Deutsche Bank Americas Holding v. Moreno
Court Docket Sheet

2nd Circuit Court of Appeals

2017-02911 (ca2)

NOTICE OF APPEARANCE AS AMICUS COUNSEL, on behalf of, <EDIT by Clerk's Office>, FILED. Service date 09/26/2017 by CM/ECF. [2133702] [17-2911] [Entered: 09/26/2017 03:01 PM]

Case 17-2911, Document 19, 09/26/2017, 2133702, Page1 of 1 NOTICE OF APPEARANCE FOR SUBSTITUTE, ADDITIONAL, OR AMICUS COUNSEL Short Title: Deutsche Bank Americas Holding v. Moreno Docket No.: 17-2911 Substitute, Additional, or Amicus Counsel’s Contact Information is as follows: Name: Brian D. Netter Firm: Mayer Brown LLP Address: 1999 K St NW Washington, DC 20006 Telephone: (202) 263-3339 Fax: (202) 263-5236 E-mail: bnetter@mayerbrown.com Appearance for: The Chamber of Commerce of the United States of America (party/designation) Select One: Substitute counsel (replacing lead counsel:) (name/firm) Substitute counsel (replacing other counsel:) (name/firm) Additional counsel (co-counsel with:) (name/firm) Deutsche Bank Americas Holding Corp., Deutsche Bank Americas Holding Corp. Executive Committee, Richard O'Connell, Deutsche Bank Matched Savings Plan Investment Committee, John Arvanitis, Robert Dibble, Tim Dowling, Richard Ferguson, James Gnall, Louis Jaffe, Patrick McKenna, Amicus (in support of: David Pearson, Joseph Rice, Scott Simon, Andrew Threadgold, James Volkwein/Petitioners) (party/designation) CERTIFICATION I certify that: I am admitted to practice in this Court and, if required by Interim Local Rule 46.1(a)(2), have renewed my admission on 6/16/2015 OR I applied for admission on. Signature of Counsel:/s/Brian D. Netter Type or Print Name:Brian D. Netter

MOTION ORDER, referring motion to file amicus curiae brief [{{22}}] filed by Movant United States Chamber of Commerce, FILED. [2134134][29] [17-2911] [Entered: 09/27/2017 09:24 AM]

Case 17-2911, Document 29, 09/27/2017, 2134134, Page1 of 1 UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT At a Stated Term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the 27th day of September, two thousand seventeen. ________________________________________ Deutsche Bank Americas Holding Corp., Deutsche Bank Americas Holding Corp. Executive Committee, Richard ORDER O'Connell, Deutsche Bank Matched Savings Plan Investment Committee, John Arvanitis, Robert Dibble, Tim Dowling, Docket No. 17-2911 Richard Ferguson, James Gnall, Louis Jaffe, Patrick McKenna, David Pearson, Joseph Rice, Scott Simon, Andrew Threadgold, James Volkwein, Petitioners, v. Ramon Moreno, Individually and as representatives of a class of similarly situated persons and on behalf of the Deutsche Bank Matched Savings Plan, Donald O'Halloran, Individually and as representatives of a class of similarly situated persons and on behalf of the Deutsche Bank Matched Savings Plan, Omkharan Arasarantnam, Baiju Gajjar, Rajath Nagaraja, Respondents. ________________________________________ The Chamber of Commerce of the United States of America moves for leave to file an amicus curiae brief in support of Petitioners. IT IS HEREBY ORDERED that the motion is REFERRED to the panel that will determine the merits of the petition for leave to appeal. For the Court: Catherine O’Hagan Wolfe, Clerk of Court

OPPOSITION TO MOTION, for leave to appeal (FRCP 23(f)) [{{1}}], on behalf of Respondent Omkharan Arasarantnam, Baiju Gajjar, Ramon Moreno, Rajath Nagaraja and Donald O'Halloran, FILED. Service date 09/29/2017 by CM/ECF. [2136722] [17-2911] [Entered: 09/29/2017 02:28 PM]

