Summary of the Lawsuit

This lawsuit, James J. Thole et al. v. U.S. Bank NA et al. (D. Minn.), alleges that Defendants caused the U.S. Bancorp Pension Plan (the “Plan”) to engage in an imprudently and excessively risky investment strategy by investing approximately 100% of its assets in one asset class, equities.  In particular, Plaintiffs allege that this investment strategy caused the Plan to lose $1.1 billion in 2008, bringing the Plan from being 144% funded at the end of 2007 to being 84% funded at the end of 2008, thereby jeopardizing the retirement benefits of the Plan’s participants and beneficiaries.

The case – named one of Law360’s “ERISA Cases to Watch in 2019” – is scheduled to be argued before the U.S. Supreme Court during its 2019 autumn term.

Summary of the Claims

Plaintiffs allege that Defendants breached the fiduciary duties they owed to the Plan and Plan participants by causing or permitting the Plan to invest almost 100% of its assets in equities, either in direct stock holdings or through mutual funds managed by the U.S. Bancorp subsidiary FAF Advisors, a strategy that failed to safeguard principal through proper risk management and diversification of asset classes.  Plaintiffs also allege that the Compensation Committee Defendants and the Investment Committee Defendants failed to monitor adequately the Plan’s investments and failed to take appropriate steps to remove the Plan’s Investment Manager, FAF Advisors, which was a subsidiary of U.S. Bancorp.  Additionally, Plaintiffs allege that this Investment Strategy served the company and the Defendants’ own interests to the detriment of the Plan and its participants.  Plaintiffs further allege that Defendants knew or should have known that this investment strategy was neither prudent nor in the best interests of the participants and beneficiaries of the Plan.

Plaintiff brings this action to recover losses to the Plan for which Defendants are personally liable, to disgorge any unjust profits received by certain Defendants, and for such other equitable relief against the Defendants as may be appropriate including, without limitation, injunctive relief, a court-appointed fiduciary, constructive trust, restitution, equitable tracing, and other monetary relief to make the Plan whole.

Class Action Allegations

This lawsuit is brought on behalf of the following persons:  All participants who were vested in accrued benefits in the Plan from September 30, 2007 to December 31, 2010 and their beneficiaries.  Excluded from the Class are Defendants and members of their immediate families or any of their heirs, successors, or assigns.

Status of the Litigation

Plaintiff filed the Complaint on September 30, 2013 in the United States District Court for the District of Minnesota.  After being appointed Interim Co-Lead Counsel, Plaintiffs’ counsel filed a Consolidated Amended Class Action Complaint on March 20, 2014 (“Amended Complaint”).  On April 11, 2014,  Defendant Nuveen Asset Management, LLC and the U.S. Bank Defendants both filed motions to dismiss.  On November 21, 2014, the Court granted in part and denied in part Defendants’ Motion to Dismiss the Consolidated Complaint and also granted Defendants’ summary judgment motion with respect to the Securities Lending Program claims. Defendants filed an Answer to the Amended Complaint on December 19, 2014. Plaintiffs filed a letter to request permission to file a Motion to Reconsider the Court’s November 21, 2014 order on December 23, 2014. The Court denied the request in an Order issued on January 8, 2015. 

Defendants filed a Motion to Dismiss for Lack of Jurisdiction on August 19, 2015. Plaintiffs opposed the Motion in a brief filed on October 5, 2015. A reply to Plaintiffs’ Opposition to the Motion to Dismiss was filed by Defendants on October 19, 2015. The Court held Oral Argument on the Motion on November 9, 2015 and the Motion is currently pending before the Court.

The case is currently before the U.S. Supreme Court (James J. Thole et al. v. U.S. Bank NA et al., Case No. 17-1712, U.S. Supreme Court). The Court is reviewing Plaintiffs’ petition for a writ of certiorari (supported by an amicus brief from the U.S. Solicitor General, filed September 18, 2019) asking the Court to overturn the Eighth Circuit’s decision upholding a lower court’s ruling to dismiss the lawsuit on standing grounds because – over the course of the litigation – the Plan Sponsor made voluntary contributions to cause the Plan to become overfunded (i.e., where the Plan trust held more money than it needed to cover its existing obligations).

Whom to Contact for More Information

If you are a member of the proposed class or you have information which might assist us in the prosecution of these allegations, please contact one of the following persons:

Michelle C. Yau, Esq. 
Mary J. Bortscheller, Esq. 
Dirk Hamel, Paralegal,

Cohen Milstein Sellers & Toll PLLC
1100 New York Avenue, N.W., Suite 500
Washington, D.C. 20005
Telephone:  888-240-0775 (Toll Free) or 202-408-4600