Can I just say that I find it mighty depressing that everyone is talking about Hurricane Sandy in the past tense, as if the storm were already done and gone? Here in Northeast Ohio, as I write this blog post on Thursday evening, the rain continues to fall and the cold and gloomy damp lingers on. We have had continuous rain here since Sunday afternoon— and it is still raining. Trees down, power out, water everywhere. We haven’t yet arrived at the “aftermath” part of this story because the event is still taking place. Sandy just won’t leave.
The storm has made serious inroads into my blogging activities. There aren’t many opportunities for blogging when you are sitting in a candlelit room, huddled in blankets and listening to an ancient transistor radio, waiting for the power to return and hoping at least for a break in the weather.
With intermittent Internet access at coffee shops, I have at least been able to scan the Web. I seriously wonder if Sandy is the single most commented upon event in the history of the Internet. Of course all of the major media outlets have deployed saturation coverage of the event. The most charmingcoverage I have seen is the November 1, 2012 summary on Gawker of small town newspaper reporting about Sandy, here. As Gawker put it in the introduction to the article, “Every black-clad, chain-smoking SoHo gallery owner and martini-lunching, town car-riding hedge fund manager started out life as a chubby, freckle-faced kid from South Dakota. Their parents and hometown newspapers were worried about them during the storm. These are their stories.”
There has also been a lot of media attention to the insurance angle of the story. A host of aggregate insurance loss estimates have been published. I know one thing for sure. All of the estimates are WAAAAY too low. Trust me on this one. It isn’t just that things are a lot worse in New York and New Jersey than people are assuming. (By way of illustration, check out this before and after photo display of the Jersey shore, here.) It is that nobody is even thinking about how much damage there was in places like Pennsylvania, Maryland, West Virginia, Ohio and Michigan. Be honest -- before you read this blog post, were you even aware that the storm was bad in Ohio? Of course not, nobody cares that there is a terrible storm in Ohio when there was a hurricane in New York. (Just to prove my point,-- did you know that in 2008, Hurricane Ike caused nearly $1.5 billion damage in Ohio? Of course you didn't.) This is going to be just like it was with Hurricane Irene, where the early estimates were too low because at first nobody knew at first how bad the damage was in Upstate New York and New England. The exact same sequence of events is set up to happen with the estimates for Sandy.
One particularly interesting question that has come up in the insurance context has been the issue of whether or not insurers can enforce hurricane deductibles in New York, New Jersey and Connecticut. According to news reports, those states’ governors are saying that the insurers cannot enforce the deductibles. Is that so, I asked myself? Apparently, so too did Alison Frankel, over at the On the Case blog, where she has a very interesting article discussing the question of whether or not the governors actually can prevent the insurers from enforcing the deductibles. Quick summary of her analysis: We’ll see. Among the many interesting questions is whether Sandy was still a hurricane at the time she made landfall. I will say this -- homeowners and property owners in New York, New Jersey and Connecticut were already going to see their insurance rates jump. If insurers can't enforce a hurricane dedictible, then the insurers are going to expect to be compensated for the increased risks -- and so proeprty insurance rates will skyrocket. .
Anyway, I sure hope that we get power back soon so that, among other things, I can resume normal blogging activities. For now, I will leave you with one last link worth checking out. Woodruff-Sawyer has published its third quarter installment of their D&O Databox, which can be found here. The article has an update on third quarter securities class action filings as well as some interesting commentary on other litigation developments. Among other things, the article refers to the growing wave of executive compensation –related proxy disclosure litigation, a topic about which I had a guest post earlier this week, here.
To everyone out there who is stuck in a cold, dark house waiting for the power to come back on, let me tell you, from first hand knowledge, things could be worse. You could be stuck in a cold, dark house with your mother-in-law waiting for the power to come back on. FRIDAY MORNING UPDATE: The good news is that it stopped raining overnight. The bad news is that it is raining again this morning. At 8:30 am, it is still so dark that the possibility of daylight is still just a rumor. Power still out.
Follow-Up: Last week, I posted an article (here) about proposals by the U.S. Chamber Institute for Legal Reform to introduce legislation to address the M&A litigation problem. In a commentary to my blog post, Doug Greene, on his D&O Discourse blog, proposes his own partial solution to the M&A litigation problem. Doug’s interesting post can be found here.
In Case You Missed It: Earlier this week, I posted a blog entry entitled: “The Looming Fiscal Cliff and Business Risk.” Not many people wound up seeing the article because I posted it the day that Sandy hit. Please take a look at it now if you missed it earlier this week. The post can be found here.