D&O Insurance

News & Analysis as of

The Impact of Halliburton on Directors and Officers Insurance

Over the past year, directors and officers have been anticipating the Supreme Court’s ruling in Halliburton Co. et al. v. Erica John Fund, Inc., No. 13-317. In its recent 9-0 decision, the Supreme Court retained the...more

D&O Claims – Overview of US Securities Law

The Securities Act of 1933 (“the 1933 Act”) regulates the process by which securities are first offered and sold to the public, and has two primary objectives: (1) to ensure that investors receive full and accurate...more

Insurance Recovery Law - July 2014

Second Circuit: Insurer Must Defend Where Factual Allegations Create a Possibility of Coverage - Why it matters: In a recent pro-policyholder decision, the Second Circuit, applying New York law, reminded...more

Who pays when the authorities come calling? Syracuse Univ. v. National Union Fire Ins. Co. of Pittsburgh, P.A.

With the seemingly endless stream of federal and state investigations implicating institutions of higher education, a recent New York decision offers a glimmer of hope to those schools that find themselves in the cross-hairs....more

Policyholder Observer

Encryption Flaw "Heartbleed" Creates Data Risk: How Insurance Can Stanch the Bleeding - In early April, news broke of an encryption flaw named “Heartbleed” that exposed companies to data breaches for over two and one...more

"Supreme Court Allows Rebuttal of Fraud on the Market at Class Certification Stage in Halliburton Co. v. Erica P. John Fund"

The Supreme Court of the United States today in Halliburton Co. v. Erica P. John Fund upheld the fraud-on-the-market presumption of reliance first recognized by the Court in Basic v. Levinson, but gave defendants a new tool...more

Second Circuit Vacates Judge Rakoff’s Rejection of SEC Settlement: Consent Decree “Fair and Reasonable” Even Without Admission of...

D&O insurers should be mindful of a recent development in the Second Circuit that could have implications for D&O insurers. The developments stem from a key decision in the Southern District of New York in 2011. On November...more

King of the Mug Shots - Interview with Kevin LaCroix, Founder and Editor of the D&O Diary

I grew up in Fairfax, Virginia, a suburb of Washington, D.C. We had a small house and a large family – I am the fifth of six children. Growing under those conditions helped foster independence, resilience and self-reliance....more

FinCrimes Update - Volume 1, Issue 3

On May 8, OFAC released enforcement information regarding “apparent violations” of the Cuban Assets Control Regulations by Canadian subsidiaries of a U.S. insurance company. The U.S. company self-reported 3,560 apparent...more

Delaware Court Clarifies Director and Officer Liability in M&A Transactions

In Chen v. Howard-Anderson, 87 A.3d 648 (Del. Ch. 2014), the Delaware Court of Chancery (Laster, V.C.) held that directors and officers can be held liable for their participation in a change-of-control transaction if their...more

D&O Insurance and IPOs: Seven Issues You Need to Consider

As a company prepares for an IPO, the last thing to sometimes be considered is the potential of future litigation. Although going public can of course be a very good thing for a company, its directors, its initial investors...more

Is Your D&O Policy Ready For The Halliburton Decision?

Any day now the United States Supreme Court will announce its decision in Halliburton Co. v. Erica P. John Fund, Inc. If the Supreme Court rules to neither reject nor affirm “fraud on the market,” the importance of event...more

The SEC’s (New) Admissions Policy: Questions and Consequences

Nearly a year has passed since the SEC announced that it would require admissions of wrongdoing as a condition of settling SEC charges in certain cases. Perhaps it can no longer be called a “new” policy. But lawyers are still...more

Insurance Coverage for Data Breach Claims

Recent examples of data breaches resulting in invasion of privacy lawsuits abound. Target and other retailers, financial services companies and other businesses have had their internal data systems breached and consumers’...more

Individual Liability in CFPB Enforcement Proceedings

To date, the CFPB has brought 12 cases—out of more than three dozen total CFPB enforcement cases—in which it named individuals as defendants or respondents liable for violations of consumer protection statutes. Below, we...more

Does the Business Judgment Rule Protect Bank Officers and Directors?

When a corporation suffers significant losses, or ultimately fails, frustrated shareholders, creditors, or others often try to sue the corporation and/or its officers and directors for losses caused by mismanagement of the...more

Arizona Court Holds Insured Person Exclusions Applicable to Consolidated Securities Claims

In its recent decision in Amerco v. Nat’l Union Fire Ins. Co., 2014 U.S. Dist. LEXIS 69066 (D. Ariz. May 20, 2014), the United States District Court for the District of Arizona had occasion to consider the application of...more

Surviving in an Age of Individual Accountability: How Much Protection Do Indemnification and D&O Insurance Provide?

We consider below how advancement of legal fees, indemnification, and insurance operate when officers and directors become involved in regulatory investigations and proceedings. Part I addresses the enhanced risk officers and...more

Delaware Court Enforces “Loser Pays” Bylaw, Opens the Door for D&O Insurers to Better Assess and Control Shareholder Litigation...

The Delaware Supreme Court held that a corporation’s fee-shifting bylaw is enforceable as long as the bylaw is not adopted for an inequitable purpose. A first of its kind, this ruling seems poised to change dramatically the...more

Seeking (and Finding) Coverage for Proposition 65 Claims

Navigating California’s Safe Drinking Water and Toxic Enforcement Act of 1986—better known as Proposition 65—is becoming an increasingly difficult endeavor for California-based companies and companies that do business in...more

Insurance Recovery Law - May 2014

Policyholder Entitled to Select Counsel, Even Where Insurer Withdrew Reservation of Rights - Why it matters: An insured dissatisfied with counsel selected by its insurer was entitled to select counsel of its...more

Cyber Risks for the Boardroom Part 5: Coverage for Privacy Violations

The last installment in our series – “Coverage for Privacy Violations” - Part 5 of 5: Coverage For Privacy Violations: As we previously noted, recent SEC actions on the topic of cybersecurity indicates...more

Chen v. Howard-Anderson: A Study in the Standards of Review and of D&O Conduct in the Merger Context

Litigation over challenges to corporate mergers has swelled in recent years, exposing directors, officers and their D&O insurers to large amounts of defense costs and potentially great liability. The Delaware Chancery Court...more

Adopting A Vision: Putting The Pieces Together (Part II of IV)

People need a vision to inspire them. I know this sounds corny but I always used this motto as a motivational tool. If you can see the goal, then you can figure out a way (or ways) to achieve the goal. If you conduct a set...more

Cyber Risks for the Boardroom Part 3: Top Questions Directors Should be Asking about D&O Coverage

Our series “Cyber Risks – Director Liability and Potential Gaps in D&O Coverage” continues – Part 3 of 5: Top Questions Directors Should Be Asking About D&O Coverage Directors never want to be in the unenviable...more

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