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: D&O insurance

D&O Insurance: The Major Shareholder Exclusion

Posted in D & O Insurance
An exclusion sometimes found in D&O insurance policies precludes coverage for claims made by shareholders who have a specified percentage of ownership in the insured company. This type of exclusion is called a Major Shareholder Exclusion (or, sometimes, the Principal Shareholder Exclusion). An interesting May 6, 2015 decision (here) by the Supreme Court of Victoria… Continue Reading

Thinking About Excess D&O Insurance

Posted in D & O Insurance
In many cases, companies’ D&O insurance programs are structured in several layers, with one or more policies of excess of insurance written over top of a primary layer. The excess insurance is often said to be written on a “follow form” basis, meaning that the primary policy’s terms govern the operation of the excess policies.… Continue Reading

U.S. Trade Sanctions and D&O Insurance

Posted in D & O Insurance
As part of its conduct of foreign affairs and of its national security program, the U.S. government has instituted a series of economic and trade sanctions against a number of countries and a long list of designated individuals. The various sanctions programs are administered by the Office of Foreign Asset Control (OFAC) within the U.S… Continue Reading

Guest Post: D&O Insurance on the Agenda of Shareholders’ Meetings in Germany

Posted in International D & O
In the following guest post, Dr. Burkhard Fassbach and Dr. Niklas Rahlmeyer imagine a possible shareholder presentation about D&O insurance at an annual meeting of shareholders in Germany.  Fassbach is an Of Counsel with the Dusseldorf based D&O-Specialist Law Firm Hendricks. Rahlmeyer is an attorney in the corporate practice group of the Dusseldorf office of… Continue Reading

Yet Another Shareholder Suit Alleging Misrepresentation of Environmental Liabilities

Posted in Environmental Liability
At a time when cyber liability and other hot topics dominate the discussion, potential corporate liability arising from environmental disclosures often does not receive the attention it should. However, as I have previously noted on this blog, environmental issues have been and remain an area on which plaintiffs’ lawyer have been focused. A recently filed… Continue Reading

D&O Insurance: Insured That Settled Underlying Claim Without Insurer’s Consent Cannot Sue the Insurer for Breach of Contract or Bad Faith

Posted in D & O Insurance
The Georgia Supreme Court has held that where a policyholder settled an underlying claim without its D&O insurer’s consent, the policyholder cannot sue the carrier for breach of contract or for bad-faith failure to settle. The Court, applying Georgia law, entered its opinion in the case based on questions certified from the United States Court… Continue Reading

Management Liability Insurance: Who is a “Non-Executive” Director?

Posted in D & O Insurance
Many contemporary management liability insurance policies draw distinctions between types of directors. For example, many private company D&O insurance policies provide additional excess defense expense coverage for the benefit of “non-executive directors.” However, these kinds of provisions beg the question of who exactly is a “non-executive director”? A recent decision by an appellate court in… Continue Reading

Guest Post: Give Notice on Your D&O Claim…Yesterday

Posted in D & O Insurance, Uncategorized
A frequently recurring management liability insurance coverage issue involves the question of whether or not the policyholder has given timely notice as required under the policy, as I have discussed in prior posts on this blog (most recently here). Among the many kinds of notice issues that can arise are questions involving multiple or interrelated… Continue Reading

D&O Insurance: Contract Exclusion Does Not Preclude Coverage for Intentional Misrepresentation Claim

Posted in D & O Insurance
A recurring D&O insurance question is whether or not a policy’s contract exclusion precludes coverage for claims that the insured induced the claimant into entering a contract through negligent or intentional misrepresentations. In a interesting December 22, 2014 opinion (here), District of Rhode Island Judge John J. McConnell, Jr., applying Rhode Island law, held that… Continue Reading

D&O Insurance: Contractual Liability Exclusion Precludes Coverage for Negligent Misrepresentation Claims

Posted in D & O Insurance
In an October 20, 2014 opinion (here), Middle District of Florida Judge Roy B. Dalton, Jr., applying Florida law, entered summary judgment for a D&O insurer, holding that the insurer was not liable for the stipulated judgment its insured had entered because the policy’s broad contractual liability exclusion precluded coverage for the underlying claims of… Continue Reading

D&O Insurance: Insured vs. Insured Exclusion Applicability to FDIC Failed Bank Claim Held Ambiguous

Posted in D & O Insurance
As I have previously noted on this blog, one of the recurring D&O insurance coverage issues arising during the latest bank failure wave has been the question whether the Insured  vs. Insured Exclusion precludes coverage for claims brought by the FDIC in its capacity as receiver for a failed bank against the failed bank’s former… Continue Reading

