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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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In March 2021, to great fanfare, the SEC announced its formation of a Climate and ESG Task Force to “develop initiatives to proactively identify ESG-related misconduct,” as well as to “coordinate the effective use of Division resources, including through the use of sophisticated data analysis to mine and assess information across registrants, to identify potential violations.” Now, it turns out that, much more quietly, the agency has disbanded the Task Force. As first reported in a September 12, 2024, Bloomberg article (here), the SEC shut down the Task Force “within the past few months.”Continue Reading SEC Disbands Climate and ESG Task Force

In recent months, the SEC Chair and other government officials have made it clear that they are closely watching for companies that try to catch the AI wave by making exaggerated or false claims about the AI capabilities of their products or services. In the latest example of the crack down on these kinds of AI-related misrepresentations, both the U.S. Attorney  for the Southern District of New York and the SEC have filed charges against the former CEO and Chairman of the tech company Kubient. The government alleges that the executive, Paul Roberts, inflated the company’s revenues and also lied about one of its signature products, an AI-powered tool that was supposed to detect ad fraud in the digital advertising industry. There are some interesting features of the charges against Roberts, as discussed below.Continue Reading Tech Exec Charged with AI-Related Misrepresentations and Fraudulent Revenue Recognition

As I noted in a blog post at the time, in June the U.S. Supreme Court entered its opinion in the SEC v. Jerkesy case, striking down the SEC’s use of Administrative Law Judges in civil penalty action. In the following guest post, Gregory Markel, Sarah A. Fedner, and Gershon Akerman of the Seyfarth Shaw law firm take a detailed look at the case and consider its significance and implications. A version of this article previously was published in the Practical Law Forum. I would like to thank the authors for allowing me 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 the authors’ article.Continue Reading Guest Post: SEC Administrative Proceedings After SEC v. Jarkesy

A frequently recurring D&O insurance coverage question is whether the insurance policy provides insurance against claimed damages that are restitutionary in nature. The argument against coverage is under a public policy principle that the insured persons should not be able to obtain insurance protection against the return of so-called ill-gotten gains. This question was considered again in a recent insurance coverage decision out of a Connecticut trial court. In a decision that apparently is one of first impression in Connecticut, the court held both that the policy’s uninsurability clause and the policy’s personal benefit exclusion precluded coverage for the amount of a stipulated judgment in the underlying action. A copy of the Connecticut court’s August 23, 2024, opinion can be found here.Continue Reading Ct. Court Holds Restitutionary Damages Uninsurable

It has been a while since I have had occasion to write about third-partly litigation financing. However, recent developments at the SEC, in which the agency has pursued enforcement actions alleging that various purported vehicles to finance litigation had defrauded prospective investors, have brought litigation funding back onto my radar screen. Once again, as in the past, various groups are sounding alarm bells about third-party litigation funding, as discussed below.Continue Reading Litigation Funding in the Spotlight

Securities class action litigation observers know that securities suits frequently are accompanied by shareholder derivative lawsuits based on the same essential allegations. A recent report from Cornerstone Research, entitled “Parallel Derivative Action Settlement Outcomes: 2023 Review and Analysis,” takes a look at the settlement patterns for these kinds of parallel derivative suits. As the report shows, in recent years, nearly half of all securities class action lawsuits have been accompanied by a derivative lawsuit, and the securities suits with accompanying derivative suits typically are associated with higher settlements. The Cornerstone Research report can be found here. Hat Tip to the August 26, 2024 Cooley law firm memo about the report, here.Continue Reading Parallel Derivative Suits Associated with Higher Securities Suit Settlements

In recent months, many companies have found themselves under fire from conservative advocates for their stances on ESG-related issues. At the same time, other companies have found themselves facing litigation based on allegations that they have overstated their green credentials (a set of allegations sometimes called “greenwashing”). As two recent cases show, companies can face challenges and potential liability over their sustainability claims.Continue Reading Beverage Companies Face Scrutiny Over Their Green Claims

Sometimes seemingly subtle policy wording differences can significantly affect the court’s analysis of key policy clauses. The significance of the wording subtleties sometimes is best seen by comparing the wording to equivalent provisions in different policies. That was the case in recent proceedings in which an excess insurer sought to compel arbitration of an underlying coverage dispute. As discussed below, the court found that the language of the specific arbitration provision in dispute did not apply either to the parties or the dispute involved in the underlying coverage lawsuit. The ruling, in which the court applied New York law, can be found here.Continue Reading Insurer Cannot Compel Arbitration in Reliance on Narrow Arb Clause Wording

Richard M. Leisner

In the following guest post, Richard M. Leisner takes a look at recent case law developments in Texas that underscore the key role of expert testimony as well as problems that can arise with expert witnesses. The article also provides important examples of the importance of the proper deployment of expert witness testimony. Leisner is a Senior Member in the Trenam law firm in Tampa. I would like to thank Richie for allowing me to publish his 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 Richie’s article.Continue Reading Guest Post: Avoiding Expert Witness Disasters

In my recent round-up of the top trends in the world of directors’ and officers’ insurance and liability, I noted that, even though we are now well into the fifth year since the initial outbreak of COVID-19 in the U.S., COVID-related securities suits continue to be filed. In the latest example of this kind of lawsuit, last week a plaintiff investor filed a securities class action lawsuit against customer contact data firm ZoomInfo Technologies, alleging that after COVID-related demand inflated the company’s results during the pandemic, the company allegedly strained to conceal subsequent declining demand from investors. A copy of the September 4, 2024, complaint can be found here.Continue Reading Customer Contact Data Company Hit with COVID-Related Securities Suit