The U.S. Supreme Court recently declined to grant certiorari to review the Fourth Circuit’s decision in RJR Pension Investment, et al. v. Tatum, 761 F.3d 363 (4th Cir. 2014). As we previously reported here, a divided panel of the Fourth Circuit held that, because the plaintiff proved that the plan fiduciaries acted imprudently by liquidating the stock fund without the benefit of a proper investigation, the burden of proof shifted to defendants to show that a prudent fiduciary would have made the same decision. In so ruling, the Court reversed the lower court decision, which had found in favor of defendants because they demonstrated that a prudent fiduciary could have made the same decision. Defendants asked the Supreme Court to review: (1) whether the Fourth Circuit properly concluded that the burden of proving loss causation shifts to defendants upon a showing a imprudence, and (2) if the burden does shift, whether an ERISA fiduciary can be held liable despite a finding that the challenged investment decision was ultimately objectively prudent, i.e. that a prudent fiduciary could have made the same decision. The Court’s order denying certiorari may be found at RJR Pension Investment, et al. v. Tatum, No. 14-656, 2015 WL 2473481 (Jun. 29, 2015).
