<!-- Swiftype Variables -->

Courts

Eaton Vance to pay $3.45 million to settle ERISA fiduciary breach claim

Eaton Vance (EV) Corp. has agreed to pay $3.45 million settle a claim that managers of its 401(k) plan violated their fiduciary duties under ERISA by offering mostly proprietary products and failing to provide less expensive, similar options.

The preliminary settlement, announced Monday, requires court approval. The ERISA suit, which sought class-action status on behalf of some 2,600 current and former participants, was filed in October in U.S. District Court in Boston.

Eaton Vance used the 401(k) plan "as a test laboratory and vehicle for self-gain," said the original complaint in Price vs. Eaton Vance Corp. et al., filed by a plan participant.

The complaint maintained that as of the end of 2016, about 80% of the 401(k) plan's assets were invested in Eaton Vance products.

"Eaton Vance's monopolistic, 'buy from the company store' arrangement is indicative of a process that is tainted by a failure of effort, competence or loyalty," the complaint said.

The proposed settlement agreement noted that the defendants deny the allegations.

The settlement fund will include a payment of up to $1.15 million for attorneys' fees and out-of-pocket costs to Sanford Heisler Sharp, the firm that represents the plaintiff.

The Eaton Vance Profit Sharing and Savings Plan, Boston, had assets of $522.7 million as of Dec. 31, 2017, according to its latest Form 5500.