Knight-Swift $3M ERISA Settlement Over Excessive 401k Fees and Costly Investments

Hagins v. Knight-Swift Transportation Holdings Inc. centers on how the company’s 401(k)-style retirement plan was run for participants and beneficiaries between Oct. 26, 2016, and Nov. 26, 2025. In these plans, employers and plan committees act as fiduciaries—meaning they must manage the plan solely in participants’ interests—by negotiating reasonable recordkeeping and administrative costs, selecting prudent investments, and properly handling plan “forfeitures” (money left behind when employees leave before certain employer contributions vest). The settlement creates a $3 million fund that, after court-approved deductions, will be distributed pro rata based on each person’s average account balance during the class period, with current participants typically receiving a credit to their plan account and former participants generally receiving a check. The lawsuit was filed because plaintiffs alleged the plan’s fiduciaries violated ERISA by allowing excessive administrative fees, keeping or choosing high-cost or imprudent investment options, and misusing forfeiture funds—claims that, if proven, can mean participants paid more than necessary or earned less than they reasonably should have. ERISA (the Employee Retirement Income Security Act) is a federal law that imposes strict duties of loyalty and prudence and provides a pathway for participants to sue when they believe those duties were breached, making these cases significant both for potential monetary recovery and for pushing employers to tighten oversight of plan vendors and investment menus. Knight-Swift denied wrongdoing but agreed to settle to avoid the expense and uncertainty of continued litigation, with final approval scheduled for an April 1, 2026 fairness hearing. This case fits into a broader wave of “excessive fee” ERISA class actions targeting large employers across industries, often focusing on recordkeeping charges, the use of more expensive share classes, and whether fiduciaries regularly benchmarked fees and replaced underperforming or overpriced options. Courts and regulators have increasingly emphasized process—documented fee comparisons, competitive bidding, and ongoing monitoring—because even common plan features can become problematic if fiduciaries can’t show they acted prudently. The allegations around forfeitures also reflect heightened scrutiny of how plans apply those funds (for example, to offset plan expenses or reduce employer contributions), an area where clearer disclosures and consistent plan administration practices can reduce the risk of similar litigation.