Full opinion text
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS FOURTH AMENDED COMPLAINT LUCY H. KOH, United States District Judge Plaintiff Northstar Financial Advisors, Inc. (“Northstar”) brings this action against Schwab Investments, the members of the Board of Trustees of Schwab Investments, and Charles Schwab Management, Inc. (collectively, the “Defendants”). Before the Court is Defendants’ motion to dismiss Plaintiff s Fourth Amended Complaint (“FAC”). See ECF No. 214 (“FAC”); ECF No) 2Í7 (“Mot.”). Having considered the parties’ submissions, the relevant law, and the record in this case, the Court hereby GRANTS in part and DENIES in part Defendants’ motion to dismiss. I. BACKGROUND A. Factual Background On Augu'st 28, 2008, Northstar filed its first complaint (“Original Complaint”) in this putative • class action on behalf of all persons who owned shares of the Schwab Total Bond Market Fund (the “Fund”) at any time from August 31, 2007 to the present. ECF No. 1 (“Compl.”) ¶ 1. North-star is a registered investment advisory and financial planning firm that serves both institutional and individual clients. Id. ¶ 9. Northstar manages both discretionary and nondiscretionary accounts on behalf of investors in, Northstar’s role as an investment advisor. Id. Northstar traded through Charles Schwab’s Institutional Advisor Platform, where it purchased shares in .the Fund for its, clients. Id. ¶¶ 11-12. Although Northstar has amended its Complaint four times, Northstar’s core allegations remain the same. Northstar alleges that Defendants deviated from the Fund’s investment objective to track the Lehman Brothers U.S. Aggregate Bond Index (the “Index”) in two ways. First, Northstar alleges that, beginning around August 31, 2007, the Fund deviated by investing in high risk non-U.S. agency col-lateralized mortgage obligations (“CMOs”) that were not part of the Lehman Index and that were substantially more risky than the U.S. agency securities and other instruments that comprised the Index. See id. ¶ 3; FAC ¶ 5. Second, Northstar alleges that, beginning around August 31, 2007, the Fund deviated from the Fund’s investment objectives (which prohibited any concentration of Fund assets greater than 25% in any one industry, unless such concentration was necessary in order to track the Index) by investing more than 25% of the Fund’s total assets in U.S. agency and non-agency mortgage-backed securities and CMOs. Compl. ¶4; FAC ¶6. North-star alleges that Defendants’ deviation from the Fund’s investment objectives exposed the Fund and the Fund’s shareholders to tens of millions of dollars in losses due to a sustained decline in the value of non-agency mortgage-backed securities. According to Northstar, the Funds’ deviation caused the Fund to incur a negative total return of 4.80% for the period of September 1, 2007, through February 27, 2009, compared to a positive return of 7.85% for the Index over this same period. FAC ¶ 7. B. Procedural History 1. Northstar I Based on the allegations described above, Northstar asserted the following four claims against a number of'Schwab-related entities in the Original Complaint: (1) violation of § 13(a) of the Investment Company Act of 1940 (“ICA”); (2) breach of fiduciary duty; (3) breach of contract; and (4) breach of the covenant of good faith and fair dealing. Compl. ¶¶ 85-99. Northstar’s § 13(a) claim was asserted under federal law; Northstar’s remaining claims were asserted under state law. On November 20, 2008, Defendants' moved to dismiss the Original Complaint. See ECF No. 33 (“First MTD”). U.S. District Judge Susan Illston, to whom this case was previously assigned, granted in part and denied in part Defendants’ motion. See ECF No. 74 (“Northstar /”). First, Judge Illston found that North-star did not have standing to bring any of the claims asserted in the Original Complaint because Northstar “only purchased shares for its clients and not for itself.” Northstar I at 3. Judgé Illston, however, granted Northstar leave to amend because Northstar could plausibly cure this deficiency by receiving an assignment of claims from one of Northstar’s clients. Id. at 4. Second, Judge Illston found that there was an implied private right of action under § 13(a) of the ICA and that Northstar had stated a claim for violation of shareholders’ voting rights under this section. Northstar I at 7, 9-12. Finally,turning to Northstar’s state law causes of action, Judge Illston dismissed Northstar’s breach of fiduciary duty claim with leave to amend. Judge Illston instructed North-star “to carefully examine whether each of the defendants named in this claim can in fact be named in such a claim, and under which state’s laws such a claim [may be] properly brought.” Id. at. 14-15. Because of the close relationship between Northstar’s-breach of fiduciary duty claim and North-star’s breach of contract claim, Judge Ill-ston also granted Northstar leave to amend the breach of contract claim.. Id. at 15. Judge Illston denied Defendants’ motion to dismiss Northstar’s breach of .the covenant of good faith and fair dealing claim. Id. at 15-16. 2. Northstar II On March 2, 2009, Northstar filed its First Amended Complaint. Oh March 5, 2009, Defendants filed a motion which sought leave to file an interlocutory appeal of Judge Illston’s order. Defendants sought only to challenge Judge Illston’s finding that Northstar could assert a private right of action under § 13(a) of the ICA. This motion was granted, ECF No. 108, and this action was stayed pending the outcome of-Defendants’ appeal-- This case was stayed from April 27, 2009, through August 13, 2010. In .the. interim, this case was reassigned, first to U.S. District Judge Richard Seeborg, and then to the undersigned. See ECF Nos. 115 & 117. On August 13, 2010, the Ninth Circuit reversed Judge Illston’s order, and held that there is no private right of action under § 13(a). Northstar Fin. Advisors, Inc. v. Schwab Invs. (“Northstar II”), 615 F.3d 1106, 1122 (9th Cir.2010). 3. Northstar III In light of Northstar II, Northstar filed, on September 28, 2010, a Second Amended Complaint (“SAC”) which- did not include a § 13(a) claim. Northstar also Asserted an assignment- of claims from Henry Holz, a client of Northstar’s who had owned shares of the Fund as of August 31, 2007, in an attempt to address the standing -issue previously identified- by Judge Illstom See ECF No. 127 (“SAC”) ¶ 15. The SAC named Schwab Investments (the “Trust”); the members of the 'Board of Trustees of Schwab Investménts (the “Trustees”), and Charles- Schwab Investment Management, Inc. (the-“Advisor”) as Defendants. According to the SAC, the Trust.is an investment trust organized under Massachusetts law, and “consists of a series of mutual funds, including the Fund.” SAC ¶ 16. The Trust is managed by the Trustees. Id. ¶¶ 19-20. Pursuant to a contráctual agreement between; the Trust and the Advisor, known as the In-véstment Advisory Agreement (“IAA”), the Advisor handles day-to-day oversight of the Fund. M ¶¶23, 154. The SAC alleged claims based ón (1) breach of fiducia;-ry duty (against all Defendants); (2) breach of contract (against the Trust); (3) breach of the covenant of good faith and fair dealing (against the Trust and the Advisor); and (4) breach of contract as a third party beneficiary to the IAA (against the Advisor). This Court dismissed the SAC on March 2, 2011. See ECF No. 175 (“Northstar III”). The Court found all of Northstar’s claims precluded by the Securities Litigation Uniform Standards Act 'of 1998 (“SLUSA”) because all of the claims alleged misrepresentations or omissions of material fact made in connection with the purchase or sale of the Fund’s shares. 