Case 17-2911, Document 32, 09/29/2017, 2136722, Page1 of 30 NO. 17-2911 IN THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT Deutsche Bank Americas Holding Corp., Deutsche Bank Americas Holding Corp. Executive Committee, Richard O’Connell, Deutsche Bank Matched Savings Plan Investment Committee, John Arvanitis, Robert Dibble, Tim Dowling, Richard Ferguson, James Gnall, Louis Jaffe, Patrick McKenna, David Pearson, Joseph Rice, Scott Simon, Andrew Threadgold, James Volkwein, Petitioners, – v. – Ramon Moreno, Donald O’Halloran, Omkharan Arasarantnam, Baiju Gajjar, Rajath Nagaraja, Individually and as representatives of a class of similarly situated persons and on behalf of the Deutsche Bank Matched Savings Plan, Respondents. ON PETITION FOR LEAVE TO APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK CASE NO. 1:15-CV-09936 RESPONDENTS’ ANSWER TO PETITION FOR PERMISSION TO APPEAL PURSUANT TO FED. R. CIV. P. 23(f) Case 17-2911, Document 32, 09/29/2017, 2136722, Page2 of 30 KAI H. RICHTER JACOB T. SCHUTZ NICHOLS KASTER, PLLP 4600 IDS CENTER 80 SOUTH EIGHTH STREET MINNEAPOLIS, MN 55402-2242 TELEPHONE: 612-256-3200 COUNSEL FOR RESPONDENTS Case 17-2911, Document 32, 09/29/2017, 2136722, Page3 of 30 TABLE OF CONTENTS INTRODUCTION 1 FACTUAL AND PROCEDURAL BACKGROUND 3 I. EVIDENCE TO DATE 4 II. CLASS CERTIFICATION 6 ARGUMENT 7 I. PETITIONERS DO NOT MEET THE HIGH STANDARD FOR INTERLOCUTORY REVIEW UNDER RULE 23(F) 7 II. THE DISTRICT COURT PROPERLY CERTIFIED THE CLASS UNDER RULE 23(b)(1) 11 A. LaRue Is Not a Barrier to (b)(1) Certification 12 B. Certification Under Rule 23(b)(1) Does Not Violate Due Process 14 III. THE CLASS DEFINITION DOES NOT WARRANT INTERLOCUTORY REVIEW..15 IV. THE CHAMBER OF COMMERCE’S AMICUS BRIEF DOES NOT PROVIDE ANY FURTHER SUPPORT FOR THE PETITION 19 CONCLUSION........................................................................................................ 20 i Case 17-2911, Document 32, 09/29/2017, 2136722, Page4 of 30 TABLE OF AUTHORITIES CASES Bauer-Ramazani v. Teachers Ins. & Annuity Ass’n of Am.-Coll. Ret. & Equities Fund, 290 F.R.D. 452 (D. Vt. 2013)............................................................. 13 In re Beacon Assocs. Litig., 282 F.R.D. 315 (S.D.N.Y. 2012)................................ 11 Blair v. Equifax Check Servs., Inc., 181 F.3d 832 (7th Cir. 1999)............................ 8 Brotherston v. Putnam Invs., LLC, No. 1:15-cv-13825, Dkt. No. 88 (D. Mass. Dec. 13, 2016)............................ 1 Caufield v. Colgate-Palmolive Co., 2017 WL 3206339 (S.D.N.Y. July 27, 2017)................................................ 11 Chamberlan v. Ford Motor Co., 402 F.3d 952 (9th Cir. 2005)............................... 16 In re Citigroup Pension Plan ERISA Litig., 2007 WL 1074912, (S.D.N.Y. Apr. 4, 2007)..........................................19, 20 In re Cobalt Int’l Energy, Inc. Sec. Litig., 2017 WL 3620590 (S.D. Tex. Aug. 23, 2017).............................................. 19 Dobson v. Hartford Fin. Servs. Grp., Inc., 342 F. App’x 706 (2d Cir. 2009)......... 11 F.T.C. v. Wyndham Worldwide Corp., 10 F. Supp. 3d 602 (D.N.J. 2014).................................................................. 20 Forbush v. J.C. Penney Co., 994 F.2d 1101 (5th Cir.1993).................................... 18 Fort Worth Emps.’ Ret. Fund v. J.P. Morgan Chase & Co., 301 F.R.D. 116 (S.D.N.Y. 2014)................................................................... 16 Giovanniello v. ALM Media, LLC, 726 F.3d 106 (2d Cir. 2013).............................. 7 In re Global Crossing Secs. & ERISA Litig., 225 F.R.D. 436 (S.D.N.Y.2004)...... 11 ii Case 17-2911, Document 32, 09/29/2017, 2136722, Page5 of 30 Healthcare Strategies, Inc. v. ING Life Ins. & Annuity Co., 2012 WL 10242276 (D. Conn. Sept. 27, 2012)............................................ 13 Hevesi v. Citigroup Inc., 366 F.3d 70 (2d Cir. 2004)............................................ 8, 9 In re Initial Pub. Offering Sec. Litig., 671 F. Supp. 2d 467 (S.D.N.Y. 2009)......... 16 In re J.P. Morgan Stable Value Fund ERISA Litig., 2017 WL 1273963 (S.D.N.Y. Mar. 31, 2017).........................................13, 20 Jones v. NovaStar Fin., Inc., 257 F.R.D. 181 (W.D. Mo. 2009)............................. 12 Kanawi v. Bechtel Corp., 254 F.R.D. 102 (N.D. Cal. 2008).........................2, 11, 15 Krueger v. Ameriprise Fin., Inc., 304 F.R.D. 559 (D. Minn. 2014).................... 2, 17 L.I. Head Start Child Dev. Servs., Inc. v. Econ. Opportunity Comm’n of Nassau Cty., Inc., 710 F.3d 57 (2d Cir. 2013)........................................................... 15 LaRue v. DeWolff, Boberg & Assocs., Inc., 552 U.S. 248 (2008)....................passim Mass. Mut. Life Ins. Co. v. Russell, 473 U.S. 134 (1985)........................................ 14 In re Natural Gas Commodities Litig., 231 F.R.D. 171 (S.D.N.Y. 2005)............... 19 In re Northrop Grumman Corp. ERISA Litig., 2011 WL 3505264 (C.D. Cal. Mar. 29, 2011).......................................... 2, 12 Ortiz v. Fireboard Corp., 527 U.S. 815 (1999)....................................................... 11 In re Parmalat Sec. Litig., 2008 WL 3895539 (S.D.N.Y. Aug. 21, 2008)........16, 17 In re Petrobras. Secs., 862 F.3d 250 (2d Cir. 2017)................................................ 18 Prado-Steinman ex rel. Prado v. Bush, 221 F.3d 1266 (11th Cir. 2000)................ 10 Robertson v. Nat’l Basketball Ass’n, 556 F.2d 682 (2d Cir. 1977)......................... 14 In re Rodriguez, 695 F.3d 360 (5th Cir. 2012)........................................................ 18 In re Schering Plough Corp. ERISA Litig., 589 F.3d 585 (3d Cir. 2009)...11, 12, 13 iii Case 17-2911, Document 32, 09/29/2017, 2136722, Page6 of 30 Sims v. BB&T Corp., 2017 WL 3730552 (M.D.N.C. Aug. 28, 2017)................. 1, 17 Spano v. Boeing Co., 633 F.3d 574 (7th Cir. 2011)................................................ 13 Sumitomo Copper Litig. v. Credit Lyonnais Rouse, Ltd., 262 F.3d 134 (2d Cir. 2001)........................................................1, 8, 9, 15, 16 In re Suntrust Banks, Inc. ERISA Litig., 2016 WL 4377131 (N.D. Ga. Aug. 17, 2016)............................................... 17 Tibble v. Edison Int’l, 2009 WL 6764541 (C.D. Cal. June 30, 2009)....................... 2 Tussey v. ABB, Inc., 2007 WL 4289694 (W.D. Mo. Dec. 3, 2007)...............2, 11, 15 Urakhchin v. Allianz Asset Mgmt. of Am., L.P., 2017 WL 2655678 (C.D. Cal. June 15, 2017)................................................. 1 Urakhchin v. Allianz Asset Mgmt. of Am., L.P., No. 17-80124, Dkt. No. 4 (9th Cir. Sept. 13, 2017)........................................ 2 In re Visa Check/MasterMoney Antitrust Litig., 280 F.3d 124 (2d Cir. 2001)......... 8 Vizcaino v. United States Dist. Court for Western Dist. of Wash., 173 F.3d 713, (9th Cir.1999)......................................................................... 18 Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011).............................6, 14, 15, 20 Wagner v. Barrick Gold Corp., 251 F.R.D. 112 (S.D.N.Y. 2008).......................... 17 In re Warner Chilcott Ltd. Sec. Litig., 2008 WL 344715 (S.D.N.Y. Feb. 4, 2008)................................................... 17 Waste Mgmt. Holdings, Inc. v. Mowbray, 208 F.3d 288 (1st Cir. 2000)................ 10 Weber v. United States, 484 F.3d 154 (2d Cir. 2007)........................................10, 16 iv Case 17-2911, Document 32, 09/29/2017, 2136722, Page7 of 30 RULES AND STATUTES 29 U.S.C. §§ 1109....................................................................................2, 13, 14, 15 29 U.S.C. §§ 1132(a)(2).................................................................................2, 13, 14 OTHER AUTHORITY Manual for Complex Litigation § 21.222 (4th ed. 2004)........................................ 19 Marc Galanter, The Vanishing Trial: An Examination of Trials and Related Matters in Federal and State Courts, 1 J. EMPIRICAL LEGAL STUD. 459 (2004)...... 9 William B. Rubenstein, Newberg on Class Actions §§ 4:21, 4:24 (5th ed., June 2017 update).......................................................................................................12, 15 v Case 17-2911, Document 32, 09/29/2017, 2136722, Page8 of 30 INTRODUCTION The fiduciaries of the Deutsche Bank Matched Savings Plan ("Plan") who bring this Petition ("Petitioners")1 have not met their heavy burden to show that interlocutory review of the District Court’s class certification order is warranted under Rule 23(f). See Sumitomo Copper Litig. v. Credit Lyonnais Rouse, Ltd., 262 F.3d 134, 140 (2d Cir. 2001) ("[T]he standards of Rule 23(f) will rarely be met."). In a thorough and well-reasoned opinion, the District Court gave careful consideration to Petitioners’ arguments and rejected them. Although Petitioners are disappointed by the District Court’s class certification ruling, they have not shown that the District Court’s order is questionable and will effectively terminate the litigation. Nor have they identified any "compelling issues" relating to the District Court’s order that require immediate appellate intervention. To the contrary, the District Court’s decision is consistent with a long line of cases that have certified similar types of class actions involving 401(k) plan fiduciaries.2 Indeed, the Ninth Circuit recently denied a Rule 23(f) petition in 1 Petitioners are Deutsche Bank Americas Holding Corp. ("Deutsche Bank"), the Deutsche Bank Matched Savings Plan Investment Committee ("Investment Committee"), Deutsche Bank Americas Holding Corp. Executive Committee ("Executive Committee"), Richard O’Connell, John Arvanitis, Robert Dibble, Tim Dowling, Richard Ferguson, James Gnall, Louis Jaffe, Patrick McKenna, David Pearson, Joseph Rice, Scott Simon, Andrew Threadgold, and James Volkwein. 2 See, e.g., Sims v. BB&T Corp., 2017 WL 3730552 (M.D.N.C. Aug. 28, 2017); Urakhchin v. Allianz Asset Mgmt. of Am., L.P., 2017 WL 2655678 (C.D. Cal. June 15, 2017); Brotherston v. Putnam Invs., LLC, No. 1:15-cv-13825, Dkt. No. 88 (D. 1 Case 17-2911, Document 32, 09/29/2017, 2136722, Page9 of 30 another class action involving 401(k) plan fiduciaries and proprietary funds, where the parties are represented by the same counsel on both sides, and where most of the same arguments Petitioners make here were also made.3 The Advisory Committee Notes to Rule 23(b)(1) expressly recognize that class certification is appropriate in "an action which charges a breach of trust by an indenture trustee or other fiduciary similarly affecting the members of a large class of security holders or other beneficiaries." Fed. R. Civ. P. 23, Advisory Cmte. Note to Subd. (b)(1) Clause (B) (1966). Indeed, class certification is especially appropriate in cases involving claims under the Employee Retirement Income Security Act ("ERISA"), because ERISA grants retirement plan participants the right to bring an action on behalf of a plan as a whole. See 29 U.S.C. §§ 1109, 1132(a)(2). This is precisely such a derivative action on behalf of the Plan under ERISA, and the issues in this case relate to Petitioners’ management of the Plan as a whole – in particular, the fact that the Petitioners have managed the Plan in their Mass. Dec. 13, 2016) (Text Order); Krueger v. Ameriprise Fin., Inc., 304 F.R.D. 559 (D. Minn. 2014); In re Northrop Grumman Corp. ERISA Litig., 2011 WL 3505264 (C.D. Cal. Mar. 29, 2011); Tibble v. Edison Int’l, 2009 WL 6764541 (C.D. Cal. June 30, 2009); Kanawi v. Bechtel Corp., 254 F.R.D. 102 (N.D. Cal. 2008); Tussey v. ABB, Inc., 2007 WL 4289694 (W.D. Mo. Dec. 3, 2007). 3 Urakhchin v. Allianz Asset Mgmt. of Am., L.P., No. 17-80124, Dkt. No. 4 (9th Cir. Sept. 13, 2017); see also Petition Under Fed. R. Civ. P. 23(f) for Permission to Appeal Order Granting Class Certification, Urakhchin v. Allianz Asset Mgmt. of Am., L.P., No. 17-80124, Dkt. No. 1-2, at 19-20 (9th Cir. June 29, 2017) (arguing that LaRue v. DeWolff, Boberg & Assocs., Inc., 552 U.S. 248, 256 (2008) precludes class certification under Rule 23(b)(1) for participants in defined contribution plans, and that such certification would violate due process). 2 Case 17-2911, Document 32, 09/29/2017, 2136722, Page10 of 30 own business interests and not those of Plan participants. Accordingly, this case is tailor made for Plan-wide class certification, and there is no reason to delay the proceedings by granting early appellate review. Petitioners are fully capable of litigating this action through trial (as the defendants did in Tibble, Tussey, and Brotherston), and can seek review of any issues they believe should be addressed together at the end of the case, once final judgment is entered. FACTUAL AND PROCEDURAL BACKGROUND On December 21, 2015, Plaintiffs Ramon Moreno and Donald O’Halloran4 brought this action on behalf of the Plan and a class consisting of all participants and beneficiaries of the Plan at any time on or after December 21, 2009 (excluding Defendants, their directors, and any employees responsible for the Plan’s investment or administrative functions). See Dkt. No. 1 ¶¶ 102-03.5 In their Complaint, Plaintiffs alleged that Petitioners "use the Plan as an opportunity to promote the business interests of Deutsche Bank AG and its affiliates and subsidiaries... at the expense of the Plan and its participants" by, among other things, loading the Plan with imprudent and excessively expensive funds offered by Deutsche Bank’s affiliates. Id. ¶¶ 3-5. 4 Omkharan Arasaratnam, Baiju Gajjar, and Rajath Nagaraja were first named as Plaintiffs in the Second Amended Complaint. Dkt. No. 66. 5 Unless otherwise indicated, all docket references are to the District Court docket. 3 Case 17-2911, Document 32, 09/29/2017, 2136722, Page11 of 30 On April 29, 2016, Petitioners moved to dismiss the then-operative First Amended Complaint. Dkt. No. 31. However, the District Court denied Petitioners’ motion to dismiss in substantial part, and allowed the central claims for breach of fiduciary duty, prohibited transactions, and failure to monitor fiduciaries to proceed. Dkt. No. 57.6 Plaintiffs’ operative Third Amended Complaint ("TAC") repeats the central allegations from prior pleadings, and asserts claims on behalf of the same class. Dkt No. 162 ¶ 144. I. EVIDENCE TO DATE Plaintiffs have marshalled substantial support for their claims, as set forth in their class certification motion papers and the District Court’s order (Dkt No. 165, the "CC Order"). Among other things, the record reflects:  The Plan’s Investment Committee is comprised exclusively of managers and executives affiliated with Deutsche Bank, with no independent fiduciaries. CC Order at 2.  As of December 2009, the start of the proposed class period, the Plan offered participants 22 core investment options, ten of which were Deutsche Bank-affiliated mutual funds ("proprietary funds") that generated fees for Deutsche Bank’s subsidiaries. CC Order at 3. 6 The only claim the District Court dismissed was Plaintiffs’ equitable disgorgement claim in Count V. 4 Case 17-2911, Document 32, 09/29/2017, 2136722, Page12 of 30  Three of the proprietary funds in the Plan were passively-managed "index" funds with investment management fees that were more than five times those of non-proprietary funds that tracked the same index. Although the Plan’s investment advisor, Aon Hewitt ("Hewitt"), presented Petitioners with less costly alternatives, Petitioners delayed removing these excessively costly proprietary index funds for years. CC Order at 3. In marked contrast, Deutsche Bank’s pension plan did not use Deutsche Bank index funds, instead using a far less expensive non-proprietary alternative. Id. at 7.  The actively-managed proprietary funds in the Plan were also excessively expensive compared to those used in other similarly-sized plans, and these excess fees were not justified by superior performance. Dkt. No. 142 at 8-9. For example, for four years Petitioners ignored advice from Hewitt to remove a particularly egregious underperformer, the Deutsche Bank Large Cap Value Fund, before finally doing so shortly before this lawsuit was filed. Id. at 10.  The Investment Committee failed to follow its own Investment Policy Statement ("IPS"). The Plan’s IPS called for use of "Special Review" and "Termination Review" lists to closely monitor underperforming funds. Dkt. No. 142 at 10-12. After proprietary funds repeatedly appeared on these lists, and based on the advice of outside counsel, the Investment Committee 5 Case 17-2911, Document 32, 09/29/2017, 2136722, Page13 of 30 stopped using the lists, contributing to the mismanagement of the Plan and its poor investment options. Id.  Petitioners failed to minimize Plan expenses in other ways. For example, the Plan did not offer the lowest cost share classes for many of the funds in the Plan. Dkt. No. 142 at 12. Petitioners also failed to adequately investigate alternatives to mutual funds, such as separate accounts and collective investment trusts, which have lower investment management fees. Id. at 12-13. In addition, the Plan paid excess recordkeeping fees to ADP, to which Deutsche Bank sold its recordkeeping business in 2003 while maintaining an interest in that business. Id. at 13. II. CLASS CERTIFICATION Based on this evidence and the other evidence set forth in Plaintiffs’ class certification brief and the preliminary expert report submitted in connection therewith (Dkt. Nos. 142, 144-1), Plaintiffs moved for class certification under Rule 23(b)(1). In opposition, Petitioners argued, based on LaRue and Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), that certification under Rule 23(b)(1) is inappropriate. Id. at 19-22.7 After Plaintiffs filed their Reply (Dkt. No. 151), the Court granted Plaintiffs’ motion in a 23-page written Order. 7 Petitioners also asserted other arguments that they do not pursue in their petition for review. 6 Case 17-2911, Document 32, 09/29/2017, 2136722, Page14 of 30 In its Order, the Court held that certification under Rule 23(b)(1) was appropriate and rejected Petitioners’ arguments regarding LaRue, noting that "Defendants misapprehend Plaintiff’s theory of liability." CC Order at 17. As the Court explained, "Plaintiffs do not assert harms based on Defendants’ misconduct that is specific to his or her individual account." Id. Rather, Plaintiffs "challenge Defendants’ process for selecting and retaining the investment options presented to all Plan participants." Id. The Court also rejected Petitioners’ reliance on Dukes, holding that Rule 23(b)(1) requires neither "impossibility nor unworkability", which it explained were traditional justifications for class treatment under this subsection, not an independent element required for class certification. Id. at 19 (citing Dukes, 564 U.S. at 361). The District Court slightly modified Plaintiffs’ class definition to include only participants "whose individual accounts suffered losses as a result of the conduct alleged in Counts One through Four of the Third Amended Complaint." Id. at 21. The Court then noted, "This definition is sufficient at this stage of the litigation." Id. at 22. ARGUMENT I. PETITIONERS DO NOT MEET THE HIGH STANDARD FOR INTERLOCUTORY REVIEW UNDER RULE 23(f) Rule 23(f) petitions are not freely or routinely granted in this Circuit, see Giovanniello v. ALM Media, LLC, 726 F.3d 106, 118 (2d Cir. 2013), and the 7 Case 17-2911, Document 32, 09/29/2017, 2136722, Page15 of 30 standards of Rule 23(f) will only rarely be met. Sumitomo, 262 F.3d at 140. This prevents "needless erosion of the final judgment rule and the policy values it ensures, including efficiency and deference." Id. To justify interlocutory review, Petitioners "must demonstrate either (1) that the certification order will effectively terminate the litigation and there has been a substantial showing that the district court’s decision is questionable, or (2) that the certification order implicates a legal question about which there is a compelling need for immediate resolution." Id. at 139. Petitioners have not made and cannot make either showing here. To establish the first prong set forth in Sumitomo, Petitioners must demonstrate both that the class certification decision is questionable, and that it sounds a "death knell" on the litigation, id. at 140—e.g., that it results in "potentially ruinous liability" that would "place[] inordinate or hydraulic pressure on defendants to settle," Hevesi v. Citigroup Inc., 366 F.3d 70, 80 (2d Cir. 2004) (quoting In re Visa Check/MasterMoney Antitrust Litig., 280 F.3d 124, 148 (2d Cir. 2001) (Jacobs, J., dissenting)).8 Petitioners—which include the American holding company of a multinational bank traded on the New York Stock Exchange—have not shown that this is a "death knell" situation. Several similar 8 True "death knell" cases are few, and a reviewing court "must be wary lest the mind hear a bell that is not tolling." Blair v. Equifax Check Servs., Inc., 181 F.3d 832, 834–35 (7th Cir. 1999). 8 Case 17-2911, Document 32, 09/29/2017, 2136722, Page16 of 30 ERISA class actions have been tried (including the Tibble, Tussey, and Brotherston cases cited supra at 1 n.2), and Petitioners are equally capable of trying this action. Although Petitioners state that many ERISA class actions settle, this is a truism of litigation in general, not just ERISA class actions. See Marc Galanter, The Vanishing Trial: An Examination of Trials and Related Matters in Federal and State Courts, 1 J. EMPIRICAL LEGAL STUD. 459 (2004) (noting that in 2002, only 1.8% of civil cases filed in federal court were tried). Regardless, as explained more fully below, the District Court’s decision is not "questionable"—it is correct and in line with a long line of other decisions. As for the second basis for review under Sumitomo, "a novel legal question will not compel immediate review unless it is of fundamental importance to the development of the law of class actions and it is likely to escape effective review after entry of final judgment." 262 F.3d at 140 (emphasis added).9 Here, Petitioners have not provided a credible reason why the district court’s class certification order "cannot be fully reviewed on appeal from the final judgment—a circumstance that, alone, establishes an adequate basis to deny the petition." Id. at 142. Regardless, 9 Petitioners fail to acknowledge the second half of this test. See Petition at 13 (quoting Hevesi as providing, "An unsettled legal question must be of'fundamental importance to the development of the law of class actions’ to warrant a Rule 23(f) appeal."). The full sentence states: "[A] novel legal question will not compel immediate review unless it is of fundamental importance to the development of the law of class actions and it is likely to escape effective review after entry of final judgment." Hevesi, 366 F.3d at 77 (emphasis added). 9 Case 17-2911, Document 32, 09/29/2017, 2136722, Page17 of 30 the mere characterization of the District Court’s decision as "important" (Petition at 9) is not sufficient to warrant interlocutory review. Prado-Steinman ex rel. Prado v. Bush, 221 F.3d 1266, 1274 (11th Cir. 2000) (noting that it is "relatively easy for a litigant to identify some question of law... [and] characterize that question as novel or unsettled.").10 There must be a "compelling need for resolution of the legal issue sooner rather than later." Id. at 1274. Petitioners have not made such a showing here. At bottom, Petitioners are asking the Court to grant interlocutory review to establish precedent for other cases, which the defense bar and the Chamber of Commerce hope will be helpful.11 This is precisely the sort of "precedent-creation function" that this Court has rejected as a basis for interlocutory review in the past. See Weber v. United States, 484 F.3d 154, 160 n.5 (2d Cir. 2007) ("Although some circuit courts have suggested that Rule 23(f) may also serve a precedent-creation function, we disagree."). This Court should also decline to grant such review here. 10 Accord, Waste Mgmt. Holdings, Inc. v. Mowbray, 208 F.3d 288, 294 (1st Cir. 2000) ("[A] creative lawyer almost always will be able to argue that deciding her case would clarify some'fundamental’ issue."). 11 See, e.g., Petition at 5 ("This Court should... provide much-needed guidance to district courts"), 12-13 ("District courts have weighed in for years; it is now time for this Court to do so."), 14 (arguing that immediate review would advance the development of the law addressing Rule 23(b)(1) certification). 10 Case 17-2911, Document 32, 09/29/2017, 2136722, Page18 of 30 II. THE DISTRICT COURT PROPERLY CERTIFIED THE CLASS UNDER RULE 23(b)(1) Beyond failing to establish that an immediate appeal is necessary, Petitioners have failed to show that the District Court’s certification order under Rule 23(b)(1) was questionable (let alone incorrect).12 One of the "classic" examples of a case suitable for treatment under Rule 23(b)(1)(B) is an action alleging "‘a breach of trust by an indenture trustee or other fiduciary similarly affecting the members of a large class’ of beneficiaries, requiring an accounting or similar procedure'to restore the subject of the trust.’" Ortiz v. Fireboard Corp., 527 U.S. 815, 833-34 (1999) (quoting Fed. R. Civ. P. 23, Adv. Cmte. Note to Subd. (b)(1) Clause (B)). "In light of the derivative nature of ERISA § 502(a)(2) claims, breach of fiduciary duty claims brought under § 502(a)(2) are paradigmatic examples of claims appropriate for certification as a Rule 23(b)(1) class, as numerous courts have held." In re Schering Plough Corp. ERISA Litig., 589 F.3d 585, 604 (3d Cir. 2009) (citing cases).13 Thus, "[m]ost ERISA class action cases are certified under Rule 23(b)(1)." Caufield v. Colgate-Palmolive Co., 2017 WL 3206339, at *5 (S.D.N.Y. July 27, 2017) (quoting Kanawi, 254 F.R.D. at 111); see also William B. 12 Rulings on class certification are reviewed for abuse of discretion. Dobson v. Hartford Fin. Servs. Grp., Inc., 342 F. App’x 706, 709 (2d Cir. 2009). 13 Accord, In re Beacon Assocs. Litig., 282 F.R.D. 315, 342 (S.D.N.Y. 2012) (quoting In re Global Crossing Secs. & ERISA Litig., 225 F.R.D. 436, 453 (S.D.N.Y.2004)); see also Tussey, 2007 WL 4289694, at *8 ("Alleged breaches by a fiduciary to a large class of beneficiaries present an especially appropriate instance for treatment under Rule 23(b)(1)."). 11 Case 17-2911, Document 32, 09/29/2017, 2136722, Page19 of 30 Rubenstein, Newberg on Class Actions § 4:21 (5th ed., June 2017 update) ("Newberg on Class Actions") ("[C]ourts regularly certify ERISA cases under Rule 23(b)(1)(B)"). This is true not only for cases involving defined benefit plans, but also cases involving defined contribution plans. See supra at 1 n.2. A. LaRue Is Not a Barrier to (b)(1) Certification Contrary to Petitioners’ arguments, the Supreme Court’s decision in LaRue has no bearing on the class certification analysis. See Jones v. NovaStar Fin., Inc., 257 F.R.D. 181, 190 (W.D. Mo. 2009) ("LaRue does not eliminate the possibility of [ERISA] § 502(a)(2) class actions."). Indeed, LaRue does not even address Rule 23; it merely provided that in addition to suing derivatively on behalf of a plan, an individual also could individually sue for damages to his or her own account. See In re Schering Plough Corp. ERISA Litig., 589 F.3d at 595 n.9 (stating that "LaRue is of no help to defendants" because "it did not involve a class action"). Further, LaRue does not address injunctive relief, which is a critical component of an action such as this and impacts the Plan as a whole. Thus, "[a] majority of courts addressing the propriety of certifying an ERISA class under § 502(a)(2) following LaRue... have continued to find Rule 23(b)(1)(B) certification appropriate." In re Northrop Grumman Corp., 2011 WL 3505264, at *17 (citing cases). Although Petitioners suggest that no appellate court has addressed this issue, they are wrong. Both the Third Circuit and the Seventh Circuit have expressly 12 Case 17-2911, Document 32, 09/29/2017, 2136722, Page20 of 30 rejected Petitioners’ argument that LaRue operates as a bar to Rule 23(b)(1) certification of actions such as this. See In re Schering Plough Corp. ERISA Litig., 589 F.3d at 604 n.22; Spano v. Boeing Co., 633 F.3d 574, 591 (7th Cir. 2011) ("Importantly, LaRue was an individual case, and so it does not answer the question whether, or when, the kind of suit it was addressing may proceed as a class action. In our view, it would be inconsistent with LaRue to assume that class actions are impossible in these cases."). There is no need for this Court to grant immediate appellate review to simply add to the chorus of already existing voices. Moreover, the district court cases upon which Petitioners rely are inapt. The three cases supposedly establishing an intra-circuit "split" on Rule 23(b)(1) certification involved different claims and different proposed classes than are at issue in this case. See Petition at 12 n.6. None of those cases sought to certify a class on behalf of participants of a single plan.14 This is a critical distinction, given that ERISA provides for a right of action on behalf of "a plan", 29 U.S.C. §§ 1109, 14 Healthcare Strategies, Inc. v. ING Life Ins. & Annuity Co., 2012 WL 10242276, at *12 (D. Conn. Sept. 27, 2012) was brought by a plan administrator on behalf of a proposed class of all plan administrators invested in a certain product. Bauer-Ramazani v. Teachers Ins. & Annuity Ass’n of Am.-Coll. Ret. & Equities Fund, 290 F.R.D. 452, 457 (D. Vt. 2013) involved plaintiffs seeking to recover "individualized monetary damages" on behalf of a class of all participants, regardless of plan, who experienced losses when a particular recordkeeper allegedly delayed transfers. In J.P. Morgan Stable Value Fund ERISA Litig., 2017 WL 1273963, at *13 (S.D.N.Y. Mar. 31, 2017), the court deemed the relief sought by a proposed class of all participants in a particular investment, regardless of plan, to be "individual monetary damages." 13 Case 17-2911, Document 32, 09/29/2017, 2136722, Page21 of 30 1132(a)(2), and Plaintiffs have brought this action as a derivative action on behalf of the Plan rather than as an individual action.15 B. Certification Under Rule 23(b)(1) Does Not Violate Due Process Petitioners’ due process arguments are also unavailing. "There is no right to request exclusion from a (b)(1)... class." Fed. R. Civ. P. 23, Advisory Cmte. Notes to Subd. (c), Par. (2) (2003). Prior challenges to this provision on constitutional grounds have been rejected. See Robertson v. Nat’l Basketball Ass’n, 556 F.2d 682, 686 (2d Cir. 1977) ("[P]reclusion of the opt-out right in a (b)(1) settlement does not violate due process.") Although Defendants argue that Dukes precludes certification of a (b)(1) class in a case for money damages, their reliance on Dukes is misplaced. Dukes involved a proposed class under Rule 23(b)(2) – not 23(b)(1). Moreover, Plaintiffs are not seeking individualized damages awards for class members; they are seeking relief on behalf of the Plan as a whole under ERISA. See Mass. Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 140 (1985) ("[R]ecovery for a violation of [ERISA] § 409 inures to the benefit of the plan as a whole.... [T]he potential personal liability of the fiduciary is'to make good to such plan any losses to the plan....’") (quoting 15 Contrary to Petitioners’ arguments, there is no requirement that individualized actions be "impossible or unworkable." Petition at 12 (citing Dukes, 564 U.S. at 361. As the District Court explained in its opinion, Dukes referred to impossibility and unworkability as "traditional justifications for class treatment," not independent elements necessary for certification. CC Order at 19 (citing Dukes, 564 U.S. at 361). 14 Case 17-2911, Document 32, 09/29/2017, 2136722, Page22 of 30 29 U.S.C. § 1109); accord, LaRue, 552 U.S. at 262 n.* (Thomas, J. concurring) ("[A] participant suing to recover benefits on behalf of the plan is not entitled to monetary relief payable directly to him; rather, any recovery must be paid to the plan.").16 Although any "recovery inuring to the Plan may ultimately benefit particular participants," that "does not convert their derivative suit into an action for individual relief." L.I. Head Start Child Dev. Servs., Inc. v. Econ. Opportunity Comm’n of Nassau Cty., Inc., 710 F.3d 57, 65 (2d Cir. 2013). Thus, even if Dukes has any application in the (b)(1) context, it does not bar (b)(1) classes in cases such as this. As the leading treatise on class action law explains: [E]ven applying Wal-Mart strictly, money damages that flow to the entire class ought to remain available under Rule 23(b)(1) as Wal-Mart suggests that they might be under Rule 23(b)(2); this would enable (b)(1) certification in, for example, ERISA cases in which monetary relief flows to the fund itself not to any individual litigant directly." Newberg on Class Actions § 4:24. III. THE CLASS DEFINITION DOES NOT WARRANT INTERLOCUTORY REVIEW Petitioners also seek to review the District Court’s class definition. However, "issues that would result at most in a modification of a certification 16 "If the Plaintiffs recover any damages on behalf of the Plan, it will be up to the Plan administrator to determine how those damages are to be distributed." Kanawi, 254 F.R.D. at 109 (quoting Tussey, 2007 WL 4289694, at *5). 15 Case 17-2911, Document 32, 09/29/2017, 2136722, Page23 of 30 order," like the definition of the class, "will be unlikely candidates for Rule 23(f) appeal." Sumitomo, 262 F.3d at 139-40. Apparently conceding that the issue fails to warrant review under the standards set forth in Sumitomo, Petitioners attempt to manufacture a "manifestly erroneous" standard. Petition at 10, 19. This is not a recognized standard for 23(f) petitions under Second Circuit law.17 In any event, the District Court’s decision was not manifestly erroneous. Although Petitioners complain that the District Court limited the class to Plan participants who "suffered losses" as a result of the conduct alleged in the Complaint, this type of class definition is common. "The phrase'and were damaged thereby’ appears regularly in class definitions even though the ultimate question of damages may not be settled until later in the litigation." Fort Worth Emps.’ Ret. Fund v. J.P. Morgan Chase & Co., 301 F.R.D. 116, 143 (S.D.N.Y. 2014); see, e.g, In re Initial Pub. Offering Sec. Litig., 671 F. Supp. 2d 467, 492 (S.D.N.Y. 2009); In re Parmalat Sec. Litig., 2008 WL 3895539, at *1 (S.D.N.Y. 17 The phrase "manifestly erroneous" is used three times in the Weber case cited by Petitioners in support of such a standard: once in reference to the standard for interlocutory appeals of bankruptcy court orders, and twice in parentheticals quoting other Courts of Appeals. Weber, 484 F.3d at 160. The phrase has not appeared in any other Second Circuit opinion discussing Rule 23(f). Regardless, even in Circuits where it is the controlling standard, "It is difficult to show that a class certification order is manifestly erroneous unless the district court applies an incorrect Rule 23 standard or ignores a directly controlling case." Chamberlan v. Ford Motor Co., 402 F.3d 952, 962 (9th Cir. 2005). 16 Case 17-2911, Document 32, 09/29/2017, 2136722, Page24 of 30 Aug. 21, 2008); Wagner v. Barrick Gold Corp., 251 F.R.D. 112, 114 (S.D.N.Y. 2008); In re Warner Chilcott Ltd. Sec. Litig., 2008 WL 344715, at *1 (S.D.N.Y. Feb. 4, 2008). Petitioners attempt to distinguish these cases on the ground that many of them are "securities actions" in which "determining who was injured is a simple matter." Petition at 22 n.12. However, numerous ERISA cases have adopted similar class definitions. See, e.g., Sims, 2017 WL 3730552, at *1 (certifying class of participants "who were injured by the conduct alleged in the Second Amended Complaint"); In re Suntrust Banks, Inc. ERISA Litig., 2016 WL 4377131, at *8 (N.D. Ga. Aug. 17, 2016) (certifying class of 401(k) participants "who sustained a loss to their account as a result of the investment in SunTrust Stock"); Krueger, 304 F.R.D. at 579 (amending class definition to refer "to participants and beneficiaries'who were injured by’ the alleged wrongful conduct"). Indeed, Petitioners’ objections to the class definition are entirely disingenuous, as Petitioners previously argued to the District Court that the definition in Krueger was preferable to the one that Plaintiffs originally proposed.18 18 In their opposition to class certification, Petitioners stated: "Plaintiffs also rely heavily upon Krueger, but even Krueger, which involved different facts and evidence than this case, was limited to'participants and beneficiaries "who were injured by" the alleged wrongful conduct.’" Dkt. No. 148 at 16 (emphasis added by Petitioners). 17 Case 17-2911, Document 32, 09/29/2017, 2136722, Page25 of 30 Petitioners do not cite any case from this Circuit that has rejected the type of class definition at issue on the ground that it is a "fail safe" class.19 Indeed, the Fifth Circuit has rejected the very type of argument raised by Petitioners here: Countrywide does not cite any case where we have rejected a class definition because it created a so-called fail-safe class. We rejected a rule against fail-safe classes in... Forbush v. J.C. Penney Co., 994 F.2d 1101 (5th Cir.1993), abrogated on other grounds by Dukes, 131 S.Ct. 2541. The plaintiff in Forbush proposed that the court should define its class as, "employees'whose pension benefits have been, or will be, reduced or eliminated as a result of the overestimation of their Social Security benefits.’" 994 F.2d at 1105. The defendant argued that the class was not defined with sufficient specificity and was "hopelessly'circular,’ as the court must first determine whether an employee’s pension benefits were improperly reduced before that person may be said to be a member of the class." Id. In response, we stated that, "[t]his argument is meritless and, if accepted, would preclude certification of just about any class of persons alleging injury from a particular action. These persons are linked by this common complaint, and the possibility that some may fail to prevail on their individual claims will not defeat class membership." Id. In re Rodriguez, 695 F.3d 360, 370 (5th Cir. 2012); see also Vizcaino v. United States Dist. Court for Western Dist. of Wash., 173 F.3d 713, 722 (9th Cir.1999). Although Petitioners cite to this Court’s decision in In re Petrobras. Secs., 862 F.3d 250, 266 (2d Cir. 2017), that case does not support Petitioners’ position. To the contrary, the Court affirmed class certification over the appellants’ ascertainability objections, and held that the ascertainability requirement is a 19 The class is not "fail safe" because the District Court could find that class members suffered a loss from Petitioners’ conduct without finding Petitioners’ conduct unlawful. 18 Case 17-2911, Document 32, 09/29/2017, 2136722, Page26 of 30 "modest threshold" that "does not require a complete list of class members at the certification stage." Petrobras, 862 F.3d at 266 & n.16. Indeed, at least one court has considered the recently-decided Petrobras opinion, and held a class definition of securities purchasers who "were damaged thereby" was sufficiently definite. In re Cobalt Int’l Energy, Inc. Sec. Litig., 2017 WL 3620590, at *2 n.1, *3 (S.D. Tex. Aug. 23, 2017). The adequacy of the class definition is further supported by the fact that the class at issue is a (b)(1) class, and notice is not required to be distributed to individual class members. See Manual for Complex Litigation § 21.222 (4th ed. 2004) ("Rule 23(b)(3) actions require a class definition that will permit identification of individual class members, while Rule 23(b)(1) or (b)(2) actions may not."). At a later date (when judgment is entered or a settlement is reached), the class definition may be amended to be more precise. See In re Natural Gas Commodities Litig., 231 F.R.D. 171, 180 (S.D.N.Y. 2005) (noting that "if those who have been damaged by the alleged manipulation may be readily ascertained at a later point in the proceeding, the definition may be modified by the Court."). "This definition is sufficient at this stage of the litigation." CC Order at 22. IV. THE CHAMBER OF COMMERCE’S AMICUS BRIEF DOES NOT PROVIDE ANY FURTHER SUPPORT FOR THE PETITION The amicus brief offered by the Chamber of Commerce ("Chamber") does not provide an independent basis for granting the petition. See In re Citigroup 19 Case 17-2911, Document 32, 09/29/2017, 2136722, Page27 of 30 Pension Plan ERISA Litig., 2007 WL 1074912, at *1 n.5, *3 n.40 (S.D.N.Y. Apr. 4, 2007) (noting that 23(f) petition had been rejected despite filing of amicus brief); see also F.T.C. v. Wyndham Worldwide Corp., 10 F. Supp. 3d 602, 632 (D.N.J. 2014), aff’d, 799 F.3d 236 (3d Cir. 2015) (rejecting motion for leave to file amici curiae briefs in support of motion seeking interlocutory appeal because the court "requires no further assistance"). The Chamber’s proposed brief simply repeats Petitioners’ misguided argument that the Petition should be granted for the sake of establishing precedent, Dkt. No. 22-2 at 4; repeats Petitioners’ mischaracterization of the decision in J.P. Morgan Stable Value Fund Litigation to manufacture a supposed intra-circuit "split," Dkt. No. 22-2 at 5-7; repeats Petitioners’ bare assertion that many ERISA cases settle, without attempting to demonstrate that the decision under review creates a "death knell" situation, Dkt. No. 22-2 at 8-10; and repeats Petitioners’ due process arguments based on Dukes and LaRue, Dkt. No. 22-2 at 10-14. For the reasons discussed above, the arguments of the Chamber do not support interlocutory review. CONCLUSION Plaintiffs respectfully request that this Court deny the petition for review. 20 Case 17-2911, Document 32, 09/29/2017, 2136722, Page28 of 30 Date: September 29, 2017 NICHOLS KASTER, PLLP/s/Kai H. Richter Kai H. Richter, MN Bar No. 0296545 Jacob T. Schutz, MN Bar No. 4600 IDS Center 80 South Eighth Street Minneapolis, MN 55402 Telephone: (612) 256-3200 Facsimile: (612) 338-4878 krichter@nka.com jschutz@nka.com Attorneys for Respondents 21 Case 17-2911, Document 32, 09/29/2017, 2136722, Page29 of 30 CERTIFICATE OF COMPLIANCE 1. This Brief complies with the type-volume limitation of Federal Rule of Appellate Procedure 5(c)(1) because it contains 5,166 words, as determined by the word-count function of Microsoft Word 2010, excluding the parts of the brief exempted by Federal Rule of Appellate Procedure 32(f). 2. This brief complies with the typeface requirements of Federal Rule of Appellate Procedure 32(a)(5) and the type of style requirements of Federal Rule of Appellate Procedure 32(a)(6) because it has been prepared in a proportionally spaced typeface using Microsoft Word 2010 in 14-point Times New Roman font. Dated: September 29, 2017/s/Kai H. Richter Kai H. Richter 22 Case 17-2911, Document 32, 09/29/2017, 2136722, Page30 of 30 CERTIFICATE OF SERVICE I hereby certify that on September 29, 2017, I electronically filed the foregoing with the Clerk of the Court for the United States Court of Appeals for the Second Circuit by using the appellate CM/ECF system. Participants in the case who are registered CM/ECF users will be served by the appellate CM/ECF system./s/Kai H. Richter Kai H. Richter 23

