Director and Officer Liability

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Every year after Labor Day, The D&O Diary takes a step back to survey the most important current trends and developments in the world of Directors’ and Officers’ liability and insurance. This year’s review is set out below. As the following discussion shows, this is a particularly interesting time in the world of D&O.

Continue Reading What to Watch in the World of D&O

In recent years, the D&O Diary has followed the growing debate over whether companies should reincorporate outside Delaware, particularly in states such as Nevada and Texas.  We have also followed Delaware’s efforts to address the trend through measures including the enactment of SB 21 and the Delaware Supreme Court’s decision upholding the statute.

And we queried whether DExit could prove to be a new source of D&O exposure. A newly amended class action complaint against Dropbox may provide yet another example of that risk, as shareholders are challenging Dropbox’s reincorporation to Nevada, alleging that the move was undertaken to protect management and the controlling stockholder from accountability for underlying business and governance decisions.

Continue Reading Dropbox Derivative Suit Over a DExit
Ben Dubin

In the following guest post, Ben Dubin, Managing Memberof VC Expert Services, LLC, examines Vice Chancellor Laster’s May 2026 opinion in the Zync v. Porsche case, a decision that highlights the legal and D&O insurance risks for investor-appointed directors and their sponsoring venture firms, particularly when directors are accused of acting as agents of the investor rather than exercising independent fiduciary judgment on behalf of the company. This post is the second of two guest post from Ben discussing D&O risks associated with venture capital board seats. Ben’s prior post on the topic can be found here. We would like to thank Ben for allowing us to publish his articles as guest posts on this site. Here is Ben’s article.

Continue Reading Guest Post: Zync v. Porsche and the D&O Risks of VC Board Seats
Ben Dubin

In the following guest post, Ben Dubin, Managing Member of VC Expert Services LLC, discusses Delaware Vice Chancellor Laster’s January 29, 2026 opinion in the Calumet Capital Partners case. This article, which is the first of two discussing recent Delaware decisions regarding VC firm’s representative’s service on the firm’s portfolio company boards, argues that the Calumet decision creates greater litigation risk for venture capital firms whose employees or partners serve as board designees, because courts may more readily infer that the investor knowingly participated in a fiduciary breach when its own representative is involved. The author’s companion article to this one will be published on this site next week. Our thanks to Ben for allowing us to publish his article on our site. Here is Ben’s article.

Continue Reading Guest Post: Calumet and VC Board Designee Risk
Thomas Boley

In the following guest post, Thomas Boley, an associate at the Wiley Rein LLP law firm, takes a closer look at the Up-C corporate structure, and considers the claims that can arise due to the issues the corporate structure can present, as well as the insurance coverage issues that these claims may involve. Our thanks to Thomas for allowing us to publish his article as a guest post on this site. Here is Thomas’s article.

Continue Reading Guest Post: D&O Risks in Up‑C Dilution Claims

A newly filed lawsuit against Oura Health (Oura) highlights how company-directed share repurchases executed shortly before major financing transactions or anticipated IPOs can create significant D&O risk for late-stage private companies domiciled in Delaware. As companies remain private longer, secondary liquidity transactions involving founders, employees, and former executives seeking to monetize their holdings have become increasingly common. At the same time, these transactions can create fertile ground for litigation when significant valuation-enhancing events emerge shortly after a sale closes.

Continue Reading D&O Risks in Pre-IPO Share Repurchases

D&O Diary readers are likely familiar with the following pattern involving short seller reports: the short seller publishes attention-grabbing revelations about the operations or financial results of a listed company; the company’s shares decline; and a plaintiffs’ securities class action law firm files a securities class action lawsuit, often based solely on the accusations in the short seller’s report.  However, in a lawsuit filed on May 1, 2026, in the Southern District of Florida, Starfighters Space, Inc. (Starfighters) and related entities flipped the script. Starfighters complaint against purported short sellers alleges a coordinated “short-and-distort” campaign involving the publication of a purported research report and its amplification across social media platforms (Starfighters Lawsuit).  

Continue Reading Affirmative Litigation and “Short-and-Distort” Campaigns

In recent years, leveraged buyouts have once again become a significant source of corporate and securities litigation risk, particularly where founder‑led or controller‑influenced companies pursue take‑private transactions with private equity sponsors. A newly filed Delaware Chancery Court complaint arising out of the 2025 take-private of Skechers U.S.A., Inc. (the “Skechers Complaint”) provides a timely example. The Skechers Complaint illustrates how these transactions can give rise to fiduciary duty claims, especially when minority stockholders allege that a controlling stockholder influenced both the timing and structure of a transaction to their own benefit. The case may also offer a useful lens through which to examine how recent developments in Delaware statutory and case law may affect the standard of review applicable to controller-led transactions.

Continue Reading A Delaware Take-Private Suit and Controller Buyout D&O Risk

As the D&O Diary reported earlier this year, the Trump Administration has increasingly turned to the False Claims Act to support policy priorities, including anti-DEI and tariff-related initiatives. The President’s March 16, 2026, Executive Order (EO) may signal that FCA enforcement activity will only continue to accelerate. In particular, the President’s EO establishes a multi-agency “Task Force to Eliminate Fraud,” directing the federal government to “use all available resources” to combat fraud, enhance coordination, and strengthen enforcement across federally funded programs.  

Continue Reading A New Federal Anti-Fraud Task Force and D&O Exposure