Teets v. Great-West Life & Annuity Insurance Company

Filing 149

ORDER granting in part and denying in part 130 Motion for Order to Approve Notice of Class Certification by Judge William J. Martinez on 12/29/2016. (Attachments: # 1 Attachment to the Order)(cthom, )

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO

You have been identified as a participant in or
beneficiary of your employer-sponsored 401(k)
retirement savings plan that is currently or in the past
invested in the Great-West Key Guaranteed Portfolio
Fund. A class action lawsuit may affect your rights.
A Federal Court has authorized this notice, but no Court has ruled on the merits, if any,
of the Plaintiff’s claims. This is not a solicitation from a lawyer. Neither you nor your retirement
plan is being sued.
A 401(k) plan participant who invested in the Great-West Key Guaranteed Portfolio Fund
(the “Fund”) has sued Great-West Life & Annuity Insurance Company (“Great-West”) alleging
that Great-West makes too much money from the Fund. Plaintiff claims that Great-West retains
too much of the Fund’s investment return (minus certain costs), to the detriment of Fund
participants and beneficiaries (the class members), and in violation of ERISA. The lawsuit is
known as John Teets v. Great-West Life & Annuity Insurance Company, No. 14-02330. Judge
William J. Martinez of the United States District Court for the District of Colorado (the “Court”)
is overseeing this case.
The Court has certified this lawsuit to proceed as a class action under Federal Rule of Civil
Procedure 23, subparts (b)(1)(A) and (b)(3) on behalf of the following class (the “Class”):
All participants in and beneficiaries of defined contribution employee pension
benefit plans within the meaning of ERISA § 3(2)(A), 29 U.S.C. § 1002(2)(A),
who had funds invested in the Great-West Key Guaranteed Portfolio Fund from
six years before the filing of this action [June 4, 2008] until the time of trial.
The Court has not decided whether Great-West did anything wrong. There is no money
available now, and no guarantee there will be. However, your legal rights are affected, and you
have a choice to make now:
YOUR LEGAL RIGHTS AND OPTIONS IN THIS LAWSUIT
DO
NOTHING

Stay in this lawsuit as a member of the Class. Await the outcome.
Give up the right to bring your own lawsuit. By doing nothing, you
keep the possibility of getting money or benefits that may come from a
trial or a settlement. But, you give up any rights to sue Great-West
separately about the claims that were brought in this lawsuit.

Questions? Visit www.

.com, email Class Counsel at XX.com, write to Class Counsel at
ADDRESS, or call Class Counsel at XX.
DO NOT CONTACT THE COURT FOR INFORMATION.
1

ASK TO BE
EXCLUDED

•

•

Exclude yourself from the Class. Give up the right to money that
may result from the lawsuit. Keep rights to bring your own
lawsuit.
You have the right to exclude yourself from the lawsuit. If you ask to
be excluded and money is later awarded, you won’t have a right to
share in that. But you could decide to sue Great-West separately for
that money.

Your options are explained in this notice. To ask to be excluded, you must act before
May 31, 2017.
Lawyers must prove the claims against Great-West to the satisfaction of the Court. If
money is obtained from Great-West you will be notified about the share you are entitled
to receive under a “Plan of Allocation.” A Plan of Allocation describes how money paid
by a Defendant like Great-West is to be divided up in a case like this.
WHAT THIS NOTICE CONTAINS

BACKGROUND OF THE LITIGATION............................................................ PAGE
1.
Why did I get this notice?
2.
What is this lawsuit about?
3.
What does Great-West say about the lawsuit?
4.
Has the Court decided who is right?
5.
What is the Plaintiff asking for?
6.
Is there any money available now?
WHAT IS A CLASS ACTION AND WHO IS IN THE CLASS ........................ PAGE
7.
What is a class action and who is involved?
8.
Why is this lawsuit a class action?
9.
Am I part of this Class?
10.
Which retirement plans are included?
11.
I’m still not sure if I am included.
YOUR RIGHTS AND OPTIONS.......................................................................... PAGE
12.
What happens if I do nothing at all?
13.
Why would I ask to be excluded?
14.
How do I ask the Court to exclude me from the Class?
THE LAWYERS REPRESENTING YOU .......................................................... PAGE
15.
Do I have a lawyer in this case?
16.
Should I get my own lawyer?
17.
How will the lawyers be paid?

Questions? Visit www.