ACKNOWLEDGMENT AND NOTICE OF APPEARANCE, on behalf of Respondent Omkharan Arasarantnam, Baiju Gajjar, Ramon Moreno, Rajath Nagaraja and Donald O'Halloran, FILED. Service date 10/10/2017 by CM/ECF.[2143838] [17-2911] [Entered: 10/10/2017 04:19 PM]

ACKNOWLEDGMENT AND NOTICE OF APPEARANCE Short Title: Deutsche Bank Americas Holding v. Moreno, et al. Docket No.: 17-2911 Lead Counsel of Record (name/firm) or Pro se Party (name): Kai H. Richter Nichols Kaster, PLLP, 4600 IDS Center, 80 S. 8th Street, Minneapolis, MN 55402 Appearance for (party/designation): Ramon Moreno, Donald O'Halloran, Omkharan Arasarantnam, Naiju Gajjar, Rajth Nagaraja, Respondents DOCKET SSHEET AC DOC ACKNOWLEDGMENT/AMENDMENTS OW DG/A D S Caption as indicated is: (✔) Correct () Incorrect. See attached caption page with corrections. Appellate Designation is: (✔) Correct () Incorrect. The following parties do not wish to participate in this appeal: Parties: () Incorrect. Please change the following parties= designations: Party Correct Designation Contact Information for Lead Counsel/Pro Se Party is: (✔) Correct () Incorrect or Incomplete. As an e-filer, I have updated my contact information in the PACER AManage My Account@screen. Name: Kai H. Richter Firm: Nichols Kaster, PLLP Address: 4600 IDS Center, 80 S. 8th Street, Minneapolis, MN 55402 Telephone: (612) 256-3200 Fax: (612) 338-4878 Email: krichter@nka.com RELATED CASES (✔) This case has not been before this Court previously. () This case has been before this Court previously. The short title, docket number, and citation are: () Matters related to this appeal or involving the same issue have been or presently are before this Court. The short titles, docket numbers, and citations are: CERTIFICATION I certify that (✔) I am admitted to practice in this Court and, if required by LR 46.1(a)(2), have renewed my admission on OR that () I applied for admission on or renewal on. If the Court has not yet admitted me or approved my renewal, I have completed Addendum A. Signature of Lead Counsel of Record:/s/Kai H. Richter Type or Print Name: Kai H. Richter OR Signature of pro se litigant: Type or Print Name: () I am a pro se litigant who is not an attorney. () I am an incarcerated pro se litigant.

NOTICE OF APPEARANCE AS ADDITIONAL COUNSEL, on behalf of Respondent Omkharan Arasarantnam, Baiju Gajjar, Ramon Moreno, Rajath Nagaraja and Donald O'Halloran, FILED. Service date 10/10/2017 by CM/ECF. [2143849] [17-2911] [Entered: 10/10/2017 04:23 PM]

Case 17-2911, Document 37, 10/10/2017, 2143849, Page1 of 1 NOTICE OF APPEARANCE FOR SUBSTITUTE, ADDITIONAL, OR AMICUS COUNSEL Short Title: Deutsche Bank Americas Holding Corp. v. Moreno, et al. _____ Docket No.: 17-2911 ________ Substitute, Additional, or Amicus Counsel’s Contact Information is as follows: Name: Jacob T. Schutz Firm: Nichols Kaster, PLLP Address: 4600 IDS Center, 80 S. 8th Street, Minneapolis, MN 55402 Telephone: (612) 256-3200 ___________________________ Fax: (612) 338-4878 E-mail: jschutz@nka.com Appearance for: Ramon Moreno, Donald O'Halloran, Omkharan Arasarantnam, Naiju Gajjar, Rajth Nagaraja, Respondents (party/designation) Select One: G Substitute counsel (replacing lead counsel:) (name/firm) G Substitute counsel (replacing other counsel: _______) (name/firm) ✔ G Additional counsel (co-counsel with: Kai H. Richter, Nichols Kaster, PLLP) (name/firm) G Amicus (in support of:) (party/designation) CERTIFICATION I certify that: G I am admitted to practice in this Court and, if required by Interim Local Rule 46.1(a)(2), have renewed my admission on OR G I applied for admission on 9/28/2017 ✔. Signature of Counsel:/s/Jacob T. Schutz Type or Print Name: Jacob T. Schutz

FRAP 28(j) LETTER, dated 12/12/2017, on behalf of Respondent Omkharan Arasarantnam, Baiju Gajjar, Ramon Moreno, Rajath Nagaraja and Donald O'Halloran, RECEIVED. Service date 12/12/2017 by CM/ECF.[2192242] [17-2911] [Entered: 12/12/2017 11:24 AM]

