Private Credit

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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 D&O Diary has chronicled mounting stress in the private credit market, underscored by the high-profile collapses of borrowers such as Tricolor and First Brands, and the resulting migration from borrower insolvency into securities litigation against private credit lenders themselves. This escalation highlights sharpening scrutiny from private credit fund investors and public shareholders alike. Exemplifying this trend, Blue Owl Capital Corporation (“Blue Owl”) recently moved to limit redemptions following a historic surge in withdrawal requests. This liquidity strain coincides with putative class actions filed in December 2025 and January 2026 (Blue Owl SCAs) as well as a derivative suit filed on April 27, 2026 (Blue Owl Suit).  

While the Blue Owl SCA alleges that Blue Owl’s leadership concealed pressures on the firm’s direct lending vehicles, the Blue Owl Suit additionally alleges that Blue Owl was acting in a dual capacity when determining illiquid private credit fund valuations.  Below, we discuss the allegations against Blue Owl and the developing D&O and E&O risks for private credit funds.

Continue Reading Blue Owl and the Growing D&O and E&O Risks in Private Credit