15 U.S.C. § 77p. The Court stated that “the central theme... of Plaintiffs’ claims is that defendants made misrepresentations about how investments in the fund would be managed, that Plaintiffs purchased Fund shares relying on these misrepresentations, • and that Plaintiffs were injured when these statements turned out to be false.” Northstar III at 9. In addition' to dismissing Northstar’s claims based on SLÜSA preclusion, the Court found that Northstar had failed to sufficiently allege a breach of contract claim despite specific instructions from Judge Illston in Northstar I to “add more specific allegations regarding the language plaintiff relies on to allege the formation of a contract, as well as each defendants’ involvement.’^ Northstar I at 15. In light of this fact, Northstar’s breach of contract claim and Northstar’s related claim 'for breach of the covenant of good faith and fair dealing were dismissed with prejudice. Northstar III at 18-19. Northstar’s claim for third party beneficiary status was also dismissed, with leave to amend to “specify.. .what specific provisions of the Investment Advisor Agreement were allegedly breached, and how.” Id. at 24. Finally, with respect to Northstar’s breach of fiduciary duty claim, the Court noted that it was possible for this claim to fall outside the scope of SLUSA preclusion through a statutory exception known as the Delaware carve-out. Accordingly, Northstar was given leave to amend Northstar’s breach of fiduciary duty claim in order to clarify whether this claim could indeed fall under the Delaware qarve-out. Id. at 15. 4. Northstar IV Northstar filed a Third Amended Complaint (ECF No. 181 (“TAC”)) on March 28, 2011. For the first time, Northstar bifurcated potential Plaintiffs into two subclasses. TAC ¶ 65. First,-Northstar asserted claims on behalf of a “Pre-Breach” class, which consisted of “all persons or entities who purchased shares of the Fund on or prior to August 31, 2007, and who continued to hold their shares as of August 31, 2007.” Id. Second, Northstar asserted claims on behalf of a “Breach Class,” which consisted of “all persons or entities who purchased shares of the Fund during the period of September 1, 2007, through February 27, 2009.” Id. The classes were divided between August 31 and September 1 because Northstar alleged that “August 31, 2007 [was] the last day of the fiscal’ year preceding the one during which the: Fund first began deviating from' its required fundamental investment policy to seek to track the Lehman Index through the use of an indexing strategy.” Id. Northstar alleged that the Fund “reverted back to its required fundamental investment policy” on or around February 27, 2009, Id. ¶66. Northstar brought five causes of action on behalf of each of the two classes, for a total of ten claims. These were: breach of fiduciary duty against both the Trustees and the Trust; breach of fiduciary duty against the Advisor; aiding and abetting breach of fiduciary duty against the Trustees; aiding and abetting breach of fiduciary duty against the Advisor; and breach of contract as third party beneficiary to the IAA against the Advisor. North-star also incorporated by reference the breach of contract and breach of the covenant of good faith and fair dealing claims from the SAC. Id. ¶ 120. Northstar did not develop any new arguments with respect to these- claims; Northstar asserted them solely for purposes of preserving them for appeal. Id. On April 2, 2011, Defendants filed a motion to dismiss Northstar’s' TAC. On August 8, 2011, this Court granted with prejudice Defendants’ motion to dismiss the TAC. ECF No. 190 (“Northstar IV”). On the breach of fiduciary duty claims, this Court found that any such claims must be derivative, and not direct, in nature. Northstar IV at 12. In other words, North-star could not, according to the Court, bring these claims directly. Northstar’s fiduciary duty claims were therefore dismissed with prejudice. Notably, the Court did not, in Northstar IV, “address the other arguments raised by the parties regarding Plaintiffs claims for breach of fiduciary duty, including whether claims against the Trustees were timely and whether Northstar successfully pled a fiduciary duty arising as a matter of fact.” Id. This Court also dismissed with prejudice Northstar’s related aiding and abetting claims. Id. at 12-13. On Northstar’s third party beneficiary claims, the Court found that the IAA’s terms did not make clear an intention to benefit Fund shareholders. Accordingly, these shareholders could not be considered third party beneficiaries, and Northstar’s third party benefi-ciaiy claims were dismissed with prejudice. Id. at 17-rl8. 5. Northstar V On appeal, the Ninth Circuit reversed in part and vacated in part this Court’s order in Northstar TV. First, the Ninth Circuit clarified that this Court did not abusé its discretion in allowing Northstar to amend its pleadings to show that Northstar had standing to bring suit. Northstar Fin. Advisors, Inc. v. Schwab Invs. (“Northstar V”), 779 F.3d 1036, 1043 (9th Cir.2015). Second, the Ninth Circuit held “that the mailing of the proxy statement and the adoption' of the two fundamental investment policies after the shareholders voted to approve them, and the annual representations by the Fund” were “sufficient to form a contract between the shareholders on the one hand and the ,Fund and the Trust on the other.” Id. at 1054. Accordingly, the Ninth Circuit reversed this Court’s decision dismissing Northstar’s breach of contract claim. Third, the Ninth Circuit vacated this Court’s finding that Northstar could only bring its fiduciary duty claims derivatively. Id. at 1065. Finally, the Ninth Circuit reversed this Court’s decision to dismiss Northstar’s third party beneficiary claims. The Ninth Circuit determined that' Northstar had sufficiently alleged facts to show that Northstar was a third party beneficiary to the IÁA. Id. The Ninth Circuit did not discuss whether any (or all) of Northstar’s claims were precluded by SL'USA, instead leaving' that determination to this Court on remand. Id. at 1050. Judge Bea dissented from the majority opinion and argued that Northstar did' not have standing to bring suit. Id. at 1069 (Bea, J., dissenting). Judge' Bea did not examine any of the other issues discussed in the majority’s opinion. In response to the Ninth Circuit’s decision, Northstar filed its FAC on June 25, 2015. This " Complaint states fourteen causes of action, with seven causes of action that pertain to the Pre-Breach class and seven causes of action that pertain to the Breach class., Northstar asserted seven causes, of action on behalf of the Pre-Breach class. Counts one. through seven in the FAC are: (1) breach of fiduciary duty against both the Trust 'and the Trustees; (2) breach of fiduciary duty against the Advisor; (3) aiding and abetting breach of fiduciary duty against the Trustees; (4) aiding and abettjng breach of fiduciary duty against the Advisor; (5) breach of contract as third party beneficiary-to the IAA against the Advisor; (6) breach of contract