Case 17-2911, Document 43-1, 12/12/2017, 2192242, Page1 of 2 Kai H. Richter 4600 IDS Center Direct: (612) 256-3278 80 South Eighth Street Fax: (612) 338-4878 Minneapolis, MN 55402 krichter@nka.com (877) 448-0492 December 12, 2017 VIA EMAIL AND U.S. MAIL Catherine O'Hagan Wolfe, Clerk of Court United States Court of Appeals for the Second Circuit Thurgood Marshall United States Courthouse 40 Foley Square New York, New York 10007 RE: Moreno, et al. v. Deutsche Bank Americas Holding Corp., et al. Second Circuit Case No. 17-2911 District Court Case No. 15-cv-9936 Dear Ms. Wolfe: Pursuant to Federal Rule of Appellate Procedure 28(j), Respondents submit this letter to bring to the Court's attention two recent decisions bearing on the pending Petition for Permission to Appeal Pursuant to Fed. R. Civ. P. 23(f). First, on November 27, 2017, the United States District Court for the Southern District of New York granted a motion for class certification in another ERISA breach of fiduciary duty case involving proprietary funds. See Leber v. Citigroup 401(k) Plan Inv. Comm., 2017 WL 5664850, at *1 (S.D.N.Y. Nov. 27, 2017) (Exhibit 1). Like Petitioners (see Petition at 4), the defendants argued that certification under Rule 23(b)(1) was improper. However, the Leber court disagreed, noting that "the structure of ERISA favors the principles enumerated under Rule 23(b)(1)(B), since the statute creates a 'shared' set of rights among the plan participants by imposing duties on the fiduciaries relative to the plan, and it even structures relief in terms of the plan and its accounts, rather than directly for the individual participants." Id. at *17. Second, on December 6, 2017, the United States District Court for the Western District of Missouri granted class certification in another ERISA breach of fiduciary duty case involving proprietary funds. See Wildman v. Am. Century Servs., LLC, 2017 WL 6045487 (W.D. Mo. Dec. 6, 2017) (Exhibit 2). Like Petitioners (see Petition at 11-12), the defendants argued that the Supreme Court's decision in LaRue v. DeWolff, Boberg & Assocs., Inc., 552 U.S. 248 (2011) foreclosed certification under Rule 23(b)(1) in cases seeking monetary relief. Wildman, 2017 WL 6045487, at *6. However, the court stated that LaRue did not "identify a blanket prohibition against a Rule 23(b)(1) class www.nka.com Case 17-2911, Document 43-1, 12/12/2017, 2192242, Page2 of 2 certification in which monetary relief is sought." Id. The court found certification proper under Rule 23(b)(1) both because separate lawsuits "could establish incompatible standards governing Defendants' conduct" and because "adjudication of Plaintiffs' claims would be dispositive of the interest of all plan participants." Id. These decisions are the latest in a long line of 401(k) cases certifying classes under Rule 23(b)(1). See Answer to Petition at 1 n.2. Sincerely, NICHOLS KASTER, PLLP Kai H. Richter Encl. 2 Case 17-2911, Document 43-2, 12/12/2017, 2192242, Page1 of 18 EXHIBIT 1 Leber v. CitigroupCase 401(k)17-2911, Document Plan Investment 43-2, Committee, 12/12/2017, --- F.R.D. ---- (2017)2192242, Page2 of 18 2017 WL 5664850 of prudence and loyalty pursuant to the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. 2017 WL 5664850 § 1001 et seq. Plaintiffs have now moved for class Only the Westlaw citation is currently available. certification. For the reasons explained below, plaintiffs' United States District Court, motion is granted. S.D. New York. Marya J. LEBER, Sara L. Kennedy, I. BACKGROUND Leslie Highsmith, Sherri M. Harris, and The Court assumes the parties' familiarity with this all others similarly situated, Plaintiffs, action's procedural history, which was recounted in detail v. in the Court's September 8, 2015, Opinion & Order on The CITIGROUP 401(K) PLAN INVESTMENT plaintiffs' motion to amend the complaint. See Leber COMMITTEE; The Benefit Plans Investment v. Citigroup 401(k) Plan Inv. Comm., 129 F.Supp.3d 4 Committee of Citigroup, Inc.; Michael Carpenter; (S.D.N.Y. 2015). In that Opinion & Order, the Court Paul Collins; James Costabile; Virgil Cumming; granted plaintiffs leave to file a fourth amended complaint David Dodillet; Robert Grogan; William Heyman; ("4AC" or the "Fourth Amended Complaint"), which Robin Leopold; Alan MacDonald; Michael plaintiffs then filed on September 18, 2015. (4AC, ECF Murray; Christine Simpson; Richard Tazik; No. 211.) Plaintiffs now seek to certify the class proposed in their Fourth Amended Complaint under Federal Rule Todd Thomson; Timothy Tucker; David Tyson; of Civil Procedure 23(b)(1) or, in the alternative, Rule Ronald A. Walter; Guy Whittaker; Donald 23(b)(3). Young; James Zelter; Bruce Zimmerman; and Doe Defendants 1–20, Defendants. A. The Plan 07–Cv–9329 (SHS) This action involves allegations of self-dealing and | imprudent fiduciary conduct related to the administration Signed 11/27/2017 of Citigroup's 401(k) Plan. The Plan is a defined contribution plan, within the meaning of 29 U.S.C. § Attorneys and Law Firms 1002(34). (See 4AC ¶ 25; Answer, ECF No. 228, ¶ 25.) David Steven Preminger, Keller Rohrback L.L.P., New In a defined contribution plan, each participant maintains York, NY, James Moore, Bryan T. Veis, Pro Hac Vice, an individual account, chooses from a menu of specific James Brian McTigue, Pro Hac Vice, James A. Moore, investment options, and is entitled to only those benefits Pro Hac Vice, McTigue & Veis LLP, Gregory Y. Porter, stemming from the amounts contributed to his or her Bailey & Glasser, LLP, Washington, DC, Patrick Owen account. See Hughes Aircraft Co. v. Jacobson, 525 U.S. Muench, Bailey & Glasser, LLP, Springfield, IL, for 432, 439, 119 S.Ct. 755, 142 L.Ed.2d 881 (1999) (citing 29 Plaintiffs. U.S.C. § 1002(34)). In contrast to a defined contribution plan, the second type of pension plan covered by ERISA Lewis Richard Clayton, Karen R. King, Timothy James —a defined benefit plan—is comprised of a "general pool Holland, Paul, Weiss, Rifkind, Wharton & Garrison LLP, of assets rather than individual dedicated accounts" and New York, NY, for Defendants. employees are entitled to fixed payments upon retirement. Hughes Aircraft, 525 U.S. at 439, 119 S.Ct. 755. 1 OPINION & ORDER The three named plaintiffs—Marya J. Leber, Sara L. *1 SIDNEY H. STEIN, U.S. District Judge. Kennedy, and Sherri M. Harris 2 —are all participants in the 401(k) Plan, and claim that the committees responsible Plaintiffs are participants in Citigroup's 401(k) retirement for overseeing the Plan during the putative class period, 3 plan (the "401(k) Plan" or the "Plan") and bring this along with those committees' individual members putative class action against certain fiduciaries of the and officers (collectively, "defendants"), breached their Plan, alleging that these fiduciaries violated their duties fiduciary duties of prudence and loyalty by persistently © 2017 Thomson Reuters. No claim to original U.S. Government Works. 1 Leber v. CitigroupCase 401(k)17-2911, Document Plan Investment 43-2, Committee, 12/12/2017, --- F.R.D. ---- (2017)2192242, Page3 of 18 2017 WL 5664850 favoring certain investment options despite the fact In Count I, plaintiffs allege that defendants generally that those options had higher management fees than failed to "monitor the suitability of Plan investment comparable alternatives. options, and to remove or replace any investment option that was found to be imprudent, e.g.[,] because of high *2 Defendants were responsible for monitoring the fees." (4AC ¶ 89.) Plaintiffs allege that the minutes of Plan and making decisions with respect to removing, Plan committee meetings demonstrate that defendants replacing, or adding investment options offered to the performed "no or a purely perfunctory" review of the participants. (4AC ¶¶ 1, 27, 40, 42; see also Answer ¶¶ performance and fees of the Plan's investment options 1, 40, 42.) During the putative class period—October 18, and instead focused their attention on Citigroup's defined 2001, to September 4, 2007—the Plan contained twenty- benefit plans. (4AC ¶ 91.) According to the Fourth six different investment options, including Citigroup's Amended Complaint, defendants only began to monitor corporate stock, money market funds, equity funds, and the performance of the Plan's funds after Citigroup fixed income funds. (Expert Report of Atanu Saha 9, Oct. decided to sell CAM; at that point, defendants no 23, 2015, ECF No. 232, Ex. 1 ("Saha Expert Report").) longer had an interest in keeping the Plan's proprietary investment options free from scrutiny. (4AC ¶ 91.) As many as sixteen of those investment options were mutual funds that were offered and managed Plaintiffs allege that because of defendants' failure to by Citigroup's subsidiaries ("proprietary funds"). 4 monitor the Plan and to remove and replace imprudent According to plaintiffs, Citigroup had a financial stake investments, the Plan and its participants incurred in offering these proprietary funds as investment options "millions of dollars" in losses through the high fees of nine to Plan participants because Citigroup—through its particular proprietary funds (the "Affiliated Funds"). 5 affiliates, Citi Fund Management, Inc., Smith Barney (4AC ¶ 92.) These nine Affiliated Funds are a subset Fund Management LLC, and Salomon Brothers Asset of the sixteen proprietary funds offered by the Plan. Management, Inc.—received revenues from the funds' According to plaintiffs, the other proprietary funds did investment advisory fees. (4AC ¶ 3, see also id. at ¶¶ 2, 35, not experience losses during the putative class period 52.) and therefore could not sustain a suit seeking monetary damages. (Oral Arg., Oct. 16, 2017, Tr. 11:17–19, 12:10– On December 1, 2005, Citigroup sold Citigroup Asset 13:3; see also Pls.' Resp. to Defs'. Subm'n of Suppl. Auth. Management ("CAM")—the division that included the 2, July 10, 2017, ECF No. 260.) managers of its proprietary funds—to Legg Mason, Inc. At that point, the proprietary funds ceased to *3 Counts II and III focus on specific decisions taken be affiliated with Citigroup, but defendants did not by defendants at a September 5, 2002, committee meeting, immediately remove them from the Plan. (4AC ¶¶ which was attended by representatives from Citigroup 4, 48, 51.) Defendants finally eliminated each of the Asset Management ("CAM"), the Citigroup entity that remaining (formerly) proprietary funds—except for the would profit from any investment advisory fees paid Citi Institutional Liquid Reserves Fund—from the Plan to Affiliated Funds. In Count II, plaintiffs allege that on September 4, 2007. (4AC ¶¶ 4, 51.) defendants added three of the Affiliated Funds—the Citi Institutional Reserves Fund, the Smith Barney Small Cap Value Fund, and the Smith Barney Fundamental B. The Claims Value Fund—to the Plan after simply "rubber-stamp In their Fourth Amended Complaint, plaintiffs bring [ing]" CAM's recommendation. (4AC ¶ 95.) And in Count three counts, reflecting three different ways in which III, plaintiffs allege that, at that same September 5, defendants are alleged to have improperly favored 2002, meeting, defendants also "rubber-stamped" CAM's Citigroup's proprietary funds and thereby breached their recommendation to transfer, or "map," assets that had duties of prudence and loyalty, in violation of the fiduciary previously been invested in non-proprietary funds into standards outlined in sections 404(a) and 405 of ERISA, four of the Affiliated Funds—the Citi Institutional Liquid 29 U.S.C. §§ 1104(a), 1105. Reserves Fund, the Smith Barney Large Cap Growth Fund, Smith Barney Fundamental Value Fund, and the Smith Barney Government Securities Fund. (4AC ¶ © 2017 Thomson Reuters. No claim to original U.S. Government Works. 2 Leber v. CitigroupCase 401(k)17-2911, Document Plan Investment 43-2, Committee, 12/12/2017, --- F.R.D. ---- (2017)2192242, Page4 of 18 2017 WL 5664850 100.) According to plaintiffs, both the inclusion of new Notably, the named plaintiffs did not themselves invest Affiliated Funds and the mapping of other funds' assets in each of the nine Affiliated Funds through which they into the Affiliated Funds caused losses to the Plan through allege the Plan suffered losses. Leber and Kennedy both the Affiliated Funds' allegedly high fees. (4AC ¶¶ 98, 100– invested only in the Citi Institutional Liquid Reserves 01.) Fund, while Harris invested only in the Smith Barney Large Cap Growth Fund. (4AC ¶¶ 14, 16, 19; see also Plaintiffs bring each of their claims in a derivative capacity Answer ¶¶ 14, 16, 19.) on behalf of the Plan pursuant to 29 U.S.C. § 1132(a)(2). 6 Because section 1132(a)(2) "does not provide a remedy for *4 In opposition to plaintiffs' class certification motion, individual injuries distinct from plan injuries," LaRue v. defendants argue that—as a threshold matter—the named DeWolff, Boberg & Assocs., Inc., 552 U.S. 248, 256, 128 plaintiffs do not have standing to raise claims concerning S.Ct. 1020, 169 L.Ed.2d 847 (2008), any relief plaintiffs those Affiliated Funds in which they did not invest. seek will "inur [e] to the Plan" and will only indirectly Defendants further contend that, even if the named benefit individual participants, L.I. Head Start Child Dev. plaintiffs' claims were fully justiciable, they would not Servs., Inc. v. Economic Opportunity Comm'n of Nassau be typical of the claims of class members who invested Cty., 710 F.3d 57, 66 (2d Cir. 2013). Accordingly, plaintiffs in other Affiliated Funds. In addition, defendants argue are seeking disgorgement of investment advisory fees and that plaintiffs cannot satisfy Rule 23(a)'s commonality restoration of all losses to the Plan, coupled with the requirement and that their suit does not fall into any of designation of the putative class members as the ultimate the categories enumerated in Rule 23(b). Defendants also recipients of the amounts disgorged and restored to the object to plaintiffs' extension of the class period beyond December 1, 2005, after which the Affiliated Funds were Plan. 7 (4AC at 39.) no longer affiliated with Citigroup. Separately, defendants urge the Court to find that Harris's claims were time- C. The Class barred when she was added as a named plaintiff in 2015. Because any plaintiff in a 29 U.S.C. § 1132(a)(2) suit must "take ... steps to become a bona fide representative of II. TIMELINESS OF HARRIS'S CLAIMS other interested parties," the U.S. Court of Appeals for Prior to addressing plaintiffs' class certification motion, the Second Circuit has stated that plaintiffs who comply the Court must reevaluate, in light of California Public with the standards for class certification of Federal Rule Employees' Retirement System v. ANZ Securities, Inc., ––– of Civil Procedure 23 "will likely be proceeding in a U.S. ––––, 137 S.Ct. 2042, 198 L.Ed.2d 584 (2017), its 'representative capacity' properly for purposes of [section earlier decision to permit Harris to join the case as a named 1132(a)(2)]." Coan v. Kaufman, 457 F.3d 250, 259, 261 (2d plaintiff. Cir. 2006). This Court has the "power to reconsider its own decisions In this case, Leber, Kennedy, and Harris seek to represent prior to final judgment" and is justified in doing so in a class that consists of "[a]ll participants in [the Plan]"— situations where there has been "an intervening change except for "[d]efendants, [d]efendants' beneficiaries, and of controlling law" or to "correct a clear error." DiLaura [d]efendants' immediate families"—who invested in any of v. Power Auth. of State of N.Y., 982 F.2d 73, 76 (2d Cir. the nine Affiliated Funds between October 18, 2001, and 1992); see also Fed. R. Civ. P. 54(b) ("[A]ny order or other September 4, 2007. (4AC ¶ 79.) The October 18, 2001, date decision, however designated, that adjudicates fewer than represents the outer bound of ERISA's six-year limitations all the claims or the rights and liabilities of fewer than all period and September 4, 2007, is the date on which all the parties ... may be revised at any time before the entry of Affiliated Funds (except for the Citi Institutional Liquid a judgment adjudicating all the claims and all the parties' Reserves Fund) were removed from the Plan. (4AC ¶ rights and liabilities."). 4.) Plaintiffs seek to certify this proposed class pursuant to Federal Rule of Civil Procedure 23(b)(1) or, in the In this Court's Opinion & Order of September 8, 2015, alternative, Rule 23(b)(3). the Court permitted Leber and Kennedy to amend their complaint to add Harris as a class representative. At the time, defendants opposed this amendment by arguing © 2017 Thomson Reuters. No claim to original U.S. Government Works. 3 Leber v. CitigroupCase 401(k)17-2911, Document Plan Investment 43-2, Committee, 12/12/2017, --- F.R.D. ---- (2017)2192242, Page5 of 18 2017 WL 5664850 that Harris's claims were time-barred. 8 (Defs'. Mem. could not be tolled), cert. denied, ––– U.S. ––––, 137 S.Ct. in Opp'n to Pls.' Mot. for Leave to File Fourth Am. 2326, 198 L.Ed.2d 755 (2017) (denying certiorari the day Compl. 4–8, Mar. 25, 2015, ECF No. 155.) The Court after issuing the ANZ decision). disagreed, concluding that Harris's claims were subject to a principle called "American Pipe tolling," in which "the Second, the Supreme Court clarified that 29 U.S.C. § commencement of a class action suspends the applicable 1113(1) was a statute of repose. ANZ, 137 S.Ct. at statute of limitations as to all asserted members of the 2050. The ANZ majority used the ERISA statute as class." Am. Pipe and Constr. Co. v. Utah, 414 U.S. 538, an illustrative example of statutes of repose that permit 554, 94 S.Ct. 756, 38 L.Ed.2d 713 (1974); see also Crown, tolling only in "certain circumstances" envisioned by the Cork & Seal Co. v. Parker, 462 U.S. 345, 353–54, 103 S.Ct. legislature. Id. 10 2392, 76 L.Ed.2d 628 (1983). Although defendants argued then that Harris was not actually a "member of the class" Plaintiffs attempt to distinguish ANZ by pointing out that because Leber and Kennedy lacked standing to raise it involved a plaintiff who had opted out of a class in claims related to the fund in which Harris had invested order to file an individual suit, while "Harris was simply (ECF No. 155 at 5–6), the Court found that American Pipe added by amendment as a named plaintiff to an existing tolling applied so long as Leber and Kennedy purported to class action suit." (Pls.' Resp. to Defs'. Subm'n of Suppl. assert claims on her behalf. Leber v. Citigroup 401(k) Plan Auth.; see also Oral Arg. Tr. 6:1–3.) But the holding of Inv. Comm., 129 F.Supp.3d 4, 22 (S.D.N.Y. 2015) (citing, ANZ cannot be limited to cases that share its procedural inter alia, In re WorldCom Sec. Litig., 496 F.3d 245, 254– posture. American Pipe tolling applies not only to opt- 55 (2d Cir. 2007)). out plaintiffs who elect to file individual suits, but also to putative class members seeking to intervene in a pre- In connection with plaintiffs' motion to amend, neither existing class action. See American Pipe, 414 U.S. 538, the parties nor the Court addressed the question of 94 S.Ct. 756, 38 L.Ed.2d 713 (establishing the tolling whether the ERISA statute was eligible for American Pipe doctrine in a case involving intervention by putative class tolling. At that time, it was well-established that only members); see also ANZ, 137 S.Ct. at 2057 (Ginsburg, statutes of limitations—as opposed to statutes of repose J., dissenting) (observing that the majority's decision —could be subject to equitable tolling. 9 See CTS Corp. incentivizes unnamed putative class members "to file a v. Waldburger, ––– U.S. ––––, 134 S.Ct. 2175, 2183, 189 protective claim, in a separate complaint or in a motion to L.Ed.2d 62 (2014); Police & Fire Ret. Sys. of City of Detroit intervene, before the three-year period [of repose] expires") v. IndyMac MBS, Inc., 721 F.3d 95, 106 (2d Cir. 2013). (emphasis added). However, it was not clear whether the six-year time bar in ERISA, 29 U.S.C. § 1113(1), was a statute of repose or a In order to account for changes in controlling law statute of limitations. Nor was it clear whether American and to correct a prior error, the Court must revise its Pipe tolling was equitable or legal in nature. See IndyMac, prior determination that American Pipe tolling applied 721 F.3d at 109 (declining to decide the question). to Harris's claims. Because Harris was time-barred from raising any individual claims at the time of her entry *5 In the 2017 ANZ decision, the Supreme Court into this case and because she was not yet a member of addressed both of those issues. First, the Supreme Court a certified class, she should not have been permitted to held that American Pipe tolling is in fact a species of serve as a lead plaintiff. 11 Of course, striking Harris as an "equitable tolling." ANZ, 137 S.Ct. at 2050–51. As such, improperly added named plaintiff does not preclude her it could not be used to toll the statute of repose in Section from remaining a member of any class that is certified by 13 of the Securities Act. Id. at 2052. Although the ANZ this Court. A statute of repose "puts an outer limit on the case involved one particular statute of repose, the case's right to bring a civil action," CTS, 134 S.Ct. at 2182; it reasoning extends to other statutes of repose. See id. at does not cut off a class action that was timely initiated. 2050 ("[T]he determination that the 3–year period [in the Securities Act] is a statute of repose is critical ...."); see also SRM Global Master Fund Ltd. P'ship v. Bear Stearns Cos., III. STANDING 829 F.3d 173 (2d Cir. 2016) (applying the same reasoning *6 Before moving on to the requirements of Rule 23, this to conclude that the statute of repose in the Exchange Act Court must resolve the "threshold question" of whether © 2017 Thomson Reuters. No claim to original U.S. Government Works. 4 Leber v. CitigroupCase 401(k)17-2911, Document Plan Investment 43-2, Committee, 12/12/2017, --- F.R.D. ---- (2017)2192242, Page6 of 18 2017 WL 5664850 the remaining named plaintiffs—Leber and Kennedy— injuries may also have "class standing" to assert "other have standing to bring claims regarding those Affiliated claims, unrelated to those injuries," on behalf of unnamed Funds in which they did not personally invest. Warth v. class members. Retirement Board, 775 F.3d at 160. In Seldin, 422 U.S. 490, 498, 95 S.Ct. 2197, 45 L.Ed.2d 343 NECA–IBEW Health & Welfare Fund v. Goldman Sachs (1975). & Co., the Second Circuit established a two-part test for class standing: A. Legal Standards [I]n a putative class action, a plaintiff The doctrine of standing is derived from Article III of the has class standing if he plausibly Constitution, which limits federal courts' jurisdiction to alleges (1) that he personally has "Cases" and "Controversies," U.S. Const. art. III, § 2, and suffered some actual injury as exists to "ensure that a plaintiff has a sufficiently personal a result of the putatively illegal stake in the outcome of the suit so that the parties are conduct of the defendant, and (2) adverse," Ret. Bd. of the Policemen's Annuity & Benefit that such conduct implicates the Fund of the City of Chi. v. Bank of N.Y. Mellon (Retirement same set of concerns as the conduct Board), 775 F.3d 154, 159 (2d Cir. 2014) (quotation marks alleged to have caused injury to omitted). A plaintiff must demonstrate standing for "each other members of the putative class claim he seeks to press." DaimlerChrysler Corp. v. Cuno, by the same defendants. 547 U.S. 332, 352, 126 S.Ct. 1854, 164 L.Ed.2d 589 (2006). 693 F.3d 145, 162 (2d Cir. 2012) ("NECA–IBEW") In order to establish the "irreducible constitutional (quotation marks, citations, and alterations omitted). 12 minimum of standing," a plaintiff must show that he or If this two-pronged test is satisfied, "the named plaintiff's she has "(1) suffered an injury in fact, (2) that is fairly litigation incentives are sufficiently aligned with those of traceable to the challenged conduct of the defendant, and the absent class members [such] that the named plaintiff (3) that is likely to be redressed by a favorable judicial may properly assert claims on their behalf." Retirement decision." Spokeo, Inc. v. Robins, ––– U.S. ––––, 136 S.Ct. Board, 775 F.3d at 161. 1540, 1547, 194 L.Ed.2d 635 (2016) (quotation marks omitted) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560–61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992)). To B. Discussion establish the first requirement—injury in fact—a plaintiff *7 Plaintiffs have standing to assert all of the claims must "show that he or she suffered 'an invasion of a legally brought in this action even though they did not invest protected interest' that is 'concrete and particularized' and in each of the Affiliated Funds at issue. In this Circuit, 'actual or imminent, not conjectural or hypothetical.' " plaintiffs do not need to point to individualized injuries Id. at 1547–48 (quoting Lujan, 504 U.S. at 560, 112 S.Ct. with respect to each Plan investment in order to establish 2130). constitutional standing in a derivative suit brought pursuant to 29 U.S.C. § 1132(a)(2). In Long Island Because the three standing requirements are "not mere Head Start Child Development Services, Inc. v. Economic pleading requirements but rather an indispensable part Opportunity Commission of Nassau County, Inc., the of the plaintiff's case," a plaintiff must support them Second Circuit held that plaintiffs who "asserted their "with the manner and degree of evidence required at the claims in a derivative capacity" on behalf of a plan successive stages of the litigation." Lujan, 504 U.S. at 561, established "injury-in-fact sufficient for constitutional 112 S.Ct. 2130. At the class certification stage, the Second standing" by alleging injuries to that plan. 710 F.3d 57, 67 Circuit has approved of evaluating standing by relying n.5 (2d Cir. 2013). on the pleadings and "constru[ing] the complaint in favor of the complaining party." See Denney v. Deutsche Bank Although the applicability of Long Island Head Start AG, 443 F.3d 253, 263 (2d Cir. 2006) (quotation marks to actions involving defined contribution plans has been omitted). called into question, the decision has not been displaced as Second Circuit precedent. See Allen v. Bank of Am. Corp., In the context of class actions, a named plaintiff who has No. 15 Civ. 4285, 2016 WL 4446373, at *5 (S.D.N.Y. constitutional standing to raise claims based on his own Aug. 23, 2016) ("[T]he Second Circuit's holding in [Long © 2017 Thomson Reuters. No claim to original U.S. Government Works. 5 Leber v. CitigroupCase 401(k)17-2911, Document Plan Investment 43-2, Committee, 12/12/2017, --- F.R.D. ---- (2017)2192242, Page7 of 18 2017 WL 5664850 Island] Head Start is neither ambiguous nor dictum."), N.Y. Mellon, No. 15-CV-10180, 2017 WL 1208598, at *3– argued, No. 16–3327 (2d Cir. June 22, 2017); see also 4 (S.D.N.Y. Mar. 31, 2017) (applying Long Island Head Fletcher v. Convergex Grp., LLC, 679 Fed.Appx. 19, 21 Start to claims asserted on behalf of defined contribution (2d Cir. 2017) (summary order), petition for cert. filed, No. plans). 17–343 (Sept. 1, 2017). Defendants highlight In re UBS ERISA Litigation, No. 08-cv-6696, 2014 WL 4812387, *8 Here, plaintiffs have sued in a representative capacity at *7 (S.D.N.Y. Sept. 29, 2014), aff'd sub nom. Taveras and allege that the Plan suffered millions of dollars a v. UBS AG, 612 Fed.Appx. 27 (2d Cir. 2015) (summary year in losses as a result of defendants' disloyal and order), in which a district court held that a loss to the imprudent decisions to offer the nine Affiliated Funds plan is insufficient to establish injury-in-fact for a defined as investments. (4AC ¶¶ 70, 92, 98, 102.) The fact that contribution plan because the plan can lose value even only some of these alleged losses manifested themselves while the plaintiff's individual account does not. The court in the named plaintiffs' individual accounts does not distinguished Long Island Head Start, which addressed deprive plaintiffs of their standing to seek redress on an "ERISA welfare benefits plan," in which a breach behalf of the Plan for the broader injuries the Plan of fiduciary duties would have "necessarily caused the incurred. See Cryer v. Franklin Templeton Res., Inc., No. value of the plan to diminish, to the detriment of all plan C 16-4265, 2017 WL 4023149, at *4 (N.D. Cal. July 26, participants." In re UBS ERISA Litig., 2014 WL 4812387, 2017) ("[I]n determining constitutional standing, courts at *7. Although the Second Circuit endorsed the district look not to individual funds but to the nature of the court's reasoning, it did so in a non-precedential summary claims and allegations to determine whether the pleaded order that relied on pre-Long Island Head Start authority. injury relates to the defendants management of the Plan See Taveras, 612 Fed.Appx. at 29 (citing Kendall v. Emps. as a whole." (quotation marks omitted)), request to appeal Ret. Plan of Avon Prods., 561 F.3d 112, 119 (2d Cir. 2009)). filed, No. 17–80213 (9th Cir. Oct. 18, 2017); McDonald v. Edward D. Jones & Co., No. 4:16 CV 1346, 2017 WL The persuasive value of In re UBS ERISA Litigation— 372101, at *2 (E.D. Mo. Jan. 26, 2017) ("In a suit brought and the summary order affirming it—is limited. Nothing pursuant to 29 U.S.C. § 1132(a)(2), a plan participant may in the Long Island Head Start decision indicates that the seek recovery for the plan even where the participant did Court of Appeals relied on any unique characteristics not personally invest in every one of the funds that caused of defined benefit plans to reach its conclusion about an injury to the plan."); Taylor v. United Techs. Corp., No. standing. In fact, neither In re UBS ERISA Litigation nor 3:06CV1494, 2008 WL 2333120, at *3 (D. Conn. June 3, Taveras addresses the primary basis of Long Island Head 2008) ("[T]he loss to the Plan assets due to excessive fees Start's reasoning: the derivative nature of the suit before or impaired returns represents a concrete and actual injury it. Although defendants would prefer it to be otherwise, to satisfy standing."); Tussey v. ABB, Inc., No. 06-04305- a 29 U.S.C. § 1132(a)(2) suit brought on behalf of a cv, 2007 WL 4289694, at *2 (W.D. Mo. Dec. 3, 2007) defined contribution plan is no less derivative than one ("The Fidelity Defendants' argument that Tussey cannot brought on behalf of a defined benefit plan. See LaRue advance any claims for investment options which he never v. DeWolff, Boberg & Assocs., Inc., 552 U.S. 248, 256, elected is not persuasive because the losses occurred to the 128 S.Ct. 1020, 169 L.Ed.2d 847 (2008) ("[29 U.S.C. § Plan as a whole."). 1132(a)(2)] authorize[s] recovery for fiduciary breaches that impair the value of plan assets in a participant's Even if Long Island Head Start did not control and individual account."); see also LaRue, 552 U.S. at 262, plaintiffs needed to allege individualized harm related to 128 S.Ct. 1020 (Thomas, J., concurring) ("The allocation each fund at issue to establish constitutional standing, 13 of a plan's assets to individual accounts for bookkeeping an application of the Second Circuit's class standing test purposes does not change the fact that all the assets in the would similarly permit plaintiffs to bring claims related [defined contribution] plan remain plan assets."). to all nine Affiliated Funds. See NECA–IBEW, 693 F.3d at 158 (applying class standing analysis where plaintiff Because the holding of Long Island Head Start "clearly lack[ed] standing" to assert claims arising out of remains binding on this Court, plaintiffs can establish financial products that did not cause injuries to plaintiff). constitutional standing to bring representative claims by pointing to injuries to Plan assets. See Carver v. Bank of © 2017 Thomson Reuters. No claim to original U.S. Government Works. 6 Leber v. CitigroupCase 401(k)17-2911, Document Plan Investment 43-2, Committee, 12/12/2017, --- F.R.D. ---- (2017)2192242, Page8 of 18 2017 WL 5664850 As noted above, to establish class standing, a plaintiff Retirement Board, where class standing was lacking. In must show that (1) the plaintiff has "personally suffered" Retirement Board, plaintiffs brought breach of contract an injury-in-fact as a result of the defendant's conduct, and fiduciary duty claims against Bank of New York and (2) the defendant's conduct "implicates the same set Mellon ("BNYM"), a trustee of residential mortgage- of concerns as the conduct alleged to have caused injury" backed securities trusts, including those trusts in which to the other putative class members. NECA–IBEW, 693 plaintiffs did not invest. The Second Circuit held that F.3d at 162 (quotation marks omitted). plaintiffs did not have a "sufficiently personal and concrete stake" in proving the claims of those class Plaintiffs satisfy the first prong of the class standing test by members who invested in other trusts because BNYM's alleging that they personally paid excessive fees as a result alleged misconduct—the failure to detect and report of having invested in the Citi Institutional Liquid Reserves material breaches of the agreements governing those trusts Fund, an Affiliated Fund that is implicated in all three —had to be "proved loan-by-loan and trust-by-trust." of the counts alleged in the Fourth Amended Complaint. Retirement Board, 775 F.3d at 162–63. See Moreno v. Deutsche Bank Ams. Holding Corp., 15 Civ. 9936, 2017 WL 3868803, at *10 (S.D.N.Y. Sept. 5, 2017) In the case sub judice, plaintiffs do have a clear (plaintiffs adequately alleged actual injury by alleging that path to demonstrating defendants' misconduct without "[t]hey were charged excessive fees and were offered an undertaking the kind of fund-by-fund analysis that unlawful menu of investments, assembled for the benefit was unavoidable in Retirement Board. Proving the of Defendants"), appeal filed, No. 17–2911 (2d Cir. Sept. "interrelated and overlapping" duty of prudence and 19, 2017); cf. Taveras, 612 Fed.Appx. at 29 (plaintiff failed loyalty claims that are at issue in this case, Leber v. to demonstrate injury-in-fact because she did not allege Citigroup 401(k) Plan Inv. Comm., 129 F.Supp.3d 4, 13 that her individual account was impacted by defendants' (S.D.N.Y. 2015), will require an inquiry into defendants' alleged breach). conduct in managing the Plan, which plaintiffs allege was uniform and not dependent on the idiosyncratic *9 Plaintiffs also satisfy the second prong of the Second characteristics of any proprietary funds. Circuit's class standing test because the allegedly disloyal and imprudent conduct of defendants "implicates the The duty of prudence standard focuses "on a fiduciary's same set of concerns" for investors in all nine Affiliated conduct in arriving at an investment decision, not on its Funds. NECA–IBEW, 693 F.3d at 162. Plaintiffs allege results." Pension Benefit Guar. Corp. ex rel. St. Vincent that they and all other Plan participants who invested Catholic Med. Ctrs. Ret. Plan v. Morgan Stanley Inv. in the Affiliated Funds were injured in the same manner Mgmt. Inc. (PBGC), 712 F.3d 705, 716 (2d Cir. 2013) when defendants failed to monitor the Plan or to (quoting In re Unisys Sav. Plan Litig., 74 F.3d 420, 434 investigate alternatives before selecting Affiliated Funds (3d Cir. 1996)); see also Katsaros v. Cody, 744 F.2d 270, or mapping monies into them from other funds. (4AC ¶¶ 279 (2d Cir. 1984); Leber, 129 F.Supp.3d at 14 (quoting 91, 95, 100.) In addition, the allegation that defendants' PBGC, 712 F.3d at 716); Taylor v. United Techs. Corp., behavior was motivated by their divided loyalties and No. 3:06cv1494, 2009 WL 535779, at *10 (D. Conn. Mar. improper preference for funds affiliated with Citigroup 3, 2009), aff'd, 354 Fed.Appx. 525 (2d Cir. 2009). Showing serves to further unite the claims of all Plan participants that any given Affiliated Fund had cheaper alternatives or who invested in any of the Affiliated Funds. As another that it had unreasonably excessive fees may allow a trier of district court found in a case involving similar allegations, fact to "reasonably infer ... that the [defendants'] process "[b]ecause the alleged harms are premised on the process was flawed," but it is not dispositive of the ultimate Defendants used to manage the Plan, the claims involve question regarding the "methods employed by the ERISA similar inquiries and proof, and thus implicate the same fiduciary" to investigate, select, or monitor investments. set of concerns." Moreno, 2017 WL 3868803, at *10. PBGC, 712 F.3d at 718 (quotation marks omitted). Defendants vigorously contest the notion that their Similarly, the standard for evaluating breach of loyalty conduct toward the nine Affiliated Funds "implicates claims "focuses ... on the fiduciary's conduct," and asks the same concerns" for all class members. Defendants whether the fiduciary took "all steps necessary to prevent analogize the circumstances of this case to those in conflicting interests from entering into the decision- © 2017 Thomson Reuters. No claim to original U.S. Government Works. 7 Leber v. CitigroupCase 401(k)17-2911, Document Plan Investment 43-2, Committee, 12/12/2017, --- F.R.D. ---- (2017)2192242, Page9 of 18 2017 WL 5664850 making process." Bussian v. RJR Nabisco, Inc., 223 F.3d caused losses to the Plan—a prerequisite to establishing 286, 298 (5th Cir. 2000) (citing, inter alia, Donovan v. liability for any fiduciary breach, see Silverman v. Mut. Bierwirth, 680 F.2d 263, 276 (2d Cir. 1982)). "Although a Benefit Life Ins. Co., 138 F.3d 98, 105 (2d Cir. 1998) fiduciary's ultimate choice may be evidence that the duty (Jacobs, J. and Meskill, J., concurring) ("Causation of of loyalty has been breached, the proper inquiry has as its damages is ... an element of the claim, and the plaintiff central concern the extent to which the fiduciary's conduct bears the burden of proving it.")