Archives: Director and Officer Liability

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Nike Board Hit with Sexual Misconduct-Related Derivative Suit

In the latest example of a D&O lawsuit following in the wake of allegations of sexual misconduct, three shareholders have filed a state court derivative lawsuit in Oregon against Nike’s Board of Directors alleging that the defendants failed in their oversight duties and allowing a toxic “boys club” culture of sexual harassment and bullying to … Continue Reading

Guest Post: The SEC/Musk/Tesla Settlement: The Dawning of a New Era of SEC Internet Enforcement

 As I detailed in a post at the time (here), on Thursday last week, the SEC filed a securities fraud enforcement action against Tesla Chairman and CEO Elon Musk in connection with his now infamous tweets, in which he said he had “secured” funding to take the company private at a substantial premium over the … Continue Reading

SEC Files Securities Fraud Suit Against Elon Musk Over Take-Private Tweets

Elon Musk’s August 7, 2018 Tweets, in which he had “secured” funding to take Tesla private at a substantial premium over the then-current share price, have already produced a storm of controversy and a series of securities class action lawsuits against him and the company. The Tesla CEO’s now-infamous Tweets have now also led to … Continue Reading

Plaintiff’s Sexual Assault Complaint Asserts Claims Against Michigan State’s Board of Trustees

Stories of alleged sexual misconduct have dominated recent headlines.  Allegations of sexual assault raised against Supreme Court Brett Kavanagh have been the lead story all week, and there has also been extensive coverage of the criminal sentencing of Bill Cosby for sexual assault. These stories arise as part of a broader series of revelations of … Continue Reading

Guest Post: Stronger UK Pensions Regulator: Risks for Directors and Officers

In the following guest post, Tristan Hall, Andrew Milne, and Emma Boulding of the CMS Cameron McKenna Nabarro Olswang LLP law firm take a look at the increased risks to directors and officers in the U.K. for non-compliance with employer pension schemes, as well as the implications of those increased risks for D&O insurance purposes. … Continue Reading

While You Were Out

September is here. Labor Day has come and gone. Time to put away the swim trunks, parasols, flip flops, bungee cords, ukuleles, sun screen, boomerangs, bongos, snorkels, vorpal blades, and unicycles, and get back to work. Yes, it is time to answer all those emails and return all of those phone messages. And most importantly … Continue Reading

Sexual Misconduct and D&O Claims

The fallout from the current wave of revelations sexual misconduct involving media figures, politicians, and corporate executives has included, among other things, a rash of D&O claims – including, for example, claims against the boards of 21st Century Fox and Wynn Resorts. An interesting recent scholarly paper takes a detailed look at D&O claims arising … Continue Reading

Investor Files Sexual Misconduct-Related D&O Claim Against Wynn Resorts Board

Amidst the fallout following the latest high-profile set of revelations of sexual misconduct at the highest levels of business, the media, and politics, Steve Wynn has resigned his position as Chairman and CEO of Wynn Resorts. However, as we have seen with in other instances of this type of high profile sexual misconduct, the accountability … Continue Reading

Delaware Chancery Court Action Challenges Federal Forum Bylaws

For a time a few years ago, litigation management bylaws were all the rage. Driven by concerns about multi-forum merger-related litigation, commentators proposed company adoption of forum selection bylaws for internal corporate disputes. The debate widened when reformers suggested that companies adopt fee-shifting bylaws. The debate subsided in 2015 when the Delaware legislature adopted legislation … Continue Reading

Top Ten D&O Stories of 2017

The world of directors’ and officers’ liability is always dynamic, but 2017 was a particularly eventful year in the D&O liability arena. The year’s many developments have significant implications for what may lie ahead in 2018 – and possibly for years to come. I have set out below the Top Ten D&O stories of 2017, … Continue Reading

Deputy AG Emphasizes Continued Individual Accountability for Corporate Misconduct

As observers have been monitoring the evolving policies and priorities of the Department of Justice in the Trump administration, one of the questions has been what the agency’s approach will be to the guidelines laid out in the so-called Yates Memo. The Yates Memo, named for its author, the former Deputy Attorney General and former … Continue Reading

Guest Post: Playing the Blame Game: Fiduciary Duty Litigation in Bankruptcy Proceedings

An unfortunately frequent part of bankruptcy proceedings is the assertion of claims against the directors and officers of the failed company. In the following guest post, Joseph W. Swanson and Donald R. Kirk of the Carlton Fields law firm take a look at the kinds of claims these officials face, as well as the steps … Continue Reading

Supreme Court Asked to Review Responsible Corporate Officer Doctrine

The U.S. Supreme Court may soon get a chance to consider and review the “Responsible Corporate Officer” Doctrine (also sometimes referred to as the “Park doctrine,” in reference to the 1975 case in which the Court first described the doctrine) in a case in which corporate executives challenge their individual criminal imprisonment sentences for alleged … Continue Reading

How Will the Trump Administration Affect D&O Claims?

A recurring question – one that I am getting now on just about a daily basis – arises from concerns about the Trump administration’s possible impact on the world of directors’ and officers’ liability. Implicit in the question is the assumption that the new administration’s policies and actions will indeed affect D&O claims. While I agree … Continue Reading

Guest Post: Pitfalls of Sharing Privileged Information During Due Diligence

One of the interesting recurring issues arising in M&A transactions is the question of the extension of attorney client privilege to information shared during transactional due diligence. In the following guest post, Joseph B. Crace, Jr. and Britt K. Latham take a look a recent New York Court of Appeals decision examining the question of … Continue Reading

Guest Post: The Importance of the Business Judgment Rule

The business judgment rule is one of the important principles involved when questions of board and director liability are raised. In the following guest post, Bernard Sharfman, an associate fellow of the R Street Institute and a member of the Journal of Corporation Law’s editorial advisory board, takes a look at the way that the … Continue Reading

Del. Court Pans Fee-Shifting Portion of Forum Selection Bylaw

Many readers will recall that just a short time ago companies were actively experimenting to try to incorporate litigation management measures into their corporate bylaws. These efforts led to decisions by Delaware courts upholding both forum selection bylaws (about which refer here) and fee-shifting bylaws (refer here). Delaware’s legislature ultimately addressed these bylaw experimentation efforts … Continue Reading
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