against the Trust; and (7) breach of the- covenant of good faith and fair dealing against the Advisor and-the Trustees. Northstar relied on the same allegations to assert seven causes of action on behalf of the Breach class. Counts' eight through fourteen in the FAC are: (8) breach of fiduciary‘duty against both the Trust and the Trustees; (9) breach of fiduciary duty against the Advisor; (10) aiding and abetting, breach of fiduciary duty against the Trustees; (11) aiding and abetting breach of fiduciary duty against the Advisor; (12) breach of contract as third party beneficiary to-the IAA against the Advisor; (13) breach of contract against the Trust; and (14) breach of the covenant of good faith and fair dealing against the Advisor and the Trustees. Defendants filed the instant motion to dismiss on July 24, 2015, which contended that all of Northstar’s causes of action wei;e precluded by SLUSA, and also asserted a number of other arguments, discussed in greater detail below. Northstar filed a response on August 26, 2015, which argued, in part, that Defendants were foreclosed from arguing for SLUSA preclusion with respect to several of North-star’s causes of action. EOF No. 223 (“Opp’n”) at 6. Defendants filed a reply on September 10, 2015. ECF No. 226 (“Reply”). Although not directly relevant to the disposition of this motion, Defendants have also filed a petition for a writ of certiorari in Nortkstar V before the U.S. Supreme Court. ECF No. 222. Defendants’ petition is pending. II. LEGAL STANDARD A. Motion to Dismiss Pursuant to Federal Rule of Civil Procedure 12(b)(6), a defendant may move to dismiss an action for failure to allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955,167 L.Ed.2d 929 (2007). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. The plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (internal citations omitted). For purposes of ruling on a Rule 12(b)(6) motion, the Court “accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the light most favorable to the nonmoving party.” Manzarek v. St Paul Fire & Marine Ins. Co., 519 F.3d 1025,1031 (9th Cir.2008). Nonetheless, the Court is not required to “ ‘assume the truth of legal conclusions merely because they are cast in the form of factual allegations.’ ” Fayer v. Vaughn, 649 F.3d 1061, 1064 (9th Cir.2011) (quoting W. Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir.1981)). Mere “conclusory allegations of law and unwarranted inferences are'insufficient to defeat a motion to dismiss.” Adams v. Johnson, 355 F.3d 1179, 1183 (9th Cir.2004); accord Iqbal, 556 U.S. at 678, 129 S;Ct. 1937. Furthermore, “ ‘a plaintiff may plead [him]self out of court’ ” if he “plead[s] facts which establish that he cannot prevail on his... claim.” Weisbuch v. Cnty. of L.A., 119 F.3d 778, 783 n. 1 (9th Cir.1997) (quoting Warzon v. Drew, 60 F.3d 1234, 1239 (7th Cir.1995)). B. Leave to Amend’ Under Rule 15(a) of the Federal Rules of Civil Procedure, leave to amend “shall be freely granted when justice so requires,” bearing in mind “the underlying purpose of Rule 15 to facilitate decision on the merits, rather than on the pleadings or technicalities.” Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir.2000) (en banc) (internal quotation marks and alterations omitted). Generally, leave to amend shall be denied only if allowing amendment would unduly prejudice the opposing party, cause undue delay, or be futile, or if the moving party has acted in.bad faith. Leadsinger, Inc. v. BMC Music Publ’g, 512 F.3d 522, 532 (9th Cir.2008). III. DISCUSSION A. Breach of Fiduciary Duty Against the Trust & the Trustees (Claims One & Eight) Defendants assert a number of arguments regarding Northstar’s breach , of fiduciary duty claims against the Trust and the Trustees. This Court will review these arguments in turn. 1. SLUSA Preclusion Defendants first contend that all of Northstar’s claims are precluded by SLU-SA. Before the Court can address, this contention, the Court must examine whether Defendants are foreclosed from asserting this argument with-respect to Northstar’s breach of fiduciary ., duty claims. As background, Defendants argued for SLUSA preclusion with respect to all of Northstar’s claims in Defendants’ motion to dismiss Norfhstar’s SAC. Nee ECF. No. 150 (“Second MTD”). Curiously, Defendants did not re-assert these arguments in moving to dismiss Northstar’s TAC.- See ECF No. 182 (“Third MTD”). Instead, Defendants noted that “Northstar [had] avoided SLUSA preemption for its fiduciary claims” because Northstar had, in the TAC, asserted these claims under Massachusetts law. Id, at 13 n.5. Defendants did, in the Third MTD, assert a SLUSA preclusion defense with respect to' Northstar’s third party beneficiary claims. Id. at 13-14. Now,- in Defendants’ instant motion, Defendants argue once more that all of Northstar’s claims are barred by SLUSA. Mot. at 8. Northstar contends that Defendants abandoned these arguments with respect. to Northstar’s breach of fiduciary duty claims, and that Defendants cannot now revive these arguments. The Court agrees. Federal Rule of Civil Procedure 12(g)(2) states that “[except as provided in Rule 12(h)(2) or (3), a party that makes a motion under this rule must not make another motion under this rule raising a defense or objection that was available to the party but omitted from its earlier motion.” Federal Rule of Civil Procedure 12(h)(2), in turn, provides that arguments which pertain to a plaintiffs “[f]ailure to state a claim upon which relief can be. granted .. .may be raised: (A) in any pleading allowed or ordered under Rule 7(a); (B) by a motion under Rule 12(c);. or (C) at trial.” To summarize, under Rule 12(g)(2) and Rule 12(h)(2), a party that seeks to assert a defense that was available but omitted from an earlier Rule 12 motion can only do so in a pleading, a Rule 12(c) motion, or at trial. Here, Defendants seek to assert “a defense... that was available... but ‘omitted from [ah] earlier motion” to dismiss. Fed R. Civ. P. 12(g)(2). However, Defendants have not asserted this defense in a pleading, a Rule 12(c) motion, or at trial. Instead, Defendants have asserted this defense in a motion to dismiss pursuant to Federal.Rule of Civil Procedure 12(b)(6). Defendants are foreclosed from doing so because of Rule 12(g)(2) and Rule 12(h)(2). A number of eases lend support to this conclusion. In Wafra Leasing Corporation 1999-A-1 v. Prime Capital Corporation, 247 F.Supp.2d 987, 999 (N.D.Ill.2002), for instancé, Defendants Smithburg and Walter filed three motions to dismiss for failure to state a claim, one each in response to Wafra’s Original Complaint, First Amended Complaint, and Second Amended Complaint. Smithburg and Walter’s first motion did not address counts one and two in the Original Complaint. Wafra subsequently filed a First Amended Complaint, which kept counts one and two but also added a new count, count ten. Id. Smithburg and Walter’s second motion to dismiss included a number of additional arguments which addressed count ten, but, like Smithburg and Walter’s first motion to dismiss, did not include any arguments which addressed counts one and two. Finally, in Smithburg and Walter’s third motion to dismiss, Smithburg and Walter “rais[ed] arguments with respect to counts one and two that they failed to advance in either of their previous motions to dismiss.” Id. ■ The district court in Wafra determined that Smithburg and Walter were “precluded from raising these arguments in their third motion to dismiss.” Id. The district court noted that Federal Rule of Civil Procedure 12(g)(2) “generally precludes a defendant from bringing successive motions to dismiss raising arguments that the defendant failed to raise at the first available opportunity.” Id. To be sure, Smith-burg and Walter had not waived their arguments entirely. As the district court explained, under Federal Rule of Civil Procedure 12(h)(2), if a defendant “fails to raise a defense... [in a] motion to dismiss for failure to state a claim,”- “the defendant may make such an argument ‘in any pleading permitted or ordered under Rule 7(a), or by motion for judgment on the pleadings, or at the trial on the merits.’” 