The U.S. Securities and Exchange Commission’s move to formally rescind its 2024 climate disclosure rule represents a significant turning point in the evolution of ESG-related regulation and the associated D&O risks. According to the federal regulatory tracking website, SEC staff submitted a proposed rule entitled “Rescission of Climate-Related Disclosure Rules” to the Office of Information and Regulatory Affairs for review on May 4, 2026, formally initiating the withdrawal process. 

Continue Reading SEC Moves to Rescind Climate Disclosure Rule

Following the U.S. Supreme Court’s decision invalidating tariffs imposed under the International Emergency Economic Powers Act (IEEPA), litigation risk has entered a new phase. As previously noted on The D&O Diary, early lawsuits seeking recovery focused on companies that passed tariff costs on to consumers. A newly filed class action against Sony Interactive Entertainment suggests a second wave may now be emerging; one targeting companies for allegedly pursuing a “double recovery” by retaining both higher consumer prices and government tariff refunds.

Continue Reading A Second Wave of Tariff Recovery Litigation and Expanding D&O Risk

As Sarah Abrams noted in a post on this site last September, President Trump, in a social media post, proposed eliminating quarterly report for public companies. On May 5, 2026, the SEC acted on the President’s suggestion and proposed a rule that would provide companies currently subject to the agency’s quarterly reporting requirements with the option to instead file interim reports semiannually. It seems likely that optional semiannual reporting will soon be put into effect. The question is whether this is a good idea or will produce the intended benefits, as discussed below.

Continue Reading SEC Proposes Allowing Optional Semiannual Reporting
Shabnam Karim
Simon Lamb

The current conflict in Iran has enormous implications for the global and regional Middle East economy. The conflict also has important insurance implications, including with respect to D&O insurance in the Middle East region. In the following guest post, Shabnam Karim and Simon Lamb examine the ways that the current military, political, and diplomatic circumstances in the region are affecting both corporate risk exposure and the D&O insurance underwriting and claims environment. Shabnam is a partner and Simon is an associate at the Norton Rose Fulbright law firm’s Dubai office. We would like to thank Shabham and Simon for allowing us to publish their article on this site. Here is Shabnam and Simon’s article.

Continue Reading Guest Post: Middle East D&O Claims Exposures in a Time of Tension

As followers of the financial markets know, in recent months, trouble has been brewing in the private credit sector. In at least some cases, the problems in the private credit markets have translated into D&O claims, including both securities class action lawsuits (for example, here) and shareholder derivative lawsuits (here). In the latest example of a private credit-related D&O claim, a shareholder plaintiff has filed a securities class action lawsuit against one of KKR’s private credit ventures, alleging that the firm overstated asset valuations and the effectiveness of its restructuring efforts. A copy of the May 4, 2026, securities class action lawsuit complaint can be found here.

Continue Reading Yet Another Private Credit Firm Hit With Securities Suit

The U.S. Supreme Court’s June 2024 decision in SEC v. Jarkesy continues to generate follow-on litigation, as regulated entities increasingly challenge the constitutionality of administrative enforcement proceedings. As D&O Diary readers will recall, Jarkesy held that when the SEC seeks civil penalties for securities fraud, claims the Court characterized as “legal in nature,” defendants are entitled to a jury trial under the Seventh Amendment. That ruling is now fueling a growing wave of challenges to state administrative regimes, including a pending appeal in Delaware and a closely watched case before the Arizona Supreme Court.

Continue Reading Recent Jarkesy Developments and D&O Impact

It was 20 years ago this week – on May 6, 2006 – that The D&O Diary published its first blog post. Two decades and literally thousands of blog posts later, The D&O Diary is still at it, still a “Periodic Journal,” still publishing “Items of Interest from the World of Directors and Officers Liability, With Occasional Commentary.”  

Continue Reading The D&O Diary Celebrates Its 20th Anniversary

According to industry reports, education technology companies experienced unprecedented demand during COVID‑19, fueled by remote learning mandates and significant public investment in digital infrastructure. School districts rapidly deployed laptops, software platforms, and immersive learning tools while students were learning remotely. However, now that classrooms have largely returned to in‑person instruction, a growing backlash against ed‑tech has begun to emerge.  In the last month, both the New York Times and Wall Street Journal have reported on the backlash from educators and parents, as well as study results showing the deteriorating effect of technology use in classrooms.

This recent reporting has coincided with certain ed‑tech companies confronting tightening capital markets, operational challenges, and increasing scrutiny from investors and regulators. A complaint filed against zSpace, Inc (zSpace) and its directors and officers on April 23, 2026  (zSpace SCA), may demonstrate how these converging dynamics are now beginning to manifest in securities litigation.  The following will discuss the zSpace SCA allegations, the company’s purported financial pressures, and potential D&O exposure for companies in the ed‑tech industry.

Continue Reading Ed-Tech Backlash and Emerging Securities Litigation Risk

One of the perennial D&O insurance issues involves the question whether “disgorgement” amounts awarded in SEC proceedings represent “penalties” for which insurance coverage is precluded. In the latest example of a case involving these issues, the Delaware Superior Court recently held, in reliance on the statutory provisions defining the SEC’s authority to seek monetary remedies, that the disgorgement amounts and prejudgment interest awarded against the media company Clear Channel are not “penalties” for which coverage is precluded. As discussed below, the court’s analysis of the issues, and its reference to the relevant statutory provisions, is both detailed and instructive.

Continue Reading Del. Court: SEC Disgorgement Not a “Penalty” for Which Coverage is Barred
Evan Bundschuh
Burkhard Fassbach

In the following guest post, Evan Bundschuh and Burkhard Fassbach share and analyze their research into the AI-related Form 10-K disclosures of 26 U.S.-listed public companies, in order to assess the level and significance of public companies’ disclosure statements pertaining to artificial intelligence. Evan is Vice President at GB&A, a retail insurance brokerage in New York, and Burkhard is a D&O lawyer in private practice in Germany. My thanks to Evan and Burkhard for allowing us to publish their article on this site. Here is their article.

Continue Reading Guest Post: Mapping AI Risks: Insights from 2025 10-K Filings