Cunningham v. Cornell University

Under this rule, the Cunningham plaintiffs' allegations—that Cornell's 403(b) plan engaged in covered transactions with service providers—sufficed to state a Section 1106(a) claim without separately pleading facts that negated Section 1108's exemption. Cornell's argument that plaintiffs bore the burden of disproving exemption eligibility at the motion-to-dismiss stage inverted the proper allocation of proof. The Court's reversal establishes that once a plaintiff alleges a transaction falls within Section 1106(a)'s prohibition, the fiduciary defendant must affirmatively invoke and prove the availability of a statutory exemption, not the reverse. This shifts the pleading burden and makes it substantially easier for beneficiaries to proceed past dismissal in ERISA service-provider cases.