Pfeil explained, plaintiffs need only allege a fiduciary breach and a
causal connection to losses suffered by the plan, which the court determined
the plaintiffs in the Fifth Third suit have done. John Dudenhoefer and Alireza
Partovipanah, former employees of Fifth Third Bank, allege that
Fifth Third engaged in lending practices that were equivalent to
participation in the subprime lending market that they were aware of the risks
of such investments by the start of the class period, and that such risks made
Fifth Third Stock an imprudent investment. The plaintiffs allege the price of
Fifth Third Stock dropped 74% during the class period.
Amended Complaint also expressly alleges that “[a]n adequate (or even cursory)
investigation would have revealed to a reasonable fiduciary that investment by
the Plan in Fifth Third Stock was clearly imprudent. A prudent fiduciary acting
under similar circumstances would have acted to protect participants against
unnecessary losses, and would have made different investment decisions.”
The opinion in Dodenhoefer v.
Fifth Third Bank is here.