Why the Supreme Court Should've Clarified ERISA's Breach of the Duty of Prudence Standard in Hughes v. Northwestern University

In Dudenhoeffer, the Supreme Court struck down the Moench presumption and held that a claim for breach of the duty of prudence owed to plan participants is subject to a heightened pleading standard.17 The Court held that a complaint must (1) offer some alternate legal course of action that the defendant could have taken and (2) that the alternative course of action must, from the perspective of a similarly situated "prudent fiduciary," be more likely to help the plan than the course of action that was actually taken.18 Because of its subjective nature, the second prong of the Dudenhoeffer test has proven to be a sticking point in achieving uniform application of the rule throughout the federal circuits. BACKGROUND A. Statutory Background The rapid and substantial growth of employee benefit plans in the years surrounding 1974 prompted Congress to pass ERISA.21 Because it was determined that such plans affect interstate commerce to a large extent, Congress found that ERISA was necessary to protect both interstate commerce and the employees engaged in such benefit plans.22 ERISA does so "by requiring the disclosure and reporting to participants and beneficiaries of financial and other information with respect thereto, by establishing standards of conduct, responsibility, and obligation for fiduciaries of employee benefit plans, and by providing for appropriate remedies, sanctions, and ready access to the Federal courts. "23 ERISA grants plan participants or beneficiaries a multitude of causes of action necessary for them to: recover for violations of the law; enforce terms of their plan; and provide other forms of relief.24 The most pervasive of these remedies include: (1) claims for the denial of benefits; (2) claims for breach of a fiduciary duty; (3) claims for appropriate equitable relief against non-fiduciaries to remedy violations of the act or a plan; (4) claims for interference with participants' or beneficiaries' exercise of ERISA rights; and (5) common law ERISA claims.25 ERISA also imposes various duties upon plan fiduciaries and allows participants or beneficiaries to bring civil actions for appropriate relief against fiduciaries who, pursuant to section 409 of ERISA, breach "any of the responsibilities, obligations, or duties imposed upon fiduciaries,"26 and states that: [No person] shall be personally liable to make good to such plan any losses to the plan resulting from each such breach, and to restore to such plan any profits of such fiduciary