Federal appeals court judges in Oakland, Calif., have rejected a petition for a rehearing from participants in a Chevron Corp. 401(k) plan who accused plan fiduciaries of offering "imprudent" investment options and of charging "unreasonable" administrative expenses.
The plaintiffs had asked for a rehearing among all judges of the 9th Circuit Court of Appeals, based in San Francisco, to review a Nov. 13 ruling by a three-judge appeals court panel favoring Chevron.
The appeals court upheld rulings by a federal District Court judge in Oakland, Calif. — once in August 2016 and again in June 2017 — who dismissed a lawsuit initially filed in February 2016.
On Jan. 3, three federal appeals court judges voted to deny the request for a rehearing en banc — a review by the full court — in the case of White et al. vs. Chevron Corp. et al. "The full court has been advised of the petition for rehearing en banc, and no judge has requested a vote on whether to rehear the matter en banc," the judges wrote. The participants had sought class-action status. They claimed that some funds in the Chevron plan's investment lineup had charged "unreasonably high" investment management fees among the six fiduciary breach claims.
The plaintiffs said the record keeper, Vanguard Group, charged excessive record-keeping fees, and they argued that Vanguard had a conflict of interest because it owned Chevron stock while also serving as the plan's record keeper.
In their Nov. 27 request for an appeals court rehearing, the plaintiffs argued that the three-judge panel imposed excessively strict standards in evaluating the District Court judge's dismissal of their complaints. The full court should have reviewed the case to overturn the "imposition of impermissibly strict pleading standards in this case," the plaintiffs wrote in their petition for a full-court hearing.
The Chevron Employee Savings Investment Plan, San Ramon, Calif., had assets of $19.94 billion as of Dec. 31, 2017, according to the latest 11-K filing.