John Raymond Tunheim

In ERISA 401(k) imprudence cases Tunheim applies the Eighth Circuit's Meiners 'meaningful benchmark' test and treats sustained, multi-year cumulative underperformance against several comparators as circumstantial evidence of a flawed fiduciary process sufficient to survive a motion to dismiss. A defendant's argument that the comparator funds used different risk strategies, or that the fund beat a benchmark in an isolated year, is treated as a fact dispute for discovery -- not a basis for Rule 12 dismissal. Plaintiffs should plead multiple meaningful benchmarks; defendants should not expect to win imprudence claims on the pleadings.

“To the extent that Defendants dispute the similarities between the Wells Fargo TDFs and the Morningstar Comparators, these are factual issues that the Court cannot resolve on a motion to dismiss. ... Snyder has identified not one, but six different meaningful benchmarks, all of which the Wells Fargo TDFs underperformed against over the course of eleven years.”

Tunheim will not entertain a summary-judgment motion before discovery: where a defendant moves for SJ at the pleadings stage and the non-movant submits a Rule 56(d) declaration showing further discovery is needed, he denies the motion as premature rather than reaching the merits. Movants should wait until the record is developed; a premature SJ motion bundled with a 12(b)(6) motion will be denied on timing alone.

“As a general rule, summary judgment is proper only after the nonmovant has had adequate time for discovery. ... Snyder has properly submitted a declaration which details how further discovery will enable her to rebut the assertion that there is no genuine issue of material fact. Thus, the Court will deny Defendants' Motion for Summary Judgment as premature.”