Investors Say “Set-It-and-Forget-It” Funds Betrayed Them
The dispute stems from a 2022 lawsuit accusing Vanguard of breaching its fiduciary duty to small investors in its target-date retirement funds. Plaintiffs claimed Vanguard’s effort to reduce costs backfired, forcing investors to liquidate up to 15% of their holdings. Those with taxable accounts were left saddled with unexpected tax burdens, effectively punished for trusting in “set-it-and-forget-it” funds.
“The settlement provides an immediate recovery and avoids the considerable risks of continued litigation in this complex case,” the plaintiffs said in their Friday filing.
Counsel on All Sides
The investors are represented by a coalition of law firms including Dovel & Luner LLP, The Rosen Law Firm PA, Wolf Haldenstein Adler Freeman & Herz LLP, Golomb Legal, Beasley Allen Law Firm, and The Brown Law Firm PC.
Vanguard and its officers are represented by Debevoise & Plimpton LLP and Welsh & Recker PC. Independent trustees managing the funds are represented by Paul Weiss Rifkind Wharton & Garrison LLP and Troutman Pepper Locke LLP.