—this type of inquiry does reflects a subordination of beneficiaries' and participants' not preclude a finding of class standing. First, NECA– interests to those of a third party." Id. IBEW and Retirement Board do not require every single element of a claim to be provable on a class-wide basis. *10 Defendants insist that even a focus on their conduct After all, Rule 23 certification—which presupposes the in managing the Plan does not eliminate the need to existence of class standing—does not require a plaintiff to consider the unique characteristics of the individual establish that "each element of her claim is susceptible to Affiliated Funds. In Retirement Board, the Second Circuit classwide proof." Amgen Inc. v. Conn. Ret. Plans & Tr. panel rejected the plaintiffs' contention that BNYM's Funds, 568 U.S. 455, 469, 133 S.Ct. 1184, 185 L.Ed.2d misconduct could be proven by establishing a common 308 (2013) (quotation marks and alterations omitted). "policy of 'inaction' in the face of widespread defaults." Instead, the Second Circuit's class standing doctrine Retirement Board, 775 F.3d at 162. The panel explained focuses on the conduct of the defendant and whether that "even proof that BNYM always failed to act when that conduct implicates the same concerns for all putative it was required to do so would not prove their case, class members. See NECA–IBEW, 693 F.3d at 162. because [plaintiffs] would still have to show which trusts Here, despite the variations between the Affiliated Funds, actually had deficiencies that required BNYM to act investors in all nine funds have the "same necessary stake in the first place." Id. According to defendants, the in litigating" whether defendants' conduct amounted to same reasoning applies to this case. They posit that a breach of their fiduciary duties. Id. at 164 (quotation "[e]ven if ... [defendants] failed to properly consider marks omitted). Proving the existence and quantum of management fees, plaintiffs still must show which funds losses incurred by each Affiliated Fund is therefore a had excessive expense ratios relative to comparable funds secondary inquiry. It is analogous to the damages inquiry, such that the fiduciaries were required to take action in and "it is well-established that the fact that damages the first place." (Defs.' Mem. in Opp'n to Pls.' Mot. to may have to be ascertained on an individual basis is not Certify Class 16, ECF No. 233.) According to defendants, sufficient to defeat class certification under Rule 23(a), plaintiffs' decision to bring claims related to only a subset let alone class standing." Id. at 164–65 (quotation marks of Citigroup's proprietary funds serves as an implicit omitted). acknowledgment that a fund-by-fund analysis is needed "in order to determine if there [was] an actionable Second, the derivative posture of this action eliminates violation." (Oral Arg. Tr. 32:12–22.) the Second Circuit's ultimate concern about situations in which misconduct must be proved on a fund-by-fund However, defendants' argument overlooks a fundamental basis. In Retirement Board, the Second Circuit needed to distinction between the allegations in this case and those be "reassure[d] ... that Plaintiffs themselves have any real in Retirement Board. In Retirement Board, the plaintiffs interest in litigating the absent class members' claims." 775 could not show that BNYM breached its obligations F.3d at 163. But in this litigation, plaintiffs are suing in without establishing that BNYM failed to take certain a representative capacity and can prevail on behalf of the actions when its duty to do so was triggered. But here, Plan so long as they show that defendants breached their plaintiffs' allegations are centered on breaches of the duties of loyalty and prudence with respect to any of the duty to administer the Plan solely in the interest of its Plan's investment options. See Urakhchin v. Allianz Asset participants and the duty to monitor Plan investments. Mgmt. of Am., L.P., No. 8:15-cv-1614, 2017 WL 2655678, These are constant duties; they need not be triggered by at *5 (C.D. Cal. June 15, 2017). Therefore, while plaintiffs the characteristics of any Affiliated Fund. will ultimately need to establish liability by proving that the Plan suffered losses through individual funds, this does Although plaintiffs will have to engage in a fund-specific not preclude them from satisfying the Second Circuit's inquiry to establish that the fiduciary breaches actually class standing test. © 2017 Thomson Reuters. No claim to original U.S. Government Works. 8 Case Leber v. Citigroup 401(k)17-2911, Document Plan Investment 43-2, Committee, --- 12/12/2017, F.R.D. ---- (2017)2192242, Page10 of 18 2017 WL 5664850 2005, at 2, Oct. 16, 2006, ECF No. 215, Ex. 3).) This is *11 Because plaintiffs asserting 29 U.S.C. § 1132(a) sufficient evidence to satisfy the numerosity requirement. (2) claims in a derivative capacity can establish injury- See In re Polaroid ERISA Litig., 240 F.R.D. 65, 74 in-fact by pointing to Plan losses and because, in any (S.D.N.Y. 2006). event, plaintiffs have class standing to assert breach of duty of loyalty and prudence claims on behalf of all Plan participants injured by defendants' common course of 2. Commonality conduct, the Court concludes that plaintiffs have standing to bring all claims asserted in their Fourth Amended Complaint. a. Legal standards The commonality requirement of Rule 23(a)(2) is satisfied IV. CLASS CERTIFICATION when plaintiffs' grievances raise "questions of law or fact A court may certify a class action only if the court common to the class." Fed. R. Civ. P. 23(a)(2). Because determines that a class satisfies the four prerequisites "[a]ny competently crafted class complaint literally raises of Federal Rule of Civil Procedure 23(a)—numerosity, common 'questions,' " the Supreme Court has defined commonality, typicality, and adequacy of representation a common question as one that is "capable of classwide —as well as "at least one of the three provisions for resolution—which means that determination of its truth certification found in Rule 23(b)." In re U.S. Foodservice or falsity will resolve an issue that is central to the Inc. Pricing Litig., 729 F.3d 108, 117 (2d Cir. 2013). Rule validity of each one of the claims in one stroke." Dukes, 23 "does not set forth a mere pleading standard," so 564 U.S. at 349–50, 131 S.Ct. 2541 (quotation marks the "party seeking class certification must affirmatively omitted). In other words, the key issue is "not the raising demonstrate his compliance with the Rule." Wal–Mart of common questions—even in droves—but, rather the Stores, Inc. v. Dukes, 564 U.S. 338, 350, 131 S.Ct. 2541, capacity of a classwide proceeding to generate common 180 L.Ed.2d 374 (2011). In addition, because "certification answers." Id. at 350, 131 S.Ct. 2541 (quotation marks is proper only if the trial court is satisfied, after a omitted). However, a "single common question" capable rigorous analysis, that the prerequisites of Rule 23(a) have of generating a common answer is only sufficient to meet been satisfied," a district court must evaluate even those the requirements of Rule 23(a)(2) if that question is central components of Rule 23 that defendants do not contest. Id. to the determination of liability. Id. at 359, 131 S.Ct. 2541 at 350–51, 131 S.Ct. 2541 (quotation marks omitted); see (quotation marks and alterations omitted); see also Ruiz also Douglin v. GreatBanc Tr. Co., 115 F.Supp.3d 404, 409 v. Citibank, N.A., 93 F.Supp.3d 279, 289–90 (S.D.N.Y. (S.D.N.Y. 2015). 2015). A. Rule 23(a) b. Discussion 1. Numerosity i. Existence of common questions Federal Rule of Civil Procedure 23(a)(1) requires that *12 In this case, plaintiffs identify multiple questions that a class be "so numerous that joinder of all members they claim are susceptible to common proof: is impracticable." Fed. R. Civ. P. 23(a)(1). Defendants do not dispute that plaintiffs have met the numerosity [1] Whether [d]efendants were requirement. (Oral Arg. Tr. 40:15–16.) In this Circuit, fiduciaries to the Plan; [2] numerosity is "presumed at a level of 40 members." Whether [defendants'] fiduciary Consol. Rail Corp. v. Town of Hyde Park, 47 F.3d 473, duties included responsibility for 483 (2d Cir. 1995). According to plaintiffs, the Plan selecting, monitoring, and replacing had 189,470 participants at the beginning of 2005 and Plan investments; [3] Whether the "thousands" of their accounts were invested in the nine fees charged by the funds at proprietary funds. (Pls.' Mem. in Supp. of Mot. for Class issue were reasonable compared Cert. 6, ECF No. 214 (citing Form 5500 for Plan Year © 2017 Thomson Reuters. No claim to original U.S. Government Works. 9 Case Leber v. Citigroup 401(k)17-2911, Document Plan Investment 43-2, Committee, --- 12/12/2017, F.R.D. ---- (2017)2192242, Page11 of 18 2017 WL 5664850 to alternatives ...; [4] Whether *5–6 (S.D.N.Y. Sept. 5, 2017) (finding commonality [defendants] breached their duties where common questions included "whether Defendants' of loyalty and prudence by process for assembling and monitoring the Plan's menu failing to remove the funds of investment options, including the proprietary funds, at issue from the 401(k) Plan; was tainted by a conflict of interest or imprudence"), [5] Whether the Plan suffered appeal filed, No. 17–2911 (2d Cir. Sept. 19, 2017); see losses as a result of [d]efendants' also Krueger v. Ameriprise Fin., Inc., 304 F.R.D. 559, fiduciary breaches; [6] Whether 571 (D. Minn. 2014) (finding commonality after rejecting [d]efendants improperly favored defendants' argument that "imprudent selection and Citigroup proprietary investment retention, disloyalty, and excessive fee claims all require products for the 401(k) Plan in order evidence specific to both the funds and the participants"). to financially benefit Citigroup at the expense of Plan participants; and [7] Whether [d]efendants prudently ii. Effect of individual defenses and loyally monitored the funds at issue. *13 Defendants contend that, even if common issues exist, "no class should be certified where the major focus (Pls.' Mem. 7.) of the litigation will be on individual defenses rather than on common issues." (Defs.' Mem. 19.) Specifically, Some of the questions enumerated by plaintiffs are defendants point out that litigation will focus on (i) the inadequate to establish commonality. For instance, fact that some class members' claims are likely time-barred asking whether the fees charged by the funds at issue either by ERISA's six-year statute of repose or by its three- were reasonable compared to alternatives requires fund- year statute of limitations—which begins to run on the by-fund analysis and cannot generate answers that "earliest date on which the plaintiff had actual knowledge are common to the entire class plaintiffs seek to of the breach," 29 U.S.C. § 1113(2)—and (ii) the fact represent. Meanwhile, other questions, "though [capable that some class members released their claims upon the of] generating common answers, are not apt to drive the termination of their employment with Citigroup. (Defs.' resolution of the litigation." Ruiz, 93 F.Supp.3d at 289. Mem. 20–21.) Nevertheless, plaintiffs have established commonality Defendants' argument mistakenly applies the by identifying at least two questions that are capable predominance standard in Rule 23(b)(3) and is not a of classwide resolution: whether defendants improperly proper basis for contesting commonality. See Dukes, favored proprietary funds in order to benefit Citigroup 564 U.S. at 359, 131 S.Ct. 2541; Johnson, 780 F.3d at at the expense of Plan participants (number 6, supra), 138. Moreover, to the extent that individual defenses and whether defendants failed to prudently and loyally are relevant to the Rule 23(a) inquiry, cases generally monitor the Plan's investments (number 7, supra). "Where analyze them in the context of the typicality or adequacy the same conduct or practice by the same defendant prerequisites. In that context, only individual defenses gives rise to the same kind of claims from all class asserted by class representatives—not putative class members, there is a common question." Johnson v. Nextel members—pose a barrier to certification. See Gary Plastic Commc'ns Inc., 780 F.3d 128, 137–38 (2d Cir. 2015) Packaging Corp. v. Merrill Lynch, Pierce, Fenner & Smith, (quoting Suchanek v. Sturm Foods, Inc., 764 F.3d 750, 756 Inc., 903 F.2d 176, 180 (2d Cir. 1990), abrogated on other (7th Cir. 2014)). Here, if an examination of defendants' grounds by Microsoft Corp. v. Baker, ––– U.S. ––––, 137 conduct in managing the Plan shows that they failed S.Ct. 1702, 198 L.Ed.2d 132 (2017); see also Baffa v. to monitor its investments or that they did not take Donaldson, Lufkin & Jenrette Sec. Corp., 222 F.3d 52, steps to avoid conflicts of interest, it would not only 59 (2d Cir. 2000). Here, because neither of the "unique" generate answers applicable to all class members, but defenses identified by defendants is applicable to the would also address the heart of the claims at issue in class representatives, there is no "danger that absent class this litigation. 14 See Moreno v. Deutsche Bank Ams. members will suffer if their representative is preoccupied Holding Corp., 15 Civ. 9936, 2017 WL 3868803, at with defenses unique to it." Gary Plastic, 903 F.2d at 180. © 2017 Thomson Reuters. No claim to original U.S. Government Works. 10 Case Leber v. Citigroup 401(k)17-2911, Document Plan Investment 43-2, Committee, --- 12/12/2017, F.R.D. ---- (2017)2192242, Page12 of 18 2017 WL 5664850 Taylor v. United Techs. Corp., No. 3:06CV1494, 2008 WL In any event, whether analyzed under commonality, 2333120, at *4 (D. Conn. June 3, 2008) ("[A]mple case law typicality, or adequacy, the defenses identified by holds that the signing of releases does not affect typicality defendants will not preclude certification. First, because where ERISA claims allege damage to the Plan as a whole plaintiffs have standing to raise claims related to all nine rather than to individuals."); Loomis v. Exelon Corp., No. Affiliated Funds, those class claims are timely under 06 C 4900, 2007 WL 2060799, at *6 (N.D. Ill. 2007) (same); ERISA's six-year statute of repose. Defendants posit that In re Aquila ERISA Litig., 237 F.R.D. 202, 210–11 (W.D. "many members of the proposed class" will nonetheless be Mo. 2006) (same); In re JDS Uniphase Corp. ERISA Litig., time-barred by ERISA's three-year statute of limitations No. 03-04743, 2006 WL 2597995, at *1 (N.D. Cal. Sept. because they are likely to have been aware of the material 11, 2006) (same). 15 facts of their claims prior to October 18, 2004—three years prior to the commencement of this action. (Defs.' Mem. *14 Because plaintiffs have raised common questions 20.) But "bald speculation that some class members might capable of generating common answers and because the have [had] knowledge" cannot be "enough to forestall individual issues identified by defendants do not pose an certification." U.S. Foodservice, 729 F.3d at 122; N.J. obstacle for certification, the Court concludes that the Carpenters Health Fund v. DLJ Mortg. Capital, Inc., No. commonality prerequisite is satisfied. 08 Civ. 5653, 2014 WL 1013835, at *9 (S.D.N.Y. Mar. 17, 2014). Moreover, the basis of defendants' speculation is that 3. Typicality class members—who were Citigroup employees—would be aware that the Affiliated Funds were proprietary and a. Legal Standards would also be privy to their expense ratios. (Defs.' Mem. 20.) This does not suffice to establish the kind of "specific Like commonality, the typicality requirement in knowledge of the actual breach of duty" required to start Federal Rule of Civil Procedure 23(a)(3) serves as a the clock on ERISA's three-year limitations period. Leber "guidepost[ ] for determining whether under the particular v. Citigroup 401(k) Plan Inv. Comm., No. 07-Cv-9329, circumstances maintenance of a class action is economical 2014 WL 4851816, at *5 & n.8 (S.D.N.Y. Sept. 30, 2014) and whether the named plaintiff's claim and the class (citing Caputo v. Pfizer, Inc., 267 F.3d 181, 193 (2d claims are so interrelated that the interests of the class Cir. 2001)); see also Moreno, 2017 WL 3868803, at *6 members will be fairly and adequately protected in their (finding that statute of limitations issues did not impede absence." Dukes, 564 U.S. at 349 n.5, 131 S.Ct. 2541. certification in a similar case because "[t]he record on this motion does not show that any named Plaintiff or class "To establish typicality under Rule 23(a)(3), the party member had—or even could have—'actual knowledge' seeking certification must show that each class member's of [the fiduciaries'] process" for selecting and monitoring claim arises from the same course of events and each investment options). class member makes similar legal arguments to prove the defendant's liability." In re Flag Telecom Holdings, Second, the fact that Citigroup employees "routinely" sign Ltd. Sec. Litig., 574 F.3d 29, 35 (2d Cir. 2009) (internal releases waiving all claims against Citigroup, including quotation marks omitted); accord Cent. States Se. & Sw. claims brought under the ERISA statute (see Letter Areas Health & Welfare Fund v. Merck–Medco Managed from Citibank N.A. to Leslie Y. Highsmith § 5(b) (Feb. Care, L.L.C., 504 F.3d 229, 245 (2d Cir. 2007). 25, 2010), ECF No. 232, Ex. 14 (Highsmith's release of claims)), does not preclude certification. In cases Typicality also "requires that the disputed issues of law brought on behalf of a plan, most courts have held or fact occupy essentially the same degree of centrality to that "individuals do not have the authority to release a the named plaintiff's claim as to that of other members defined contribution plan's right to recover for breaches of the proposed class." Mazzei v. Money Store, 829 F.3d of fiduciary duty"; the consent of the plan is required for 260, 272 (2d Cir. 2016) (alterations and quotation marks a release of 29 U.S.C. § 1132(a)(2) claims. In re Polaroid omitted). Accordingly, "[w]hen it is alleged that the same ERISA Litig., 240 F.R.D. at 75 (collecting cases); see also unlawful conduct was directed at or affected both the © 2017 Thomson Reuters. No claim to original U.S. Government Works. 11 Case Leber v. Citigroup 401(k)17-2911, Document Plan Investment 43-2, Committee, --- 12/12/2017, F.R.D. ---- (2017)2192242, Page13 of 18 2017 WL 5664850 named plaintiff and the class sought to be represented, 2017 WL 4023149, at *6 (C.D. Cal. July 26, 2017) the typicality requirement is usually met irrespective of (finding typicality after rejecting defendants' argument minor variations in the fact patterns underlying individual that plaintiff "would be preoccupied with establishing the claims." Robidoux v. Celani, 987 F.2d 931, 936–37 (2d Cir. imprudence of the specific funds in which he invested and 1993). demonstrating his losses" (quotation marks omitted)), request to appeal filed, No. 17–80213 (9th Cir. Oct. 18, 2017). b. Discussion *15 Defendants make their typicality argument by The named plaintiffs have established that their claims relying heavily on a distinguishable case from outside the are typical of the other class members because their Second Circuit. In Spano v. The Boeing Co., 633 F.3d claims "arise[ ] from the same course of events and each 574, 586 (7th Cir. 2011), the U.S. Court of Appeals for class member makes similar legal arguments." In re Flag the Seventh Circuit held that "a class representative in a Telecom, 574 F.3d at 35 (quotation marks omitted). First, defined-contribution case would at a minimum need to both the named plaintiffs and the class members they seek have invested in the same funds as the class members." to represent participated in the same Plan and invested in The court explained that the possibility that only some proprietary funds. They were therefore subject to the same investment vehicles were imprudent—while others were course of conduct by the same defendants in managing the not—creates a potential lack of "congruence" between the Plan. Second, the class asserts claims based on identical claims of the named plaintiffs and those of absent class legal arguments—that defendants breached their fiduciary members who invested in other funds. Id. duties of prudence and loyalty by failing to properly monitor and investigate the Plan's investments because However, the Second Circuit does not have a per se rule they were motivated by divided loyalties. See Krueger, 304 requiring exact congruence of investments. See NECA– F.R.D. at 573 ("[A]s Plan participants alleging breaches of IBEW Health & Welfare Fund v. Goldman Sachs & Co., the fiduciary duties Defendants owed to the Plan, the class 693 F.3d 145, 158 n.9 (2d Cir. 2012) ("[The district members are seeking redress of similar grievances under court] erred to the extent it based its conclusion on the same legal and remedial theories."). the (mistaken) assumption that 'only when other people bought the same securities that the plaintiff bought' may Echoing their contentions regarding class standing, a 'practically identically situated' plaintiff serve as their defendants argue that plaintiffs cannot be typical if they 'class representative.' " (alteration omitted)); see also incurred losses through funds that are different from those Hicks v. Morgan Stanley & Co., No. 01 Civ. 10071, 2003 in which other class members had invested. However, WL 21672085, at *3 (S.D.N.Y. July 16, 2003). Here, as this fact does not suffice to destroy typicality. While in most other jurisdictions, the "typicality inquiry focuses plaintiffs will ultimately have to establish loss causation on the nature of the class representative's claim or defense and damages through an analysis that might yield and not on the specific facts from which that claim or different answers for each fund, the primary "disputed defense arose." 7 Newberg on Class Actions § 22:71 issues of law or fact" presented in this case—whether (5th ed. 2017). As other district courts have found, the defendants' conduct in managing the Plan amounted to fact that "Plan participants may ... invest in different breaches of their duties of prudence and loyalty—"occupy funds ... does not change the nature of their claims or the essentially the same degree of centrality to the named legal arguments they would make to prove [d]efendants' plaintiff's claim as to that of other members of the liability." Urakhchin v. Allianz Asset Mgmt. of Am., L.P., proposed class." Mazzei, 829 F.3d at 272 (quotation No. 8:15-cv-1614, 2017 WL 2655678, at *5 (C.D. Cal. June marks and alteration omitted); see also Taylor, 2008 15, 2017); see also Krueger, 304 F.R.D. at 573. WL 2333120, at *4 ("Typicality is met even though the individual participants may have some differing interests Furthermore, while Spano stated its holding categorically, as to damages because the shared interest in establishing the Seventh Circuit's decision was driven by concerns the fiduciary defendants' liability to the Plan outweighs specific to that case. The plaintiffs in Spano were alleging any such slight divergence." (quotation marks omitted)); a multitude of objections to defendants' management of Cryer v. Franklin Templeton Res., Inc., No. C 16-4265, an ERISA plan, including the imprudent retention of two © 2017 Thomson Reuters. No claim to original U.S. Government Works. 12 Case Leber v. Citigroup 401(k)17-2911, Document Plan Investment 43-2, Committee, --- 12/12/2017, F.R.D. ---- (2017)2192242, Page14 of 18 2017 WL 5664850 particular funds (the Technology Fund and the Boeing marks omitted). In addition, courts consider whether Stock Fund) in the defined contribution plan. But there "plaintiff's attorneys are qualified, experienced and able to was no common course of conduct alleged that united conduct the litigation" as part of the Rule 23(a)(4) inquiry. the plaintiffs' prudence claims; the Technology Fund was Id. (quoting Baffa v. Donaldson, Lufkin & Jenrette Sec. allegedly imprudent because it was "imprudently selected, Corp., 222 F.3d 52, 60 (2d Cir. 2000)). 16 undiversified and excessively (unnecessarily) risky," while the Boeing Stock Fund was allegedly imprudent because As defendants implicitly acknowledge by declining to it had excessive fees and "held excessive levels of cash." contest adequacy, plaintiffs have an interest in pursuing Spano v. The Boeing Co., 294 F.R.D. 114, 124, 126 (S.D. the class's claims and do not have fundamental conflicts Ill. 2013). Proving liability in Spano would not only have of interest with the other class members. Plaintiffs Leber required the consideration of a fiduciary's conduct with and Kennedy have demonstrated their commitment to respect to each individual fund, but would have also prosecuting this action by remaining class representatives required plaintiffs to prove their claims through separate for the course of this decade-long litigation. Moreover, inquiries making use of distinct metrics. even though Leber and Kennedy only have a clear financial stake in proving the claims of class members who By contrast, in this case, the funds that plaintiffs seek invested in the Citi Institutional Liquid Reserves Fund, to represent are all proprietary funds and each of there is no fundamental conflict between their interests the claims concerns allegedly disloyal and imprudent and those of class members who invested in other funds. conduct that impacted them in the same manner. In Because plaintiffs allege that all class members' injuries these circumstances, the Court concludes that plaintiffs' were caused by paying their chosen funds' excessive fees, claims have the requisite level of congruence with those "[n]o participant could have taken advantage of the high of the putative class members despite the fact that all fees of [any] funds to eke out gains at the expense of other class members did not all invest in the same funds. See participants." In re Northrop Grumman Corp. ERISA Robidoux, 987 F.2d at 936–37 ("When it is alleged that the Litig., No. CV 06-06213, 2011 WL 3505264, at *11 n.72 same unlawful conduct was directed at or affected both (C.D. Cal. Mar. 29, 2011) (noting that there is a relatively the named plaintiff and the class sought to be represented, low likelihood of intra-class conflicts in cases of "excessive the typicality requirement is usually met irrespective of fee claims"); see also Moreno, 2017 WL 3868803, at *7. minor variations in the fact patterns underlying individual claims."). Plaintiffs have also demonstrated their capacity to protect the interests of the class by their appointment of qualified *16 The Court concludes that the typicality requirement counsel. See Kanawi v. Bechtel Corp., 254 F.R.D. 102, of Rule 23(a)(3) has been met. 111 (N.D. Cal. 2008) (citing Baffa, 222 F.3d at 61–62). The qualifications of plaintiffs' counsel are addressed in this Court's discussion of Rule 23(g). See infra; see also 4. Adequacy Kalish v. Karp & Kalamotousakis, LLP, 246 F.R.D. 461, 463 (S.D.N.Y. 2007) (the analysis of the adequacy of class Federal Rule of Civil Procedure 23(a)(4) requires the counsel is "largely the same" under Rule 23(a)(4) and Court to find that the named plaintiffs "will fairly and 23(g)). adequately protect the interests of the class." Fed. R. Civ. P. 23(a)(4). "Adequacy is twofold: the proposed class representative must have an interest in vigorously B. Rule 23(b) pursuing the claims of the class, and must have no interests *17 Once the threshold requirements of Federal Rule antagonistic to the interests of other class members." of Civil Procedure 23(a) are satisfied, plaintiffs must Denney v. Deutsche Bank AG, 443 F.3d 253, 268 (2d establish that their putative class action falls into one of Cir. 2006). Although the adequacy inquiry is designed the categories of suits enumerated in Rule 23(b). Plaintiffs to uncover conflicts of interest between named plaintiffs ask the Court to certify their class pursuant to Rule 23(b) and the class they seek to represent, "[i]n order to (1), but they also argue that Rule 23(b)(3) certification defeat a motion for certification, ... the conflict must be would be appropriate in the alternative. The difference fundamental." Flag Telecom, 574 F.3d at 35 (quotation between these certifications is significant: unlike Rule © 2017 Thomson Reuters. No claim to original U.S. Government Works. 13 Case Leber v. Citigroup 401(k)17-2911, Document Plan Investment 43-2, Committee, --- 12/12/2017, F.R.D. ---- (2017)2192242, Page15 of 18 2017 WL 5664850 23(b)(3) class actions, suits that are certified pursuant to 412). Because defendants' alleged mismanagement of the Rule 23(b)(1) are "not subject to the Rule 23(c) provision Plan is "the same as to all Plan participants, resolution of for notice to absent class members or the opportunity for one action against one Plan participant would necessarily potential class members to opt out of membership as a affect the resolution of any concurrent or future actions by matter of right." In re Simon II Litig., 407 F.3d 125, 133 other Plan participants." Urakhchin, 2017 WL 2655678, at (2d Cir. 2005). *8. A court may certify a class under Rule 23(b)(1) if *18 The only argument offered by defendants against "prosecuting separate actions by or against individual Rule 23(b)(1)(B) certification is that this case does not class members would create a risk of: (A) inconsistent involve a limited fund. (Defs.' Mem. 23.) But limited fund or varying adjudications ... that would establish cases—which involve situations in which a fund's assets incompatible standards of conduct for [defendants]; or are insufficient to satisfy all claims—are just one of the (B) adjudications with respect to individual class members "traditional varieties of representative suit encompassed that ... would be dispositive of the interests of [non-party by Rule 23(b)(1)(B)." Ortiz v. Fibreboard Corp., 527 U.S. members] or would substantially impair or impede their 815, 834–35, 119 S.Ct. 2295, 144 L.Ed.2d 715 (1999). Rule ability to protect their interests." Fed. R. Civ. P. 23(b) 23(b)(1)(B) also envisions "actions charging 'a breach of (1). Accordingly, Rule 23(b)(1)(A) "considers possible trust by an indenture trustee or other fiduciary similarly prejudice to the defendants, while 23(b)(1)(B) looks to affecting the members of a large class' of beneficiaries, possible prejudice to the putative class members." In re requiring an accounting or similar procedure 'to restore Global Crossing Sec. & ERISA Litig., 225 F.R.D. 436, 453 the subject of the trust.' " Id. at 834, 119 S.Ct. 2295 (S.D.N.Y. 2004) (quotation marks omitted). Certification (quoting Fed. R. Civ. P. 23 advisory committee's note under Rule 23(b)(3) is proper if the "questions of law to 1966 amendment). That is precisely the kind of action or fact common to class members predominate over any at issue here. See Moreno, 2017 WL 3868803, at *7– questions affecting only individual members" and if "a 8 ("[C]ourts regularly certify 23(b)(1)(B) class actions class action is superior to other available methods for in non-limited fund situations, particularly in ERISA fairly and efficiently adjudicating the controversy." Fed. cases alleging breach of a fiduciary duty ...." (quoting 3 R. Civ. P. 23(b)(3). Newberg on Class Actions § 4:20 (5th ed. 2017))); Krueger, 304 F.R.D. at 577–78. Accordingly, certification under When a class is eligible for certification under both Rules Rule 23(b)(1)(B) is appropriate and the Court need not 23(b)(1) and (b)(3), courts find that Rule 23(b)(1) controls. address whether certification is also proper under either Doe v. Karadzic, 176 F.R.D. 458, 463 (S.D.N.Y. 1997); Rule 23(b)(1)(A) or Rule 23(b)(3). see also Robertson v. Nat'l Basketball Ass'n, 556 F.2d 682, 685 (2d Cir. 1977). To hold otherwise would "directly contraven[e]" the stated purpose of Rule 23(b)(1)(B) and C. Definition of the certified class could open the door to separate litigation by individual The class that plaintiffs seek to have the Court certify members of the class. 7AA Charles Alan Wright & Arthur extends from October 18, 2001, to September 4, 2007. R. Miller, Federal Practice and Procedure § 1772 (3d ed. (Pls.' Mem. 3.) September 4, 2007, is the date on which 2017) (quotation marks omitted). defendants removed all of the Affiliated Funds (except the Citi Institutional Liquid Reserves Fund) from the Plan. Most courts that have certified ERISA class actions (4AC ¶ 51.) However, none of the Affiliated Funds were alleging breaches of fiduciary duties have done so under actually "managed or offered by Citigroup affiliates" after December 1, 2005—the date on which Citigroup sold its Rule 23(b)(1)(B). 17 "[T]he structure of ERISA favors asset management business to Legg Mason. (4AC ¶ 48.) the principles enumerated under Rule 23(b)(1)(B), since Accordingly, defendants ask the Court to cut off the class the statute creates a 'shared' set of rights among the period at December 1, 2005. (Defs.' Mem. 17.) plan participants by imposing duties on the fiduciaries relative to the plan, and it even structures relief in terms The Court agrees with defendants that none of the claims of the plan and its accounts, rather than directly for the in this case are viable after December 1, 2005. Plaintiffs' individual participants." Kindle v. Dejana, 315 F.R.D. 7, duty of loyalty claims are premised on defendants' lack 12 (E.D.N.Y. 2016) (quoting Douglin, 115 F.Supp.3d at of interest in monitoring and investigating the Plan's © 2017 Thomson Reuters. No claim to original U.S. Government Works. 14 Case Leber v. Citigroup 401(k)17-2911, Document Plan Investment 43-2, Committee, --- 12/12/2017, F.R.D. ---- (2017)2192242, Page16 of 18 2017 WL 5664850 investments while they were generating fees for Citigroup. —as liaison counsel. Mr. McTigue, Mr. Porter, and Mr. (See 4AC ¶¶ 53(D), 54, 90, 91, 97, 101.) But plaintiffs Preminger have provided competent representation for acknowledge—as they must—that any "conflict of interest plaintiffs since this action's initiation and Mr. Moore was vitiated after 2005." (Oral Arg. Tr. 20:21–22, 21:12– has actively participated in the matter since 2010. 13.) Meanwhile, plaintiffs' duty of prudence claims are Counsel has defended against defendants' motions to predicated on defendants' conduct in failing to monitor dismiss the complaint and partial summary judgment, or investigate Plan investment options. At oral argument, conducted extensive discovery, and moved to amend the plaintiffs attempted to justify their proposed class period complaint on multiple occasions in order to assert new by arguing that "the monitoring did not improve" despite claims and incorporate new factual allegations based the Affiliated Funds' sale to Legg Mason and that on evidence uncovered during discovery. In addition, defendants "should have taken action sooner to remove counsel has repeatedly submitted letters identifying these funds." (Oral Arg. Tr. 21:16–18.) However, this legal developments relevant to pending motions. It is explanation is at odds with plaintiffs' own complaint, evident that counsel has competently "identif[ied]" and which alleges that defendants "got much more serious "investigat[ed] potential claims in the action" and that about monitoring 401(k) Plan investments" shortly after they have "knowledge of the applicable law." Fed. R. Civ. deciding to sell the Affiliated Funds to Legg Mason P. 23(g)(1)(A)(i, iii). around June of 2005. (4AC ¶ 54; see also ¶¶ 50, 91.) The evidence plaintiffs produced in support of their Furthermore, counsel and their respective firms have class certification motion also indicates that defendants significant prior experience litigating ERISA class actions were already actively engaged in monitoring the Plan's involving similar fiduciary breach claims. (Decl. of James investments by the end of 2005. (See Memorandum from A. Moore in Supp. of Mot. to Certify Class, ECF No. Leonardo R. Rodriguez to Defendant Citigroup 401(k) 215, Exs. 4, 5, 6.) See Fed. R. Civ. P. 23(g)(1)(A)(ii). Their Plan Investment Committee 1–2, Mar. 22, 2006, ECF No. ability to prosecute this action over an extended period of 239, Ex. 1.) Because plaintiffs have no basis for asserting time, including during resource-intensive phases such as claims related to the period from December 1, 2005, to discovery, also demonstrates that they have the resources September 4, 2007, the period of the certified class is necessary to adequately represent the class. See Fed. R. truncated accordingly. Civ. P. 23(g)(1)(A)(iv). Accordingly, the Court appoints J. Brian McTigue and James Moore of McTigue LLP and Gregory Porter of Bailey & Glasser LLP as class D. Rule 23(g) counsel and David S. Preminger of Keller Rohrback LLP After certifying a class, the Court must also appoint as liaison counsel. class counsel that will "fairly and adequately represent the interests of the class." Fed. R. Civ. P. 23(g)(4). Pursuant to Federal Rule of Civil Procedure 23(g)(1)(A), V. CONCLUSION the Court "must consider" the following factors when For the foregoing reasons, plaintiffs' motion to certify a appointing class counsel: "(i) the work counsel has done in class is granted, with the following terms and conditions: identifying or investigating potential claims in the action; (ii) counsel's experience in handling class actions, other (1) The following class is certified pursuant to Fed. R. complex litigation, and the types of claims asserted in the Civ. P. 23(b)(1)(B): action; (iii) counsel's knowledge of the applicable law; and All participants in the Citigroup 401(k) Plan who (iv) the resources that counsel will commit to representing invested in any of the following funds from October the class." Id. (g)(1)(A). The Court may also consider "any 18, 2001 to December 1, 2005: Citi Institutional other matter pertinent to counsel's ability to fairly and Liquid Reserves Fund, Smith Barney Government adequately represent the interests of the class." Id. (g)(B). Securities Fund, Smith Barney Diversified Strategic Income Fund, Smith Barney Large Cap Growth *19 Plaintiffs request the appointment of J. Brian Fund, Smith Barney Large Cap Value Fund, McTigue and James Moore of McTigue LLP and Gregory Smith Barney Small Cap Value Fund, Smith Porter of Bailey & Glasser LLP as class counsel, as well Barney International All Cap Growth Fund, Smith as David S. Preminger of Keller Rohrback LLP—whose Barney Fundamental Value Fund, and the Salomon office is located in the Southern District of New York © 2017 Thomson Reuters. No claim to original U.S. Government Works. 