Supreme Court Clarifies Statute of Limitations for Trustees Fiduciary Duty Claim under ERISA

In Tribble v. Edison Int’l, the United States Supreme Court found that ERISA beneficiaries claims were not time barred under a six year statute of limitation, from the date of the original purchase of investments, because ERISA fiduciaries have an ongoing duty derived from trust law that requires them to continue to monitor, and remove imprudent, trust investments. As long as a plaintiff’s claim alleging breach of the continuing duty of prudence occurred within six years of suit, the claim is timely.  Justice Breyer, writing for the Court, explained:

In determining the contours of an ERISA fiduciary’s duty, courts often must look to the law of trusts. We are aware of no reason why the Ninth Circuit should not do so here. Under trust law, a trustee has a continuing duty to monitor trust investments and remove imprudent ones. This continuing duty exists separate and apart from the trustee’s duty to exercise prudence in selecting investments at the outset. The Bogert treatise states that “[t]he trustee cannot assume that if investments are legal and proper for retention at the beginning of the trust, or when purchased, they will remain so indefinitely.” A. Hess, G. Bogert, & G. Bogert, Law of Trusts and Trustees 684, pp.145–146 (3d ed. 2009) (Bogert 3d). Rather, the trustee must “systematic[ally] conside[r] all the investments of the trust at regular intervals” to ensure that they are appropriate. Bogert 3d §684, at 147–148;

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