247 F.Supp.2d at 999 (quoting Fed. R. Civ. P. 12(h)(2)). The defendant may not, however, assert any such defenses in a second pre-answer motion. Id. Courts in this Circuit concur with the reasoning in Wafra. In Herron v. Best Buy Stores, LP, 2013 WL 4432019, at *4 (E.D.Cal. Aug. 16, 2013), for instance, Toshiba had “failed to squarely raise [an] argument in its initial dismissal motion, even though the argument was available to Toshiba when it originally sought to dismiss Plaintiffs complaint.” Accordingly, “this portion of Toshiba’s dismissal motion [was] not considered.” Id. Similarly, in Federal Agricultural Mortgage Corporation v. It’s A Jungle Out There, Inc. (“FAMG”), 2005 WL 3325051, at *5 ,(N.D.Cal. Dec. 7, 2005), the district court stated that, “[a]lthough the Ninth Circuit has not had occasion to apply this principle, the weight of authority outside this circuit holds that where.-the complaint.is amended after the defendant has filed a Rule 12(b) motion, the defendant may not thereafter file a second Rule 12(b) motion asserting objections or defenses that could have been asserted in the first motion.” See also Wright, & Miller, 5C. Federal Practice & Procedure § 1388, 491-95 (3d ed. 2004) (citing additional cases applying Federal Rule 12(g)(2) and Rule 12(h)(2)). Wafra, Herron, and FAMC illuminate how courts have interpreted and applied Federal Rule of CM Procedure 12(g)(2) and Federal Rule of Civil Procedure 12(h)(2). As with the movants in those cases, Defendants here could have asserted a SLUSA-preclusibn defense against all of Northstar’s claims in Defendants’ motion to dismiss'Northstar’s TAC. In fact, unlike the movant in Wafra, Defendants did do so in a previous motion to dismiss. Then, in a subsequent motion to dismiss, Defendants asserted a SLUSA preclusion defense against only some of Northstar’s claims, and provided a reason as to why Defendants were not asserting a SLUSA preclusion defense against Northstar’s other claims. Defendants may not re-assert in a successive motion to dismiss arguments that Defendants abandoned in a prior motion to dismiss. Defendants’ arguments to the contrary are unavailing. First, Defendants’ reliance on Mattel, Inc. v. MGA Entertainment, Inc., 782 F.Suppud 911, 1017 (C.D.Cal. 2011), is inapposite. In Mattel, the district court addressed Mattel and MGA’s cross motions for partial summary judgment, not a motion to dismiss. Id. at 940-41. To be clear, there is: nothing in Rule 12(g) that prevents a. party from re-asserting a previously waived defense in a motion for summary judgment. See Fed. R. Civ. P. 12(g)(2) (“Except as provided in Rule 12(h)(2)- or (3), a party that makes a motion under this rule must not make another motion under this rule raising a defense ... available to the party but omitted from its earlier motion”) (emphasis added). Similarly, Defendants’ citation to cases such as Massey v. Helman, 196 F.3d 727 (7th Cir.1999), Spearman v. U.S. Steel Corporation, 2013 WL 170667 (S.D.Ill. Jan. 16, 2013), and In re Parmalat Securities Litigation, 421 F.Supp.2d 703 (S.D.N.Y. 2006), is not well taken. As Defendants themselves acknowledge, these cases stand- for the proposition that an amended complaint opens the door for “previously unasserted affirmative defenses.” Reply at 13 (emphasis added). Defendants’ SLUSA preclusion defense does not fall within this category. Third, Defendants’ discussion of United States v. Vaile, 5 F.3d 544, at *1 (Table) (9th Cir.1993), and United States v. Flores, 176 Fed.Appx. 62 (11th Cir.2006), is not relevant. Vaile and Flores are criminal cases, governed by the Federal Rules of Criminal Procedure. The instant case is a civil case, governed by the Federal Rules of Civil Procedure. Federal Rule of Civil Procedure 12 specifically holds that 12(b)(6) defenses cannot be asserted if these defenses were available but omitted in an earlier 12(b)(6) motion unless these defenses are asserted in a pleading, in a 12(c) motion, or at trial. Defendants have not asserted the instant defense in a pleading, a 12(c) motion, or at trial. Defendants cannot re-assert an abandoned SLUSA preclusion defense with respect to North-star’s breach of fiduciary duty claims in the instant motion to dismiss. In sum, the Court declines to consider SLUSA preclusion with respect to claims one and eight, Northstar’s breach of fiduciary duty claims against the Trust and the Trustees. In addition, the Court notes that Defendants did not assert a SLUSA preclusion defense with respect to any of Northstar’s breach of fiduciary duty claims in the TAC. The Court therefore declines to discuss'SLUSA preclusion with respect to Northstar’s breach' of fiduciary duty claims against the Advisor, claims two and nine. Furthermore, claims three and ten, which allege that the Trustees aided and abetted the Advisor’s breach of the Advis- or’s fiduciary duties, and claims four and eleven, which allege that the Advisor aided and abetted the Trustees’ breach of the -Trustees’ fiduciary duties, are clearly related to Northstar’s underlying breach of fiduciary duty claims. Accordingly, Defendants may not raise a SLUSA preclusion defense on a successive motion to dismiss with respect to these aiding and abetting claims (claims three, four, ten, and eleven). 2. Existence of á Duty Next, Defendants acknowledge that, in Northstar V, the Ninth Circuit “held that the Trustees owed fiduciary duties directly to the shareholders.” Mot. at 20 (emphasis in original); Northstar V, 779 F.3d at 1056-57. Defendants contend that the Ninth Circuit “did not make any similar ruling with respect to the Trust or the Advisor.” Id. Consequently, Defendants argue that no such fiduciary duty exists with respect to these entities. The Court will analyze whether a fiduciary duty exists between Plaintiff and the Trust below, and whether a fiduciary duty exists between Plaintiff and the Advisor in Part III.B. As for the Trust, the Court agrees with Defendants that no, such fiduciary duty exists. Plaintiffs FAC describes the Trust as “an investment trust, organized under Massachusetts law and... a registered investment company under the Investment Company Act of 1940.” FAC ¶30. “The Trust consists of a series of 94 Schwab-related mutual funds; including the Index Fund.” Id. The Trust, in other words, serves as “an instrument of trust by which property is held and managed by trustees for the benefit of persons who are or become the holders of the beneficial interests in the trust estate.”' Id, ¶ 33 (emphasis added). According to Schwab Investments’ Statement of Additional Information (“SAI”), the Trustees have