Private Equity

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The wave of litigation involving private credit continues to expand. FS KKR Capital Corp. (“FSK”), one of the largest publicly traded business development companies (“BDCs”), is already defending a securities class action lawsuit (KKR SCA) alleging that it overstated asset valuations and misrepresented the effectiveness of its efforts to address troubled portfolio companies. On July 15, 2026, a shareholder of FSK filed a separate derivative lawsuit against the company’s external investment adviser, FS/KKR Advisor, LLC (FS/KKR), alleging that the adviser extracted grossly excessive advisory fees in violation of its fiduciary duties under Section 36(b) of the Investment Company Act of 1940.

Continue Reading Another Private Credit Excessive Fee Lawsuit

Continuation Vehicles (CVs) have grown in popularity with private equity (PE) firms as traditional exit routes, such as IPOs and strategic sales, have become unfavorable due to geopolitical turmoil, macroeconomic and AI- driven disruption.  However, the same features that make CVs attractive for PE sponsors may also create D&O and E&O exposure, as sponsors typically control key aspects of the transaction, including valuation, process design, and investor disclosures.

Continue Reading Continuation Vehicles and Private Equity Management Liability Risk

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

Dividend recapitalization is a tool that enables private equity firms to extract liquidity from portfolio companies without the need to complete a sale or IPO. In the following guest post, the authors explore this funding technique, which is not without its risks and exposures and which may raise important insurance issues as well. This article is co-authored by Sarah Abrams, Head of Professional Liability Claims, Bowhead Specialty Underwriters, Inc., Elan Kandel, Member, Bailey Cavalieri LLC and James Talbert, Associate, Bailey Cavalieri LLC. I would like to thank the authors for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ article.

Continue Reading Dividend Recaps: Potential Risks for Private Equity Firms and Their Insurers
Sarah Abrams

In this guest post, Sarah Abrams, Head of Professional Liability Claims at Bowhead Specialty, examines Sovereign Wealth Funds’ increasing investment in U.S. private equity firms and considers whether there are unique regulatory and professional liability risk exposures for PE firms that partner with Sovereign Wealth Funds. I would like to thank Sarah for…

In the following guest post, Brian Baney, Senior Vice President, Head of Management and Professional Liability Claims, Ascot Group, Peter Trochev, Senior Vice President, Financial Institutions, Ascot Group, Elan Kandel, Member, Bailey Cavalieri LLC and James Talbert, Associate, Bailey Cavalieri LLC, survey the current risk environment for private equity firms. I would like to thank the authors for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers Please contact me directly if you would like to submit a guest post. Here is the author’s article.

Continue Reading Guest Post: The State of Private Equity in 2023: Is a Maelstrom on the Horizon?  

Sarah Abrams

In the following guest post, Sarah Abrams, Head of Professional Liability Claims at Bowhead Specialty Underwriters, takes a look at the implications for D&O insurers of the growing investment interest of private equity firms in the healthcare sector. I would like to thank Sarah for allowing me to publish her article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Sarah’s article.
Continue Reading Guest Post: As Private Equity Healthcare Investments Grow, Will D&O Liability Exposure Increase?

Sarah Abrams

Steven Kane

In the following guest post, Sarah Abrams, Head of Professional Liability Claims Bowhead Specialty Underwriters, Inc., and Steven Kane, Head of Financial Institutions Underwriting, Bowhead Specialty Underwriters, Inc., take a look at insurance coverage issues that could arise in connection with the separation of a principal or partner from a private equity firm. I would like to thank the authors for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors from topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ article.
Continue Reading Guest Post: Private Equity Divorce, Carried Interest, and Insurance Response

Jonathan Legge

In a three-post series, Jonathan Legge, a Senior Vice President at RT ProExec, is taking a look at the key insurance issues relating to Private Capital Investment. In the first of the three articles in the series (here), Jon examined the issues involved with getting the insurance for private equity-backed portfolio companies’ right. In the second post in the series (here), Jon discussed transactional risk insurance, and in particular, contingent liability insurance. In today’s post, the third and final post in the series, John takes a look at the evolving insurance solutions for Private Capital investors’ changing needs. I would like to thank Jon for allowing me to publish his series of articles as guest posts on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is Jon’s article.
Continue Reading Guest Post: Evolving Solutions for Private Capital Investors

Jonathan Legge

In a three-post series, Jonathan Legge, a Senior Vice President at RT Pro Exec, is taking a look at the key insurance issues relating to Private Capital Investment. In the first of the three articles in the series (here), Jon examined the issues involved with getting the insurance for private equity-backed portfolio companies right. In today’s post, the second in the three-part series, Jon discusses transactional risk insurance, and in particular, contingent liability insurance. I would like to thank Jon for allowing me to publish his series of articles as guest posts on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is Jon’s article.
Continue Reading Guest Post: Don’t Forget About the Other Transactional Solutions