In what looks to be a first in excessive fee litigation, a court has ordered plaintiffs to produce some Facebook posts.
In this excessive fee suit, the plaintiffs charge – as others have in similar actions – that the fiduciaries of the $5.1 billion Anthem 401(k) Plan (formerly the WellPoint 401(k) Retirement Savings Plan) breached their duties by causing the plan to pay excessive investment management and administrative fees and providing an imprudent money market fund.
The lawsuit, filed in late 2015 in the Southern District of Indiana, alleged that fiduciaries failed to leverage the plan’s size and economic clout to take advantage of lower-fee investment options, that Anthem failed to investigate and offer non-mutual fund investments, including collective trusts and separately managed accounts prior to 2013, and challenged Anthem’s decision to offer the Vanguard Prime Money Market Fund, described as “microscopically” low-yielding in the suit, rather than a stable value fund providing higher returns. Also at issue in the suit are the recordkeeping fees paid to Vanguard.
A little over a year ago, the fiduciary-defendants largely lost their attempt to dismiss charges in the suit brought by the St. Louis-based law firm of Schlichter, Bogard & Denton. Indeed, the only claim dismissed was that the defendants breached their fiduciary duty by providing and maintaining the Vanguard Prime Money Market Fund, while failing to prudently consider and make a reasoned decision regarding whether to use a stable value fund since, in the judge’s estimation, the plaintiff failed to meet their obligation to provide the factual grounds supporting his entitlement to relief – and, finding those missing, dismissed this claim.
Now the Anthem defendants (Bell v. Pension Comm. of ATH Holding Co., S.D. Ind., No. 1:15-cv-02062-TWP-MPB, order on defendants’ motion to compel production of certain documents 6/14/18) have petitioned the court to compel plaintiff Janice Grider to produce: (1) a Facebook private message string between her and plaintiff Cindy Prokish; and (2) a Facebook post from July 2015 capturing a screenshot related to an attorney seeking members of the Anthem 401(k) Plan. The defendants argued that Grider testified during her deposition that she had a private Facebook messaging exchange with Prokish regarding depositions and that Grider also testified to publishing a post on her Facebook page related to this litigation.
In the case of the former, Bloomberg Law reports that those Facebook private messages discussed the participant’s emotional status over her upcoming deposition, a future meeting with the attorneys, and that she wanted to be a “good representative."
In reviewing the petition, Magistrate Judge Matthew P. Brookman of the U.S. District Court for the Southern District of Indiana concluded that the plaintiffs provided “no evidence or specific argument as to the burden of retrieval,” whereas the defendants “provided the requisite showing contemplated by the Discovery Order that the particular need for these Facebook communications justifies the burden of preservation and retrieval.” He further commented that while the “ultimate relevance of Grider’s and Prokish’s 'jibber jabber' prior to the depositions may be minimal, this is enough when the court compares it to the “minimal burden of preservation and retrieval that has been established by the current record before the Court.”
As for arguments that the messaging dealt with strategy (a.k.a. “work product”), Judge Brookman was “…unconvinced that the messages dealt with the litigation strategies as opposed to merely factual information,” going on to note that plaintiff Grider “testified that they discussed when there depositions were to occur, that Prokish was to meet with the attorneys, and ‘jibber jabber’ about being a little nervous, wanting the deposition over with, and wanting to be a good representative,” and that “without more, the Court cannot conclude that the Facebook private message communications are protected by the work product doctrine given that there is no evidence that the communication related to the legal strategies, theories, and mental impressions related to the furtherance of Plaintiffs’ case. Instead, based on the testimony provided it appears that the Facebook private message was a general, factual communication between the two Plaintiffs.”
Brookman, however, denied Anthem’s request to compel the participant to produce the 2015 Facebook post which allegedly captured a screenshot related to an attorney seeking members of Anthem’s 401(k) plan to be lead plaintiff in a proposed class action. Judge Brookman noted that Grider also testified that there may have been some responses to the post, “but that is it,” that the defendants “provide no response to this argument,” and that therefore, “on its face, the Court does not see the relevancy of Grider’s 2015 Facebook post of a snapshot of an attorney inquiry she had read a few times regarding the 401(k) nor, without a more detailed explanation, the relevancy of a few comments back and forth about the snapshot.” Finding that the defendants had not met their initial burden of establishing relevancy of the 2015 Facebook post, he denied the request.