in turn “delegated the responsibility for voting proxies to CSIM” — the Advisor — “through their respective Investment Advisory and Administration Agreements.” ECF No. 218-6 (“SAI”) at 83. In short, the Trust consists of various assets managed by the Trustees for the benefit of shareholders. Many of these management responsibilities are thereby delegated to the Advisor through the IAA; the Advisor serves as an agent for the Trustees. To the extent that any fiduciary duties are owed at all to Northstar, those duties are owed by those who manage the Trust — not by the Trust itself. Four arguments counsel in favor of this determination: the Ninth Circuit’s reasoning in Northstar V, the authority (or lack thereof) cited by Northstar in Northstar’s opposition to the instant motion, case law found by the Court in the Court’s own research, and the allegations made in the FAC. The Court will discuss each of these arguments in turn. First, in Northstar V, the Ninth Circuit made clear its intention to respond directly to Defendants’ assertion, made by Defendants at oral argument, that “the Trustees did not owe a fiduciary duty to the beneficiaries of the Schwab Trust.” 779 F.3d at 1056; see id. (summarizing Defendants’ argument and then stating that “[t]here are several deficiencies in this argument.”). The Ninth Circuit cited cases such as Fogelin v. Nordblum, where the Supreme Judicial Court of Massachusetts stated that “[i]t is axiomatic that the.. .trustees [stand] in a fiduciary relationship to all the beneficiaries of the trust.” 402 Mass. 218, 521 N.E.2d 1007, 1011 (1988) (emphasis added). Importantly, in Fogelin, the trustees brought suit against the trust’s beneficiaries; no claims or counterclaims were ever asserted against the trust itself. Furthermore, after reviewing a- collection of secondary sources,-the Ninth Circuit held that “[t]he allegations in the complaint ... are sufficient to support an argument that the Trustees .violated .;. [the] duty of care.” Id. at 1059 (internal quotation marks and alterations 'Omitted) (emphasis added). Again, the Ninth Circuit did not say whether such ulaims could be brought against the Trust. Finally, in rejecting one of Defendants’ policy-based arguments, the Ninth Circuit'.stated that “the trustees of a mutual fund cannot.seriously be expected to induce arm’s-length bargaining” with the Advisor. Id. at 1061 (internal quotation marks omitted) (emphasis added). The Ninth Circuit did not, however, discuss whether the Trust could maintain any such relationship with the Advisor; This summary highlights the Ninth Circuit’s determination that the Trustees owed shareholders a fiduciary duty because of the Trustees’ role in managing the Trust. There is no evidence in Northstar V to suggest that the Trust owed shareholders a fiduciary duty. Second, in addition to the reasoning in Northstar V, the Court also notes that Northstar has failed to identify a single case — and the Court has found none in the Court’s own research — where a trust’s beneficiaries have successfully brought a breach of fiduciary duty claim against the trust, itself. In every case identified' in Northstar’s opposition to Defendants’ instant motion to dismiss, courts have found that a -fiduciary duty might exist between an individual that manages the trust and the beneficiaries of that trust: See, e.g,, In re Hilson, 448 Mass. 603, 863 N.E.2d 483, 493 (2007) (finding breach of fiduciary duty by trustee because trustee had improperly converted funds for-own use); . But again, none of these - cases involve litigation against the trust itself. Third, in the course of the Court’s own research, the Court has analyzed the existence of fiduciary duties-in analogous contexts, and has found that the results of this analysis are not helpful to Northstar. For example, in Patsos v. First Albany Corp., 433 Mass. 323, 741 N.E.2d 841, 851 (2001), the Supreme Judicial Court of Massachusetts held that if Patsos, the investor, “had merely alleged in very general terms that he trusted [his broker], that [his broker] was aware of his inexperience, and that he had transferred funds-for [his broker] to invest on his behalf, that would be insufficient-to establish that Patsos and [his broker] had entered into a general fiduciary relationship.”. The Supreme Judicial--Court only found the existence of a fiduciary relationship in Patsos after Patsos had pleaded at least eight, different facts to show how Patsos’ relationship with his broker was different from a typical investor-broker relationship. Patsos appears-to be the only case where a court has found that the brokerage — First Albany, in the case of Patsos — may also be held liable for breach of a fiduciary duty for the broker’s actions. However,- in reaching this conclusion, the Supreme Judicial Court relied upon “principles of agency law,” and found liability because Patsos’s broker served as an agent to First Albany, the principal. In the instant case, no such, principal-agent relationship exists between the Trust and the Trustees. The Trustees are not agents of the Trust. The Trust contains assets, which are managed by the Trustees. This is.clear from the Declaration of Trust, which states that “the Trustees hereby declare that they will hold all cash, securities and other assets, which they may from time-to time acquire in any manner as Trustees hereunder IN TRUST to manage and dispose of the same.” See Northstar V, 779 F.3d at. 1039 (quoting from Declaration of Trust). If anything, the only principal-agent relationship that exists is between that of the Trustees (the principal) and the Advisor (the agent), to whom the Trustees have delegated day-today management responsibilities. The Trust itself, however, simply contains the assets for which the Trustees and the Ad-visor are jointly responsible. Finally, Northstar’s own submissions to the Court highlight the fact that the Trust does not owe a fiduciary duty to the shareholders. In Northstar’s response to Defendants’ instant motion, for example, Northstar defines “a fiduciary duty [as] arisfing] whenever one reposes-faith and confidence in another’s integrity, advice or judgment.” Opp’n at 22. Following North-star’s own definition, the Trust does not exercise integrity, advice, or judgment. These tasks are exercised by the Trustees and the Advisor. The allegations made in Northstar’s FAC further corroborate the Court’s analysis. Northstar states that “[t]he Trust also owed fiduciary duties to plaintiff and other members of the Class by virtue of its affiliation with and being controlled by or under the common control of or with the Trustees, defendant Charles Schwab and the Schwab Corp.” FAC ¶ 129 (emphasis added). Fiduciary duties do not arise by affiliation. They arise where an entity, the fiduciary, is “under a duty to act for the benefit of the other as to matters within the scope of the relation.” Doe v. Harbor Sch, Inc., 446 Mass. 245, 843 N.E.2d 1058, 1064 (2006). The Trust has no such duty to act. The Trust is only an instrument through which the Trustees and the Advisors act. Accordingly, the Court finds that North-star has failed to sufficiently allege a fiduciary duty by the Trust. Moreover, the Court finds that amendment would be fií-jale, given the way that the Trust, the Trustees, and the Advisor are organized. Additional factual allegations would not change the fact that the Trust does not owe a fiduciary duty to shareholders. The Trust is an instrument which contains assets that are managed by the Trustees and the Advisor. See Lopez, 203 F.3d at 1130 (court may dismiss claim .without leave to amend where “pleading could not possibly be cured by the allegation of other facts.”) (internal quotation marks omitted). North-star’s breach of fiduciary duty claims against the Trust, which constitute claims one and eight in the FAG, are therefore dismissed with prejudice. 