Discount Tire Ordered to Defend 401(k) Plan’s Target-Date Funds

A lawsuit challenging the American Century Investments target-date funds in Discount Tire Co.'s 401(k) plan advanced Thursday, when a federal judge said the case was based on “apples to apples” comparisons.

The plaintiff, a former participant in the Discount Tire plan, argued the American Century funds were imprudent because they underperformed five other target-date fund suites with similar strategies and risk tolerances, along with the market index benchmark set by the Discount Tire plan. These are meaningful comparisons that support viable claims under the Employee Retirement Income Security Act, Judge Douglas L. Rayes of the US District Court for the ...