No, the point is that if the fund hasn't been sued for the past few decades of its existence for holding non-well known companies (or whatever your definition of "blue chip is"), they're probably not going to get sued for holding x holdings, inc.
I think that could be the point if the question was "Will the fund be sued for [...]?" but the question was "Can the fund be sued for [...]?", which likely was intended to ask if such a lawsuit could reasonably be expected to win.
It seems to me that the presence of other even less "blue-chip" holdings in Fidelity's blue chip funds would make a lawsuit more credible, not less credible.
That said, I don't see many entities with the will and funding to pursue this lawsuit. The SEC has way more obvious problems to solve than clarifying the definition of "blue chip" in court, institutional investors aren't usually going to pursue a suit on moral outrage, and the average individual has no chance in court against Fidelity's legal team.
>It seems to me that the presence of other even less "blue-chip" holdings in Fidelity's blue chip funds would make a lawsuit more credible, not less credible.
From the prospectus:
>Principal Investment Strategies
> [...]
> Normally investing at least 80% of assets in blue chip companies (companies that, in Fidelity Management & Research Company LLC (FMR)'s view, are well-known, well-established and well-capitalized), which generally have large or medium market capitalizations.
Fidelity has wide latitude to decide what counts as "blue chip". On top of that, even if there are companies that aren't "blue chip", it's fine as they're below 20%.