15 Case Leber v. Citigroup 401(k)17-2911, Document Plan Investment 43-2, Committee, --- 12/12/2017, F.R.D. ---- (2017)2192242, Page17 of 18 2017 WL 5664850 Brothers High Yield Bond Fund. Excluded from the LLP are appointed as class counsel, and David M. Preminger of Keller Rohrback LLP is appointed as class are Defendants, Defendants' beneficiaries, and liaison counsel for the class. Defendants' immediate families. (2) Plaintiffs Marya J. Leber and Sara L. Kennedy SO ORDERED: are appointed to serve as class representatives, while plaintiff Sherri M. Harris is stricken as a named All Citations plaintiff; and --- F.R.D. ----, 2017 WL 5664850 (3) J. Brian McTigue and James Moore of McTigue Law LLP and Gregory Y. Porter of Bailey & Glasser Footnotes 1 Although only Citigroup's 401(k) Plan—as noted, a defined contribution plan—is at issue in this case, the company also offered defined benefit plans to certain eligible employees during the same time period. (4AC ¶¶ 21, 53(D), 66.) 2 When plaintiffs initially moved for class certification, there were four named plaintiffs. In the course of briefing the class certification motion, Leslie Highsmith withdrew as a named plaintiff because she learned that she had released all claims against Citigroup upon the termination of her employment with the company. (Defs.' Mem. in Opp'n to Pls.' Mot. to Certify Class, 4 n.5, ECF No. 233; see also Letter from Citibank N.A. to Leslie Y. Highsmith (Feb. 25, 2010), ECF No. 232, Ex. 14 (Highsmith's release of claims).) 3 The Plan was administered by two investment committees during the proposed class period. At the beginning of the period, the relevant investment committee was called the Benefit Plans Investment Committee. Effective August 3, 2005, it was succeeded by the Citigroup 401(k) Plan Investment Committee. Both committees are named as defendants in this action. (4AC ¶¶ 21, 22.) 4 Neither the Fourth Amended Complaint nor the expert report provided by defendants specifies the total number of proprietary funds offered by the Plan. Nevertheless, during oral argument on plaintiffs' motion for class certification, defendants repeatedly represented that there were sixteen proprietary funds offered by the Plan at various times during the putative class period. Plaintiffs' counsel did not dispute this computation. (Oral Arg., Oct. 16, 2017, Tr. 19:7–15, 30:8– 10, 32:16–17.) 5 The nine Affiliated Funds are: (1) Citi Institutional Liquid Reserves Fund, (2) Smith Barney Government Securities Fund, (3) Smith Barney Diversified Strategic Income Fund, (4) Smith Barney Large Cap Growth Fund, (5) Smith Barney Large Cap Value Fund, (6) Smith Barney Small Cap Value Fund, (7) Smith Barney International All Cap Growth Fund, (8) Smith Barney Fundamental Value Fund, and (9) the Salomon Brothers High Yield Bond Fund. Certain of these Affiliated Funds were renamed after they were sold to Legg Mason on December 1, 2005. (4AC ¶ 49.) 6 Section 502(a)(2) of ERISA, 29 U.S.C. § 1132(a)(2), authorizes ERISA plan participants to seek "appropriate relief under [section 409 of ERISA, 29 U.S.C. § 1109]," and section 1109, in turn, provides that plan fiduciaries who breach their duties "shall be personally liable to make good to such plan any losses to the plan resulting from each such breach," shall "restore to such plan any profits of such fiduciary," and "shall be subject to such other equitable or remedial relief as the court may deem appropriate," 29 U.S.C. § 1109(a). 7 Plaintiffs also ask the Court to "[a]ward such other equitable or remedial relief as may be appropriate, including the permanent removal of [d]efendants from any positions of trust with respect to the 401(k) Plan." (4AC at 39.) 8 The last date of the putative class period is September 4, 2007, and the fund in which Harris invested—the Smith Barney Large Cap Growth Fund—was no longer offered by the Plan after that date. Therefore, any breaches alleged by Harris would have occurred more than six years prior to plaintiffs' March 2015 request to add her as a class representative. See ERISA § 413, 29 U.S.C. § 1113 (barring ERISA actions for breaches of fiduciary duty that are brought after the earlier of (i) six years from the breach, or (ii) three years from the earliest date of plaintiff's actual knowledge of the breach). 9 Statutes of limitations and statutes of repose "serve distinct purposes." Police & Fire Ret. Sys. of City of Detroit v. IndyMac MBS, Inc., 721 F.3d 95, 106 (2d Cir. 2013). Statutes of limitations are "designed to encourage plaintiffs to pursue diligent prosecution of known claims" and "begin to run when the cause of action accrues." ANZ, 137 S.Ct. at 2049 (quotation marks omitted). In contrast, statutes of repose "effect a legislative judgment that a defendant should be free from liability after the legislatively determined period of time" and "begin to run on the date of the last culpable act or omission of the defendant." Id. (quotation marks omitted). © 2017 Thomson Reuters. No claim to original U.S. Government Works. 16 Case Leber v. Citigroup 401(k)17-2911, Document Plan Investment 43-2, Committee, --- 12/12/2017, F.R.D. ---- (2017)2192242, Page18 of 18 2017 WL 5664850 10 Although plaintiffs contend that the ERISA statute's express reference to tolling in the case of fraud or concealment somehow leaves the statute open to equitable tolling (Plaintiffs' Response to Defendants' Submission of Supplemental Authority, July 10, 2017, ECF No. 260), there is no basis for such an interpretation. ANZ discussed the fraud exception as a type of legal tolling and contrasted it with the "doctrine of equitable tolling." ANZ, 137 S.Ct. at 2050–51. The ANZ decision nowhere suggests that statutes of repose that are subject to legal tolling somehow become eligible for equitable tolling. Cf. IndyMac, 721 F.3d at 106 ("[A] statute of repose is subject only to legislatively created exceptions, and not to equitable tolling." (emphasis added) (alterations, quotation marks, and citations omitted)). 11 Plaintiffs were also precluded from using the relation-back doctrine to include Harris in an amended pleading pursuant to Fed. R. Civ. P. 15(c). In the Second Circuit, "a newly added plaintiff's claims relate back pursuant to Rule 15(c) [only] if there was a mistake that caused the party to be omitted from the original complaint." Merryman v. J.P. Morgan Chase Bank, N.A., 319 F.R.D. 468, 473 (S.D.N.Y. 2017) (citing Levy v. U.S. Gen. Accounting Off., 175 F.3d 254, 255 (2d Cir. 1999)). Plaintiffs never attributed their omission of Harris to a mistake of identity. 12 The class standing inquiry "derives from constitutional standing principles," Retirement Board, 775 F.3d at 161, and is distinct from the question of whether a putative class representative may serve as an adequate representative under Fed. R. Civ. P. 23(a), NECA–IBEW, 693 F.3d at 158 n.9. 13 The Court acknowledges that the Second Circuit's eschewal of an individualized injury requirement in Long Island Head Start makes it an outlier among its sister circuits. See Perelman v. Perelman, 793 F.3d 368, 375–76 (3d Cir. 2015) (collecting cases and noting that the "reasoned consensus" of federal appellate courts is that individualized injuries are required even in actions brought "in a 'derivative' or 'representative' capacity on behalf of the Plan"); see also Cent. States Se. & Sw. Areas Health & Welfare Fund v. Merck–Medco Managed Care, LLC, 433 F.3d 181, 200 (2d Cir. 2005) (citing approvingly to Harley v. Minn. Mining & Mfg. Co., 284 F.3d 901, 906–07 (8th Cir. 2002), which held that "an ERISA Plan participant or beneficiary must plead a direct injury in order to assert claims on behalf of a Plan"). Nonetheless, Long Island Head Start is the law in this Circuit. 14 Defendants argue that questions about a fiduciary's selection of investment options for the Plan cannot lead to common answers because individual participants choose investments based on combinations of factors that "vary considerably from one individual to the next." (Defs.' Mem. 21 (citing King Decl., Ex. 1 (Saha Expert Report) ¶¶ 13, 19–24, 27).) This argument has been roundly rejected. See Spano v. The Boeing Co., 633 F.3d 574, 586 (7th Cir. 2011) (finding that the assertion that a plan fiduciary "failed to satisfy its fiduciary duties in its selection of investment options ... describe[s] [a] problem[ ] that would operate across the plan rather than at the individual level"); Krueger v. Ameriprise Fin., Inc., 304 F.R.D. 559, 571 (D. Minn. 2014); see also Figas v. Wells Fargo & Co., No. CIV. 08-4546, 2010 WL 2943155, at *5 (D. Minn. Apr. 6, 2010) (rejecting identical argument in the context of the typicality inquiry); Kanawi v. Bechtel Corp., 254 F.R.D. 102, 110 (N.D. Cal. 2008) (same). 15 The two cases relied upon by defendants, Spann v. AOL Time Warner, Inc., 219 F.R.D. 307, 316–24 (S.D.N.Y. 2003), and Walker v. Asea Brown Boveri, Inc., 214 F.R.D. 58, 64–66 (D. Conn. 2003), are distinguishable because they involved individual ERISA claims; neither was brought on behalf of a plan. See In re Polaroid ERISA Litig., 240 F.R.D. at 75 n.3 (distinguishing Spann and Walker). 16 Courts in the Second Circuit have continued to consider the adequacy of class counsel under Rule 23(a)(4) despite the 2003 Amendments to Rule 23, which "shift[ed] the court's examination of the adequacy of counsel to coincide with its new duty to appoint class counsel under Rule 23(g)." Kalish v. Karp & Kalamotousakis, LLP, 246 F.R.D. 461, 463 (S.D.N.Y. 2007); see also 1 Newberg on Class Actions § 3:80 (5th ed. 2017) ("Rule 23(g) migrated the discussion of counsel's adequacy away from 23(a)(4)."). 17 See, e.g., Moreno, 2017 WL 3868803, at *7; Koch v. Dwyer, No. 98 Civ. 5519, 2001 WL 289972, at *5 (S.D.N.Y. Mar. 23, 2001); Urakhchin, 2017 WL 2655678, at *7–9; see also Krueger, 304 F.R.D. at 576–78; Yost v. First Horizon Nat'l Corp., No. 08-2293, 2011 WL 2182262, at *13–14 (W.D. Tenn. June 3, 2011); Northrop Grumman, 2011 WL 3505264, at *15– 18; Taylor, 2008 WL 2333120, at *6; Tussey v. ABB, Inc., No. 06-04305, 2007 WL 4289694, at *8 (W.D. Mo. Dec. 3, 2007). End of Document © 2017 Thomson Reuters. No claim to original U.S. Government Works. © 2017 Thomson Reuters. No claim to original U.S. Government Works. 17 Case 17-2911, Document 43-3, 12/12/2017, 2192242, Page1 of 7 EXHIBIT 2 Case Wildman v. American 17-2911, Century Document Services, 43-3, LLC, Slip Copy 12/12/2017, (2017) 2192242, Page2 of 7 2017 WL 6045487 Now before the Court are Plaintiffs' Motion for Class Certification (Doc. 62), Defendants' Motion to Strike 2017 WL 6045487 Only the Westlaw citation is currently available. Plaintiffs' Reply (Doc. 79), 1 Plaintiffs' Notices of United States District Court, Supplemental Authority (Docs. 88, 105, 109, 111, 115, W.D. Missouri, Western Division. 152) and Defendants' Responses to Plaintiffs' Notice of Supplemental Authority (Docs. 90, 107, 110, 112, 116). Steve WILDMAN and Jon Borcherding, For the following reasons, Plaintiffs' motion for class Individually and as representatives of a class of certification is GRANTED. Defendants' motion to strike similarly situated persons, and on behalf of the Plaintiffs' reply brief is DENIED. American Century Retirement Plan, Plaintiffs, v. AMERICAN CENTURY Factual Background SERVICES, LLC, et al., Defendants. Defendant American Century Companies, Inc. No. 4:16–CV–00737–DGK ("American Century") makes the American Century | Retirement Plan (the "Plan") available to its eligible Signed 12/06/2017 employees and the employees of its affiliates. The Plan is a defined contribution 401(k) plan 2 that allows Attorneys and Law Firms participants to contribute a percentage of their pre-tax Brock J. Specht, Pro Hac Vice, James H. Kaster, Pro earnings and invest those contributions among different Hac Vice, Jennifer K. Lee, Pro Hac Vice, Paul J. Lukas, investment options. Pro Hac Vice, Carl F. Engstrom, Pro Hac Vice, Jacob T. Schutz, Pro Hac Vice, Kai H Richter, Pro Hac Vice, Plaintiffs Wildman and Borcherding are former American Nichols Kaster & Anderson, PLLP, Minneapolis, MN, Century employees. Wildman has participated in the Plan for Plaintiffs. from 2005 to the present day. Borcherding participated in the Plan from 1996 until 2012. Plaintiffs assert Paul Nemser, Pro Hac Vice, Alison V. Douglass, Pro Hac approximately 2,000 to 2,500 people participated in the Vice, Dave Rosenberg, Pro Hac Vice, James O. Fleckner, Plan from June 30, 2010, to the present day. Pro Hac Vice, Goodwin Procter LLP, Boston, MA, W. Perry Brandt, Bryan Cave, LLP, Kansas City, MO, for The American Century Retirement Plan Retirement Defendants. Committee (the "Committee") is responsible for selecting, retaining, and reviewing the investment options in the Plan and overseeing the Plan's investment and ORDER GRANTING PLAINTIFFS' administrative expenses. Until 2016, the investment MOTION FOR CLASS CERTIFICATION options were generally limited to American Century mutual funds, American Century collective investment GREG KAYS, CHIEF JUDGE UNITED STATES trusts, and shares of American Century common stock. DISTRICT COURT The Plan also offers a self-directed brokerage account that allows participants to invest in stocks, bonds, and mutual *1 This putative class action involves claims for breach funds not affiliated with American Century. of fiduciary duty brought pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA"), Plaintiffs filed this ERISA lawsuit on June 30, 2016. In 29 U.S.C. § 1001, et seq. Plaintiffs Steve Wildman their Amended Complaint, Plaintiffs assert five counts ("Wildman") and Jon Borcherding ("Borcherding") bring pursuant to 29 U.S.C. § 1132(a)(2) and (3) on behalf of the this suit on their own behalf and on the behalf of Plan. Count I asserts Defendants breached their duties of a proposed class claiming Defendants breached their loyalty and prudence in violation of 29 U.S.C. § 1104(a) fiduciary duties and engaged in prohibited transactions. (1)(A)–(B). Count II alleges Defendants failed to monitor the Committee and Committee members. Counts III and IV allege Defendants engaged in prohibited transactions © 2017 Thomson Reuters. No claim to original U.S. Government Works. 1 Case Wildman v. American 17-2911, Century Document Services, 43-3, LLC, Slip Copy 12/12/2017, (2017) 2192242, Page3 of 7 2017 WL 6045487 in violation of 29 U.S.C. § 1106(a)(1) and (b). Count V the representative parties are typical of the claims or is a claim for other equitable relief based on ill-gotten defenses of the class; and (4) the representative parties will proceeds recoverable under 29 U.S.C. § 1132(a)(3). fairly and adequately protect the interests of the class." Fed. R. Civ. P. 23(a). These requirements are typically *2 Plaintiffs allege Defendants breached their fiduciary summarized as numerosity, commonality, typicality, and duties to the Plan, causing the Plan to suffer losses. adequacy. In re Constar Int'l Inc. Sec. Litig., 585 F.3d 774, Specifically, Plaintiffs believe Defendants selected and 780 (3d Cir. 2009). retained proprietary funds, despite their high cost and poor performance, in order to further the self-interest of Plaintiffs pursue certification under Rule 23(b)(1). 3 American Century. Plaintiffs also allege Defendants acted Under this rule, a party seeking class certification must disloyally by not capturing revenue-sharing payments and satisfy the court that "prosecuting separate actions by or by failing to promptly convert certain funds' shares to against individual class members would create a risk of" a lower-cost share class. In addition, Plaintiffs contend either: Defendants caused the Plan to pay unreasonable record- keeping fees because they failed to negotiate the existing (A) inconsistent or varying adjudications with respect contract or put the service up for competitive bidding. to individual class members that would establish incompatible standards of conduct for the party Plaintiffs propose defining the class as, opposing the class; or All participants and beneficiaries of (B) adjudications with respect to individual class the American Century Retirement members that, as a practical matter, would be Plan at the time on or after June dispositive of the interest of the other members 30, 2010, excluding Defendants, not parties to the individual adjudications or would employees with responsibility for the substantially impair or impede their ability to protect Plan's investment or administrative their interests. functions, and members of the American Century Services, LLC Fed. R. Civ. P. 23(b)(1). Board of Directors. The Court has broad discretion to determine whether class Pls.' Mot at 8 (Doc. 65). certification is appropriate. Shapiro, 626 F.2d at 71. The court must engage in "a rigorous analysis" to ensure the On February 27, 2017, the Court granted in part, requirements of Rule 23 are met. Wal–Mart Store, Inc. v. Defendants' Motion for Summary Judgment because Dukes, 564 U.S. 338, 351 (2011). Plaintiffs bear the burden Wildman and Borcherding's claims were partially barred of demonstrating that the proposed class meets Rule 23 by a release they signed when they were laid off from requirements. See Coleman v. Watt, 40 F.3d 255, 258 (8th American Century. The Court found the release of claims Cir. 1994). was valid as to Borcherding's claims that arose on or before July 19, 2012, but not Wildman's. In considering whether class certification is appropriate, the Court does not address the merits of the parties' claims and defenses, but does probe behind the pleadings and look to what the parties must prove. Gen. Tel. Co. Standard v. Falcon, 457 U.S. 147, 160–61 (1982); Elizabeth M. Federal rule of Civil Procedure 23 governs class v. Montenez, 458 F.3d 779, 786 (8th Cir. 2006). "In certification. A party seeking class certification must conducting this preliminary inquiry, however, the court satisfy all of the requirements of Rule 23(a) and at must look only so far as to determine whether, given least one of the requirements of Rule 23(b). Id. The the factual setting of the case, if the plaintiff's general requirements under Rule 23(a) are satisfied when "(1) allegations are true, common evidence could suffice to the class is so numerous that joinder of all members make out a prima facie case for the class." Blades v. is impracticable; (2) there are questions of law or fact Monsanto Co., 400 F.3d 562, 566 (8th Cir. 2005). common to the class; (3) the claims or defenses of © 2017 Thomson Reuters. No claim to original U.S. Government Works. 2 Case Wildman v. American 17-2911, Century Document Services, 43-3, LLC, Slip Copy 12/12/2017, (2017) 2192242, Page4 of 7 2017 WL 6045487 Discussion A. The Rule 23(a) factors are satisfied. I. Plaintiffs have standing to bring this lawsuit. *3 Before moving to the merits of the class certification 1. The numerosity requirement is satisfied. motion, the Court addresses Defendants' argument that There is no magic number to satisfy the numerosity Plaintiffs' class definition is overbroad because it includes requirement; the putative class must simply be so members who suffered no injury and thus lack standing. numerous that joinder of all class members is impractical. In re St. Jude Med., Inc., 425 F.3d 1116, 1119 (8th Standing requires a plaintiff to demonstrate he has an Cir. 2005). Here, Plaintiffs assert during the class period "injury in fact" that is "fairly traceable to the challenged there were approximately 2,000 to 2,500 Plan participants. action of the defendant" and that the injury "is likely [to] Defendants do not address the numerosity requirement be redressed by a favorable decision." Braden v. Wal– in their response. Therefore, given the number of Mart Stores, Inc., 588 F.3d 585, 591 (8th Cir. 2009). "[A] potential class members, the Court finds the numerosity plaintiff with Article III standing may proceed under § requirement is met. 1132(a)(2) on behalf of the plan or other participants." Id. at 593. Defendants argue that due to individual investment 2. The commonality requirement is satisfied. decisions by members of the proposed class, some Plan To satisfy Rule 23(a)(2)'s commonality requirement, the participants did not suffer a loss to their account and plaintiff must do more than show the presence of common therefore lack standing. 4 questions of law or fact. Dukes, 564 U.S. at 349–50. "Commonality requires the plaintiff to demonstrate that Defendants' argument has no merit. Plaintiffs' claims are the class members 'have suffered the same injury,' " Luiken brought in a representative capacity on behalf of the Plan. v. Domino's Pizza, LLC, 705 F.3d 370, 376 (8th Cir. 2013) See 29 U.S.C. § 1132(a). Individual investment decisions (quoting Dukes, 654 U.S. at 349–50), and that class-wide are not relevant to Plaintiffs' claims. See Braden, 588 F.3d resolution will generate common answers that will resolve at 593. Plaintiffs allege the Plan was injured by, among the litigation. Dukes, 564 U.S. at 350. other things, failing to capture revenue-sharing payments, retaining a high-cost record-keeper, and engaging in *4 Plaintiffs do little to argue commonality exists except prohibited transactions. Plaintiffs further allege that these to quote a Northern District of California order finding injuries are traceable to Defendants' conduct and are likely commonality existed because "the common focus is on the to be redressed by a favorable decision. conduct of the Defendants: whether they breached their fiduciary duties to the Plan as a whole by paying excessive II. The Court grants Plaintiffs' motion for class fees, [and] whether they made imprudent investment certification. decisions." Pls.' Sugg. in Supp. at 10 (Doc. 65) (quoting Next, the Court addresses the arguments in the parties' Kanawi v. Bechtel Corp., 254 F.R.D. 102, 109 (N.D. Cal. memoranda regarding class certification. As already 2008)). discussed, Plaintiffs bring their claims in a representative capacity under 29 U.S.C. § 1132(a)(2) and (3) which allows Defendants' response is similarly sparse on argument but an ERISA plan participant to bring a civil action on seems to argue: (1) individual investment decisions made behalf of a plan for relief under § 1109. Section 1109 by each class member bar a finding of commonality; and imposes personal liability on a plan fiduciary for plan (2) Plaintiffs' claims are actually individual in nature. losses resulting from a breach of the fiduciary's duties and obligations to the plan. Id. at § 1109. For the most part, Defendants repeat their standing arguments to argue commonality is not present in this case. First, Defendants claim commonality is not present because the class includes participants regardless © 2017 Thomson Reuters. No claim to original U.S. Government Works. 3 Case Wildman v. American 17-2911, Century Document Services, 43-3, LLC, Slip Copy 12/12/2017, (2017) 2192242, Page5 of 7 2017 WL 6045487 of their investment decisions which would require "an UtiliCorp United, Inc., 84 F.3d 1525, 1540 (8th Cir. 1996). individualized analysis of how much each investor has "The burden is fairly easily met so long as other class been damaged," citing In re Principal U.S. Property members have claims similar to the named plaintiff." Id. Account ERISA Litigation, No. 10–cv–00198, 2013 WL (internal quotations and citation omitted). "A proposed 7218827, at *27 (S.D. Iowa Sept. 30, 2013). Further, class representative is not ... typical if it is subject to a Defendants argue the proposed class could include those unique defense that threatens to play a major role in the who suffered no harm because they invested in funds not litigation." In re Milk Prod. Antitrust Lit., 195 F.3d 430, included in Plaintiffs' complaint. Defendants' use of In 437 (8th Cir. 1999). re Principal is little help to the Court in its commonality analysis because it relies on a discussion of the typicality *5 Plaintiffs argue typicality is met because they assert requirement. 5 their claims on behalf of the Plan as a whole and do not base any of their claims on any unique facts specific Next, Defendants attack Plaintiffs' position that they are to themselves or any particular investment. On the other seeking relief on behalf of the Plan as a whole. Defendants hand, Defendants argue Wildman's and Borcherding's argue Plaintiffs' claims are actually an aggregation of claims are atypical of those of the class because they are individual accounts, citing LaRue v. DeWolff, Boberg & subject to unique defenses including a "release of claims" Assocs., Inc., 552 U.S. 248, 255–56 (2008). The Supreme and the statute of limitations. Defs.' Sugg. in Opp. at 12. Court held in LaRue that an individual 401(k) participant had a cognizable claim under § 1132(a)(2) for injuries The Court finds Wildman's and Borcherding's claims are sustained by the plan. 552 U.S. at 256. It did not find typical of those of the putative class members because that an action brought under § 1132(a)(2) was a claim for all class members are participants in the Plan, and the individual relief. alleged breaches of fiduciary duties were directed to the Plan rather than to individual participants. The Court has The Court finds Plaintiffs have met the commonality already ruled on the issues of the release of claims and requirement, but minimally. Plaintiffs do nothing to state the statute of limitations. See Order on Mot. for Summ. what the common questions of law or fact are in this J. (Doc. 54). The Court finds Defendants have not shown case. It is not the Court's role to define the common Wildman and Borcherding will need to devote significant questions of law or fact in order to certify a class. See, time and effort litigating these defenses or that they will e.g., Coleman, 40 F.3d at 258 (finding plaintiffs bear the threaten to play a major role in this case. burden of demonstrating that the proposed class meets Rule 23 requirements). Nonetheless, the Court finds there are numerous questions of law and fact that are capable of 4. The adequacy requirement is met. class-wide resolution, and that answers to these common questions will generate answers common to all of the The parties also dispute whether Plaintiffs are adequate putative class members and will resolve the litigation. representatives of the proposed class. Rule 23(a)(4) requires class representatives to "vigorously prosecute the interests of the class through qualified counsel." Paxton, 688 F.2d at 562–63. Class representatives must also have 3. The typicality requirement is met. "common interests with the members of the class." Id. The The test for typicality is not "onerous" and focuses on adequacy inquiry seeks "to uncover conflicts of interest whether the "other members of the class ... have the between named parties and the class they represent." same or similar grievances as the plaintiff." Paxton v. Amchem Prods., Inc. v. Windsor, 521 U.S. 591, 625 (1997). Union Nat'l Bank, 688 F.2d 552, 559 (8th Cir. 1982). Typicality "is generally considered to be satisfied if the Defendants do not separately address the adequacy claims or defenses of the representatives and the members requirement aside from their combined typicality and of the class stem from a single event or are based on the adequacy argument. 6 Plaintiffs state Wildman and same legal or remedial theory." Id. at 561–62 (internal Borcherding do not know of any conflicts of interest with quotation and citation omitted). This is true even if there other class members and that their interests in pursuing are "[f]actual variations in the individual claims." Alpern v. recovery on behalf of the Plan are aligned with the Plan. © 2017 Thomson Reuters. No claim to original U.S. Government Works. 4 Case Wildman v. American 17-2911, Century Document Services, 43-3, LLC, Slip Copy 12/12/2017, (2017) 2192242, Page6 of 7 2017 WL 6045487 Therefore, the Court finds Plaintiffs have met their burden (SRC), 05–2369(SRC), 2009 WL 331426 (D.N.J. Feb. 10, of demonstrating Wildman and Borcherding are adequate 2009); In re Williams Cos. ERISA Litig., 231 F.R.D. 416 class representatives. (N.D. Okla. 2005). Turning next to the adequacy of Plaintiffs' counsel, The Court finds both subsections of Rule 23(b)(1) are Defendants do not address whether Plaintiffs' attorneys met. First, as to subsection (A), Defendants owe fiduciary are adequate class counsel. Plaintiffs' counsel identified duties to the Plan and therefore, separate lawsuits by numerous ERISA actions in which they have acted as individual Plan participants could establish incompatible class counsel. Pls.' Sugg. in Supp. at 12, Ex. 1. Plaintiffs' standards governing Defendants' conduct. For example, counsel also state they have actively participated in Defendants could face differing adjudications regarding motion practice and discovery in the present matter. the prudent process for determining reasonable Id. Accordingly, the Court finds Plaintiffs' counsel are recordkeeping fees and investment alternatives. As to adequate class counsel. subsection (B), because Plaintiffs seek Plan-wide relief, adjudication of Plaintiffs' claims would be dispositive of the interest of all plan participants. B. Plaintiffs have met the requirements under Rule 23(b) (1). Plaintiffs move to certify the class under Rule 23(b) III. The Court denies Defendants' motion to strike. (1) and argue both sections (A) and (B) are satisfied Defendants move to strike the declarations attached to in this case. "Classes certified under [Rule 23](b)(1) ... Plaintiffs' reply brief or, in the alternative, the entire reply share the most traditional justifications for class treatment brief (Doc. 80). Defendants assert Plaintiffs improperly —that individual adjudications would be impossible or submitted on reply the expert report of Steve Pomerantz, unworkable ...." Dukes, 564 U.S. at 361. Ph.D. ("Pomerantz") and additional declarations by the two named plaintiffs. Defendants argue the Court Plaintiffs argue Rule 23(b)(1)(A) is met because individual should not consider these declarations because they go to adjudications could establish incompatible standards of Plaintiffs' case in chief rather than to rebut the points in conduct for Defendants. As to subsection (B), Plaintiffs Defendants' expert report. argue this case could dispose of the same claims brought by other participants and failure to certify the class would District courts enjoy considerable discretion when ruling leave future plaintiffs without relief. on a motion to strike. See Nationwide Ins. Co. v. Cent. Mo. Elec. Coop., Inc., 278 F.3d 742, 748 (8th Cir. 2001). *6 In opposition, Defendants argue certification under 23(b)(1) is inappropriate because Plaintiffs seek monetary The parties negotiated, and the Court approved, a damages and (b)(3) is the exclusive subsection for this type scheduling order that afforded Defendants an additional of relief, relying on LaRue and Owner–Operator Indep. three weeks to submit a brief in opposition of class Drivers Ass'n, Inc. v. New Prime Inc., 339 F.3d 1001, 1011– certification if the motion for class certification relied 12 (8th Cir. 2003). Defendants also argue 23(b)(1)(B) is on expert opinions. Plaintiffs did not submit any expert only proper in cases where the defendant is in receivership reports with their motion for class certification, and or when plaintiff faces a limited fund. thus, Defendants filed their response without the benefit of the additional time. In their brief in opposition, Neither LaRue nor Owner–Operator identify a blanket Defendants fervently argued Plaintiffs failed to submit prohibition against a Rule 23(b)(1) class certification in the requisite evidence to support their motion. In reply, which monetary relief is sought. Additionally, subsection Plaintiffs submitted the Pomerantz report and additional 23(b)(1)(B) is not restricted to only limited fund situations declarations of the named plaintiffs. —many courts have certified a class under Rule 23(b)(1) (B) alleging breach of ERISA fiduciary duties. See, e.g., The Court finds it appropriate to deny Defendants' Krueger v. Ameriprise Financial, Inc., 304 F.R.D. 559 (D. motion to strike. First, the Court finds nothing in Minn. 2014); Moore v. Comcast Corp., 268 F.R.D. 530 Plaintiffs' reply brief that strays beyond the points raised (E.D. Pa. 2010); Jones v. NovaStar Financial, Inc., 257 in its opening brief. Plaintiffs crafted their reply brief in F.R.D. 181 (W.D. Mo. 2009); In re Merck, Nos. 05–1151 direct response to the points raised in Defendants' brief © 2017 Thomson Reuters. No claim to original U.S. Government Works. 5 Case Wildman v. American 17-2911, Century Document Services, 43-3, LLC, Slip Copy 12/12/2017, (2017) 2192242, Page7 of 7 2017 WL 6045487 in opposition. As to the expert report and declarations, Plan at the time on or after June 30, 2010, excluding Defendants, Defendants' brief in opposition relies almost exclusively employees with responsibility for the on Plaintiffs' lack of evidentiary support for their motion Plan's investment or administrative and it appears Plaintiffs submitted these additional functions, and members of the documents to rebut Defendants' arguments. American Century Services, LLC Board of Directors. *7 The Court limits its use of the Pomerantz report and the additional declarations of the named plaintiffs The named Plaintiffs are appointed as class for rebutting the arguments raised in Defendants' brief representatives. The Court appoints Nichols Kaster, in opposition only. Defendants' motion to strike the PLLP, as class counsel and Brady and Associates, LLP, declarations attached to Plaintiffs' reply brief or in the as local counsel. alternative, the reply brief, is denied. It is FURTHER ORDERED that the parties meet and confer regarding a trial date for this case. The parties Conclusion should file an amended proposed scheduling order setting a trial date on or before January 5, 2018. For the reasons stated above, Defendants' motion to strike Plaintiffs' reply brief is DENIED and Plaintiffs' motion to IT IS SO ORDERED. certify class action is GRANTED. The Court certifies the following class under Rule 23(b)(1): All Citations All participants and beneficiaries of the American Century Retirement Slip Copy, 2017 WL 6045487 Footnotes 1 Both parties request oral argument on Plaintiffs' motion for class certification and Defendants request oral argument on their motion to strike Plaintiffs' reply brief. Because the Court has determined oral argument would not be helpful in resolving the issues, the requests for oral argument are denied. Both motions have been decided on the parties' written memoranda. 2 The Plan is an "employee pension benefit plan" and a "defined contribution plan" within the meaning of 29 U.S.C. §§ 1002(2)(A), (34). 3 In their Amended Complaint, Plaintiffs state class certification is also appropriate under Rule 23(b)(3) but did not include that argument in their motion for class certification. Am. Compl. at 56 (Doc. 28). Therefore, the Court will only consider certification under Rule 23(b)(1). 4 Defendants also argue some participants released some or all of their claims, but this argument is more aligned with an attack of Plaintiffs' typicality argument. 5 Equally unpersuasive is Defendants' reliance on Spano v. The Boeing Co., 633 F.3d 574, 588, 591 (7th Cir. 2011) quoting statements from the court's Rule 23(b)(1)(B) analysis and a comment made on the adequacy of a class representative. 6 In a footnote Defendants argue there is a risk of intra-class conflict because the release of claims signed by Wildman and Borcherding were similar to 175 other former employees during the class period. Defs.' Sugg. in Opp. at 12, n.37. Defendants do not expound further on how this creates a conflict of interest between the members of the proposed class and so the Court does not address the argument. End of Document © 2017 Thomson Reuters. No claim to original U.S. Government Works. © 2017 Thomson Reuters. No claim to original U.S. Government Works. 6

