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City of Farmington Hills Employees Retirement System v. Wells Fargo Bank, N.A.

United States District Court, Eighth Circuit

January 14, 2014

The City of Farmington Hills Employees Retirement System, The Board of Trustees of the Arizona State Carpenters Pension Trust Fund, and The Arizona State Carpenters Defined Contribution Trust Fund, individually and on behalf of all others similarly situated, Plaintiffs,
v.
Wells Fargo Bank, N.A., Defendant.

David M. Cialkowski, Esq., Carolyn G. Anderson, Esq., June Pineda Hoidal, Esq., and Brian C. Gudmundson, Esq., Zimmerman Reed, P.L.L.P.; and Peter A. Binkow, Esq., Kara M. Wolke, Esq., Kevin Ruf, Esq., Leanne E. Heine, Esq., Casey E. Sadler, Esq., Elizabeth M. Gonsiovowski, Esq., Jill Duerler, Esq., and Robin Bronzaft Howald, Esq., Glancy Binkow & Goldberg LLP; and Thomas C. Michaud, Esq., Vanoverbeke, Michaud & Timmony P.C.; and Christopher D. Kaye, Esq., E. Powell Miller, Esq., Jayson E. Blake, Esq., and Sharon S. Almonrode, Esq., The Miller Law Firm, P.C., counsel for Plaintiffs.

Bart H. Williams, Esq., Munger Tolles & Olson LLP; John N. Sellner, Esq., Justin H. Jenkins, Esq., Brooks F. Poley, Esq., William A. McNab, Esq., Winthrop & Weinstine, PA; Lawrence T. Hoffman, Esq., Richard M. Hagstrom, Esq., Rory D. Zamansky, Esq., Lindsey A. Davis, Esq., Daniel J. Millea, Esq., Michael R. Cashman, Esq., Zelle Hofmann Voelbel & Mason LLP; and Manuel F. Cachan, Esq., Munger Tolles & Olson LLP, counsel for Defendant.

MEMORANDUM OPINION AND ORDER

DONOVAN W. FRANK, District Judge.

INTRODUCTION

This matter is before the Court on Plaintiffs' Motion to File a Second Amended Complaint Pursuant to Rule 15 and to Add an Additional Class Representative Pursuant to Rule 23 of the Federal Rules of Civil Procedure (Doc. No. 387) and Wells Fargo Bank, N.A.'s Motion for Reconsideration on Decertification of the Separately Managed Accounts (Doc. No. 417). For the reasons set forth below, the Court grants in part and denies in part the motion to amend and denies the motion for reconsideration.

BACKGROUND

This case arises from the participation of the City of Farmington Hills Employees Retirement System ("CFHERS") and other similarly situated institutional investors (together, "Plaintiffs") in Wells Fargo Bank, N.A.'s ("Wells Fargo" or "Defendant") securities lending program ("SLP"). The factual background of this matter is laid out in detail in the Court's prior orders and is incorporated by reference herein. ( See, e.g., Doc. No. 386.)

On March 27, 2012, the Court granted Plaintiffs' motion for class certification with respect to the breach of fiduciary duty, breach of contract, and MCFA claims. (Doc. No. 120 at 19.) On September 17, 2013, the Court granted in part and denied in part the parties' respective motions for summary judgment, and decertified the class with respect to the ERISA Plaintiffs. (Doc. No. 386 at 32-34.) On October 11, 2013, the parties agreed to the filing of a second amended complaint. (Doc. Nos. 399 & 400.) Plaintiffs filed their Second Amended Class Action Complaint and Jury Trial Demand ("Second Amended Complaint") the same day. (Doc. No. 402 ("Second Am. Compl.").)

While the Second Amended Complaint includes the same six counts[1] as those asserted by CFHERS in the First Amended Complaint (Doc. No. 277 ("Am. Compl.")), the Second Amended Complaint includes two additional class representatives: (1) the Board of Trustees of the Arizona State Carpenters Pension Trust Fund; and (2) the Arizona State Carpenters Defined Contribution Trust Fund (together, the "Arizona Plaintiffs"). (Second Am. Compl. at 1.) All three named Plaintiffs assert their claims on behalf of themselves and the class, and the Arizona Plaintiffs also assert their claims on behalf of "all the ERISA entities that were decertified by the Court." (Second Am. Compl. ΒΆ 19.)

Plaintiffs now seek to amend their complaint and to add the Arizona Plaintiffs as class representatives. Wells Fargo also moves for reconsideration of the Court's certification of the class to include those six Plaintiffs who invested in Wells Fargo's "separately managed" accounts.

DISCUSSION

I. Motion to Amend

Plaintiffs seek leave to file a second amended complaint and to include additional class representatives. To the extent Plaintiffs have already filed their Second Amended Complaint, Defendant does not object. (Doc. No. 402 ("Second Am. Compl."); see Doc. No. 409 at 1 n.1 ("As filed, Plaintiffs' motion also sought permission to file a Second Amended Complaint.... Wells Fargo did not oppose Plaintiffs' filing of the Second Amended Complaint and that complaint has already been filed with the Court.").)[2] That is, insofar as Plaintiffs seek leave to file an amended complaint, Defendant does not oppose amendment, and the Second Amended Complaint has already been filed and docketed in this matter. In that regard, the motion is moot. At the heart of Plaintiffs' motion, however, is Plaintiffs' request to add additional class representatives and, therefore, to re-include the ERISA entities within the class. Defendant continues to oppose the appointment of additional class representatives.

In its prior order granting, in part, Defendant's motion for decertification, the Court excluded the, then, sixteen ERISA Plaintiffs from the class. (Doc. No. 386 at 32-33.) At that time, however, the Court expressed no opinion "as to whether the ERISA Plaintiffs may be properly joined in this matter in the event Plaintiffs were to further amend their complaint or add an additional class representative." ( Id. at 20.) Plaintiffs have now taken such action and assert that ...


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