets.
       When ConocoPhillips spun off Phillips 66 on April 30, 2012,
ConocoPhillips’s share price was about $55. Over the next two years, its share
price increased by more than 50%, reaching $86 by June 2014. Plaintiffs allege,
however, that by the second half of 2014, there were red flags indicating
ConocoPhillips was a risky investment. Plaintiffs point to publicly available
information, including declining share prices, uncertainty in the price of oil,
and Berkshire Hathaway’s sale of its stake in ConocoPhillips. ConocoPhillips’s
share price fell to $69 by the end of 2014, $46 by the end of 2015, and $40 by
February 2016. When Plaintiffs filed this lawsuit in October 2017, the share
price was $50. 3
       Plaintiffs allege that the Investment Committee and its members (the
“Fiduciaries”) breached their fiduciary duties of diversification and prudence
under ERISA by failing to independently review the merits of divesting the
ConocoPhillips Funds. According to Plaintiffs, the Fiduciaries incorrectly
believed that ConocoPhillips was a “qualifying employer securit[y],” an ESOP,
and thus exempt from certain diversification requirements. 4
       The district court held that Plaintiffs failed to state a claim based on the
duty to diversify because the Phillips 66 participants were not allowed to make
new investments in the ConocoPhillips Funds and could elect to exchange their
assets out of the Funds at any time. It also held that Plaintiffs’ duty-of-

       2  The Phillips 66 Plan is an Eligible Individual Account Plan, which like an employer
stock option plan “offer[s] ownership in employer stock as an option to employees.” Amgen
Inc. v. Harris, 136 S. Ct. 758, 758 (2016) (per curiam).
        3 “We can, of course, take judicial notice of stock prices.” Catogas v. Cyberonics, Inc.,

292 F. App’x 311, 316 (5th Cir. 2008) (unpublished) (per curiam).
        4 See 29 U.S.C. § 1104(a)(2).

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prudence claim was foreclosed by the Supreme Court’s holding in Fifth Third
Bancorp v. Dudenhoeffer. 5 This appeal followed.
                                              II.
       “This court reviews de novo a district court’s grant or denial of a Rule
12(b)(6) motion to dismiss, ‘accepting all well-pleaded facts as true and viewing
those facts in the light most favorable to the plaintiff[.]’” 6 “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.’” 7 “A claim has facial
plausibility when the plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable for the misconduct
alleged.” 8 However, “the tenet that a court must accept as true all of the
allegations contained in a complaint is inapplicable to legal conclusions” or
“[t]hreadbare recitals of the elements of a cause of action, supported by mere
conclusory statements.” 9
                                            III.
       ERISA governs employee benefit plans and their invested funds.
Congress enacted the statute to “promote the interests of employees and their
beneficiaries” in these funds. 10 To that end, ERISA fiduciaries are assigned “a
number of detailed duties and responsibilities, which include ‘the proper
management,        administration,      and       investment   of   [plan]    assets,    the
maintenance of proper records, the disclosure of specified information, and the

       5 573 U.S. 409 (2014).
       6 True v. Robles, 571 F.3d 412, 417 (5th Cir. 2009) (quoting Stokes v. Gann, 498 F.3d
483, 484 (5th Cir. 2007)).
       7 Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007)).
       8 Id. (citing Twombly, 550 U.S. at 556).
       9 Id. (citing Twombly, 550 U.S. at 555).
       10 Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 90 (1983).

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avoidance of conflicts of interest.’” 11 Their duties to plan participants are
“derived from the common law of trusts” 12 and are “the highest known to the
law.” 13
       Section 1104(a)(1) sets out “several overlapping duties.” 14 The duty of
prudence requires a fiduciary to “discharge his duties . . . . with the care, skill,
prudence, and diligence under the circumstances then prevailing that a
prudent man acting in a like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character and with like aims.” 15
The duty to diversify requires a fiduciary to “diversify[] the investments of the
plan so as to minimize the risk of large losses, unless under the circumstances
it is clearly prudent not to do so.” 16 ERISA also requires fiduciaries to adhere
to a duty of loyalty and to act in accordance with the plan insofar as it does not
conflict with the Act. 17 To state a claim under this section, a plaintiff must
plausibly allege that a fiduciary breached one of these duties, causing a loss to
the employee benefit plan. 18
       Plaintiffs contend that the Fiduciaries breached their duty to diversify
under § 1104(a)(1)(C) and their duty of prudence under § 1104(a)(1)(B) by
failing to consider reducing their holdings in the ConocoPhillips Funds.

