*1 nity is affirmed. The district court’s deci-
sion denying qualified immunity is re-
versed in part the case is remanded
with instructions to enter judgment
Packman and the Board members on process claim. due
Ronald J. SREIN and R.J. Srein
Corp., Appellant COMPANY,
FRANKFORD TRUST Key Company.
n/k/a
No. 01-4516.
United States Court of Appeals,
Third Circuit.
Argued Sept. 2002.
Filed March *2 L. P. (Argued),
Jаmes Griffith John Diliberto, Klett, Halfpenny, K. Steven Rooney, Philadelphia, & Schorling, Lieber PA, Appellant. (Argued),
Mark D. Bradshaw Todd R. Bartos, PA, Lee, Harrisburg, Stevens & Appellees. FUENTES, Before: ALITO and Circuit OBERDORFER,* Judges, District Judge.
OPINION OF THE COURT OBERDORFER, Judge. District appeal requires Plaintiffs’ us to consider liability of the of two retire- trustee plans negligence for common law fiduciary duty, any, if under the breach Employee Income Se- federal Retirement et (“ERISA”), curity Act 29 U.S.C. seq. judgment The District Court entered Pennsylvania’s under Com- for defendant jury Negligence law after a found parative negligence contributory negligence than greater defendant’s for defendant on the also found theory that the trustee was issue on * Oberdorfer, designation. sitting by Louis F. Senior The Honorable Columbia, Judge District District of ker, Findco, Craig Inc., meaning within the of that Silverman and and, commission, locate “viators” for a
law. Wе reverse remand. negotiate in participation investments agreements.1 During early 1992 and AND I. FACTUAL PROCEDURAL Srein entered on own six par- account *3 BACKGROUND ticipation agreements for viatical settle- specific of this fact Resolution case re- ment contracts with Findco. exposition extensive them. quires of Find- February Corpo Before 1993 R.J. Srein ings undisputed of the District Court and engaged ration In Eagle Retirement and that: evidence establish as Planning vestment Trustee of an J. Ronald Srein the sole stockholder Money qualified ERISA Pension Purchase only employee Corpora- R.J. Srein February year, Plan. of that On Srein mid-1980’s, In the tion. Srein created sought participation agree to enter into Corporation qualified in two ERISA plan ment with Findco on for behalf plans, Money retirement Purchase Pen- a 100% interest in an policy insurance sion Plan and Plan. In Sharing Profit by issued Philadelphia Life Insurance sought in partic- he to invest funds on Company of one life Errol Cham ipation agreements on so-called “viatical However, Eagle ness. “would not allow settlement contracts.” A viatical settle- plans such investments retirement is, essence, ment contract in an investment was which it trustee because such invest in policy an insurance on the life of a ments were not registered.” terminally ill insured. It allows “individu- Learning of this impasse, Silverman re diagnosed potentially als terminal Daly,2 dis- ferred Srein Laraine a Frankford (hereinafter pay- eases obtain immediate trust officer [to] sometimes re “Frankford”). part together ferred face value of their insurance Frankford informed Srein that “Frankford exchange assigning any not part against all did have rules non- or of the life insurance investments, registered partic such as This enables the insured called “via- [also ipation agreements in viatical settlement money to obtain which tors”] would other- contracts, being plans held investment wise be unavailable to him until after his 324.) for which it acted as trustee.” death. passes away, When the insured representation this agreed Based on Srein viatical company settlement collects the move retirement accounts to Frank- policy proceeds, pays the investor ford. money agreement he advanced under the
and the balance is divided between the then setting up “facilitated company investor and the settlement qualified plans Corp. R.J. Srein (Find- agreement.” accordance with thеir at transferring Frankford Trust and assets 22.) ing of Fact arrange No. JA To Eagle Retirement to Frankford investments, these engaged a bro- Trust. understood that Mr. [Frankford] "Participation Agreement” Daly prior 1.A evidences the 2. Laraine married to the trial and rights is now Laraine parties including Beckman. pay- duties of insured, assignment ment to the unregistered security 3. An investment is "a the benefit of the investor registered with the Securities Ex- obligation pay of the insurance carrier to change Commission and therefore not sold proceeds to the broker for transmittal publically specific unless met.” conditions are investor after deduction