OPINION
M. SMITH, Circuit Judge:
FACTS AND PRIOR PROCEEDINGS
Edison sponsors a defíned-contribution 401(k) Savings Plan (Plan), wherein “participants’ retirement benefits are limited to the value of their own individual investment accounts, which is determined by the market performance of employee and employer contributions, less expenses.”
Tibble v. Edison Int’l,
— U.S. —, 135 S.Ct. 1823, 1826, 191 L.Ed.2d 795 (2015)
(Tibbie IV).
“Expenses, such as management or administrative fees, can sometimes significantly reduce the value of an account in a defined-contribution plan.”
Id.
In 2007, plaintiffs-appellants (beneficiaries) brought this action against Edison and the other defendants (collectively, Edison).-' The district court ‘denied the beneficiaries’ motion for partial summary judgment, and partially granted Edison’s summary judgment motion.
Tibble v. Edison Int’l,
639 F.Supp.2d 1074, 1080 (C.D. Cal. 2009)
(Tibbie I).
This appeal concerns a claim that survived summary judgment; namely, that Edison breached its fiduciary duties by offering “higher priced retail-class mutual funds as Plan investments When materially identical lower priced institutional-class mutual funds were available (the lower price reflects lower administrative costs).”
Tibble IV,
135 S.Ct. at 1826.
The Plan is governed by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001-1461. The relevant ERISA statute of limitations is six years, 29 U.S.C. § 1113(1), and at least three of the disputed funds were added more than six years before the complaint was filed.
Tibbie TV,
135 S.Ct. at 1826. The district court allowed the beneficiaries to present evidence that their claims concerning those funds were timely because Edison, within the six-year limitations period, “fail[ed] to convert the retail shares to institutional shares upon the occurrence of certain ‘triggering events’ ” that should have prompted a full due-diligence review.
Tibble v, Edison Int’l,
No. CV 07-5359 SVW (AGRx), 2010 WL 2757153, at *31, 2010 U.S. Dist. LEXIS 69119, at *99 (C.D. Cal. July 8, 2010)
(Tibble II).
After a bench trial, the district court ruled for the beneficiaries on the retail-class funds selected within the six-year period, because Edison did “not offer[] any credible explanation for why the retail share classes were selected instead of the institutional share classes,” and “a prudent fiduciary acting in a like capacity would
have invested in the institutional share classes.”
Id.
at *30, 2010. U.S. Dist. LEXIS 69119, at *98. Indeed, the court held that there was
“no evidence
that [Edison] even considered or evaluated the different, share classes” when the funds were added.
Id.
at *25, 2010 U.S. Dist. LEXIS 69119, at *81 (emphasis in original).
As to the funds initially selected before the statute of limitations, the district court held that the “triggering events” proffered by the beneficiaries for -two of the funds— a name change because of a partial change in ownership of a sub-advisor, and a name change related to a years-old ownership change — were insufficient to trigger a full diligence review, and that a change in strategy in a third fund — from small-cap to mid-cap — triggered a review to which Edison responded adequately by adding another small-cap option.
Id.
at *31-38, 2010 U.S. Dist. LEXIS 69119, at 102-07.
On appeal to our court, the beneficiaries argued that the district court should have allowed them to prove their claims concerning funds selected before the l’elevant six-year period.
Tibble v. Edison Int’l,
729 F.3d 1110, 1119 (9th Cir. 2013)
(Tibbie III), vacated,
— U.S. —, 135 S.Ct. 1823, 1829, 191 L.Ed.2d 795 (2015). In response, Edison acknowledged that it had a duty to monitor the funds for changed circumstances that would make the investment no longer prudent, but argued that the beneficiaries did not show sufficiently changed circumstances.' Our vacated decision accepted Edison’s contention, and noted that “the district court was entirely correct to have entertained” the possibility of changed circumstances, and correct to have found the circumstances insufficient to trigger a response by Edison.
Id.
at 1120. We thus concluded that any theory of a duty absent changed circumstances amounted to a continuing violation theory that we declined to read into the ERISA statute of limitations.