D&O Insurance: Though Specific Litigation Exclusion Does Not Apply, Subsequent Suits Related to Prior Claim Not Covered

Posted in D & O Insurance
As the litigation wave arrived following the global financial crisis, many financial institutions were hit with multiple suits that arrived piecemeal and over time. For D&O insurance coverage purposes, these lawsuits were filed across multiple policy periods. A recurring question as the subprime litigation has worked its way through the system is whether the various… Continue Reading

D&O Insurance: FDIC’s Claims Against Failed Bank’s Directors and Officers Not Related to Earlier Claims, Trigger Separate Policy Period

Posted in D & O Insurance
On July 9, 2014, in yet another in the ever growing line of cases examining whether or not separate D&O claims involving interrelated wrongful acts, District of Puerto Rico Judge Gustavo Gelpi, applying Puerto Rico law, held that the FDIC’s claims against the former directors and officers of the failed Westernbank did not involve the… Continue Reading

D&O Insurance: Excess Insurance Not Triggered Due to Insolvency of Underlying Insurer and Due to Insufficient Loss

Posted in D & O Insurance
In a long and convoluted opinion befitting the long and convoluted case in which it was entered, Judge David Grine of the Pennsylvania (Centre Country) Court of Common Pleas, applying Pennsylvania law, entered summary judgment for an excess D&O insurer, holding that the excess insurer’s payment obligation had not been triggered due to the insolvency… Continue Reading

D&O Insurance: Liberalization Endorsement Allows Insureds to Rely on New Policy Form’s Enhanced Insured vs. Insured Exclusion Carve-Back

Posted in D & O Insurance
On June 19, 2014, in a case involving so many unusual coverage issues that it seems more like a law school exam question than an actual coverage dispute, New York (New York County) Supreme Court Judge Melvin Schweitzer, applying New York law, granted summary judgment for the former directors of the bankrupt Lyondell Chemical Company… Continue Reading

Insurance Coverage: Six-Month Delay in Providing Notice Not “As Soon as Practicable”

Posted in D & O Insurance
Has notice of claim been provided “as soon as practicable” if it is sent to the insurer during the policy period but six months after service on the insured of the underlying complaint? Apparently not, at least according to a June 6, 2014 opinion of a New Jersey intermediate appellate court, applying New Jersey law. In addition,… Continue Reading

D&O Insurance: Later Securities Suit and Prior FDIC Failed Bank Claim Held Unrelated, Securities Suit Not Covered

Posted in D & O Insurance
On May 8, 2014, Southern District of New York Judge Deborah Batts, applying New York law, held that a there was not a sufficient “factual nexus” between a securities suit filed after the expiration of a failed bank’s D&O insurance policy and an FDIC claim that had been first made during the policy period and… Continue Reading

Is Climate Change a D&O Insurance Issue?

Posted in Director and Officer Liability
In a series of letters sent to individual board members of various major energy companies and to a number of participants in the directors and officers liability insurance industry, three environmental groups contend that climate change denial by energy industry representatives presents a risk of personal liability to the individual energy company board members. The… Continue Reading

D&O Insurance: New York Appellate Court Refuses Dismissal for Insurer that Raised Late Notice Defense

Posted in D & O Insurance
A New York appellate court, applying New York law, has rejected a D&O insurer’s argument based on alleged late notice of claim that it had no coverage obligations for amounts Sirius XM Radio  had incurred in underlying litigation, holding that the insurer’s policy was ambiguous on the timeliness requirements for notice of interrelated claims. A… Continue Reading

D&O Insurance: Delaware Supreme Court Rules WaMu Liquidating Trust Coverage Suit Not Yet Ripe

Posted in D & O Insurance
In a May 28, 2014 opinion (here), the Delaware Supreme Court held that an action by the bankrupt Washington Mutual bank holding company’s liquidating trust seeking a judicial declaration of coverage under the bank’s D&O insurance program for claims asserted by the trust against the failed bank’s directors and officers must be dismissed on ripeness… Continue Reading

Private Companies: Risks, Exposures and Insurance

Posted in D & O Insurance
In general, and at least in the United States, executives at public companies don’t need to be convinced that their companies need to have D&O insurance. That is not always true with officials at private companies. Some officials at some private companies – particularly very closely held private companies – are skeptical that they need… Continue Reading

Guest Post: Dispelling the Myths of Side A Directors and Officers Insurance

Posted in D & O Insurance
Many insurance buyers now regularly include a separate component of Side A insurance as part of their D&O insurance program. However, even though it has become an increasingly common part of many companies’ D&O insurance programs, Side A D&O insurance is not always fully understood. In the following guest post, Robert F. Carangelo and Paul… Continue Reading