of the commissions. ed.1999). (7th Dictionary Black’s Law any investment Corp. making assets moving the R.J. Srein Fund, purpose fully for the the Trustee be Frankford Trust shall Plans to partic- of, things, investing rely fur- among other entitled to on such directions settlement on viatical ipation agreements nished the Plan Administrator and Fact No. JA (Finding of duty contracts.” shall be under no to make inquiry investigation especially thereto. It is intended under 1993, Srein, Corpo- February On Agreement the Plan and this into five Frankford entered ration and discretionary Trustee shall have no au- creating that had the effect agreements thority to determine the investment of Money Purchase Corp. a new R.J. Srein of the Fund. the assets Sharing Plan at Plan and a Profit Pension *4 The new Plan documents Frankford. Sharing Agreement Profit Plan Trust and Plan Participant as both named Srein 2.1. § designated and Administrator Similarly, Sharing the Profit Master on of the Daly, Plan trustee. behalf the Plan stated: bank, officer for both of acted as the trust In making any investment of contribu- creating After plans. retirement 6.3, § tions under this the Trustee shall Plans, Eagle Retirement to Srein directed fully rely be entitled to on the written plans it held and the retirement liquidate by directions furnished the Plan Admin- (JA Frankford. their assets to to transfer duty istrator and shall be under no 1217.) inquiry investigation with make Sharing Agree- Plan Trust The Profit respect If the thereto. Trustee receives (“Trust Agreement”) between not any contribution to Trust Trustee declared that and Frankford as di- accompanied by written instructions “discharge assigned [its] Trustee shall investment, recting may the Trustee its responsibilities ... with the duties and portion hold or return all or a care, skill, diligence under prudence, liability contribution uninvested without prevailing that a circumstances then appreciation pend- income or for loss of capacity in person acting a like prudent receipt рroper investment di- ing matters would use and familiar with such from the Plan Administrator. rections enterprise in of an of a like the conduct 6.3(c). § That Sharing Plan like aims.” Trust Master Profit character and with 3.1(b). continued, assets of the no Plan further stated that “the § It “at Agreement held, managed are administered part corpus or income Plan time shall to, for, in accordance by [Frankford] the Trustee of the Fund be used or diverted terms and conditions of the Trust than for the exclusive ben- with the purposes other Beneficiaries, 1.1, § and that “the Trustee Agreement,” Participants or their efit responsibility for the expenses of shall have sole defraying or for reasonable man- of the trust and the § 4.1. administration administering plan.” Id. at hereunder, the assets held agement of provided Agreement The Trust Agree- in specifically рrovided the Trust to investment decisions Sharing Plan Master Profit ment.” the Plans: Frankford invest the funds of Money § Purchase Plan 10.1. The Master Participant writing by as directed §in 11.1. language identical ... which written directions [Srein] acting as trustee In consideration timely furnished to the Trustee shall be Srein], Plans, Frankford was to Corporation’s [also the Plan Administrator participation agree- its in accor- because “the “compensated ber[]” be services investments, registered its normal fees.” were dance with schedule of ments See Agreement Trust 5.1. Frankford they pre-existing did not have num- [and] 25.) (JA charged upon Then, fees based the value assigned to them.” bers 118.) (JA 1993, assets held the Plans. As February on to ei- unbeknownst Daly explained Frankford, “all trust accounts were ther Srein or Findco entered employee charged fee. In the case of participation second agreement into accounts, benefit it would have been for Partnerships D.P. a 100% interest the'— n document, prototype plan use of the (JA 25.) the same Chamness trust- having financial institution as passed away, August After Chamness also, case, It ee.... Srein’s because we Philadelphia Life forwarded the acting were as a directed it in- proceeds of to Findco’s escrow record, maintaining security volved direction, At agent. Findco’s the escrowee maintaining the document the vault proceeds divided the net Cham- producing monthly statements ” Partnership ness between D.P. transactions assets.... (for commission); Findco its Srein’s pendency of During the rela- nothing. received Neverthe- *5 Plans, tionship between Frankford and the less, Frankford, apparently obliviоus of Srein entrusted to Frankford Partic- two Chamness’ death the distribution of ipation Agreements; representing one policy proceeds to Partnership, the D.P. policy interest in the Chamness anoth- policy continued to list the as an Chamness er in policy an insurance on the life one Money asset the Srein Purchase Plan Lloyd J. Madsen. charge a and continued to the Plan trustee upon fee based the value of that asset Policy A. The Chamness (JA 1123.) 