FRAP 28(j) LETTER, dated 12/13/2017, on behalf of Petitioner John Arvanitis, Deutsche Bank Americas Holding Corp., Deutsche Bank Americas Holding Corp. Executive Committee, Deutsche Bank Matched Savings Plan Investment Committee, Robert Dibble, Tim Dowling, Richard Ferguson, James Gnall, Louis Jaffe, Patrick McKenna, Richard O'Connell, David Pearson, Joseph Rice, Scott Simon, Andrew Threadgold and James Volkwein, RECEIVED. Service date 12/13/2017 by CM/ECF.[2193214] [17-2911] [Entered: 12/13/2017 10:58 AM]

Case 17-2911, Document 51, 12/13/2017, 2193214, Page1 of 2 James O. Fleckner Goodwin Procter LLP +1 617 570 1153 100 Northern Avenue jfleckner@goodwinlaw.com Boston, MA 02210 goodwinlaw.com +1 617 570 1000 December 13, 2017 VIA CM/ECF Catherine O'Hagan Wolfe, Clerk of Court United States Court of Appeals for the Second Circuit Thurgood Marshall United States Courthouse 40 Foley Square New York, New York 10007 Re: Moreno, et al. v. Deutsche Bank Americas Holding Corp., et al., Case No. 17-2911 Scheduled for December 19, 2017 Motions Calendar Dear Ms. Wolfe: I write in response to Respondents' 28(j) letter regarding Leber v. Citigroup 401(k) Plan Investment Committee, 2017 WL 5664850 (S.D.N.Y. Nov. 27, 2017), and Wildman v. American Century Services, LLC, 2017 WL 6045487 (W.D. Mo. Dec. 6, 2017). Respondents' letter underscores the need for this Court's review of the issues presented in Petitioners' Rule 23(f) Petition. First, that two more class-certification decisions interpreting Rule 23(b)(1) were issued in the short time since this Petition was filed demonstrates the frequency with which this issue arises, and thus the compelling need for this Court's review. The Leber and Wildman courts notably cited no appellate authority holding that mandatory classes are appropriate in defined-contribution plan damages cases under ERISA. This is no accident: not a single appellate court has ever addressed this issue notwithstanding the frequency with which it arises. Pet. 16-17. Second, the Leber and Wildman courts not only provided just a few sentences of discussion regarding the propriety of Rule 23(b)(1) certification, but also neither court addressed the important due- process concerns posed by Rule 23(b)(1) certification, addressed at length in this Petition. They also relied heavily on cases preceding LaRue v. DeWolff, Boberg & Assocs., Inc., 552 U.S. 248 (2011) and Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), two cases that caused a sea change in ERISA and class-actions jurisprudence. Scant analysis by two district courts that failed to address the due process implications of Rule 23(b)(1) classes provides no basis to deny the Petition. Third, Leber highlights the impropriety of the class definition adopted by the district court in this action. The Leber court refused to allow a class definition that included time periods for which there was no basis for the plaintiffs to assert claims, and it limited the class definition to participants who actually invested in the challenged funds during the relevant time period. 2017 WL 5664850, at *18, ACTIVE/93637146.3 Case 17-2911, Document 51, 12/13/2017, 2193214, Page2 of 2 Catherine O'Hagan Wolfe December 13, 2017 Page 2 *19. In contrast, the class defined by the district court here provided no objective criteria with definite boundaries as required by this Court's precedents. Pet. 19-22. Respectfully submitted, s/ James O. Fleckner James O. Fleckner Counsel for Petitioners cc: Counsel of Record (via CM/ECF) 2 ACTIVE/93637146.3