3. Existence of Breach . Defendants next argue that Northstar has failed to sufficiently plead “a breach of any fiduciary duty against any Defendant.” Mot. at 19. The Court is unconvinced by this argument as it applies to the Trustees, particularly in light of Northstar V. In Northstar V, the Ninth Circuit noted that “[defendants conceded at oral argument that the allegations in the operative complaint are sufficient to state a cause of action for breach of fiduciary duty.” 779 F.3d at 1056. Instead, Defendants contended only that “the Trustees did not owe a fiduciary duty to the beneficiaries of the Schwab Trust — namely, the shareholders.” Id. Rather, the Trustees owed fiduciary duties to the Trust, and any breach of fiduciary duty claims would thus have to be brought by way of a derivative action. Id. The Ninth Circuit rejected this argument, and explained why Northstar could proceed with a direct action against the Trustees. See id. at 1056-62. In light of Defendants’ admission at oral argument, the Court may, under Ninth Circuit precedent, treat Defendants’ “concession. . .as binding.” In re Adamson Apparel, Inc., 785 F.3d 1285, 1294 (9th Cir. 2015). Moreover, even if the Court were to address Defendants’ arguments on the merits, the Court would find that they lack merit. In Northstar V, the Ninth Circuit strongly implied that Northstar had pled sufficient allegations of breach in North-star’s TAC. As the Ninth Circuit noted, “[t]he adoption by the shareholders of the fundamental investment objectives of the Fund effectively imposed a restraint on the structural relationship in the Agreement and Declaration of Trust.” Northstar V, 779 F.3d at 1059. “The allegations in the complaint, although not in haec verba, are sufficient to support an argument that the Trustees violated both specific-restraints imposed by the shareholders and the officials’duty of care.” Id. (internal quotation marks and alteration omitted). This Court is also mindful of the U.S. Supreme Court’s decision in Tibbie v. Edison International, — U.S. ——, 135 S.Ct. 1823, 1827-28, 191 L.Ed.2d 795 (2015), where, in vacating and remanding another Ninth Circuit decision, the Supreme Court stated 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.” In addition, “[t]his continuing duty exists separate and apart from the trustee’s duty to exercise prudence in selecting investments at the outset.” Id. at 1828. In other words, trustees have a duty to both select prudent investments at the outset and to monitor these investments from time, to time. Per Tibbie, the FAC is replete with allegations that the Trustees failed to adequately undertake this sort of regular monitoring. The FAC specifically alleges that the Trustees neglected the Trustees’ duties to monitor the Advisor’s management decisions and permitted the Advisor to deviate from the Fund’s ■ investment objectives. See, e.g., FAC ¶¶ 110-11. If the Trustees did in fact fail to regularly review the Advisor’s management decisions, the Trustees neglected to fulfill their fiduciary duty. Thus, North-star has pled sufficient factual allegations to state a claim for breach of fiduciary duty by the Trustees. 4. Statute of Limitations Next, Defendants argue that Northstar’s breach of fiduciary duty claims against the Trustees must be dismissed because they are time-barred. The gist of Defendants’ argument is that Northstar alleges that the Trustees began to breach the Trustees’ fiduciary duty “[o]n or shortly before August 31, 2007.” FAC ¶ 4, However, “[t]he Trustees were first added as defendants in plaintiffs Second Amended Complaint dated September 28, 2010.” Id. ¶47. Under Massachusetts law, actions that allege breach of fiduciary duty must be brought “within three years... after the cause of action' accrues.” Mass. Gen. Laws, ch. 260, § 2A. That would have been August 31, 2010, according to Defendants’ theory. Because Northstar brought "the' Trustees into this case on September 28, 2010, Northstar’s claims are barred by the statute of limitations. The Court finds Defendants’ argument unsupported by the case law and by the facts in this case. Northstar’s claim that Defendants began to deviate from Defendants’ investment objectives on' or shortly before August 31, 2007 does not mean that Northstar’s cause of action began to accrue on or before August 31, 2007. As the Supreme Judicial Court of Massachusetts has stated,' “when an action is brought against a trustee, the cause of action does not accrue until the trustee repudiates the trust and the beneficiary has actual knowledge of that repudiation.” Lattuca v. Robsham, 442 Mass. 205, 812 N.E.2d 877, 884 (2004). In other words, the clock for Northstar’s breach of fiduciary duty claims start* not at the moment of breach, but at the moment when Northstar actually had knowledge of the breach. In Lattuca, for instance, the Supreme Judicial Court rejected “defendants’ argument that Lattuca ‘could have’ conducted a.. .search.. .[or] ‘could have’ investigated the trust’s finances.” Id. “Constructive knowledge is insufficient.” Id. “[A] cause of action for breach of fiduciary duty does not arise until the beneficiary is aware that repudiation has occurred.” Id. It is unclear, based on the record in this case, when Northstar actually learned of Defendants’ repudiation of Defendants’ fiduciary duties. Northstar, of course, argues that it did not have actual knowledge until after September 28, 2007. In support of this point, Northstar offers a chart which compares the Fund’s total return against the total return of the Lehman Index. FAC ¶ 121. From this chart, it appears that the Fund and the Index closely tracked one another until about October 2007 — after this point, the' Fund and the Index noticeably diverged. Northstar also alleges that Defendants filed with the SEC an Annual Certified Shareholder Report on November 2, 2007, which documented the Fund’s portfolio holdings as of August 31, 2007. See ECF 225-1 (“2007 SEC Rep.”) at 5. Thus, Northstar asserts that it could not have actually known of the Fund’s holdings before'November 2, 2007. Finally, Northstar states that the Fund’s investment objectives “prohibited any concentration of investments of ‘25% or more of the value of the total assets in any industry’ (other than if necessary to track the Index).” FAC ¶ 6 (emphasis added). Thus, even though 37% of the total holdings in the Fund were CMOs as of August 31, 2007, it is possible to believe that Defendants were, on August 31, 2007, still simply following the Lehman Index’s lead. That is, from Northstar’s perspective, it would have' been possible to believe, on August 31, 2007, that Defendants had only concentrated 37% of Fund holdings in CMOs because the Lehman Index had also decided to concentrate 37% of the Lehman Index’s holdings in CMOs. It would take more time before Defendants’ decision to deviate would become apparent, as evidenced by the chart included by Northstar in the FAC. Defendants have offered little to rebut these assertions. At most, Defendants point to the fact that the Annual Report, discussed above, provided a snapshot of the Fund’s holdings on August 31, 2007. Reply at 11. This argument is unavailing. As noted above, an official certified version of this Report was not filed with the SEC until November 2, 2007. Defendants have offered no’ evidence to show that shareholders knew of the contents of this report prior to the report’s official filing. Based on this information and based on the other factual allegations recited above, Defendants have not convinced the Court that Northstar had actual knowledge of breach prior to September 28, 2007. Accordingly, the Court finds that Northstar’s fiduciary duty claims against the Trustees are not time-barred. 