
Core Viewpoint - A class action lawsuit has been filed against Southwest Airlines for allegedly breaching fiduciary duties under ERISA by failing to replace the Harbor Capital Appreciation Fund, which has underperformed for over fifteen years and holds over $2 billion in retirement plan assets [1][2]. Summary by Sections Allegations and Performance - The Harbor Capital Fund was selected as an investment option on or before 2010 and has consistently lagged behind its benchmark, the Russell 1000 Growth Index, over three, five, and nine-year periods as of December 2018 [2]. - The decision not to remove the Harbor Capital Fund has reportedly cost the Southwest Retirement Savings Plan millions of dollars in potential retirement savings for employees [2]. Participants and Defendants - The lawsuit is filed on behalf of approximately 60,000 participants in the Southwest Retirement Savings Plan, which has around $14 billion in assets [3]. - Defendants include Southwest Airlines, its Board of Directors, and the committees managing the Retirement Savings Plan and its predecessors [3]. Fiduciary Duties and Legal Relief - The complaint emphasizes that the Harbor Capital Fund constitutes 17% of the plan's assets, making the monitoring of this investment critical for fiduciaries [4]. - Plaintiffs seek repayment of financial losses, removal of imprudent investments, and the removal of fiduciaries who have allegedly violated their duties under ERISA [4]. Context of Legal Action - This lawsuit follows several significant ERISA class settlements in 2024, including a record $69 million settlement against UnitedHealth Group and a $61 million settlement against General Electric [5].