.com, email Class Counsel at XX.com, write to Class Counsel at
ADDRESS, or call Class Counsel at XX.
DO NOT CONTACT THE COURT FOR INFORMATION.
2

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THE TRIAL ............................................................................................................ PAGE
18.
How and when will the Court decide who is right?
19.
Do I have to come to the trial?
20.
Will I get money after the trial?
GETTING MORE INFORMATION.................................................................... PAGE
21.
Are more details available?
BACKGROUND OF THE LITIGATION
1.

Why did I get this notice?

The Plaintiff in this lawsuit claims that persons who invested in the Great-West Key
Guaranteed Portfolio Fund (“Fund”) have suffered financial losses as a result of Great-West’s
alleged violation of its duties to them. You have been identified as an affected person based on
Great-West’s records, which show that on or after June 4, 2008, you had funds invested in the
Fund through a 401(k) retirement savings plan.
This notice explains that the Court has allowed, or “certified,” this case as a class action
lawsuit that may affect your 401(k) funds. You have legal rights and options that you may
exercise before the Court decides who wins this lawsuit. The Court will decide whether the
claims being made against Great-West on your behalf are valid.
2.

What is this lawsuit about?

The Employee Retirement Income Security Act of 1974 (“ERISA”) is the federal law that
governs the operation of 401(k) plans, including yours. ERISA places responsibilities, known as
“fiduciary duties,” on certain categories of persons who are involved with ERISA-covered plans
and makes certain conduct illegal. A violation of ERISA occurs if a person with a fiduciary duty
acts in a self-interested or conflicted manner when handling investments or charges excessive
fees. More information about ERISA can be found at the website of the Department of Labor,
www.dol.gov.
This lawsuit arises out of a financial product known as the Great-West Key Guaranteed
Portfolio Fund (“Fund”). Great-West receives contributions to the Fund from members of the
class like you and invests them in its general account. Great-West pays a certain amount of the
return on that investment to class members, based on “a credited rate,” which is set by GreatWest prior to each quarter. Plaintiff claims that Great-West retains too much of the Fund’s
investment return (minus certain costs), to the detriment of Fund participants and beneficiaries
(the class members), and in violation of ERISA. Great-West disputes that it has acted
improperly or violated ERISA.
In this lawsuit, Plaintiff makes three claims. First, Plaintiff alleges that Great-West
breached its duty of loyalty under ERISA by setting the “credited rate” artificially low, and
keeping too much of the overall return. Second, Plaintiff alleges Great-West engaged in selfdealing transactions which violate ERISA. Third, Plaintiff alleges Great-West knowingly
participated in prohibited transactions in violation of ERISA.
Questions? Visit www.

.com, email Class Counsel at XX.com, write to Class Counsel at
ADDRESS, or call Class Counsel at XX.
DO NOT CONTACT THE COURT FOR INFORMATION.
3

You can read the Plaintiff’s First Amended Class Action Complaint and other relevant
documents at www. .com.
3.

What does Great-West say about the lawsuit?

Great-West denies that it did anything wrong. Great-West contends that the Fund is what
is known as a “guaranteed benefit policy,” and ERISA provides that the assets underlying a
guaranteed benefit policy are not subject to ERISA. Great-West contends, as a result, that it
could not possibly have breached any obligations under ERISA, and that the Department of
Labor has specifically authorized products like the Fund as being exempt from ERISA. GreatWest contends that in addition to complying with the law, the KGPF has helped Great-West
customers to reach their retirement goals. Great-West’s Answer to the Amended Complaint is
also available at www.
.com.
4.

Has the Court decided who is right?

The Court hasn’t decided whether Great-West or Plaintiff is correct. By certifying the
Class, the Court is not suggesting that the Plaintiff will win or lose this case. The Plaintiff must
prove his claims at a trial. (See “The Trial” below in Questions Nos. 17-19). The Court might
also decide that there is not enough evidence to warrant having a trial.
5.

What is the Plaintiff asking for?

Plaintiff is asking that Great-West be stopped from further violations of its fiduciary
responsibilities under ERISA. Additionally, Plaintiff asks that Great-West refund fees and
excessive profits on the Fund, with interest, and that the funds be allocated to the Class
members’ 401(k) plan accounts.
6.

Is there any money available now?

No money is available now because the Court has not yet decided whether Great-West
did anything wrong. There is no guarantee that money ever will be obtained. If they are, you
will be notified about what your share is.
WHAT IS A CLASS ACTION AND WHO IS IN THE CLASS
7.

