In a decision of importance to hedge fund managers that have or solicit investments from private pension plans, a federal district court recently analyzed various Employee Retirement Income Security Act (ERISA) issues in connection with a purported class action lawsuit.  The suit was initiated by a pension plan against a manager of a plan assets hedge fund of funds, its managing member, their officers and directors and several funds as a result of losses allegedly caused by an investment in a Ponzi scheme.  Managers of plan asset hedge funds (and in some cases their principals) are subject to heightened regulation pursuant to ERISA, as compared to most hedge fund managers.  For a discussion of regulations impacting plan asset fund managers, see “Speakers at Katten Seminar Outline ERISA Concerns for Managers of Plan Asset Hedge Funds,” Hedge Fund Law Report, Vol. 5, No. 12 (Mar. 22, 2012); and “How Can Hedge Fund Managers Accept ERISA Money Above the 25 Percent Threshold While Avoiding ERISA’s More Onerous Prohibited Transaction Provisions? (Part One of Three),” Hedge Fund Law Report, Vol. 3, No. 19 (May 14, 2010).  The pension plan claimed that the defendants were “fiduciaries” within the meaning of ERISA and that they had breached two essential duties imposed on them as ERISA fiduciaries: They failed to manage the plan’s assets prudently and caused the plan assets fund to engage in prohibited transactions.  The plan also asserted federal securities fraud, breach of contract, breach of fiduciary duty and various state law claims.  The defendants moved to dismiss the pension plan’s complaint for failure to state a cause of action.  This article summarizes the court’s decision, with emphasis on its analysis of the pension plan’s ERISA claims.