119, through year Srein, February On Plan as Administrator, Daly directed to forward Policy The B. Madsen $72,500 Money from the Pension Purchase Katim, agent, to Findco’s escrow Neil 3,1993, June Findco “the Frank- On in a Participation Agreement invest for Trustee, Company, ford Trust F.B.O. the policy. 100% interest in the Chamness Plan,” Corp. Srein Profit Sharing R.J. en- instructed, Frankford As forwarded Participation into Agreement tered for a $72,500 agent, paid to Findco’s escrow who policy interest in an 100% insurance issued (JA 1569.) it to Chamness. Pursuant by American National Insurance on the the Agreement, conveyed Chamness (JA 1575.) Lloyd life J. Madsen. Daly policy, including right proceeds to its to signed Agreement as officer trust for Findco. Plan; signed the Profit on Sharing Srein Agreement’s required Srein,
The terms Findco behalf the Plan. As instructed to obtain an change acting insurance in capacity beneficia- as Plan Administra- ry tor, $62,500 Philadelphia form from “naming paid Life Frankford from the Prof- the Escrow Account the Participant Sharing as it Plan for the investment in the (JA 716.) proportional, percentage, Participation irrevocable Agreement. (JA 1569.) Policy....” beneficiaries of assignment a result of As random Meanwhile, Findco failed to Agreemеnts, do so. Frank- numbers to Frankford placed ford Agreement ability its vault and had no to determine whether more assigned it an “arbitrary, num- one random than customer the bank invested proceeds these related to the Agreement the same same Participation (JA 25.) policy, contract. Madsen in which the R.J. viatical settlement Profit Corp Sharing Plan had taken a Agreement of the Madsen terms 27.) (JA Daly deposited 100% interest.” essentially the same as those set were account; the check into the Richards’ Plan It Agreement. forth in ob- the Chamness the Srein none of the pro- Plan received assign owner- ligated Madsen Findco Moreover, ceeds of the policy. Madsen as his life and ship policy of the on Findco case, in the Chamness Frankford contin- change obtain an insurance form from ued to list as an the Madsen asset of it naming American and the Srein National Sharing the Srein Plan and Profit contin- Sharing Profit Plan as beneficiaries of the (JA charge ued it fees until 2001. 118- Findco, poli- as with Chamness pendency of the During trust cy, to name the Srein Plan as benefi- failed relationships, charged Frankford the Srein assigned ciary. Frankford the Par- Again, $7,000 plans approximately in trustee fees ticipation a random number Agreement based on the value of the Chamness and placed vault. its Six- Participation Agreements. later, 28, 1994, on October teen months 1014,1021.) serving Frankford was also trustee for 1997, Srein, early no Stephan having Matt Richards’ retirement re- (“Richards’ Plan”) Daly serving pre-1993 personal turn on his six invest- date, ments Participation Agreements as the trust officer. On that vi- Plan, policies atical from that as well as those made instructions $23,030 paid plan’s pur- funds to Plans which Frankford was suspicious chase a interest in the same Madsen became of Silverman and 28% Find- investigation, to which it co. After some held discov- *6 (JA that Participation Agreement. selling Srein Plan ered Silverman had been Par- 403.) ticipation Daly signed Agreements the Richards’ Partic- for investments in “Trustee, ipation policies same to more than Agreement as FBO Ste- viatical one (JA 397.) 1997, phen Although Ultimately, investor. in June M. Richards.” Frankford, Silverman, specifically jointly and sued Daly, and was Frankford Findco, plans, agent and Findco’s escrow trustee for both District Court judgment found the sixteen a half fraud. Srein a that “due to and won excess of However, by purchases month the two two million that gap between dollars. time, agreements that the not have Findco and the оther defendants fact did assigned judgment were insolvent and the uncollect- preexisting numbers to them investments, the instant they unregistered since ible. Srein then instituted ac- were in the recognize pur- against two tion Frankford District Frankford did not policy.” chases of the same Court. 29, 1995, died; jury Lloyd After a trial the merits a re- May