What is a class action and who is involved?

In a class action lawsuit, one or more people called “Class Representative” (in this case
John Teets) sues on behalf of other people who have similar claims because they have been
harmed in the very same way. The people together are a “Class” or “Class Members.” The
person who filed the lawsuit—and all the Class Members like him—are called the Plaintiffs. The
company he sued (in this case Great-West) is called the Defendant. In a class action, one court
resolves the issues for everyone in the Class—except for those people who choose to exclude
themselves from the Class.
8.

Why is this lawsuit a class action?

The Court in this case decided that this lawsuit can proceed as a class action and move
ahead because the Class meets the requirements of Federal Rule of Civil Procedure 23, which
governs class actions in federal courts. Specifically, the Court found that:
Questions? Visit www.

.com, email Class Counsel at XX.com, write to Class Counsel at
ADDRESS, or call Class Counsel at XX.
DO NOT CONTACT THE COURT FOR INFORMATION.
4

•
•
•
•
•
•

•

There are approximately 270,000 ERISA plan participants invested in the Fund;
There are legal questions and facts that are common to the plans;
The Class Representative has displayed adequate knowledge of the claims at issue;
The claims of the Class Representative are typical of the claims of all of the
participants, like yourself, that participate in the plans covered by the Class;
The Class Representative and the lawyers representing the Class will fairly and
adequately represent the Class’s interests
Separate lawsuits by or against individual class members would create a risk of
inconsistent or varying adjudications that would establish incompatible standards of
conduct for the Defendant;
A class action is the more efficient and superior way to litigate predominate class
issues.

The Court certified the Class under two different subparts of the rule governing class
actions: Federal Rule of Civil Procedure (“Rule”) 23(b)(1)(A) and 23(b)(3).
More information about why the Court is allowing this lawsuit to be a class action is in
the Court’s Order Certifying the Classes, which is available at www. .com.
9.

Am I part of this Class?

The Court certified the following class (the “Class”):
All participants in and beneficiaries of defined contribution employee pension
benefit plans within the meaning of ERISA § 3(2)(A), 29 U.S.C. § 1002(2)(A),
who had funds invested in the Great-West Key Guaranteed Portfolio Fund from
six years before the filing of this action (June 4, 2008) until the time of trial.
You are receiving this Notice because you have been identified by Great-West as
being a participant in or beneficiary of defined contribution employee pension benefit
plans who had funds invested in the Great-West Key Guaranteed Portfolio Fund during
the relevant time period. This means you are part of the Class.
10.

I’m still not sure if I am included.

If you are still not sure whether you are included, you can get help at www. .com, or by
calling or writing to the lawyers in this case, at the phone number or address listed in the answer
to Question No. 20.
YOUR RIGHTS AND OPTIONS
Rule 23(b)(3) gives you a right to be excluded from a class. You have to decide whether
to stay in the Class or ask to be excluded under Rule 23(b)(3). This is called “opting-out” of the
Class. You must decide this by the “Opt Out Deadline” set by the Court.

Questions? Visit www.

.com, email Class Counsel at XX.com, write to Class Counsel at
ADDRESS, or call Class Counsel at XX.
DO NOT CONTACT THE COURT FOR INFORMATION.
5

The Opt Out Deadline is May 31, 2017. The instructions to opt out if you choose to
do so are provided in the answer to Question No. 13 below.
11.

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What happens if I do nothing at all?

By doing nothing you are staying in the class. If you stay in, and the Plaintiff obtains
money, either as a result of the trial or a settlement, you will be notified about your share of any
recovery at a later date. Again, it is possible that no money will be recovered.
Keep in mind that if you do nothing now and the case proceeds to trial, regardless of
whether the Plaintiff wins or lose the trial, you will not be able to sue or continue to sue GreatWest—as part of any other lawsuit—about the legal claims that are the subject of this lawsuit.
You will also be legally bound by all of the Orders the Court issues and judgments the Court
makes in this class action. The possibility of another opportunity to opt out because a class
action settlement is reached is not guaranteed.
12.

Why would I ask to be excluded?

