The Better Angels of Our Nature

lincolnThere have been few darker hours in our country’s history than March 4, 1861, the date of Abraham Lincoln’s First Inaugural Address. Seven states had already seceded from the Union and armed conflict loomed. While denouncing secession as anarchy, Lincoln’s address was largely a call for reconciliation. Desperately hoping to avoid the coming conflict, Lincoln ended the speech with an eloquent and impassioned plea:


I am loath to close. We are not enemies, but friends. We must not be enemies. Though passion may have strained it must not break our bonds of affection. The mystic chords of memory, stretching from every battlefield and patriot grave to every living heart and hearthstone all over this broad land, will yet swell the chorus of the Union, when again touched, as surely they will be, by the better angels of our nature.


Yet, as Lincoln himself later put it, the war came. It was a terrible war, its brutality magnified by the use of new mechanized armaments and devices. By the time the war ended, over 700,000 soldiers had been killed. The war was drawing to a close in March 1865, when the time came for Lincoln’s Second Inaugural Address. Rather than sounding a triumphalist theme or calling for retribution, Lincoln again pled for reconciliation, as well as for healing and peace. His address ended with one of the finest paragraphs ever written in the English language:


With malice toward none, with charity for all, with firmness in the right as God gives us to see the right, let us strive on to finish the work we are in, to bind up the nation’s wounds, to care for him who shall have borne the battle and for his widow and his orphan, to do all which may achieve and cherish a just and lasting peace among ourselves and with all nations.


I have had occasion to reflect on Lincoln’s words in recent months. Lincoln’s two inaugural addresses as much as any other action of any President show how a great leader leads. In his first address, Lincoln’s appeal to the “better angels of our nature” urged all to recall and preserve what made the Union great and worth preserving. In his second address, with its invocation not of retribution or score-settling, but rather of “malice toward none” and “charity for all,” Lincoln communicated what would be required after the terrible ordeal to make America great again.


For the country’s sake, one can only hope that among our nation’s current generation of leaders there are at least some who recall Lincoln’s words invoking “the better angels of our natures” and calling us to “do all which may achieve and cherish a just and lasting peace among ourselves and with all nations.” These words are as relevant now as when Lincoln first said them. As long as we remember them, we will have a Union worthy of preserving. It is only if we forget them that our Union will no longer be worthy of being called great.


More Thoughts about a Great Leader’s Words:  Ronald C. White, Jr.’s literary biography of Abraham Lincoln entitled The Eloquent President (here), tells the interesting story of how Lincoln’s First Inaugural Address came to be.


One of the more interesting details about the stirring final paragraph of Lincoln’s speech is that it was the result of an unlikely collaboration between Lincoln and his Secretary of State, William Seward. As well-told in Doris Kearns Goodwin’s excellent book, Team of Rivals, Lincoln and Seward would go on to become political allies and close friends, but at the outset of Lincoln’s presidency, they were political rivals who hardly knew each other and who had never worked together. Lincoln set aside his ego and not only asked Seward to review his draft speech, but he adopted most of Seward’s suggestions.


The most fascinating part of this collaboration is how Lincoln adopted Seward’s suggestions. White’s book puts Seward’s suggestions and Lincoln’s final text in side by side columns, which highlights how Lincoln transformed Seward’s proposed language, sometimes in subtle, sometimes in powerful ways. For example, Seward did indeed suggest the phrase “mystic chords” but Lincoln rendered the phrase as “mystic chords of memory.” Seward suggested “the guardian angel of the nation,” which Lincoln changed into “the better angels of our nature.” Lincoln turned Seward’s well-intentioned prose into meaningful, musical poetry, with words that still resonate and inspire.


The transformative power of Lincoln’s use of language was not lost on Seward; he came to appreciate the power of Lincoln’s words perhaps as much as anyone. Though Seward presumed to make six pages of suggestions to Lincoln’s First Inaugural Address, his presumptions changed as he came to know Lincoln better. Three years later, when asked if he had helped Lincoln write the Gettysburg Address, Seward said, “No one but Abraham Lincoln could have made that address.”


In our time, the Gettysburg Address, the Emancipation Proclamation, and even Lincoln’s Second Inaugural Address may all be better remembered than the speech Lincoln delivered at his first inauguration. Lincoln’s words in his other speeches are indeed memorable. But it seems to me that in our time, as throughout our history, the mystic chords of memory unite us to our past and to our aspirations now more than ever, and the prayerful hope for the influence of the better angels of our nature remain as strong now as ever.


