The U.S. Supreme Court has been asked to review rulings by a federal appeals court and a federal district that supported actions by Great-West Life & Annuity Insurance Co. in the management of a stable value fund.
"This case involves clear cut ERISA violations," said the petition to the court by John Teets, a participant in the Farmers' Rice Cooperative 401(k) Savings Plan. He alleged that Great-West's setting of the stable value fund's terms violated ERISA because it favored Great-West's profits "at the expense of participants who invest in its fund," according to the Sept. 19 petition.
The sponsor was not named as a defendant in the class-action complaint, filed in June 2014 that alleged Great-West's behavior affected many participants in many plans.
In December 2017, a federal district court in Denver granted Great-West's request for summary judgment. The judge ruled that Great-West — a record keeper for the plan — was not a fiduciary and that Mr. Teets had failed to provide "sufficient evidence" that Great-West had unfairly benefited from the stable value fund in its non-fiduciary status.
Mr. Teets appealed to the 10th Circuit Court of Appeals, Denver, which supported the district court judge's opinion in March. Efforts by Mr. Teets to seek a rehearing by the three-judge appeals court panel and by all of the judges in the 10th Circuit were rejected.
In his petition to the Supreme Court, Mr. Teets argued that the 10th Circuit Court of Appeals' analysis of the case conflicts with similar rulings by five other appeals courts on whether non-fiduciaries could be required to give back to plaintiffs profits generated by allegedly prohibited transactions.
The other courts of appeals "are in accord except for the 10th Circuit," Mr. Teets' petition stated. "This significant question is accordingly ripe for the court's review."
The case is John Teets vs. Great-West Life & Annuity Co.