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19
09/26/2017
NOTICE OF APPEARANCE AS AMICUS COUNSEL, on behalf of, <EDIT by Clerk's Office>, FILED. Service date 09/26/2017 by CM/ECF. [2133702] [17-2911] [Entered: 09/26/2017 03:01 PM]
20
09/26/2017
NOTICE OF APPEARANCE AS AMICUS COUNSEL, on behalf of, <EDIT by Clerk's Office>, FILED. Service date 09/26/2017 by CM/ECF. [2133709] [17-2911] [Entered: 09/26/2017 03:07 PM]
21
09/26/2017
NOTICE OF APPEARANCE AS AMICUS COUNSEL, on behalf of, <EDIT by Clerk's Office>, FILED. Service date 09/26/2017 by CM/ECF. [2133718] [17-2911] [Entered: 09/26/2017 03:11 PM]
22
09/26/2017
MOTION TO FILE AMICUS CURIAE BRIEF, on behalf of Non-Party Filer(s), FILED. Service date09/26/2017 by CM/ECF.[2133770] [17-2911] [Entered: 09/26/2017 03:27 PM]
27
09/27/2017
NEW PARTY, Movant United States Chamber of Commerce, ADDED.[2134110] [17-2911] [Entered: 09/27/2017 09:07 AM]
29
09/27/2017
MOTION ORDER, referring motion to file amicus curiae brief [22] filed by Movant United States Chamber of Commerce, FILED. [2134134][29] [17-2911] [Entered: 09/27/2017 09:24 AM]
27
09/27/2017
NEW PARTY, Movant United States Chamber of Commerce, ADDED.[2134110] [17-2911] [Entered: 09/27/2017 09:07 AM]
32
09/29/2017
OPPOSITION TO MOTION, for leave to appeal (FRCP 23(f)) [1], on behalf of Respondent Omkharan Arasarantnam, Baiju Gajjar, Ramon Moreno, Rajath Nagaraja and Donald O'Halloran, FILED. Service date 09/29/2017 by CM/ECF. [2136722] [17-2911] [Entered: 09/29/2017 02:28 PM]
36
10/10/2017
ACKNOWLEDGMENT AND NOTICE OF APPEARANCE, on behalf of Respondent Omkharan Arasarantnam, Baiju Gajjar, Ramon Moreno, Rajath Nagaraja and Donald O'Halloran, FILED. Service date 10/10/2017 by CM/ECF.[2143838] [17-2911] [Entered: 10/10/2017 04:19 PM]
37
10/10/2017
NOTICE OF APPEARANCE AS ADDITIONAL COUNSEL, on behalf of Respondent Omkharan Arasarantnam, Baiju Gajjar, Ramon Moreno, Rajath Nagaraja and Donald O'Halloran, FILED. Service date 10/10/2017 by CM/ECF. [2143849] [17-2911] [Entered: 10/10/2017 04:23 PM]
38
10/10/2017
ATTORNEY, Jacob Timothy Schutz for Donald O'Halloran Ramon Moreno Rajath Nagaraja Baiju Gajjar Omkharan Arasarantnam, in case 17-2911, [37], ADDED.[2143881] [17-2911] [Entered: 10/10/2017 04:35 PM]
42
12/06/2017
ARGUMENT/SUBMITTED NOTICE, to attorneys/parties, TRANSMITTED.[2187761] [17-2911] [Entered: 12/06/2017 10:49 AM]
43
12/12/2017
FRAP 28(j) LETTER, dated 12/12/2017, on behalf of Respondent Omkharan Arasarantnam, Baiju Gajjar, Ramon Moreno, Rajath Nagaraja and Donald O'Halloran, RECEIVED. Service date 12/12/2017 by CM/ECF.[2192242] [17-2911] [Entered: 12/12/2017 11:24 AM]
51
12/13/2017
FRAP 28(j) LETTER, dated 12/13/2017, on behalf of Petitioner John Arvanitis, Deutsche Bank Americas Holding Corp., Deutsche Bank Americas Holding Corp. Executive Committee, Deutsche Bank Matched Savings Plan Investment Committee, Robert Dibble, Tim Dowling, Richard Ferguson, James Gnall, Louis Jaffe, Patrick McKenna, Richard O'Connell, David Pearson, Joseph Rice, Scott Simon, Andrew Threadgold and James Volkwein, RECEIVED. Service date 12/13/2017 by CM/ECF.[2193214] [17-2911] [Entered: 12/13/2017 10:58 AM]
56
12/19/2017
MOTION ORDER, granting motion to file amicus curiae brief [22], by DAL, RJL, SLC, FILED. [2197794][56] [17-2911] [Entered: 12/19/2017 03:16 PM]
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