One of the recurring D&O insurance issues is the question of policy coverage for additional acquisition consideration paid to an acquired companies’ shareholders – so-called "bump up" claims. In an interesting and colorfully written September 28, 2009 opinion (here) that insurers undoubtedly will cite profusely in future disputes of this kind, District of Massachusetts
More Subprime Lawsuit Dismissals
In my recent subprime and credit crisis lawsuit status update (here), I commented that the defendants seemed to be getting the upper hand at the dismissal stage in many of these cases. Two recent dismissal motion rulings tend to corroborate this view. In addition, the defendants in the auction rate securities cases continue
Up Next: Securities Suits Against Municipalities?
Among the many firms and entitles struggling with the effect of the global economic downturn are a host of municipalities, many of whom face diminished tax revenues, unfunded pension and health care liabilities and aging infrastructure. A number of these municipalities also labor under a burden of debt undertaken when times were flush. Financial woes
An Interesting Auction Rate Securities Suit Dismissal
In a ruling with potential significance for the other remaining auction rate securities lawsuits, on September 17, 2009, Southern District of New York Judge Lewis A. Kaplan granted the defendants’ motion to dismiss, with leave to amend, in the auction rate securities lawsuit pending against Raymond James Financial and certain of its subsidiaries. A copy
Do Comp Reform Proposals Threaten Increased Board Exposures?
One of the propositions on which most commentators seem to agree is that perverse compensation incentives helped fuel the global economic crisis. For example, last Wednesday, formed Fed Chairman Paul Volcker said in a speech that one of the causes of the financial crisis "was the ultimately explosive combination of compensation practices that provided enormous
Specter’s “Aiding and Abetting” Bill: Why it Could Pass and Why it Matters
In January 2008, the U.S. Supreme Court in the Stoneridge case followed its prior decision in Central Bank of Denver and held that there is no private right of action for "scheme liability" or aiding and abetting under the federal securities laws, ruling that Congress had reserved to the SEC the right to enforce aiding
Acquitted Options Backdating “Scapegoat” Seeks Revenge
Former McAfee General Counsel Kent Roberts, accused of options backdating-related misconduct, was acquitted following a criminal jury trial and the SEC later dropped its separate enforcement action against him. But that apparently is not enough for Roberts – he wants vengeance.
On September 16, 2009, he filed a lawsuit in the Northern District
Has the New Round of Banking-Related Litigation Begun?
As the number of failed and troubled banks has surged, one recurring question has been whether the banks woes would lead to a new round of banking-related litigation. While a few lawsuits had emerged in connection with earlier bank failures (refer here), there really has been nowhere near the number of suits as might
Towers Perrin Releases 2008 D&O Survey Report: Some Comments
On September 9, 2009, Towers Perrin released its report of the firm’s 2008 Survey of Directors and Officers Liability Insurance Purchasing Trends, which can be accessed here. Towers Perrin’s anticipated annual report again this year will undoubtedly be widely read throughout the D&O insurance industry. The report is a good resource and it
Subprime-Related Securities Litigation: An Interim Update
It is now over two and a half years since the first subprime-related securities class action lawsuit was filed in February 2007, yet many of the cases filed as part of the ensuing litigation wave are still only in their earliest stages. But there have been some important developments recently – for example, the Eighth Circuit’s