       11  Mertens v. Hewitt Assocs., 508 U.S. 248, 251–52 (1993) (quoting Mass. Mut. Life Ins.
Co. v. Russell, 473 U.S. 134, 142–43 (1985)).
        12 Tibble v. Edison Int’l, 575 U.S. 523, 135 S. Ct. 1823, 1828 (2015) (quoting Cent.

States, Se. & Sw. Areas Pension Fund v. Cent. Transp., Inc., 472 U.S. 559, 570 (1985)).
        13 Tatum v. RJR Pension Inv. Comm., 761 F.3d 346, 356 (4th Cir. 2014) (quoting

Donovan v. Bierwirth, 680 F.2d 263, 272 n.8 (2d Cir. 1982)).
        14 Bussian v. RJR Nabisco, Inc., 223 F.3d 286, 294 (5th Cir. 2000).
        15 29 U.S.C. § 1104(a)(1)(B).
        16 Id. § 1104(a)(1)(C).
        17 Id. § 1104(a)(1)(A), (D).
        18 Braden v. Wal-Mart Stores, Inc., 588 F.3d 585, 594 (8th Cir. 2009).

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                                              A.
       The Fiduciaries first argue that Plaintiffs’ claims never get off the
ground because the ConocoPhillips Funds are “qualifying employer securities,”
which are statutorily exempt from “the diversification requirement of
[§ 1104(a)(1)(C)] and the prudence requirement (only to the extent that it
requires diversification) of [§ 1104(a)(1)(B)].” 19 The Fiduciaries contend that
the ConocoPhillips Funds were employer securities when they were issued by
ConocoPhillips and therefore retained that status after separating from
Phillips 66.
       But ERISA’s plain text does not support this conclusion. A qualifying
employer security is a “security issued by an employer of employees covered by
the plan, or by an affiliate of such employer.” 20 An employer is a party “acting
directly as an employer, or indirectly in the interest of an employer, in relation
to an employee benefit plan.” 21 So an employer security is one that is issued by
a party “acting . . . as an employer” “of employees covered by the plan.” 22
       Although ConocoPhillips had                employed the Phillips          66 Plan’s
participants, Phillips 66 is the only entity now “acting” as the employer of
employees covered by the Phillips 66 Plan. The ConocoPhillips Funds are
qualifying employer stock only if they were issued by Phillips 66. 23 They were
not. The ConocoPhillips Funds were not “employer securities” after the spin-
off and were no longer exempt from the duties under § 1104(a)(1)(B) and (C).

       19  29 U.S.C. § 1104(a)(2).
       20  29 U.S.C. § 1107(d)(1); see id. § 1107(d)(5).
        21 Id. § 1002(5) (emphasis added).
        22 Id. §§ 1002(5), 1107(d)(1).
        23 Our reading of the statute is informed by a private letter ruling by the Internal

Revenue Service. I.R.S. Priv. Ltr. Rul. 201427024 (July 3, 2014). As the district court noted,
although the IRS’s interpretation is not binding, it has persuasive force “because it addresses
the precise issue in question—whether an employer security retains that character after a
spinoff.”
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                                               B.
       Under § 1104(a)(1)(C), fiduciaries have a duty to “diversify[] the
investments of the plan so as to minimize the risk of large losses, unless under
the circumstances it is clearly prudent not to do so.” 24 This duty looks to a
pension plan as a whole, not to each investment option. 25 Plaintiffs argue that
the Fiduciaries breached this duty by holding an excessive percentage of Plan
assets in ConocoPhillips Funds, exposing participants to a high risk of large
losses. They rely primarily on a case in which fiduciaries for a defined benefit
plan breached their duty to diversify by placing 23% of plan assets in a single
investment. 26
       But the duty to diversify under § 1104(a)(1)(C) imposes obligations on
fiduciaries for defined benefit plans that are different from those for defined
contribution plans, like the Phillips 66 Plan. As fiduciaries for defined benefit
plans choose the investments and allocate the plan’s assets, they must ensure
the plan’s assets as a whole are well diversified. The fiduciaries for a defined
contribution plan, however, only select investment options; the participants
then choose how to allocate their assets to the available options. These
fiduciaries therefore need only provide investment options that enable
participants to create diversified portfolios; they need not ensure that
participants actually diversify their portfolios. 27 Plaintiffs have not alleged

