only require an assertion that the basis was inaccurate or flawed, not that it was
fraudulent. E.g., Chao, 285 F.3d at 434.
In other words, the mere allegations that fiduciaries imprudently used or
supplied inaccurate data in their overvaluation is separate and independent from
allegations that fraud created the underlying inaccuracies.
1
The Court may assess
the plausibility of the former without considering the allegations of fraudulent
conduct. In fact, a central obligation of an ESOP fiduciary tasked with
determining the fair market value of privately held stock is to “provide [the
ESOP’s appraiser] with complete and accurate information.” Hall Holding Co.,
285 F.3d at 430; Leckey v. Stefano, 501 F.3d 212, 225 (3d Cir. 2007); Perez v.
Bruister, 823 F.3d 250, 263 (5th Cir. 2016); Keach v. U.S. Tr. Co., 419 F.3d 626,
637 (7th Cir. 2005); see also Martin v. Feilen, 965 F.2d 660, 666-68 (8th Cir.
1992) (recognizing the breach as failing to correct the impairment or
1
Here, the complaint alleges the Trustees breached their fiduciary duties by
“overvalu[ing] Lifetouch stock on the June 30, 2015 and June 30, 2016 fair
market value determination dates.” Am. Compl. ¶¶ 56, 62 (“The Trustee[s]
should not have overvalued Lifetouch stock in the first place.”). “The Trustee[s’]
improper valuation of Lifetouch stock in 2015 and 2016 harmed Plan
participants . . . . Because the shares were overvalued by the Trustee[s], the
contribution that Lifetouch made to the Plan in those years was not able to
purchase as many shares of Lifetouch stock, which resulted in fewer shares of
stock available to distribute to Plan participant accounts.” Am. Compl. ¶ 60. The
Participants alleged that “[h]ad the Trustee[s] properly utilized the extensive
professional resources available for determining the value of Lifetouch stock,
perhaps the stock price would not have been so grossly overvalued in 2015 and
2016.” Am. Compl. ¶ 57.
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