Bratislava, Slovakia

The Bratislava Castle, overlooking the Danube

The D&O Diary’s Eastern European sojourn continued earlier this week with a very brief stop in Bratislava, the capital of Slovakia, which is about a two-hour train ride from Budapest. With a population of only about 450,000, Bratislava is small, but it has a rich history and interesting setting on the Danube, only about 30 miles downstream from Vienna. Continue Reading

Guest Post: Cybersecurity and D&O Liability: Emerging Concerns under Indian Law

One of the most closely watched issues in the world of D&O is the extent to which cybersecurity-related issues will lead to liability for corporate directors and officers. In the following guest post, Tarun Krishnakumar, a New Delhi attorney qualified in India and California specializing on issues relating to emerging technology , takes a look at the corporate liability framework under Indian laws with respect to emerging cybersecurity exposures. I would like to thank Tarun for allowing me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Tarun’s article. Continue Reading

Budapest on the Danube

The Hungarian Parliament Building on the Danube River in Budapest

The D&O Diary is on assignment in Eastern Europe this week, with multiple destinations on the itinerary, starting with a weekend stop in Hungary’s capital city of Budapest. With a city population of 1.7 million and an urban population over 3 million, Budapest is a large, sprawling place. The taxi ride from the airport into the central city cuts through some pretty scruffy parts of town, so it was startling to arrive at the river and encounter the Danube’s sweeping beauty as it rolled through the city’s central district. Continue Reading

Guest Post: DOJ Issues New Policy on Coordination of Corporate Penalties to Address “Piling On”

Deputy Attorney General Rod Rosenstein recently announced a new policy at the U.S. Department of Justice to address the “piling on” problem that corporate defendants can sometimes face – that is, the accumulation of penalties that can arise when multiple different federal agencies pursue enforcement actions against the corporate target based on the same alleged misconduct. In the following guest post, attorneys from the Paul Weiss law firm take a look at the new policy and its practical implications. I would like to thank the authors for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is the Paul Weiss attorneys’ article. Continue Reading

Book Review: The Warren Buffett Shareholder

One of the highlights of the yearly business calendar is the annual meeting of Berkshire Hathaway shareholders. Every spring tens of thousands of the Berkshire faithful make the haj to Omaha, to hear the wisdom of Berkshire’s Chairman, Warren Buffett, and his long-standing side-kick and straight man, Charlie Munger. How did this assembly become such a widely attended and closely watched event, and why do so many people attend year after year? These questions are interestingly examined in a recent book of short essays edited by the wife and husband team of George Washington University Law School Professor Lawrence Cunningham and New York attorney and real estate developer Stephanie Cuba. The book, entitled “The Warren Buffett Shareholder: Stories from Inside the Berkshire Hathaway Annual Meeting” (here), provides a series of interesting glimpses of what the Berkshire shareholder meeting means to a number of different regular attendees, along the way illustrating how and why the meeting has become the phenomenon that it now is. Continue Reading

Michigan State Agrees to Pay Sexual Assault Victims $500 Million    

In a May 16, 2018 press release (here), Michigan State University announced that its board of trustees has approved a settlement in which the university agreed to pay MSU doctor Larry Nassar’s sexual assault victims a total of $500 million. There are a number of noteworthy features to this settlement agreement, beyond just its sheer size. Among other things, the school does not yet know for sure how it is going to fund the settlement. Continue Reading

SEC Public Company Enforcement Action Continue Steep Decline in First Half FY 2018

The number of SEC enforcement actions against public companies and their subsidiaries declined in the first half of FY 2018 compared to the comparable year prior period, continuing a sharp downward trend that began in the second half of FY 2017 and falling to the lowest level in years, according to a new report from Cornerstone Research, written in collaboration with the NYU Pollack Center for Law & Business. Monetary settlements during the first half of fiscal 2018 also fell to their lowest level in years. The report, entitled “SEC Enforcement Activity: Public Companies and Subsidiaries, Midyear FY 2018 Update” (here), reports on SEC enforcement activity involving public companies and their subsidiaries for the first half of fiscal 2018, which ended March 31, 2018. Cornerstone Report’s May 15, 2018 press release about the report can be found here. Continue Reading

IPO-Related Securities Litigation and the Idea of Shareholder Claim Mandatory Arbitration

As I have noted in prior posts, a number of commentators have proposed that companies filing with the SEC to complete IPOs ought to be able to include in their bylaws a mandatory arbitration provision requiring shareholder claimants to submit claims – including even claims under the federal securities laws – to arbitration. This idea, which has been percolating for years, received a significant boost in a statement last summer from outgoing SEC Commissioner Michael Piwowar, in which he suggested that the SEC would favorably view submissions by IPO companies that included bylaw provisions requiring mandatory arbitration of securities claims. As detailed in an April 23, 2018 paper from Elisa Mendoza of ISS Securities Class Action Services entitled “The Uncertain Role of IPOs in Future Class Actions” (here), this idea has its critics. But what might this kind of mandatory arbitration proposal, if put into action, actually mean for securities class action litigation going forward? Mendoza’s paper helpfully takes a statistical look at this question in light of historical securities litigation involving IPO companies. Continue Reading

U.S. Senators Introduce Bill to Require Litigation Funding Disclosure

Along with the recent rise in third-party litigation financing has come a widely-held perception that there is something vaguely shady about it. For example, a May 12, 2018 New York Times article, in what is nearly a compulsory formulation, described litigation funding as “unregulated and opaque.”  This common perception about litigation funding is one reason why I have long felt that eventually that some form of  litigation financing disclosure is going to be required – indeed, one state has already instituted rules requiring the disclosure. The possibility for more universal disclosure requirements moved one step closer last week, when three U.S. Senators introduced legislation that would make litigation financing disclosure mandatory in certain kinds of federal court lawsuits. The draft bill has predictably drawn praise and scorn from commentators with opposing viewpoints, but the key thing at this point is that the debate about litigation financing disclosure has moved from the fringes and has now taken center stage. Continue Reading

Guest Post: The First Federal Court Hearing on SEC Jurisdiction over ICOs

John Reed Stark

As cryptocurrencies and ICOs have proliferated, one very key question has been whether not the coins or tokens are securities within the meaning of the federal securities laws. Earlier this week, the first federal court hearing at which this question was discussed took place in the federal district court in Brooklyn. In the following guest post, John Reed Stark, President of John Reed Stark Consulting and former Chief of the SEC’s Office of Internet Enforcement, provides his detailed report of the court hearing as well as his perspective on the topics under discussion. A version of this article originally appeared on Cybersecurity Docket. I would like to thank John for his willingness to allow me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is John’s guest post. Continue Reading

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