A Periodic Journal Containing Items of Interest From the World of Directors & Officers Liability, With Occasional Commentary
In this prior post, the D & O Diary noted the recent resurgence of the 70’s vintage statute, the Foreign Corrupt Practices Act. Recent developments in the Comverse Technology options timing investigation underscore the increasing importance of the FCPA, particularly as the options backdating scandal continues to unfold.
On August 9, 2006, the…
The Wall Street Journal’s recent series on "Private Money" describes the "new financial order" arising from "the new rules of private equity game." According to the July 25, 2006 Journal article (subscription required) entitled "Cash Machine: In Today’s Buyouts, Payday is Never Far Away," the new power players are private financiers – hedge funds, buyout…
Eliminate Quarterly Guidance? On July 24, 2006, the CFA Centre for Financial Market Integrity and the Business Roundtable Institute for Corporate Ethics issued a Report entitled "Breaking the Short-Term Cycle: Discussion and Recommendations on How Corporate Leaders, Asset Managers, Investers and Analysts Can Refocus on Long-Term Value," calling on corporate leaders, asset managers and others…
One of the least understood and least studied features of the world of corporate and securities law is the impact that directors’ and officers’ liability insurance has on companies’ conduct. A new article by two University of Connecticut Law School professors, Tom Baker and Sean Griffith, represents an ambitious attempt to understand the impact…
Options Backdating Securities Litigation: On June 29, 2006, a putative securities fraud class action was initiated against KLA-Tencor. This brings the number the number of companies sued in securities fraud class action lawsuits based on options timing allegations to eight. Background on the other seven companies previously named can be found on prior D…
D & O insurers, concerned about lawsuits that have already have been filed and troubled by the possibility of an unknown number of lawsuits yet to come, have begun to respond to the options backdating investigation. On June 20, 2006, the Wall Street Journal (subscription required) carried an article entitled "Options Timing Raises Concern…