Id.
at 1119-20.
Plaintiffs successfully petitioned for cer-tiorari, and the Supreme Court reversed our decision concerning the statute of limitations, holding that regardless of when an investment was initially selected, “a fiduciary’s allegedly imprudent retention of an investment” is an event that triggers a new statute of limitations period.
Tibble IV,
135 S.Ct. at 1826, 1828-29. The Court specifically rejected “the conclusion that
only
a significant change in circumstances could engender a new breach of a fiduciary duty.”
Id.
at 1827. We were cautioned against “applying a statutory bar to a claim of a ‘breach or violation’ of a fiduciary duty without considering the nature of the fiduciary duty,” and told to “recognize that under trust law a fiduciary is required to conduct a regular review of its investment with the nature and timing of the review contingent on the circumstances.”
Id.
at 1827-28. The Court instructed us to decide “the scope of [Edison’s] fiduciary duty” to monitor investments.
Id.
at 1829.
The Court also left to us on remand “any questions of forfeiture,” acknowledging Edison’s contention that the beneficiaries “did not raise the claim below that [Edison] committed new breaches of the duty of prudence by failing to monitor their investments and remove imprudent ones absent a significant change in circumstances.”
Id.
A panel of our court in
Tibble v. Edison International,
820 F.3d 1041, 1048 (9th Cir. 2016)
(Tibbie V),
concluded that the issue was forfeited. We then ordered that the case be reheard en banc, so the panel’s decision in
Tibbie V
is vacated.
Tibble v. Edison Int’l,
831 F.3d 1262 (9th Cir. 2016).
For the reasons discussed below, we vacate the district, court’s decisions concerning the funds added to the Plan before 2001, and remand for trial on an open record on the claim that, regardless; of whether there was a significant change in
circumstances, Edison should have switched from retail-class fund shares to institutional-class fund shares to fulfill its continuing duty to monitor the appropriateness of the trust investments. We also encourage the district court to reevaluate its fee determination in light of the Supreme Court’s decision, and our decision en banc.
JURISDICTION AND STANDARD OF REVIEW
We have jurisdiction pursuant to 28 U.S.C. § 1291; We review summary judgment determinations
de novo. Szajer v. City of Los Angeles,
632 F.3d 607, 610 (9th Cir. 2011).
ANALYSIS
I. Applicable Law
The applicable statute of limitations in this case is the six-year limit of 29 U.S.C. § 1113(1)(A), which states that “[n]o action may be commenced ... with respect to a fiduciary’s breach of any responsibility, duty, or obligation ... six years after [] the date of the last action which constituted a part of the breach or violation.” As the Supreme Court noted in
Tibbie TV,
under this statute only a “breach or violation,” not an original investment decision, need occur to start the six-year statutory period. 135 S.Ct. at 1827.
Generally, we do not “entertain[ ] arguments on appeal that were not presented or developed before the district court.”
Visendi v. Bank of Am., N.A.,
733 F.3d 863, 869 (9th Cir. 2013). “Although no bright line rule exists to determine whether a matter [h]as been properly raised below, an- issue will generally be deemed waived on appeal if the argument was not raised sufficiently for the trial court to rule on it.”
In re Mercury Interactive Corp. See. Litig.,
618 F.3d 988, 992 (9th Cir. 2010) (internal quotation marks omitted).
II, Forfeiture
Before addressing the statute of limitations and ERISA-trust law issues remanded to us by the Supreme Court, we address Edison’s claims that the issues presently on appeal have been forfeited by the beneficiaries. We conclude that the beneficiaries did not forfeit their failure-to-monitor argument in either the district court or on appeal. Instead, we conclude that Edisou itself forfeited the.forfeiture argument .in its initial appeal.
A. There Was No Forfeiture by the Beneficiaries on Appeal
We begin with the appeal. The beneficiaries argued in their opening brief that:
Defendants had a continuing duty to ensure that each of the Plans’ investment options was and remained prudent and had , reasonable expenses. Merely because they allowed an imprudent fund into the Plan at one point does not mean Defendants could just leave it in the Plan forever. Within six years prior to the commencement of this action, Defendants could have switched the Plan out of the retail shares and into the institutional shares of three excluded mutual funds and saved the Plan millions in unnecessary fees.