       24  Id. § 1104(a)(1)(C).
       25   Young v. Gen. Motors Inv. Mgmt. Corp., 325 F. App’x 31, 33 (2d Cir. 2009)
(unpublished) (emphasis added) (“The language of [§ 1104(a)(1)(C)] contemplates a failure to
diversify claim when a plan is undiversified as a whole.”).
        26 Marshall v. Glass/Metal Ass’n & Glaziers & Glassworkers Pension Plan, 507

F. Supp. 378, 384 (D. Haw. 1980).
        27 See, e.g., Yates v. Nichols, 286 F. Supp. 3d 854, 864 (N.D. Ohio 2017) (“[T]he plan

participants themselves—rather than the [fiduciaries]—decide how to allocate their
contributions among the plan’s investment options. The [fiduciaries], in other words, have no
ability to enforce the diversification requirement on the participants. All they can do, it would
seem, is offer a diversified menu of investment options. What seems most critical, then, at
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that the Fiduciaries did not offer sufficient investment options or failed to warn
Plan participants of the risk of a concentrated portfolio, as we will explain. As
a result, their § 1104(a)(1)(C) claim fails.
                                               C.
       The duty of prudence requires that fiduciaries act “with the care, skill,
prudence, and diligence under the circumstances then prevailing that a
prudent man acting in a like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character and with like aims.” 28
Fiduciaries must determine that each investment “is reasonably designed, as
part of the portfolio[,] . . . to further the purposes of the plan, taking into
consideration the risk of loss and the opportunity for gain.” 29 They also must
“give[] appropriate consideration to those facts and circumstances that . . .
[they] know[] or should know are relevant to the particular investment.” 30 In
short, prudence requires fiduciaries to consider the totality of the
circumstances. 31 In so doing, fiduciaries must engage in a reasoned decision-
making process for investigating the merits of each investment option 32 and
ensure that each one “remain[s] in the best interest of plan participants.” 33

least in terms of the [fiduciaries’] diversification duty, is the range of investment options
available to the participants.”).
        28 29 U.S.C. § 1104(a)(1)(B).
        29 29 C.F.R. § 2550.404a-1(b)(2)(i).
        30 Id. § 2550.404a-1(b)(1)(i); see Langbecker v. Elec. Data Sys. Corp., 476 F.3d 299, 307

n.13 (5th Cir. 2007) (citing § 2550.404a-1(b)(1)(i)–(ii)).
        31 Bussian, 223 F.3d at 299 (“What the appropriate methods [of investigation] are in

a given situation depends on the ‘character’ and ‘aim’ of the particular plan and decision at
issue and the ‘circumstances prevailing’ at the time a particular course of action must be
investigated and undertaken.”); Donovan v. Cunningham, 716 F.2d 1455, 1467 (5th Cir.
1983) (“The prudent man rule as codified in ERISA is a flexible standard[.]”); DiFelice v. U.S.
Airways, Inc., 497 F.3d 410, 420 (4th Cir. 2007) (explaining that evaluating the prudence of
an investment decision requires a totality-of-the-circumstances inquiry that takes into
account “the character and aim of the particular plan and decision at issue and the
circumstances prevailing at the time”) (internal quotation marks omitted).
        32 Langbecker, 476 F.3d at 308 n.18; see also DiFelice, 497 F.3d at 423.
        33 Tatum, 761 F.3d at 358.

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      The parties engage over the prudence of retaining the ConocoPhillips
Funds without undertaking a proper investigation. Plaintiffs allege that
single-stock funds are inherently imprudent because they expose investors to
extreme volatility and risk, and they argue that the duty of prudence requires
each individual fund in a plan to be diversified. The Fiduciaries respond that
the Plaintiffs’ duty-of-prudence claim fails under the Supreme Court’s decision
in Dudenhoeffer, and that requiring each fund to be diversified would conflict
with modern portfolio theory, which evaluates the prudence of an investment
in the context of a portfolio as a whole.
                                            1.
      There are two wings of Plaintiffs’ duty-of-prudence claim. The first
alleges the Fiduciaries should have known from publicly available information
that the stock market underestimated the risk of holding ConocoPhillips stock.
Dudenhoeffer addressed this line of argument, holding that “where a stock is
publicly traded, allegations that a fiduciary should have recognized from
publicly available information alone that the market was over- or
undervaluing the stock are implausible as a general rule, at least in the
absence of special circumstances.” 34 In so doing, Dudenhoeffer effectively
foreclosed claims, like Plaintiffs’, that a fiduciary should have known from
public information that the market underestimated the risk of holding a
publicly traded security. 35
      That said, Dudenhoeffer and its progeny do not apply to the second wing
of Plaintiffs’ argument: that the ConocoPhillips Funds were imprudent
because of the risk inherent in failing to diversify. Unlike the claim in
Dudenhoeffer, this claim does not turn on publicly available information or

