Waller

Plaintiffs-appellants brought this action under the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001 et. seq. (“ERISA”), alleging that defendants-appel-lees breached their fiduciary duty to the plan by imprudently choosing annuity providers to cover plan liabilities as part of terminating plaintiffs’ plan. Without opinion, the district court granted defendants’ motion to dismiss the Second Amended Complaint for failure to state a claim. We have jurisdiction pursuant to 28 U.S.C. § 1291 . We affirm in part and reverse in part.

I

FACTS AND PROCEDURAL HISTORY

In 1986 Blue Cross of California (“Blue Cross”) terminated its retirement plan (the “Retirement Plan” or “Plan”) by using approximately $62 million of the Plan’s assets to purchase annuities for Plan participants and beneficiaries from Executive Life Insurance Company (“Executive Life”) and Provident National Assurance Company (“Provident”). 1 After purchasing the annuities, Blue Cross obtained a reversion of the residual assets, totalling approximately $32 million.

Plaintiffs represent participants and beneficiaries who are eligible (or will become eligible) to receive retirement benefits from the…