On Madsen promptly special National to turned a verdict that defendant was American delivered $27,499, $566,000 proceeds damage negligent causing Silverman (a $66,000 by Trust Co. FBO Richards loss the Profit “Frankford S.M. Inc., Silverman, Findco, Craig Sharing & as- for the 409.) $500,000 personal signee.” Silverman forwarded losses investments) negli- American viatical but that Srein’s Frankford the National check (JA gence seventy percent contributory the Richards’ was a designating it for Plan. Applying Pennsyl- cause of the recognize “Frankford Trust did not losses. 220 Aсt,4 novo; Comparative Negligence
vania de findings clusions factual survive clearly v. judgment Scully District Court rendered a for unless erroneous. See (3d WATS, negligence U.S. 505 Cir. defendant on the claim. F.3d 2001). Here, accept underly Plaintiffs ruled, consistently That court ing findings regarding factual the agree jury an serving the verdict of the advi- ments entered and actions taken sory capacity, that Frankford not a was pursuant the Plan Frankford and Trust fiduciary it was a because directed trustee. Agreements; they dispute only whether Emphasizing that Frankford had exercised properly not the District Court determined provided no discretion no investment agreements impose that those actions advice, judg- the District Court entered fiduciary status on Frankford. Given ment for defendant on the claim. ERISA legal only appeal, arе raised on we issues appeal, Appellants argue On that Frank- legal review the district court’s conclusion fiduciary ford functioned as within the id.; de See novo. see also Hamilton v. 1002(21)(A)(i) meaning of 29 U.S.C. (6th Cir.2001) Carell, F.3d because, ERISA it exercised (“Where the not in question, facts are “authority manage- over control” party’s fiduciary status as an ERISA disposition plans’ ment and of the ERISA law”); purely question of Libbey-Owens- Appellants assets.5 also contend Co. v. Ford Blue Cross & Blue Shield applied district court when it Penn- erred (6th Cir.1993) Mut., sylvania contributory negligence laws to (whether administrator is a fiducia the common law claims. law). question ry is a II. DISCUSSION Fiduciary 2. Status Frankford’s “ERISA ‘defines not in terms A. The Claims but trusteeship, formal functional Review Standard of terms control and over parties disagree at thresh Assocs., plan-’” Mertens Hewitt old about the proper standard of review to 248, 262, 2063, 124 508 U.S. 113 S.Ct. apply to the (1993). District Court’s decision L.Ed.2d 161 ERISA creates liabil- ERISA fidu ity fiduciary duty for breaches of “to *7 ciary. argue fiduciary Plaintiffs that the person that a extent” functions in a fidu- legal status that question 1002(21)(A); issue is a we § ciary capacity. 29 U.S.C. conversely review de novo. Frankford ar see also Glaziers & Glassworkers Union gues that presents the issue before us Secs., Inc., No. Newbridge Local 252 v. 93 Cir.1996). question 1171, (3d mixed law and of fact for which Fiduciary F.3d 1180 appellate only legal review courts the con- status person managing attaches to a Pennsylvania Comparative Negli- 4. Under plan any the of such authority or exercises or gence plaintiff propor- Act a is entitled to a respecting management disposition control or damages tionate only shаre the assets, of when his (ii) its he renders investment advice of for a contributory negligence fifty does not exceed compensation, fee or other or direct percent. Act, Comparative Negligence See 42 indirect, any respect moneys with to or other 7102(a). § Pa.C.S. property plan, any of such or has or so, (iii) responsibility any to do or he has 1002(21)(A) person § 5. 29 U.S.C. states that discretionary authority or discretionary re- fiduciary functions as an ERISA to the extent sponsibility plan in the administration such any that "he discretionary authority exercises added).” (emphasis or discretionary respecting manage- control
221
(i)
Participation Agreements for
Madsen
under
subsection
plan
policies. But it is
dis
obvious
1002(21)(A)
exercises
Chamness
person
if that
§
placement
plan,
or
that
did not direсt
Srein
management
in the
cretion
authority or
in the Frankford
any
agreements
several
exercises
person
if the
disposi
cross-referencing
or
one to the
management
vault without
over
control
other,
Bd.