If you do not want to participate in the lawsuit, you can ask to be excluded. If you
exclude yourself from the Class by the Opt Out Deadline set forth below you give up your right
to receive money awarded, even if the Plaintiff obtains them as a result of the trial or from
any settlement (that may or may not be reached) between Great-West and Plaintiff.
However, you may then be able to sue Defendant for ERISA violations related to its crediting of
interest for the Great-West Key Guaranteed Portfolio Fund.
If you start your own lawsuit against Great-West after you exclude yourself, you’ll have
to hire your own lawyer for that lawsuit, and you’ll have to prove your claims. If you do exclude
yourself so you can start your own lawsuit against Great-West, you should talk to your own
lawyer soon, because your claims may be subject to a statute of limitations, which sets time
limits by which claims must be brought.
13.

How do I ask the Court to exclude me from the Class?

To ask to be excluded as discussed above you must send an “Exclusion Request” in the
form of a letter sent by mail, stating that you want to be excluded from the class in Teets v.
Great-West Life & Annuity Insurance Company. Be sure to include your name and address, and
sign the letter. You must mail your Exclusion Request postmarked by May 31, 2017, to Teets v.
Great-West Life & Annuity Insurance Company Exclusions, P.O. Box________, City, ST 000000000. You may also get an Exclusion Request form at the website, www. .com.
THE LAWYERS REPRESENTING YOU
14.

Do I have a lawyer in this case?

The Court decided that the law firms of Schneider Wallace Cottrell Konecky Wotkyns
LLP; Feinberg, Jackson, Worthman & Wasow, LLP; the Law Office of Scot D. Bernstein, P.C.;
and Keller Rohrback, L.L.P., are qualified to represent you and all Class Members. Together the
law firms are called “Class Counsel.” They are experienced in handling cases involving breaches
of ERISA’s fiduciary duty provisions, including cases against other companies that service other
retirement plans. More information about these law firms, their practices, and their lawyers’
Questions? Visit www. .com, email Class Counsel at XX.com, write to Class Counsel at
ADDRESS, or call Class Counsel at XX.
DO NOT CONTACT THE COURT FOR INFORMATION.
6

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experience is available at www.schneiderwallace.com, www.feinbergjackson.com,
www.sbernsteinlaw.com and www.kellerrohrback.com.
15.

Should I get my own lawyer?

If you remain in the class you do not need to hire your own lawyer because Class
Counsel are working on your behalf. If you want to hire your own lawyer, you may do so,
although you will have to pay that lawyer. For example, you can ask him or her to appear in
Court for you if you want someone other than Class Counsel to speak for you.
16.

How will the lawyers be paid?

If the Class wins, Class Counsel may ask the Court for fees and expenses. You won’t
have to pay these fees and expenses. If the Court grants Class Counsels’ request, the fees and
expenses would be either deducted from any money obtained for the Class or paid separately by
the Defendant.
THE TRIAL
17.

How and when will the Court decide who is right?

Unless there is a settlement, Class Counsel will have to prove the Plaintiff’s claims to the
Court and will have to overcome Great-West’s defenses. During the court proceedings, the Judge
will hear all of the evidence to help the Judge reach a decision about whether the Plaintiff or
Defendant is right about the claims in the lawsuit. There is no guarantee that the Plaintiff will
win, or that he will get any money for the Class.
18.

Do I have to come to the trial?

If there is a trial, you do not need to attend. Class Counsel will present the case for the
Plaintiff, and Great-West will present their defenses through their lawyers. You and your own
lawyer are welcome to come at your own expense.
19.

Will I get money after the trial?

If the Plaintiff obtains money as a result of a trial or a settlement, you will be notified
about any recovery to which you are entitled. It is not known how long this will take or how
much money, if any, you will be entitled to receive.
GETTING MORE INFORMATION
20.

Are more details available?

Visit the website, www.__________.com, where you will find the Court’s Order
Certifying the Class, the First Amended Complaint that the Plaintiff submitted, the Defendant’s
Answer to the Amended Complaint, as well as an Exclusion Request form. Other filings with the
Court in this case are also available online. The hearings and other important events in the case
will be posted there as well. You may also get further information by calling 1-000-000-0000, or
by writing to Great-West Class Action, P.O. Box ________, ST 00000-0000, or by emailing
Class Counsel at XXXX.
Questions? Visit www.

.com, email Class Counsel at XX.com, write to Class Counsel at
ADDRESS, or call Class Counsel at XX.
DO NOT CONTACT THE COURT FOR INFORMATION.
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Date:______________________

Questions? Visit www.

.com, email Class Counsel at XX.com, write to Class Counsel at
ADDRESS, or call Class Counsel at XX.
DO NOT CONTACT THE COURT FOR INFORMATION.
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