5. Exculpatory Provision Finally, Defendants assert that the Trustees are protected by an exculpatory provision contained in the Declaration of Trust. This provision shields the Trustees from liability unless the Trustees’ conduct arises from “willful malfeasance, bad faith, gross negligence, or reckless disregard.” Mot. at 24. Northstar’s FAC, Defendants argue, alleges only facts that would amount to negligence. This argument is without merit. First, in the FAC, Northstar alleges that the Trustees acted with “willful misfeasance, bad faith, gross negligence, or reckless disregard of their duties.” FAC ¶ 132. To be sure, to survive a motion to dismiss, Northstar must do more than simply recite the pertinent clause’s language. The Court believes that Northstar has done so. In the immediate preceding paragraph, Northstar alleges that the Trustees “made or permitted or authorized investments of trust property that were speculative, irresponsible and risky.” Id. ¶ 131. . In response, Defendants assert that the Trustees were only negligent in undertaking the Trustees’ duties. This is a factual dispute: Northstar alleges one set of facts, and Defendants allege a different set of facts. Such disputés typically cannot be resolved on a motion to dismiss. See ASARCO, LLC v. Union Pac. R.R. Co., 765 F.3d 999, 1004 (9th Cir.2014) (“If, from the allegations of the complaint as well as any judicially noticeable materials, an asserted defense raises disputed issues of fact, dismissal under Rule 12(b)(6) is improper.”). Moreover, on a motion to dismiss, Northstar’s factual allegations must be accepted “as true and construe[d]...in the light most favorable to the nonmoving party.” Manzarek, 519 F.3d at 1031. Based on these allegations and based on the legal standard that the Court must apply, the Court finds Defendants’ exculpatory provision defense unavailing. To summarize, the Court finds that the Trust-, did not owe a fiduciary duty to Northstar.. Amendment would not change this finding. • The Court therefore GRANTS with prejudice Defendants’ motion to dismiss the Trust from Northstar’s breach of fiduciary duty claims, which constitute claims one and eight in the FAC. The Court, however, DENIES. Defendants’ motion to dismiss with respect to Northstar’s breach of fiduciary duty claims against the Trustees because (1). Defendants are foreclosed from asserting a SLUSA .preclusion defense, (2) Northstar has pled sufficient factual allegations to state a claim for breach of fiduciary duty, (3) and Defendants have failed to show that Northstar’s claims are time-barred or that they fall within an exculpatory clause. B. Breach of Fiduciary Duty Against the Advisor (Claims Two & Nine) The Court now turns to • Defendants’ arguments regarding whether the Advis- or owed a fiduciary duty to Northstar. Because Defendants are foreclosed from arguing SLUSA preclusion, the Court’s discussion is limited to Defendants’ contentions (1) that Northstar has failed to sufficiently allege the existence of a fiduciary duty and (2) that Northstar has failed to sufficiently allege the existence of a breach of this duty.' 1. Existence of Duty The Court turns first to Defendants’ contention that no fiduciary duty exists. Defendants’ argument is that the Advisor’s obligations arise out .of a contractual agreement, the IAA. .Any such claims against the .Advisor must thus be asserted as breach of contract claims, not breach of fiduciary duty claims. In support of this point, Defendants refer the Court to the Supreme Judicial Court of Massachusetts’ decision in Chokel v. Genzyme Corporation, 449 Mass. 272, 867 N.E.2d 325, 330-31 (2007), where the Supreme Judicial Court held that, “[w]hen rights of stockholders arise under a contract, however, the obligations - of the parties are determined by reference to contract law; and not by the fiduciary principles that would otherwise govern.” This Court is not persuaded by Defendants’ analysis. First, the Court declines to treat Chokel as the last word on the matter because it is not, in fact, the last word on the matter. In Selmark Associates, Inc. v. Ehrlich, 5 N.E.3d 923, 933, 467 Mass. 525 (2014), for instance, the Supreme Judicial Court clarified its holding in Chokel, by stating that, “when the challenged conduct at issue in a case is clearly contemplated by the terms of the parties’ written agreements, we have declined to find liability for breach of fiduciary duty. However, we have been equally clear that the presence-of a contract will not always supplant a shareholder’s fiduciary duty.” (internal quotation marks and citations omitted), (emphasis added). More tellingly, in Merriam v. Demoulas Super Markets, Inc., 464 Mass. 721, 985 N.E.2d 388, 394 n. 14 (2013), another case published post-Chokel, the Supreme Judicial Court held that parties may “proceed with a claim for breach of fiduciary duty in situations where a contract did not entirely govern the parties’ rights and duties or where the contract was breached.” Thus, even if the Advisor’s misbehavior fell within the IAA, Northstar could nonetheless bring a breach-of fiduciary duty claim so long as Northstar also sufficiently alleges a breach of contract claim. In Northstar V, the Ninth Circuit all but stated that Northstar had sufficiently alleged a breach of contract claim, when the Ninth Circuit found that a contract . existed between “shareholders on the one hand and the Fund and the Trust ■ on the other,” 779 F.3d at 1054, and that Northstar had “adequately alleged that the investors are third-party beneficiaries of the IAA,” id. at 1065. The Court thus finds Chokel inappo-site. Second, and relatedly, the Court finds Defendants’ analysis belied by the reasoning in Northstar V. As the Ninth Circuit explained, the IAA requires the Advisor to “use-the same skill and care in providing such services as -it would use in providing services to fiduciary accounts if it had investment responsibilities for such accounts.” 779 F,3d at 1062. Such language, the Ninth Circuit went on to note, “indicates the- direct relationship that the shareholders have with the IAA and the fact that they are the actual beneficiaries of the IAA.” Id. at 1063; see also id. at 1064 (“Thus, the ‘ultimate beneficiary’ of the Schwab Advisor’s contractual duties were the shareholders.”). The Ninth Circuit’s reasoning suggests that the Advisor did- not operate at arm’s length.