of random numbers
plan’s
assignment
assets. See
of the
tion
of Trs. of
6
payment
Local
for and
agreements,
Allied
Bricklayers and
Craftsmen
Fund v. Wettlin
Jersey
participation agreements
acceptance
Neiv
Welfare
(3d
Inc.,
respect
Cir.
F.3d
Frankford customers with
other
Assocs.
R.J,
2001).
recognizes
subject of one of
policy already
Court
This
two
participation agree-
Corporation’s
difference between
“significant
Srein
(i)
discretion
is that
did Srein direct Frankford
]
subsection
ments.6 Nor
[of
clauses
fiduciary
plan
Richards’
prerequisite
accept
as a
and distribute to thе
specified
is
an ERISA
person managing
percent
proceeds
of the
twenty-eight
for a
status
is con
inquiry or inves-
the word
Without
plan, but
‘discretionar/
refers to
the text
came to know that
tigation,
absent when
Frankford
spicuously
Id.;
Corp.
IT
v. General
Proceeds of the
Madsen died.
see
assets.”
(9th
Co.,
1415, 1421
into
It was
possession.
107 F.3d
life came
its
Am.
Ins.
Life
and,
Cir.1997).
proceeds
“[f]i-
said that
for what-
It has been well
“control” of those
1002(21)(A)
reason,
not
erroneously
distributed them
under
duciary status
ever
was, by
court
concept
That
nothing
[A]
another of its customers.
an all or
(if
definition,
person is a
of “control”7
the exercise
must ask whether
activity
“disposition of
particular
“authority”) respecting
to the
respect
Frank-
Bank
In this case
[plaintiffs]
v. Commerce
assets.”
question.” Maniace
(8th
N.A.,
264, 267
over the Madsen
exerсised direction
City,
Kansas
ford
denied,
in the
Cir.1994),
placed
that asset
514 U.S.
when it
cert.
(inter
(1995)
account,
therefore, di-
L.Ed.2d 854
Richards’
S.Ct.
omitted).
from the
the value of
asset
quotations
nal
verted
Plan account.
Srein
must,
Here,
accept,
we
as we
directed,
a matter of law that
conclude as
We
finding that Srein
District Court
by the District Court establish
facts found
no discretion
and Frankford exercised
“au-
undirected
that Frankford exercised
in the
to,
to invest
the decisions
should
"sophis-
does not claim
Frankford
recognized that Srein is
6. Frankford
investigated
the Findco
matters”.
and discovered
finance
have
ticated
commercial
informed,
expert,
if not
explained
believed
In Srein's
that he
fraud.
had a mech-
opinion,
"should have
Frankford
from informa-
should have known
regardless of what
assets
anism to track the
[him]
“alerted
its own files and
*8
tion in
represen-
again
And
that the
the assets were.
a double sale of one
there
been
fact that
had
X
they could administer
to me that
tation
[as
interest in
policies
had a double
[he]
unregistered
unusual
in-
for
or
trustee [sic]
Participant
Administrator].”
and Plan
Plan
not, as
as I’m concerned
should
far
vestments
mitigate
mitigate their re-
or didn’t
doesn't
register or cross refer-
sponsibility
properly
power
control-
act or
of
is “the
7. “Control”
investments,
they
types
whether
those
of
ence
command,”
ling; regulation;
domination
offerings,
private
mortgages,
stock
viati-
were
"exercising
"controlling”
defined as
is
and
contracts,
Assign a
irrelevant.
number
cal
its
Una-
Webster’s
or direction over.”
restraint
system
up
the
and if it comes
to the asset
(2d ed.1998).
