Southwest Faces Suit Over Actively Managed 401(k) Investment (1)

Southwest Airlines Co. was hit with a proposed class action saying it mismanages its retirement plans by offering a poorly performing actively managed fund that should have been removed.

The Harbor Capital Appreciation Fund served as the plans’ only large-cap option for at least 15 years, even though this fund “could not beat its benchmark,” according to a lawsuit filed Tuesday in the US District Court for the Northern District of Texas. The inclusion of this fund has been “disastrous” for Southwest workers, who lost millions of dollars in retirement savings from their combined $2.3 billion investment in the fund, ...