StockNews.AI
LUV
StockNews.AI
202 days

Sanford Heisler Sharp McKnight Files ERISA Class Case Against Southwest Airlines on Behalf of More Than 60,000 Retirement Plan Beneficiaries

1. Southwest Airlines faces a class action for mismanagement of retirement funds. 2. The suit claims failure to replace an underperforming fund costing millions. 3. The Harbor Capital Fund has lagged behind benchmarks for over 15 years. 4. Approximately 60,000 participants and $14 billion in assets are involved. 5. Plaintiffs seek removal of fiduciaries and repayment of financial losses.

7m saved
Insight
Article

FAQ

Why Bearish?

Legal issues can undermine investor confidence and affect stock performance, similar to past cases where litigation led to stock drops.

How important is it?

The lawsuit directly challenges LUV's fiduciary responsibilities, potentially impacting investor sentiment and stock value.

Why Long Term?

Resolution of the lawsuit may take time, influencing LUV's financial outlook over the long term.

Related Companies

LUVUALGE
Suit alleges Southwest Airlines failed to replace a chronically underperforming fund that holds over $2 billion in Southwest’s retirement plan assets. For more information: Jamie Moss, newsPRos, 201.788.0142; jamie@newspros.com DALLAS, Jan. 29, 2025 (GLOBE NEWSWIRE) -- Sanford Heisler Sharp McKnight filed a class complaint today in the U.S. District Court for the Northern District of Texas alleging that Southwest Airlines Co. breaches basic fiduciary duties under ERISA and violates its employees’ trust by mismanaging the company’s Retirement Savings Plan. The Complaint alleges that Southwest failed to remove from the Plan the Harbor Capital Appreciation Fund, an investment option with over $2 billion in plan assets that has significantly underperformed its investment benchmark and similar large cap growth funds for over fifteen years. According to the Complaint, Southwest selected the Harbor Capital Fund as a plan investment option on or before 2010. By December 2018, the cumulative investment performance of the Harbor Capital Fund lagged its benchmark – the Russell 1000 Growth Index - over the preceding three, five, and nine years. It also underperformed other large cap growth alternatives over the same periods. Yet, Southwest took no action to replace the Harbor Capital Fund. Its underperformance continues to this day. As alleged, the consequences for employees are substantial: the decision not to remove the Harbor Capital Fund has cost the Southwest Retirement Savings Plan millions of dollars in retirement savings. The two named plaintiffs filed this case on behalf of the Southwest plan which has approximately 60,000 participants and $14 billion in assets. Named as Defendants are Southwest Airlines, its Board of Directors, the Committee that manages the Retirement Savings Plan, the Committee that managed two predecessor plans that merged into the Retirement Savings Plan, and individual members of the Board and the Committees. “Plan participants have invested over $2 billion in the Harbor Capital Fund. As fiduciaries to the Plan, Defendants are obligated to monitor the plan to ensure that all investments are prudent,” said Charles Field, partner at Sanford Heisler Sharp McKnight and counsel for plaintiffs and the proposed class. “With the Harbor Capital Fund, this obligation is especially critical because this one fund makes up 17% of the plan’s assets. We believe the Southwest Defendants neglected their sacred fiduciary duties.” “As fiduciaries of the plan, Defendants are duty bound to monitor the plan’s investments continuously and remove imprudent ones,” said David Tracey, a partner at Sanford Heisler Sharp McKnight and counsel for Plaintiffs and the proposed class. “It is precisely that duty that this complaint alleges the Defendants have breached by failing to remove the Harbor Capital Fund. Cases like this are a critical tool for ensuring retirement security for employees.” As relief, Plaintiffs and the class seek (1) repayment of the Plan’s financial losses; (2) removal of imprudent investments; and (3) the removal of the fiduciaries who have violated their duties to the Plan’s participants and beneficiaries under ERISA. Sanford Heisler Sharp McKnight files the Southwest ERISA complaint on the heels of several significant ERISA class settlements in 2024. In December 2024, the firm filed for preliminary approval of a record $69 million settlement in its multi-year class action against UnitedHealth Group. Earlier in 2024, Sanford Heisler Sharp McKnight, together with co-counsel, also obtained final approval of a $61 million settlement in a long-running ERISA class action against General Electric. The UnitedHealth and GE settlements were among the most significant ERISA settlements of 2024. They were also among the highest value settlements ever in cases involving allegedly poor-performing plan investments. ABOUT SANFORD HEISLER SHARP MCKNIGHT Sanford Heisler Sharp McKnight is a public interest and civil rights law firm with offices in New York, Washington, DC, San Francisco, Palo Alto, Nashville, and San Diego. The firm focuses on executive representation, wrongful termination, employment discrimination, sexual harassment, retaliation, wage theft and overtime violations, whistleblower and qui tam, sexual violence, Title IX violations and victims’ rights, financial mismanagement and ERISA litigation, and Asian American litigation and finance matters. Our lawyers have recovered over $1 billion for our clients through many verdicts and settlements. In 2024, Forbes named Sanford Heisler Sharp McKnight Chairman and Co-Founder David Sanford to its inaugural list of America’s Top 200 Lawyers. The National Law Journal has selected Sanford Heisler Sharp McKnight as Civil Rights Firm of the Year, and it has recognized the firm as both Employment Rights Firm of the Year and Human Rights Firm of the Year. Benchmark Litigation has named the firm Labor & Employment Firm of the Year, and Law360 has recognized the firm as Employment Practice Group of the Year. For the latest news about Sanford Heisler Sharp McKnight, visit the firm’s newsroom or follow the firm on LinkedIn, Facebook, or Twitter. If you have potential legal claims and are seeking counsel, please call 646-768-7070 or email david.sanford@sanfordheisler.com. Attorneys at Sanford Heisler Sharp McKnight would like to have the opportunity to help you. Media Contact: Jamie Moss, newsPRos, at 201-788-0142 or Jamie@newspros.com.

Related News