The U.S. Supreme Court ruled in Fifth Third Bancorp et al. v. Dudenhoeffer, No. 12-751 (U.S. June 25, 2014), that no special presumption of prudence applies to the decision by ESOP fiduciaries to buy and hold stock of the sponsoring employer. But what the Supreme Court shot down with one hand, they reinstated through common sense. Although ESOP fiduciaries don’t get the benefit of any special presumption of prudence, they don’t have a duty to diversify holdings (after all, the ESOP exists to hold employer stock) and plaintiffs have a steep climb to allege the fiduciaries breached their duty of prudence. Alleging that the fiduciaries should violate SEC rules on insider trading is never enough; and, almost always, alleging that the fiduciaries traded in the employer’s stock at the market price is not enough, even if publicly available information could lead an investor to believe the stock was overpriced. Apparently fiduciaries don’t have to be clairvoyant and predict stock market bubbles before they burst.