Wade v. Newport Group, Inc.
1:22-cv-01126
W.D. Tenn.Apr 14, 2025Background
- Plaintiffs are clergy and employees of the African Methodist Episcopal Church (AMEC) who allege significant losses in their retirement plan due to fraud, mismanagement, and conspiracy among church officials and third-party service providers.
- Plaintiffs claim that plan assets were diverted through a web of entities controlled by Dr. Jerome V. Harris and Robert Eaton, including excessive administrative fees, high-risk investments, and improper commissions.
- Symetra Life Insurance Company, a plan annuity provider, faces multiple Tennessee-law claims including breach of fiduciary duty, fraudulent concealment, civil conspiracy, and aiding and abetting breach of fiduciary duty.
- The procedural posture is a motion to dismiss by Symetra, attacking the sufficiency of multiple claims in Plaintiffs’ Second Consolidated Amended Complaint.
- The Court previously approved settlements with other defendants and must now decide whether claims against Symetra survive the pleadings stage under Rule 12(b)(6).
- The Court applies Tennessee law and considers both direct and derivative claims by the plaintiffs, with unresolved questions about standing/capacity deferred to summary judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Violation of Tennessee Uniform Trust Code (TUTC) as Trust Advisor | Symetra exercised powers of a trust protector/advisor per TUTC | Symetra was never vested with powers as trust advisor/protector in trust documents | Claim dismissed; Symetra not a "trust advisor" |
| Fraudulent Concealment | Symetra, as fiduciary, concealed material facts harming the Plan | No fiduciary duty to Plan participants; no particularized concealment pled | Claim survives; pleading plausibly alleges concealment |
| Civil Conspiracy | Symetra participated in conspiracy with Dr. Harris and others | No agreement or common design; wrongs were independent | Claim survives; pleadings allege a plausible conspiracy |
| Aiding and Abetting Breach of Fiduciary Duty | Symetra substantially assisted known breaches by Dr. Harris/Eaton | No substantial assistance or knowledge shown | Claim survives; pleadings plausibly allege assistance |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (Pleading standard under Rule 8 and 12(b)(6))
- Ashcroft v. Iqbal, 556 U.S. 662 (Plausibility standard for pleadings)
- First Cmty. Bank, N.A. v. First Tenn. Bank, N.A., 489 S.W.3d 369 (Tenn. civil conspiracy law)
- Overstreet v. TRW Com. Steering Div., 256 S.W.3d 626 (Fiduciary duties under Tennessee law)
- Carr v. United Parcel Serv., 955 S.W.2d 832 (Aiding and abetting breach under Tennessee law)
- Kincaid v. SouthTrust Bank, 221 S.W.3d 32 (Elements of civil conspiracy in Tennessee)