       Dudenhoeffer, 573 U.S. at 426 (emphasis added).
      34
      35See Kopp v. Klein, 894 F.3d 214, 219–20 (5th Cir. 2018) (per curiam); Singh v.
RadioShack Corp., 882 F.3d 137, 146–47 (5th Cir. 2018) (per curiam).
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whether Fiduciaries can beat the market. 36 Moreover, Dudenhoeffer and our
subsequent decisions all involved employer securities, which are exempt from
the duty of prudence “to the extent that it requires diversification.” 37 They do
not address the prudence of holding a single-stock fund in the first place. As a
result, this second wing of Plaintiffs’ duty-of-prudence claim does not implicate
Dudenhoeffer and is not foreclosed by it.
                                              2.
       Plaintiffs claim that holding a single-stock fund is imprudent per se
because of the risk inherent in holding an undiversified asset. But ERISA
contains no prohibition on individual account plans’ offering single-stock
funds. Rather, it requires fiduciaries to provide in each benefit statement to
participants “an explanation . . . of the importance . . . of a well-balanced and
diversified investment portfolio, including a statement of the risk that holding
more than 20 percent of a portfolio in the security of one entity (such as
employer securities) may not be adequately diversified[.]” 38 A per se rule
against single-stock funds would also conflict with the fact-specific focus of the
duty of prudence, 39 as well as with ERISA’s legislative history and
implementing regulations, which clarify that single-stock investments can be
a prudent investment option. 40

       36  By the Efficient Market Hypothesis and modern portfolio theory, stock prices in
efficient markets do not reflect risks that an investor could eliminate through diversification.
JEFFREY J. HAAS, CORPORATE FINANCE 113 (2014) (“Under portfolio theory, the market
return received by an investor on a particular stock in a competitive market does not include
any compensation for the investor shouldering [business-specific] risk. Indeed, the market
does not reward investors who fail to diversify this risk down to zero.”).
        37 29 U.S.C. § 1104(a)(2).
        38 Id. § 1025(a)(2)(B).
        39 Tatum, 761 F.3d at 360 (rejecting argument that “non-employer, single stock funds

are imprudent per se due to their inherent risk”) (alteration and internal quotation omitted).
        40 Id.; H.R. REP. NO. 93–1280 (1974) (Conf. Rep.), reprinted in 1974 U.S.C.C.A.N. 5038,

5085–86; 29 C.F.R. § 2550.404c–1(f)(5).
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       Yet, courts have expressed concern about the prudence of single-stock
funds, recognizing that a single-stock investment option may be imprudent in
some circumstances, as it may encourage investors to put too many eggs in one
basket. 41 The Supreme Court has observed that, as single-stock funds,
qualifying employer securities are “not prudently diversified.” 42 Likewise, the
Seventh Circuit recognized that because employer securities are undiversified,
“[t]here is a sense in which” they are “imprudent per se, though legally
authorized.” 43 Because of the “built-in ‘imprudence,’” the court warned that
fiduciaries for plans investing in employer securities must be “especially
careful to do nothing to increase the risk faced by the participants still
further.” 44 The Fourth Circuit also recognized in DiFelice that while there is
no per se bar on single-stock funds, such funds “carr[y] significant risk, and so
would seem generally imprudent for ERISA purposes.” 45 Indeed, Plaintiffs
have plausibly alleged that the ConocoPhillips Funds, by its resulting
concentration of investment, became an imprudent investment with the
spinoff.
       But it does not follow that the Fiduciaries were obligated to force Plan
participants to divest from the Funds. “ERISA does not require fiduciaries of
[a defined contribution plan] to act as personal investment advisers to plan
participants . . . Such a plan gives participants the control by design, and it

       41 DiFelice, 497 F.3d at 424 (“[A]lthough placing retirement funds in any single-stock
fund carries significant risk, and so would seem generally imprudent for ERISA purposes,
Congress has explicitly provided that qualifying concentrated investment in employer stock
does not violate the ‘prudent man’ standard per se.”).
       42 Dudenhoeffer, 573 U.S. at 416 (internal citation omitted).
       43 Armstrong v. LaSalle Bank Nat. Ass’n, 446 F.3d 728, 732 (7th Cir. 2006) (Posner, J.).
       44 Id.
       45 DiFelice, 497 F.3d at 424.

