The D&O Diary

The D&O Diary

A PERIODIC JOURNAL CONTAINING ITEMS OF INTEREST FROM THE WORLD OF DIRECTORS & OFFICERS LIABILITY, WITH OCCASIONAL COMMENTARY

Tag Archives: Director and officer liability

While You Were Out

Posted in Director and Officer Liability
I have no idea where summer went, but with the passage of Labor Day weekend there’s no denying that summer is over and that it is time to get back to work. For those of you who were fortunate enough to take some time off this summer or who maybe just found it a little … Continue Reading

On the Frontiers of Corporate Litigation and Liability: Inversion Transactions and a Proposed Duty to Warn

Posted in Director and Officer Liability
Among the developments dominating the business headlines in recent weeks have been two unrelated stories – the rising wave of so-called “inversion” transactions in which U.S. companies acquire foreign firms to avoid U.S. tax laws and the revelation of previously undisclosed problems with the ignition switches in certain GM cars that allegedly resulted in numerous … Continue Reading

Georgia Supreme Court Affirms, Elucidates Business Judgment Rule – and Its Limitations

Posted in Director and Officer Liability
A recurring issue in FDIC litigation against the former directors and officers of failed banks has been whether the business judgment rule insulates the defendants  from claims of ordinary negligence. This question has been particularly important in Georgia, where there were more bank failures than any in other state and consequently more failed bank litigation. … Continue Reading

SEC Commissioner Aguilar Addresses Cybersecurity Oversight Responsibilities of Corporate Boards

Posted in Cyber Liability
In a June 10, 2014 speech entitled “Boards of Directors, Corporate Governance and Cyber-Risks: Sharpening the Focus” delivered at the New York Stock Exchange, SEC Commissioner Luis A. Aguilar highlighted the critical importance of the involvement of boards of directors in cybersecurity oversight. In his speech, Aguilar stressed that “ensuring the adequacy of a company’s … Continue Reading

Guest Post: Cyber Security, Cyber Governance, and Cyber Insurance: What Every Public Company Director Needs to Know

Posted in Cyber Liability
  As I have frequently noted on this site (refer, for example, here), cyber security issues increasingly are a board level concern, and indeed, recent shareholder litigation has shown that investors intend to hold board members accountable when data breaches cause problems for their companies.  In the following guest article, which was previously published as a … Continue Reading

Wyndham Worldwide Board Hit with Cyber Breach-Related Derivative Lawsuit

Posted in Cyber Liability, Director and Officer Liability
 In what is the latest example of the potential cybersecurity-related liability of corporate boards, a shareholder for Wyndham Worldwide Corporation has initiated a derivative lawsuit against certain directors and officers of the company, as well as against the company itself as nominal defendant, related to the three data breaches the company the company and its … Continue Reading

Liability Exposures of Audit Committee Chairs

Posted in Director and Officer Liability
One frequently asked question is whether members of a corporate board’s audit committee face heightened liability exposures. Two recent SEC enforcement actions seem to underscore that audit committee chairs do face liability exposures. Though both cases involve somewhat unusual circumstances, they seem to suggest that the “gatekeepers” on which SEC has said it will be … Continue Reading

Antitrust Enforcement and Corporate Risk Exposure

Posted in Director and Officer Liability
As a result of heightened regulatory scrutiny and changing enforcement priorities around the world, “cartel enforcement is a hot topic in boardroom,” according to a March 29, 2014 Economist magazine article entitled “Just One More Fix” (here). According to the article, antitrust enforcement authorities are getting “better at detecting cartels and bolder in punishing them.” … Continue Reading

Guest Post: The Business Judgment Rule Under Attack

Posted in Director and Officer Liability
In many jurisdictions, corporate officials sued for their actions undertaken in their corporate capacity may be able to defend themselves in reliance on the “business judgment rule.” This rule is designed to prevent courts from second-guessing the decisions of directors and officers. The defense has become particularly important in connection with the extensive litigation the … Continue Reading

Guest Post: Here We Go Again? Financial Institutions Face Heightened Regulatory Scrutiny Over Forex and Other Unregulated Rates

Posted in Director and Officer Liability
The global financial services industry is still reeling from the regulatory investigations surrounding the Libor scandal. Nevertheless, it seems that yet another scandal may be about to envelop the industry. In the following guest blog post Eric C. Scheiner and Jennifer Quinn Broda1]of the Sedgwick law firm take a look at what looks like will … Continue Reading

Top Ten D&O Stories of 2013

Posted in Director and Officer Liability
The world of directors and officers liability has long been characterized by rapid change. But even given these well-established dynamics, 2013 was a particularly eventful year, with several different developments that could impact the D&O arena for years to come. The list of the Top Ten D&O Stories of 2013 is set out below with … Continue Reading

The Responsible Corporate Officer Doctrine Gets an Administrative Extension

Posted in Director and Officer Liability
One of the more troublesome trends in recent years has been the increasing willingness of lawmakers and regulators to try to impose liability on corporate officials without regard for the requirements of the corporate form and even without reference to whether the officials are culpable in any way. (Refer here for my most recent discussion … Continue Reading

Goldman Sachs Must Advance Criminal Defense Fees of Former Employee Accused of Stealing Computer Code from the Company

Posted in Director and Officer Liability
In an October 22, 2013 opinion (here) that underscores the important distinction between indemnification and advancement and that highlights the sometimes surprising extent to which corporate officials are entitled to advancement of their attorneys’ fees when claims are filed against them, District of New Jersey Judge Kevin McNulty held that Goldman Sachs must advance the … Continue Reading

PLUS Professional Liability Regional Symposium in Zurich, October 9-10, 2013

Posted in Director and Officer Liability
I want to make sure that all readers – particularly those based outside the U.S. — are aware of an upcoming Professional Liability Underwriting Society (PLUS) event.   On October 9-10, 2013, PLUS will be sponsoring an educational and networking event in Zurich. The Professional Liability Regional Symposium will address a wide range of issues … Continue Reading

Notes from Around the Web and Around the World

Posted in Director and Officer Liability
Canadian Courts May Attract Securities Claims, But Claimants Still Must Show They Belong There: Much has been written (on this site and elsewhere) about the possibility that Canada might become a destination for would-be securities plaintiffs. That perspective gained an apparent boost in March 2012, when the Ontario Court of Appeals held that the liability regime … Continue Reading