Similarly, the beneficiaries argued:
At any time in that six-year period Defendants could have switched from retail
to institutional class shares. Their failure to do so caused the Plan to pay unnecessary, retail fees in each of those six years. Therefore, the “last action which constituted a part of the
breach”
— using retail class shares — occurred within six years and the “latest date on which the fiduciary could have cured the breach”— replacing retail with institutional shares — also occurred within six years.
And, the beneficiaries argued that “[f]und fiduciaries ... were under a continuing obligation to advise the Fund to divest itself of unlawful or imprudent investments.” (Citing
Buccino v. Cont’l Assurance Co.,
578 F.Supp. 1518, 1521 (S.D.N.Y. 1983)).
Thus, the beneficiaries argued on appeal for an ongoing duty to monitor investments and to remove imprudent investments — a duty that was not limited to “changed circumstances.” The theory was simply that: “[i]n light of the continuing duty of prudence imposed on plan fiduciaries by ERISA, each failure to exercise prudence constitutes a new breach of duty, that is to say, a new claim”— squarely embracing the theory accepted by the Supreme Court.
See Tibble IV,
135 S.Ct, at 1829. In response, Edison argued for a duty that was limited to changed circumstances: “Plan fiduciaries do have a continuing duty under ERISA to monitor investment options for changed circumstances rendering a once-prudent investment now imprudent, but plaintiffs here allege no changed circumstances.” The
Tibble III
panel accepted Edison’s limiting theory, but the Supreme Court rejected it. The claim was not forfeited on appeal.
B. There Was No Forfeiture by the Beneficiaries in the District Court
Nor did the beneficiaries forfeit their claim in the district court. Edison’s post-trial briefing stated:
The. Court expressly held. in its first summary judgment ruling that plaintiffs could not revisit the prudence of selecting mutual funds that became part of the Plan’s investment lineup more than six years prior to the filing of the Complaint,
By challenging the prudence of maintaining retail share classes
of the three “name change” funds, plaintiffs have done what the Court has forbidden, by attempting to resurrect claims that were properly held barred by the six-year statute of limitations.
(Emphasis added and citation omitted). Given this contemporaneous statement that any claim challenging the prudence of maintaining retail share classes first selected before the limitations period had been rejected on summary judgment, it is hard to see how Edison can now argue that the beneficiaries forfeited the argument by not presenting “any evidence establishing that a prudent fiduciary would have identified the alleged share-class issue during regular, periodic reviews.”
Simply put, the district court held at summary judgment that because “the initial decision to add retail mutual funds” was made outside of the six-year limitations period, “the prudence claims arising out of these decisions are barred by the statute . of limitations.”
Tibble I,
639 F.Supp.2d at 1120. And, the district court
stated in its trial decision: “three funds were added to the Plan before the statute of limitations period;
thus,
Plaintiffs challenged the failure to switch to an institutional share class upon the occurrence of certain significant events within the limitations period.”
Tibble II,
2010 WL 2757153, at *2, 2010 U.S. Dist. LEXIS 69119 at *7 (emphasis added). The district court used the causal “thus” to describe why Plaintiffs relied on a “significant changes theory”: because prudence claims' arising out of the initial selection were outside the statute of limitations, and barred by the summary judgment order (absent changed circumstances).
Edison also pointed to the district court’s questioning of the beneficiaries’ expert, Dr. Steven Pomerantz, who attempted to identify changed circumstances that would have triggered a duty to switch the share class, such that the claim would not be barred by the district court’s statute of limitations ruling. In conversation with Pomerantz, the district court said that it did not understand the connection between a name change of a fund and whether Edison should have switched to institutional class shares, and asked whether Edison should have removed the funds even without a name change. The court asked: “[w]ould you contend ... that during the relevant time period due diligence would have required the plan to nevertheless buy an institutional share class, all things being equal, assuming the institutional share class had a lower.fee?” Pomerantz mostly stuck to his significant changes theory in response. Edison .argued that this exchange showed that the district court did not forbid a duty-to-monitor claim; indeed, according to Edison, the district court
“invited
Pomerantz to make [a duty-to-monitor claim] :.., but he refused to agree,” sticking to the significant changes theory.