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gives employees the responsibility and freedom to choose how to invest their
funds.” 46
      No “rule . . . forbids plan sponsors to allow participants to make their
own choices.” 47 ERISA imposed other obligations, which the Fiduciaries met.
They repeatedly provided Plan participants with the statutorily mandated
warning against holding “more than 20 percent of a portfolio in the security of
one entity.” 48 For example, Phillips 66’s January 2016 Summary Plan
Description highlighted the risk of holding a single-stock fund:

       Funds that hold the common stock of a single company, such as
       the Phillips 66 Stock Fund, are generally considered a higher risk
       investment than a fund that holds many different stocks, such as
       actively managed funds described above. The advantage of an
       actively managed fund is that not all of the stocks within a fund
       will have price movements in the same direction at the same time,
       and this reduces investment risk when compared to a single stock.

The    Summary       Plan    Description     also   explained     the    importance     of
diversification to its participants:

       WHY DIVERSIFICATION MATTERS

       As the saying goes, “don’t put all your eggs in one basket.” This is
       especially true when investing for retirement. Maintaining a mix
       of stocks, bonds and short-term investments in your plan account
       can help manage your investment risk.

       This “diversification” is a key principle of sound investing. The idea
       is that when one type of asset is doing poorly, another may be doing
       well. For example, if your stock funds are losing value, your bond
       funds may be going up or holding steady. Of course, the opposite
       may also occur, where your bond funds lose value while your stock

       46 White v. Marshall & Ilsley Corp., 714 F.3d 980, 994 (7th Cir. 2013), abrogated by
Dudenhoeffer, 573 U.S. 409.
       47 Loomis v. Exelon Corp., 658 F.3d 667, 673 (7th Cir. 2011). Nor does any rule bar

fiduciaries from forcing divestment. See Tatum, 761 F.3d 346.
       48 29 U.S.C. § 1025(a)(2)(B).

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       funds are going up. And there may be times when it seems that
       every type of investment is losing value.

       How much of your account you should allocate to the different
       asset classes depends on you — your financial goals, your tolerance
       for risk, your other assets and needs, and how much time you have
       until retirement.

       By closing the ConocoPhillips Funds to new investments immediately
after the spin-off, the Fiduciaries also ensured that they were not offering
participants an imprudent investment option. 49 At that point, while blocked
from adding more “eggs to the basket,” Plaintiffs were free to sell off their
investments at any time and reinvest in other funds. With a rising market,
they chose to retain the ConocoPhillips Funds for over two years, balancing the
risk of a want of portfolio diversity against the rising values of ConocoPhillips
stock—a risk against which the Fiduciaries urged caution. They cannot enjoy
their autonomy and now blame the Fiduciaries for declining to second guess
that judgment.
       Finally, Plaintiffs argue that the district court erred in dismissing their
claim that the Fiduciaries failed to comply with their duty “to follow a regular,
appropriate, systematic procedure to evaluate the ConocoPhillips Funds as
investments in the Plan.” We considered and rejected a similar argument in
Kopp v. Klein. 50 There, beneficiaries argued that—separate and “apart from
any substantive imprudence—the [d]efendants breached their ‘procedural’
duty of prudence by failing to meet and discuss a possible course of action

       49 See Langbecker, 476 F.3d at 308 n.18 (“Under ERISA, the prudence of investments
or classes of investments offered by a plan must be judged individually.”); see also DiFelice,
497 F.3d at 423–24 (rejecting the view that “any single-stock fund, in which that stock existed
in a state short of certain cancellation without compensation, would be prudent if offered
alongside other, diversified Funds”).
       50 894 F.3d at 221.

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regarding the Plan’s investment in [the challenged] stock.” 51 Their claim failed,
however, as it rested solely on the fiduciaries’ procedural lapses. 52 Plaintiffs’
claim here fails for the same reason.
                                            IV.
       We affirm the district court’s dismissal of Plaintiffs’ suit.

       51Id. at 220–21.
       52 Id. at 221; accord Brown v. Medtronic, Inc., 628 F.3d 451, 461 (8th Cir. 2010)
(holding that a claim alleging a breach of the duty to monitor and inform the plan committee
“cannot survive without a sufficiently pled theory of the underlying breach” of the duty-of-
prudence claim).
                                            14