This dramatic twist centers on a lawsuit against Great-West Capital Management, doing business as Empower Retirement, under the Investment Company Act. The law firms represented a group of retirement plan participants who alleged that Great-West had charged excessive advisory and administrative service fees dating back to 2016.
$1.5M Sanction Against Schlichter Bogard : Legal Odyssey
The legal odyssey began with parts of the litigation being dismissed before a September 2018 ruling that denied summary judgment for Great-West. The presiding judge relied on opinions offered by an expert named J. Chris Meyer. In an 11-day bench trial in January 2020, it was ruled that the fees in question were reasonable. Furthermore, Meyer had been “thoroughly discredited” during cross-examination.
In a surprising turn, Great-West sought sanctions against the plaintiffs’ counsel for persisting in the case, despite its “fatal legal flaws,” which defendants repeatedly pointed out. This case confirmed these flaws, they argued.
Three Critical Arguments
In their bid to overturn the sanctions, the two law firms made three crucial arguments. Firstly, they maintained it was reasonable for them to proceed with their claims as they had survived an earlier summary judgment motion. Secondly, they challenged the court’s conclusions regarding their damage arguments conflicting with nonbinding case law. Lastly, they contended that allowing sanctions like these would deter future lawsuits from shareholders.