It is certainly possible that the district court had forgotten a portion of its voluminous summary judgment ruling, and was at that time open to a theory imposing a continuing duty in the absence of “changed circumstances.” Or it could be, as the beneficiaries suggest, that the district court was checking to see whether the theory Pomerantz was articulating was in substance the same as the theory the district court had excluded. It does not matter which interpretation is correct, because
neither shows forfeiture.
Whatever the intent behind the district court’s hypothetical questions to an expert, they did not constitute a change in its earlier ruling sufficient to put the beneficiaries on notice that- they could then, contrary to the court’s earlier ruling, put on evidence to prove their preferred continuing duty theory.
Finally, Edison emphasizes that the district court allowed the beneficiaries to put on a continuing duty case concerning a different investment, the Money Market Fund.
See Tibble II,
2010 WL 2757153, at *33-37 2010 U.S. Dist. LEXIS 69119 at *108-21. It is true that the claims have much in common, and it is not clear why the district court provided a distinct treatment of the Money Market Fund. Perhaps it was because Edison continued to negotiate the rate for the fund throughout the period at issue, while Edison employed a “set it and forget it” approach with the mutual funds. Whatever the reason, that the district court allowed a similar claim as to .the Money Market Fund simply does not show that, contrary to both sides’ .understanding, the beneficiaries were allowed to put on a monitor-and-remove-absent-significant-changed-circumstances theory concerning the mutual funds.
Because the beneficiaries — and Edison — reasonably believed that the district court’s summary judgment order precluded the duty to monitor claim, and because the beneficiaries preserved the claim on appeal, it has not been forfeited.
C. Edison’s Own Forfeiture
The beneficiaries argue that Edison forfeited its forfeiture argument by failing to raise it in the initial appeal. Edison did not argue forfeiture in the initial appeal consistent with its understanding, as expressed in its post-trial motion, that the district court’s summary judgment ruling barred claims relating to the funds first selected before 2001.
Edison argues that it did not raise forfeiture because the beneficiaries did not articulate their continuing duty theory before they submitted their Supreme Court briefing. However, as discussed above, the beneficiaries raised the continuing duty argument in their opening brief on appeal, Edison therefore forfeited any potential forfeiture response to that argument. And, even at.the Supreme Court, where the beneficiaries clearly presented their continuing duty argument in their petition for certiorari, Edison responded not that the beneficiaries had forfeited that claim, but instead, that a fiduciary only has a “duty to monitor for material changes in circumstances.” (Emphasis omitted).
Ill,
Phillips
Does Not Bar the Beneficiaries’ Claim
In
Phillips v. Alaska Hotel and Restaurant Employees Pension Fund,
944 F.2d 509, 520-21 (9th Cir. 1991), we held-that the limitations period under a different subsection of the ERISA statute of limitations, 29 U.S.C. § 1113(2), begins when a plaintiff has
actual knowledge
of a breach. When there is “a series of discrete but related breaches” because a fiduciary violated a continuing duty over time, the § 1113(2) limitations period does not begin anew with each related breach.
Id.
Phillips
followed the plain language of the statute: § 1113(2) provides that the plaintiffs “actual knowledge' of the breach” is measured from “three years after the earliest date” of such knowledge. “Once a plaintiff knew of one breach, an awareness of later breaches [of the same character] would impart nothing materially new,” and applying a “continuing violation theory [would] essentially - read[ ] the ‘actual knowledge’ standard out of [§ 1113(2)].”
Phillips,
944 F.2d at 520. Thus, we held that “[t]he earliest date on which a plaintiff became aware of any breach ... start[s] the limitation period of § 1113[ ](2)
running.”
Id.
The district court in
Tibble I
misunderstood
Phillips
to stand for the broad proposition that “[t]here is no ‘continuing violation’ theory to claims subject to ERISA’s statute of limitations.”