Lincoln’s words remind us that our nation’s history includes days that were darker indeed, but even in those desperate times, we never lost hope and we did persevere — as Lincoln might have said, with God’s help.


Right-Mindfulness for Survival in These Times: And for our final reading today, friends, we draw our text from Paul’s letter to the Philippians, Chapter 4, Verse 8:


Finally, brothers and sisters, whatever is true, whatever is honorable, whatever is just, whatever is pure, whatever is lovely, whatever is commendable, if there is any excellence, if there is anything worthy of praise, think about these things.



Guest Post: Supreme Court to Review Whether Statute of Limitations Applies to SEC Disgorgement Claims

paul-weiss-large-300x53Last Friday, the U.S. Supreme Court granted cert in two cases involving the limitations periods under the federal securities laws. One case, as I noted in a post earlier this week, will address the question of whether or not the filing of a securities class action tolls the Securities Act’s statue of repose. The second case, Kokesh v. Securities and Exchange Commission (about which refer here), involves the question of whether or not the five-year statute of limitations applicable to SEC enforcement actions seeking civil penalties applies to disgorgement claims. In the following guest post, attorneys from the Paul Weiss law firm take a look at the case and the issues it presents, as well as its potential implications. I would like to thank the Paul Weiss attorneys for their willingness to publish their guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is the Paul Weiss attorneys’ guest post.
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Guest Post: The Nuts & Bolts of SEC Investigations & Enforcement

latham logo 1The SEC is the primary regulatory body charged with the enforcement of the U.S. securities laws. Most insurance and legal professionals are well-aware of the agency and familiar with its regulatory role. But in an era that has been (at least up until now) characterized by heightened enforcement activity, many of those professionals may be unfamiliar with the agency’s investigative and enforcement process and protocols. In the following guest post, Ted Carleton and Tammy Yuen of the Skarzynski Black law firm and John Sikora of the Latham & Watkins law firm provides a basic outline of the SEC’s investigative and enforcement processes, reviews some recurring D&O insurance coverage issues arising from SEC investigations and enforcement actions, highlights some of the current issues at the agency, and take a look ahead at what the change in administration may mean. I would like to thank Ted, Tammy, and John for their willingness to publish their guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Ted, Tammy and John’s guest post. Continue Reading

Guest Post: A Focus on Directors’ and Officers’ Risks in India


Richa Shukla

Nilam Sharma

Joel Pridmore

Joel Pridmore

As readers of this blog know well, liability claims against corporate directors and officers is an increasingly global phenomenon. A number of different factors are contributing to the globalization of D&O liability, including legislative changes, changes in regulatory enforcement activity, and the rise of litigation financing. In the following guest post, Richa Shukla of Khaitan Legal Associates, Nilam Sharma of Nilam Sharma Ltd., and Joel Pridmore from Munich Re, Australia, examine the changing environment for D&O liability in India. I would like to thank Richa, Nilam, and Joel for allowing me to publish their article on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Richa, Nilam, and Joel’s guest post. Continue Reading

Supreme Court Agrees to Hear Securities Act Statute of Repose Tolling Question

Supreme court1The U.S. Supreme Court has agreed to take up a case arising out of the credit crisis-era collapse of the Lehman Brothers investment bank, in order to decide whether or not, under principles known as the “American Pipe doctrine,” the filing of a securities class action lawsuit tolls the Securities Act’s statute of repose. In its 1974 American Pipe decision, the Court held that the filing of a class action suit tolls the applicable statute of limitations; in this latest case, the Court must resolve a split between the federal circuit courts and decide whether a class action lawsuit filing also tolls the applicable statute of repose. Though the case involves seemingly arcane issue, it could have very important practical implications, particularly with respect with respect to the timing of class members’ decisions whether or not to opt-out of the class. The U.S. Supreme Court’s January 13, 2017 order granting the petition of the plaintiff for a writ of certiorari in California Public Employees’ Retirement System v. ANZ Securitites Inc. can be found here. Continue Reading

