Motions for summary judgment from both parties in a case alleging T. Rowe Price engaged in self-dealing and prohibited transactions in violation of the Employee Retirement Income Security Act (ERISA) have been mostly denied by a federal judge.

Chief Judge James K. Bredar of the U.S. District Court for the District of Maryland previously found all claims were plausible when ruling on a motion to dismiss by the defendants in the suit. Likewise, when ruling on the motions for summary judgment, Bredar found factual disputes exist for the lawsuit to proceed to trial.

Bredar said he “does not see the sort of egregious improprieties that would support the nine-figure damages award plaintiffs seek.” He noted that although the defendants showed a preference for using in-house funds in T. Rowe Price’s 401(k) plan, those funds have generally performed well and “the fees the plaintiffs characterized as highly exceptional in their pleadings were mid-market for peer group investment vehicles.” He added that the “evidence does not conform with plaintiffs’ allegations of shocking and pervasive mismanagement.”

However, Bredar pointed out that on summary judgment, the plaintiffs “need only produce evidence that, if accredited, would be sufficient for a fact-finder to surmise that defendants took some unlawful actions and thereby caused plaintiffs at least some harm.” Bredar admitted that he deems total victory as “improbable,” and recovery on the scale suggested by plaintiffs as “highly improbable,” but he conceded that the plaintiffs have “largely cleared the low bar that avoids summary judgment in favor of their opponent. Accordingly, they are entitled to proceed to trial.”

Bredar denied both sides’ motions for summary judgment for all claims except for one. He said the defendants were entitled to summary judgment on the plaintiffs’ claim that the T. Rowe Price investment affiliates breached their fiduciary duties by providing “self-interested and imprudent investment advice” to the plan’s trustees. He agreed with the defendants that there is “no evidence that T. Rowe Price’s subsidiaries provided any ‘investment advice’ at all to the trustees,” noting that employees of the T. Rowe Price affiliates merely “supplied the trustees with objective information about T. Rowe Price funds,” which does not qualify as providing “investment advice” under ERISA.

In his memorandum opinion, Bredar discussed rulings of law about ERISA prohibited transactions and prohibited transaction exemptions (PTEs) which, he said, “will provide the framework in which the arguments and evidence will be considered.”

He further suggested: “At trial, plaintiffs will need to identify specific transactions that run afoul of one or more of the [ERISA] Section 1106 prohibitions. Defendants will then have the opportunity to prove that some affirmative defense—whether PTE 77-3, the statute of repose, Section 1108(b)(8), or another Section 1108(b) exemption—protects them from liability for each transaction.”