Two Eaton Vance Shareholder Class Actions Dismissed

Skadden obtained a victory for mutual fund company Eaton Vance Management, its parent corporation and the parent’s chief executive officer in securing a dismissal of two purported class actions brought by shareholders. The lawsuits alleged that Eaton Vance’s CEO and the funds’ boards of trustees breached their fiduciary duties by improperly redeeming auction-rate preferred securities in the wake of the 2008 auction market failure, and that Eaton Vance aided and abetted that breach of fiduciary duty. In a June 20 opinion, Judge Peter Lauriat in the Massachusetts Superior Court, Business Litigation Session agreed with Skadden’s arguments and concluded that the plaintiffs’ harm “is not distinct from that of the Fund, and any recovery must go to the Fund, not directly to the common shareholders.”