Tibble I,
639 F.Supp.2d at 1086. However,
Phillips
did not reject a continuing violation theory for the ERISA statute of limitations generally; it merely held that, for claims subject to § 1113(2), the earliest date of actual knowledge of a breach begins the limitations period, even if the breach continues. When a plaintiff has actual knowledge of a breach, § 1113(2) operates to keep her from sitting on her rights and allowing the series of related breaches to continue. However, when a plaintiff does not have actual knowledge of a breach of a continuing duty and § 1113(1) applies, the rationale for
Phillips’
continuing duty limit on § 1113(2) is no longer relevant. Thus, we hold that
Phillips
is inapplicable to the continuing duty claims at issue here, namely to 29 U.S.C. § 1113(1).
The Supreme Court held that the fiduciary duty identified in this case is continuing in nature, and that-each new breach begins a six-year limitations period under § 1113(1). The Court recognized the breach as “a fiduciary’s allegedly imprudent
retention
of an investment” which results in a series of related breaches as the investment is retained over time.
Tibble IV,
135 S.Ct. at 1826, 1828-29 (emphasis added). As the Court made clear, only a “breach or violation,” such as a fiduciary’s failure to conduct its required regular review of Plan investments, need occur within the six-year statutory period; the initial investment need not be made within the statutory period.
Id.
at 1827-28.
IV. ERISA and Analogous Trust Law
The Supreme Court tasked us with resolving "the scope of [Edison’s] fiduciary duty” to monitor investments, while “recognizing the importance of analogous trust law.”
Id,
at 1829. Edison’s fiduciary duty arises from ERISA, “a comprehensive statute designed to promote the interests of employees and their beneficiaries in employee benefit plans.”
Shaw v. Delta Air
Lines,
Inc.,
463 U.S. 85, 90, 103 S.Ct. 2890, 77 L.Ed.2d 490 (1983). “An ERISA fiduciary must discharge his responsibility ‘with the care, skill, prudence, and diligence’ that a prudent person ‘acting in a like capacity and familiar with such matters’ would use.”
Tibble IV,
135 S.Ct. at 1828 (quoting 29 U.S.C. § 1104(a)(1)). “These duties are the highest known to the law.”
Howard v. Shay,
100 F.3d 1484, 1488 (9th Cir. 1996) (internal quotation marks omitted). “To enforce, them, the court focuses not only on the merits of the transaction, but also on the thoroughness of the investigation into the merits of the transaction.”
Id.
ERISA fiduciary duties are derived from the common law of trusts, so “courts' often must look to the law of trusts” to “determin[e] .the contours of an ERISA fiduciary’s duty.”
Tibble IV,
135 S.Ct. at 1828. “Under trust law, a trustee has a continuing duty to monitor trust investments and remove imprudent ones .., separate and apart from the trustee’s duty to exercise prudence in selecting investments at the outset.”
Id.
“[A] trustee cannot assume that if investments are legal and proper for retention at the beginning of the trust, or when purchased, they will remain so indefinitely.”
Id.
(quoting A. Hess, G. Bogert
&
G. Bogert, Law of Trusts and Trustees § 684, 145-46 (3d ed. 2009) [hereinafter Bogert 3d]). “Rather, the trustee must ‘systematically] conside[r] all the investments of the trust at regular intervals’"to ensure that they are appropriate;”
Id.
(quoting Bogert 3d § 684, at 147-48). In fulfilling his duties, a trustee is held to “the prudent investor rule,” which requires that he “invest and manage trust assets as a prudent investor would”; that is, by “exercising] reasonable care, skill, and caution,” and by “reevaluat[ing] the trust’s investments periodically as conditions change.” Bogert 3d § 684.
Additionally, pursuant to the Restatement (Third) of Trusts, a trustee is to “incur only costs that are reasonable in amount and appropriate .to the investment responsibilities of the trusteeship.” Restatement (Third) of Trusts § 90(c)(3);
see also id.