Dictionary
bridged
problem.
It's
there's a
else than
somewhere
1232.)
(JA
registration
of a bond.”
like
plaintiffs’
Maniace,
control”
valu-
thority and
over
the direction of another.
In
the
plaintiffs charged
in the Madsen life
that the defendant
able interests
insurance
bank
fiduciary duty
violated a
the
therefore functioned
a fidu-
as
Employee
Ownership
Stock
in-
because
to the Srein Plan’s
ciary
plan
it
improvidently retained a
owned
in Madsen
terests
Maniace,
stock
its value declined. See
conclu-
strong support
this
We find
Wettlin, F.3d at 275. claim damages addition to its that the Dis- Accordingly, we conclude resulting from Frankford’s breach of fidu- concluding that Frank- trict Court erred plaintiffs brought a claim for fiduciary respect ciary duty, with to the ford was not a Pennsylvania law with negligence investment. under respect personal investments Srein’s A remains as to whether question plans. jury and those of the two The respect to Frankford was a with negligent found that Frankford was with hand, policy. the one it the Chamness On to the Madsen respect Partic custody took Chamness (JA investment losses. personal Srein’s gave only it random ipation Agreement, 538.) However, negli- jury found no number, it a record of on its maintained role respect with to Frankford’s gence long fees after the books and collectеd respect with Chamness proceeds were dis died and the insured determined that Srein It further However, Frankford tributed elsewhere. $566,000 damages but that suffered control over the Plan’s did not exercise damages. was a 70% cause of those it to the extent that investment Chamness applied Court District the Madsen one. respect did with Comparative Negligence Pennsylvania’s Moreover, duty Frankford had no “to judg- jury’s Act to the verdict and entered re any inquiry investigation make negligence on the for Frankford alive. spect” to whether Chamness was claims. See § 2.1. Nor did Agreement (as for a new trial after it did Plaintiff moved “in-house” information have first, investment) was there judgment arguing, the Madsen about finding support D.P. insufficient evidence sale of that to the the double negli- contributory guilty Partnership plan. We conclude *10 224
gence recovery any to his investment not bar by plaintiff. loss- the But second, es, and that District damage by plaintiff the Court will sustained be di- that, failing jury the proportion erred instruct minished in the amount Pennsylvania Comparative under Neg- negligence plaintiff.” the the to the attributed (JA 1133-34) added). Act, ligence finding (emphasis a that was more Further- fifty percent than at fault for his judge jury losses more the never if told that require judg- fifty would the court to enter a it percent attributed or more of the the defendant.8 The plaintiffs injury upon plain- favor Dis- blame for that tiff, trict Court denied that judge judgment motion. would enter plain- defendant. This instruction was Jury 1. Instruction ly said, wrong for what it it for what didn’t say. Although plaintiff failed to ob- Plaintiffs’ negligence claims for ject to the instruction omission before were traversed the defense of contribu charged plаin the court jury, error tory negligence. governing Under requires cognizance us take of it and Pennsylvania Comparative Act, Negligence 419, act. Riga, See Alexander v. 208 F.3d plaintiff a a verdict that more than was (3d Cir.2000).9 426-27 fifty percent at fault requires the trial court to a judgment enter for the defen
dant. Pennsylvania courts have modulat 2. Sufficiency Evidence ed the rule to the of requiring extent a review for clear error We the de judge trying governed by Pennsyl a case termination of the District Court that jury vania’s law to include in charge there was sufficient evidence of contributo information to that effect. See Peair v. WATS, ry negligence. Scully See v. U.S. 751, Legion Home No. Ass’n 287 of Enola (3d Cir.2001). 497, Srein, 238 F.3d 505 400, 665, (1981). Pa.Super. 430 A.2d 671 Plans, administrator was all ac sophisticated
