Great-West Defeats Class Action Over 401(k) Investment Products

Great-West Life & Annuity Insurance Co. defeated a 270,000-person class action challenging the money it makes off guaranteed investment products sold in 401(k) plans.

The retirement plan service provider didn’t act as a fiduciary under the Employee Retirement Income Security Act when it set the interest rate paid to investors who hold its Key Guaranteed Portfolio Fund, the U.S. Court of Appeals for the Tenth Circuit held March 27. Restrictions Great-West allegedly placed on transfers out of the fund weren’t enough to create fiduciary status, the court said.

The thorough victory for Great-West is good news for the Principal Life ...