§ 88. The Restatement further instructs that “cost-conscious management is fundamental to prudence in the invest
ment function,” and should be applied “not only in making investments but also in monitoring and reviewing investments.”
Id.
§ 90, cmt. b;
see also id.
§ 88, cmt. a (“Implicit in a trustee’s fiduciary duties is a duty to be cost-conscious.”);
Donahue v. Donahue,
182 Cal.App.4th 259, 273, 105 Cal.Rptr.3d 723 (2010) (reversing and remanding an award for attorneys’ fees incurred by a trustee because the trial court did not consider whether the trustee fulfilled his duty to be cost-conscious in incurring the fees). As the Uniform Prudent Investor Act observes: “Wasting beneficiaries’ money is imprudent. In devising and implementing strategies for the investment and management of trust assets, trustees are obliged to minimize costs.” Unif. Prudent Investor Act § 7.
It is beyond dispute that the higher the fees charged to a beneficiary, the more the beneficiary’s investment shrinks. As a simple example, if a beneficiary invested $10,000, the investment grew at a rate of 7% a year for 40 years, and the fund charged 1% in fees each year,
at the end of the 40-year period the beneficiary’s investment would be worth $100,175. If the fees were raised to 1.18%, or 1.4%,
the value of. the investment at the end of the 40-year period would decrease to $93,142 and $85,198, respectively. Beneficiaries subject to higher fees for materially identical funds lose not only the money spent on higher fees, but also “lost investment opportunity”; that is, the money that the portion of their investment spent on unnecessary fees would have earned over time.
Tibble II,
2010 WL 2757153, at *37-38, 2010 U.S. Dist. LEXIS 69119, at *124-25. Pursuant to the aforementioned trust law principles, a trustee cannot ignore the power the trust wields to obtain favorable investment products, particularly when those products are substantially identical — other than their lower cost — to products the trustee has already selected.
The beneficiaries request “a new trial on the issue of whether [Edison] breached [its] fiduciary duties by providing as Plan investments during the limitations period mutual funds in a share class that was more expensive than other share classes that were available to the Plan.” (Citing
Lam v. Univ. Of Haw.,
40 F.3d 1551, 1554-55, 1566-67 (9th Cir. 1994) (remanding for trial after reversal of summary judgment)). The beneficiaries wrote that “[b]ecause [they] were precluded from presenting [the continuing-duty-absent-changed-circumstances] claims by the district court’s erroneous interpretation of the limitations statute, there is no record on which the Court can resolve this claim on appeal.” We agree that the record does not establish exactly what would have resulted from the application of the correct legal standard, and accordingly remand on an open record for the district court to consider these issues in light of the principles explicated by the Supreme Court and this opinion.-
V. Attorneys’ Fees and Costs
The beneficiaries also requested that we direct the district court “to reconsider an award of costs and attorney fees in light of the results of the trial on remand.” The beneficiaries had originally sought nearly $2.5 million in attorneys’ fees and nontaxable costs, and in response to the court’s
order, sought a reduced amount of $407,277.30 in fees and $3,731.92 in costs. The district court held that even if the attorneys’ fees request was appropriate, it would be offset by the costs due to Edison as the prevailing party on the majority of cláims originally filed.
In determining that the beneficiaries’ original fee request should be drastically reduced, the district court expressed its skepticism concerning the importance of the beneficiaries’ partial victory. Considering the Supreme Court decision that followed, and our en banc decision in this case, we believe that this case has far greater importance than the district court believed it did at the time of its earlier fee determinations. Accordingly, we direct the district court to reconsider the fee issue in light of the significant amount of work that has been required to vindicate an important ERISA principle in our court and the Supreme Court.
CONCLUSION
We VACATE the district court’s decisions concerning the funds added to the Plan before 2001, and REMAND on an open record for trial on the claim that, regardless of whether there was a significant change in circumstances, Edison should have switched from retail-class fund shares to institutional-class fund shares to fulfill its continuing duty to monitor the appropriateness of the trust investments. The district court is also directed to reevaluate its fee determination in light of the Supreme Court’s decision and this court’s en banc decision.