Here the District Court instructed counts a investor. He re the jury you “[i]f that that periodic reports find ceived per about both his plaintiff sonal, negligent Plans’, was contributorily and the viatical investments. that plaintiffs contributory negligence years elapsed Several before he noticed was a substantial factor in bringing about that these investments had not “matured.” harm, plaintiffs own It was not unreasonable for the trier fact plaintiff fact, contributorily negligent governed by comparative will negligence However, appeal 8. On also raise for the first we note that the defendant raised argument time the District Court question preempted of whether ERISA Pennsylvania’s erred applying Comparative negligence during pretrial claim conference Negligence Act in this case because that Act before the District Court. The District Court applies only brought to "actions to recover apparently failed to rule on the contention. damages negligence resulting in death or may it preemp On remand wish to revisit injury person property....” 42 Pa. tion issue before undertakes new trial. 7102(a). Cons.Stat. Ann. haveWe consis- See The 1975 Salaried Retirement Plan For tently held that we will not consider issues Crucible, Nobers, Eligible Employees Inc. v. of (3d Cir.1992), that are appeal raised for the first time on 401, denied, 968 F.2d cert. "compelling absent reasons.” Patterson v. 1086, 506 U.S. 113 S.Ct. 122 L.Ed.2d Cuyler, (3d Cir.1984); 729 F.2d see (1993) (explaining preemption ap City Philadelphia, Harris v. plies depends when state law claim on the (3d Cir.1994). Plaintiffs identified plan). existence anof ERISA no accordingly such reasons we decline to address the contention. *11 instruction, participants. to the Frankford was iden- allocatе some blame law “plan tified as the trustee.” him. agree
I
with the District Court
III. CONCLUSION
under the four Srein Plan documents “the
of a
role of Frankford was
limited nature
judgment
of the District
reverse
We
as Frankford was
exercise no invest-
plaintiffs’ negligence claim
on the
Court
discretion,
solely
Srein was
re-
trial.
also re-
and remand for new
We
sponsible
selecting
the investments for
not a
decision that defendant was
verse its
(D.
4)
plans.”
Op.
pp.
Ct.
at
I also
remand the case for further
fiduciary and
agree with the
Court’s observation
District
claim that de-
plaintiffs’
consideration
that Frankford’s intended role was that of
fiduciary duty with
fendant breached its
fiduciary.
directed
rather
than
in the Mad-
plan’s
to the
interest
Id. at 10-12.
policy.
sen
Notwithstanding the nature of the con
Plan
tractual duties set forth
docu
FUENTES,
concurring
Judge,
Circuit
ments,
majority, citing
Board of Trs. of
dissenting.
Bricklayers and Allied
Local 6
Craftsmen
join
portions
majority’s
I
of the
well-
all
Jersey
v.
New
Fund Wettlin
Welfare
II,
opinion other than Part
sub-
reasoned
(3d
Inc.,
Cir.2001),
authority over
Therefore, the failure to establish rec-
ord-keeping system is not of an evidence
exercise of or control either.
I,therefore, dissent. CAPITAL,
CITICORP VENTURE
LTD., Corporation, a New York
Appellant
v.
COMMITTEE OF HOLD- CREDITORS CLAIMS,
ING UNSECURED Holding
Committee Creditors Unse- Representative
cured as Estate Claims Papercraft Corporation Ltd.,
Citicorp Capital, Venture Corporation,
a New York Holding
Committee of Creditors Unse Claims,
cured and Committee of Cred Holding
itors Unsecured Claims as Representative Papercraft
Estate
Corporation Appellant. 02-1815,
No. 02-1905. Appeals,
United States Court of
Third Circuit.
Argued Dec. 2002. March
Filed