Joe Investor has had a rough decade. First, a wave of mutual fund scandals broke back in 2003, as regulators accused several prominent fund shops of allowing favored clients to engage in late trading and market timing, profiting at the expense of smaller fund investors. Then the market meltdown of 2008-2009 further eroded investor confidence in Wall Street.

It seems harder and harder for small-fry investors to get a fair shake. Now, one group of small investors has decided to fight back -- but it's facing a decidedly uphill battle in the courtroom.

The underdog rises
The plaintiffs have filed charges against Harris Associates, which runs the Oakmark family of funds. The group claims that the Oakmark funds charged excessive fees to their retail clients. The courts have sided with Harris every step of the way, and an industry heavyweight recently added its support to the fund shop as well.

The Investment Company Institute (ICI) filed briefs with the Supreme Court last month, stating its belief that overall fund fees are not excessive, and that an adverse ruling could potentially drive fees up and put managers out of business. ICI contends that established industry safeguards are sufficient, and that heavy competition in the mutual fund industry ensures that investors have low-cost investment options available to them.

Choose your battles
Ironically, there's no shortage of mutual fund companies charging excessive fees -- but for the most part, Harris Associates isn't one of them. The Oakmark funds charge far less than the average mutual fund. In fact, the Oakmark I (OAKMX) and Oakmark Select I (OAKLX) funds charge annual fees of 1.10% and 1.08%, respectively, compared to 1.37% for the average domestic stock mutual fund.

On top of that, many of the shop's funds have been no slouch lately. Oakmark I's year-to-date return has nearly doubled the S&P's gains. The fund has been boosted by its large tech allocation, with holdings including Dell (NASDAQ:DELL), Tyco International (NYSE:TYC), and Texas Instruments (NYSE:TXN), all of which are up 50% or more this year. Likewise, the more concentrated Oakmark Select I is up more than 40% so far this year, helped in large part by media holdings such as Discovery Communications (NASDAQ:DISCA) and Viacom (NYSE:VIA-B), as well as health-care names like Schering-Plough (NYSE:SGP) and Medtronic (NYSE:MDT).

At any rate, Harris Associates probably isn't too worried about the outcome of this court case, and with good reason.

Buyer beware
If nothing else, it doesn't look like fund investors can expect a white knight riding to their rescue anytime soon. That means the onus will remain on each individual investor to protect his or her financial interests.

First and foremost, if you're a fund investor, there's no excuse for not knowing how much of your hard-earned dough you're forking over to your managers for the privilege of owning their fund. Being a smart fund shopper means buying only funds that charge reasonable fees. The average domestic stock fund charges 1.37%, and the average foreign stock fund charges 1.51%. Make sure that the funds you pick charge less than that.

Second, avoid load-bearing funds like the plague. There's no reason why investors should pony up for a fund that charges a front-end or back-end load. Find another fund with the same investment objective, but without a lump-sum cover charge every time you buy shares. The same goes for paying advisor fees on funds. Never fork over a commission to a third party for placing you in certain funds.

Lastly, consider less expensive index funds or broad market exchange-traded funds. Only a handful of actively managed funds actually manage to beat the market year after year. If you don't have the knowledge, or the desire, to do the work and find out which active funds are long-term winners, stick with low-cost, well-diversified passive funds.

Despite the many problems endemic to the mutual fund industry, investing in funds is still the easiest way for the average investor to achieve long-term wealth. At least for the foreseeable future, it doesn't look like the industry will undergo any meaningful changes. That means investors need to remain proactive and up-to-date in their investing journeys. It's not impossible for the little guy to cut it in the Wall Street game, but it will take more effort and due diligence than ever before.