Eighth Circuit: Insured vs. Insured Exclusion Precludes Coverage for Claims Brought by Both Insured and Non-Insured Persons

eighth circuitYou know that the Insured vs. Insured Exclusion is a frequent source of D&O insurance coverage disputes when on consecutive days two federal appellate courts issue opinions interpreting and applying the provision. As I noted yesterday, on January 10, 2017, it was the Ninth Circuit’s turn; the next day, it was the Eighth Circuit’s turn. On January 11, 2017, the Eighth Circuit affirmed a district court’s holding that the Insured vs. Insured exclusion in a grocery store chain’s D&O insurance policy precluded coverage for claims brought by the chain’s founder’s daughter, who had served briefly as a director of the company. The appellate court also affirmed the district court’s holding that the exclusion precluded coverage not just for the daughter’s claims, but also for the claims of her two children, who were shareholders but not directors of the company. The court, applying Minnesota law, held that the exclusion precluded coverage for both the claims of the daughter (who was an insured person) and those of the children (who were not). The Eighth Circuit’s opinion can be found here. Continue Reading

Ninth Circuit: Insured vs. Insured Exclusion Unambiguously Excludes FDIC’s Failed Bank Claims

Ninth CircuitDuring the bank failure wave that followed the global financial crisis, one of the recurring questions was whether or not the failed banks’ D&O insurance policies’ insured vs. insured exclusion precluded coverage for the FDIC’s liability claims as receiver for the failed bank against the banks’ former directors and officers . As I noted in a post late last year, the general consensus among the federal appellate courts is that the exclusion’s applicability to FDIC-R claims is ambiguous and therefore that the exclusion does not preclude coverage. As I also noted, however, there was an exception to this consensus, reflecting important wording differences sometimes found in the exclusion.


Consistent with this exception to the consensus, on January 10, 2017, the Ninth Circuit, applying California law, held in an unpublished opinion that the applicable D&O policy’s insured vs. insured exclusion was not ambiguous and precluded coverage for the FDIC’s claims against the former directors and officers of the failed Security Pacific bank. Unlike the exclusion found in many D&O insurance policies, the policy at issue in the Ninth Circuit’s case specifically precluded coverage for claims brought by any “successor” or “receiver.”  The Ninth Circuit’s opinion can be found here. Continue Reading

Setting the “Blow Provisions” in Securities Class Action Settlement Agreements

scales of justiceAmong the important parts of any securities class action lawsuit settlement agreement are the so-called “blow provisions,” which provide settling defendants with an option to terminate the settlement agreement if a specified threshold of investors elect to opt out of the settlement. Among other key consideration with respect to blow provisions is that the threshold specified must be carefully structured to allow defendants to terminate or renegotiate the class settlement when opt-outs reach an unacceptable level. In a December 8, 2016 research paper entitled “Considerations for Blow Provisions in Securities Class Action Settlements” (here), Cornerstone Research takes a look at the various ways that blow provisions can be structured, and identifies the pitfalls with the various alternatives. Continue Reading

Early 2017 Securities Suit Filings Show Continued Active Pace, Life Sciences Focus

life sciencesIn the Bard’s timeless words, what’s past is prologue. And in that same vein, many of the last year’s most pronounced securities class action lawsuit filing trends are already showing signs of strong continuity in the early days of the New Year. As shown in my recent annual securities class action lawsuit filings analysis, by year-end, a record number of securities suits had been filed during 2016, with life sciences companies among the most frequent lawsuit targets. We are only just a few days into 2017, but these securities suit filings trends already appear to be continuing in the New Year, as so far this year both the continued strong filing pace and the heightened levels of securities suit activity involving life sciences companies are already appear to be well-established. Continue Reading

Del. Court Pans Fee-Shifting Portion of Forum Selection Bylaw

delawareMany readers will recall that just a short time ago companies were actively experimenting to try to incorporate litigation management measures into their corporate bylaws. These efforts led to decisions by Delaware courts upholding both forum selection bylaws (about which refer here) and fee-shifting bylaws (refer here). Delaware’s legislature ultimately addressed these bylaw experimentation efforts by adopting statutory provisions allowing forum selection bylaws but prohibiting fee-shifting bylaws.


Following the enactment of this legislation, the payroll software services firm Paylocity adopted a bylaw provision designating Delaware as the forum for any shareholder disputes and holding any shareholder who filed an action outside Delaware and who did not prevail on the merits liable for the company’s attorneys’ fees. A Paylocity shareholder filed an action in Delaware Chancery Court challenging the bylaw’s fee-shifting provision. In an interesting December 27, 2016 opinion (here), Chancellor Andre Bouchard held that the Paylocity bylaw’s penalty provisions violated the Delaware statutory fee-shifting bylaw prohibitions, but dismissed the claims that company’s board had violated its fiduciary duties in enacting the bylaw. Continue Reading