- Instead, the Advisor worked under the supervision of the Trustees on behalf of the shareholders. As such, the Advisor ultimately owed the shareholders certain fiduciary duties, Cf Victor Brudney, Contract and Fiduciary Duty in Corporate Law, 38 B.C. L. Rev. 595, 663-64 (1997) (noting that conventional contract doctrine “focuses on a party’s entitlement to benefit himself, and the limits of that entitlement,” while traditional fiduciary duty doctrine “addresses the obligation of the fiduciary to serve the beneficiary.”). 2. Existence of Breach The Court rejects Defendants’ contention that Northstar has insufficiently alleged breach of fiduciary duty by the Ad-visor. In Northstar V, the Ninth Circuit strongly suggested that the Trustees had breached at least one of their fiduciary duties — the duty of care — by, in part, violating the specific investment restraints imposed upon the Trustees by shareholders. Northstar V, 779 F.3d at 1059. The FAC alleges that the Advisor was responsible for overseeing day-to-day asset management, and that the Advisor would be subject to periodic reviews by the Trustees. FAC at ¶¶ 58, 63. As pointed out above, the relationship between the Trustees and the Advisor is akin to the relationship between a principal and an agent. Here, the Trustees — the principal— dele^ gated many responsibilities to the Advis- or — the agent. Indeed, as noted by the Ninth Circuit in Northstar V, most mutual funds “are essentially puppets of the investment adviser.” 779 F.3d at 1Q61. In sum, given the more active management role undertaken by the Advisor as compared to the Trustees, the Court finds that the FAC also pleads sufficient factual allegations to state a claim for breach of fiduciary duty by the Advisor, for substantially the same reasons that underscored the Court’s earlier decision to find that-the FAC sufficiently alleged breach of fiduciary duty by the Trustees. The Court therefore DENIES Defendants’ motion to dismiss Northstar’s breach of fiduciary duty claims against the Advisor, which constitute claims two- and nine in the FAC. C. Aiding and Abetting Breach of Fiduciary Duty (Claims Three, Four, Ten & Eleven) Northstar asserts that the Trustees aided and abetted the Advisor’s breach of the Advisor’s fiduciary duties (claims three and ten), and that the Advisor aided and abetted the Trustees’ breach of the Trustees’ fiduciary duties (claims four and eleven). Defendants challenge these aiding and abetting claims as being inadequately pleaded because (1) Northstar has failed to state ah underlying claim for breach of fiduciary duty, and (2)- because the “FAC is devoid of factual allegations establishing” aiding and abetting ‘liability. Mot. at 25. The Court has already determined that Northstar has sufficiently alleged an underlying claim for breach of fiduciary duty by both the Trustees and the Advisor. Hence, the sole remaining issue is whether the FAC sufficiently alleges a claim for aiding and abetting liability. Northstar asserts the instant claims under Massachusetts law". See, e.g., FAC ¶ 147. Under Massachusetts law, for purposes of aiding and abetting liability, “the plaintiff must show that the defendant knew of the breach and actively participated 'in it such that he or she could not reasonably be held t,o have acted in good faith.” Spinner v. Nutt, 417 Mass. 549, 631 N.E,2d 542, 546 (1994). The Court finds that the FAC satisfies these requirements. The-FAC, and the exhibits incorporated therein, suggest that the Trustees and the Advisor are to have a close working relationship. Schwab Investments’ 1997 Proxy Statement states, for -instance, that the Trustees and the Advisor worked together in proposing new investment objectives for the Fund. ECF No. 218-1 (“1997 Proxy”) at 16. Similarly, Schwab Investments’ 1998 Prospectus states that “[e]ach Fund will seek-a correlation between -its total return and that of its Index of 0.9 or better..'. .[The Advisor] will monitor the performance of each Fund against its index and will rebalance a Fund periodically to reduce tracking error. In the event a correlation of 0.9 or better is not achieved, the Board of Trustees will consider alternative arrangements.” ECF No. 218-2 (“1998 Prospectus”) at 8. Schwab Investments’ 2007 Annual Report includes several pages which document the overlapping responsibilities of the Trustees and the Advisor. See 2007 Annual Rep. at 71-72. Together, these statements strongly suggest that, if a breach did in fact occur, one Defendant knew what the other Defendant was doing, .and may have helped facilitate the breach at issue. The Court notes that the Court’s decision today does not foreclose Defendants from challenging Northstar’s aiding and abetting claims at a later stage. It is possible, for instance, that Defendants will be able to show that the Trustees did not actively participate in the Advisor’s breach of the Advisor’s fiduciary duties to Northstar, However, based on the facts alleged in the FAC, the information in the exhibits' included therein, and the cursory arguments made in Defendants’ motion to dismiss, the Court finds dismissal inappropriate at this time. The Court therefore DENIES Defendants’ motion to dismiss Northstar’s aiding and abetting claims, which constitute 'claims three, four, ten, and eleven in the FAC. D. Third Party Beneficiary of IAA Against the Advisor (Claims Five & Twelve) With respect to Northstar’s third party beneficiary claims, Defendants argue only that these claims are precluded by SLU-SA. The Court will begin with a brief overview of SLUSA’s legal framework before analyzing whether Northstar’s third party beneficiary claims survive SLUSA preclusion. 1. SLUSA Preclusion SLUSA was enacted to stem the shift of class action lawsuits from federal to state court in the wake of the Private Securities Litigation Reform Act of 1995 (“PSLRA”). Merrill Lynch v. Dabit, 547 U.S. 71, 82, 126 S.Ct. 1503, 164 L.Ed.2d 179 (2006). In order to avoid the PSLRA’s requirements, litigants began asserting what were essentially federal securities law claims as state law causes of action , in state court. Id. Congress sought to end this practice by enacting SLUSA. SLUSA bars private , plaintiffs from bringing (1) a covered class action (2) based on state law claims (3) alleging that defendant made a misrepresentation or omission or employed any manipulative or deceptive device (4) in connection with the purchase or sale of (5) a. covered security. Freeman Investments, L.P. v. Pacific Life Insurance Co., 704 F.3d 1110, 1114 (9th Cir.2013); see also Proctor v. Vishay Inter-technology Inc., 584 F.3d 1208, 1221-22 (9th Cir.2009) (noting that -covered class actions are class actions brought on behalf of more than 50 people). The complaint need not allege scienter, reliance, or loss causation in order for SLUSA to apply. See Anderson v. Merrill Lynch Pierce Fenner & Smith, Inc., 521 F.3d 1278, 1285-87 (10th Cir.2008). In addition, the precluded state law elaims need not contain a “specific element” of misrepresentation. Proctor, 584 F.3d at 1222 n. 13. Allegations of a material misrepresentation may simply serve as the factual predicate of a staté law claim in order to satisfy SLUSA’s misrepresentation prong. Id. 2. Delaware Carve-Out Federal law provides a narrow exception to SLUSA preclusion, known as the Delaware carve-out. This provision states that, notwithstanding the provisions discussed above, “a covered class action.. .that is based upon the statutory or common law of the State in which the issuer is incorporated (in the case of a corporation) or organiz