Tag Archives: D&O insurance

Guest Post: Marshall Plan for D&O Policies in Germany

This blog’s primary focus is on developments in the directors’ and officers’ liability and insurance in the United States, but we do also try to cover important developments elsewhere. In the following guest post, Burkhard Fassbach, who is Of Counsel with the Dusseldorf based D&O-Specialist Law Firm Hendricks, and Niklas Rahlmeyer, who is an attorney … Continue Reading

While You Were Out

September is here. Labor Day has come and gone. That can mean only one thing – time to put away the surf boards, bungee cords, fencing foils, pogo sticks, nunchuks, hula hoops, light sabers, and unicycles, and get back to work. Yes, it is time to answer all those emails and return all of those … Continue Reading

Ninth Circuit: Professional Services Exclusion Precludes Coverage Under Payroll Services Firm’s Management Liability Insurance Policy

The problems that can arise from the wording of the professional services exclusion in the D&O insurance policy of a service company are perennial issues and a recurring topic on this blog (see most recently here). In an unpublished August 18, 2015 opinion (here), the Ninth Circuit affirmed the district court’s conclusion that coverage for … Continue Reading

The Problem with a Broadly Worded Professional Service Exclusion in a Service Firm’s D&O Insurance Policy

In a recent post (here), I discussed a recent federal district court ruling in which the court broadly interpreted the professional services exclusion in a bank’s D&O insurance policy in order to preclude coverage under the policy for a claim that had been made against the bank and certain of its directors and officers in … Continue Reading

D&O Insurance: A Question of “Capacity”

In  a recent post in which I discussed the “basic value proposition” of D&O insurance, I noted that among the five indispensable elements required in order for coverage under a D&O insurance policy to exist is the requirement that a Claim for an alleged Wrongful Act against an Insured Person acting in an Insured Capacity. … Continue Reading

D&O Insurance: A “Final” Analysis

One of the standard features of D&O insurance policy is the fraud exclusion, which these days typically provides that the exclusion is triggered only after a “final” judicial determination that the precluded conduct has occurred. But what is it that makes a determination “final”?   On June 23, 2015, in a decision that has a … Continue Reading

D&O Insurance: Debtor-in-Possession Claims and the Insured vs. Insured Exclusion

The traditional Insured vs. Insured exclusion found in many D&O insurance policies is a frequent source of claims disputes, particularly in the bankruptcy context. As its name suggests, the Insured vs. Insured exclusion precludes coverage for claims brought by one Insured against another Insured. The typical Insured vs. Insured exclusion includes a provision (often referred … Continue Reading

Fourth Circuit: Guilty Pleas Trigger D&O Policy Exclusion and Insurer’s Right to Seek Recoupment of Previously Paid Defense Expenses

It sometimes comes as a surprise to some policyholders that D&O carriers contend that they have the right to try to recover amounts they have paid as defense expenses if it turns out that coverage for a claim is precluded by a policy exclusion. However, an insurer’s right of defense expense recoupment is by now … Continue Reading

D&O Insurance: The Major Shareholder Exclusion

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

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

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

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

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

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?

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

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

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

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

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

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

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

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