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Kevin LaCroix

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Kevin M. LaCroix is an attorney and Executive Vice President, RT ProExec, a division of RT Specialty. RT ProExec is an insurance intermediary focused exclusively on management liability issues.

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Mark Sutton
Karen Boto

The UK Criminal Finances Act 2017 will go into effect on September 30, 2017. This new law will make corporate organizations criminally liable for the failure to prevent tax evasion by an “associated person.” In the following guest post, Mark Sutton and Karen Boto take a look at the Act and its provisions and examine the legislation’s D&O insurance implications. Mark is a partner and Karen Boto is legal director of law firm Clyde & Co. I would like to thank Mark and Karen for their willingness to publish their article 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 Mark and Karen’s guest post.
Continue Reading Guest Post: Criminal Finances Act 2017: The Broadening of Corporate Accountability

In a unpublished August 30, 2017 opinion (here), the Ninth Circuit affirmed a district court ruling that a trial court verdict that a hospital system had violated the antitrust laws was not an adjudication sufficient to trigger the improper profit exclusion in the hospital system’s D&O insurance policy, and therefore that the hospital system was entitled to reimbursement of its expenses incurred in defending the antitrust suit. The decision provides a useful illustration of the way that the final adjudication provisions found in the conduct exclusions of most current D&O insurance policy operates. The Wiley Rein law firm’s Executive Summary Blog’s September 5, 2017 post discussing the Ninth Circuit opinion can be found here.
Continue Reading D&O Insurance: Antitrust Verdict Does Not Trigger Policy’s Improper Profit Exclusion

In the wake of credit monitoring and reporting firm Equifax’s announcement last week that it had sustained a data breach involving 143 million U.S. customers, a wave of consumer class action lawsuits has followed. In addition, the litigation wave now also includes at least one securities class action lawsuit; more securities suits are likely to follow. Although data breach-related D&O claims have not fared particularly well in the past, there are features of the Equifax situation that may put the securities suits against Equifax in a different category. An even more interesting question is the extent to which the new lawsuit portends further data breach-related securities litigation going forward.  
Continue Reading Equifax Data Breach Litigation Now Includes Securities Suit

In the great pendulum swing that characterizes the mood toward government oversight of companies and corporate governance, the pendulum in the U.S. has swung against regulation and against mandated governance requirements. However, in the U.K., the pendulum is on the opposite end of the arc, as the current government is moving quickly to adopt new corporate governance requirements.

As discussed in an earlier post (here), the current U.K. governance initiative kicked off with the Prime Minister’s November 2016 Corporate Governance Reform Green Paper, which focused on executive pay, private companies, and workers on boards. The Green Paper solicited comments on its various proposals. The comments have been received and processed and the result is an August 2017 report entitled “Corporate Governance Reform, The Government Response to the Green Paper Consultation” (here). The report sets out a list of governance reform proposals the government intends to put into effect in the coming year.
Continue Reading U.K. Government Announces Corporate Governance Reform Proposals

In the current political environment, class action lawsuits are under assault, particularly in conservative legal circles. As Joe Patrice put it in an August 30, 2017 Above the Law post (here) , with a somewhat tongue-in-cheek summary of the conservative perspective on class actions, “The only thing every good conservative legal thinker knows is that class actions are greedy money grabs perpetrated by slimy lawyers that help no one and only frustrate the hard-working capitalists making America great again.”

Given this general outlook among conservatives about class action lawsuits it is all the more surprising and interesting that a conservative legal scholar has come forward with a robust defense of class actions. Vanderbilt Law Professor Brian Fitzpatrick, who clerked for Reagan appointee Dairmuid O’Scannlain on the 9th Circuit and for conservative Supreme Court Justice Antonin Scalia, has published a paper entitled “Do Class Actions Deter Wrongdoing?” (here), as part of his forthcoming book, “The Conservative Case for Class Actions.” In Fitzpatrick’s view, class actions serve an important role because they deter corporate wrongdoing. Fitzpatrick’s analysis may not only be important for the ongoing debate about class actions in the U.S., but, as discussed further below, it may be even more important for the debate about class actions outside the U.S.
Continue Reading A Conservative’s Case in Support of Class Actions

As has been well-documented, the United States in the middle of an “epidemic” involving the abuse of prescription and non-prescription opioids. The companies that manufacture and distribute these drugs have been hit with a “barrage” of lawsuits, filed by states, counties, and cities. Just last week, the state of Arizona filed a lawsuit against a drug company alleging that the company had fraudulently marketed a powerful opioid painkiller.  As this lawsuit wave has grown, shareholders and others have also climbed on the litigation bandwagon. In recent days, shareholders have filed a series of lawsuits against opioid manufacturers and distributors and their directors and officers. Just as the number of lawsuits filed by governmental entities seems likely to continue to grow, the number of investor suits against opioid drug companies seems likely to grow as well.
Continue Reading Securities Suits Hit Opioid Drug Companies

The D&O Diary’s European mission concluded this week with a final stop in Zurich, for meetings and an educational session. I already knew from prior visits that Zurich is a beautiful and charming city nestled in a spectacular setting at the northern end of Lake Zurich, surrounded by mountains, with a spectacular view of the Alps to the south. What I learned on this trip is that as reliably beautiful as Zurich is at any time, it is particularly stunning in late summer.
Continue Reading Late Summer in Zurich

One issue with which courts dealing with insider trading cases have struggled is how to interpret and apply the personal benefit element of the liability standard. The personal benefit standard was in fact an important part of the U.S. Supreme Court’s 2016 decision in Salman v. United States (as discussed here). Last week, the Second Circuit issued an important decision in the United States v. Martoma, in which the appellate court provided important additional perspective on the personal benefit test. In the following guest post, Brad S. Karp, Geoffrey R. Chepiga, Daniel J. Kramer, Lorin L. Reisner, Audra J. Soloway, and Richard C. Tarlowe of the Paul Weiss law firm take a look at the Second Circuit’s decision in the Martoma case and the appellate court’s discussion of the personal benefit test. I would like to thank the authors for their willingness to allow 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 site’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ guest post.
Continue Reading Guest Post: Divided Second Circuit Panel Overrules Prior Newman Insider Trading Decision

The D&O Diary’s European assignment continued last week with a stop for meetings in Warsaw, Poland, a city that absolutely confounded expectations. As befits a national capital of a country with a growing economy, Warsaw (in Polish, var-SHAW-vah) is a dynamic, energetic city, and full of history and interesting architecture. It also a surprisingly green city, with a huge, beautiful river, and vast parklands.
Continue Reading A Visit to Warsaw