Ninth Circuit Affirms Dismissal of ERISA Breach of Fiduciary Duty Claims Against Intel

In Anderson v. Intel Corp. Inv. Pol’y Comm., No. 22-16268, —F.4th—-, 2025 WL 1463295 (9th Cir. May 22, 2025), Plaintiff Winston Anderson, on behalf of a putative class, alleged that the fiduciaries of Intel Corporation’s retirement plans breached their duties of prudence and loyalty by investing in hedge funds and private equity funds, which Plaintiff claimed were imprudent and self-serving. The district court dismissed Plaintiff’s claim on the basis that he had not plausibly alleged a breach of the duty of prudence or duty of loyalty. The Ninth Circuit affirmed, finding that Plaintiff just presented “the potential for conflicts of interest, with nothing more.”

The court’s analysis focused on two main allegations: the breach of the duty of prudence and the breach of the duty of loyalty. Under ERISA, fiduciaries are required to act with the care, skill, prudence, and diligence that a prudent person would exercise. Anderson alleged that the allocation of assets to hedge funds and private equity was imprudent, as these investments underperformed compared to more traditional assets like stocks and bonds.

The court emphasized that ERISA’s prudence requirement is based on conduct rather than outcomes. To establish a breach of this duty, plaintiffs must show that the fiduciaries failed to employ appropriate methods in their investment decisions. Plaintiff’s claims were primarily circumstantial, relying on comparisons between Intel’s funds and other funds. However, the court found these comparisons inadequate because Anderson failed to provide a “meaningful benchmark” against which to measure the Intel funds. The court noted that Intel’s funds had specific risk-mitigation objectives, and Anderson’s comparisons to equity-heavy funds with different aims did not suffice to show imprudence.

Plaintiff argued that the district court impermissibly parsed his chosen comparators and improperly engaged in factfinding. The court disagreed. Plaintiff’s complaint explained the differences among target-date funds offered by different providers, so it was appropriate for the district court to consider those differences. Some analysis is appropriate even at the pleading stage particularly where ERISA requires plan administrators to make disclosures to plan participants, giving them the opportunity to find out how the fiduciary invested the plan assets. An ERISA plaintiff can use the available data about the selected funds circumstantial allegations about methods to show that a prudent fiduciary in a similar circumstance would have acted differently.

The court also addressed the duty of loyalty, which requires fiduciaries to act solely in the interest of plan participants and beneficiaries. Anderson claimed that Intel’s fiduciaries acted disloyally by favoring investments that benefited Intel Capital, Intel’s venture capital arm. However, the court found that Anderson’s allegations were speculative and lacked plausible evidence of actual conflicts of interest or self-dealing. Judge Berzon wrote a concurring opinion clarifying the role of comparisons and circumstantial allegations in duty-of-prudence claims.