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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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The number of securities class action lawsuit filings increased in 2023 for the first time in four years, according to a new report from NERA. According to the report, the number of filings increased more than 10% in 2023 compared to 2022. On the other hand, the number of cases resolved in 2023 declined during the year. The January 23, 2024 report, entitled “Recent Trends in Securities Class Action Litigation: 2023 Full-Year Review, can be found here.

Continue Reading NERA: 2023 Fed Court Securities Suit Filings Increased for the First Time in Four Years

If the underlying insurers have paid their limits, you would generally expect that the next-in-line excess insurer would also have to pay its limit as well for losses within its layer. However, in an appellate decision with what is arguably an unexpected twist, an appellate court has held – in reliance on express policy language – that an upper layer excess carrier is relieved of its obligation to pay because the underlying carriers, all of whom paid their full limit, did not admit liability. The Third Circuit’s January 19, 2024, decision, marked “not precedential,” can be found here. A January 21, 2024, LinkedIn post about the decision by Paul Curley of the Kaufman, Borgeest & Ryan law firm can be found here.

Continue Reading Excess D&O Insurance Coverage Barred Because Underlying Insurers Didn’t Admit Liability

A few days ago when I published a post discussing a new COVID-19-related securities lawsuit I expressed my surprise that pandemic-related suits were still being filed in 2024, particularly after the pace of new coronavirus-related suits tailed off completely in the latter half of 2023. Well, it appears that the recent new case filing not just a single anomaly, as this past week yet another new pandemic-related securities lawsuit was filed.

On January 19, 2024, a plaintiff shareholder filed a securities suit against BioVie, a developmental stage biotech company, after the company reported that clinical trials for its Phase 3 drug candidate produced results the company concluded deviated from protocols and Good Clinical Practice (GCP) because the pandemic had limited patient access to clinical trial sites. A copy of the new complaint can be found here.

Continue Reading Biotech Hit with Securities Suit After Pandemic Impact on Clinical Trials

In my recent wrap-up of the top D&O stories of 2023, I noted that one of the key developments during the past year was California’s adoption of new climate change disclosure requirements, which were enacted at a time when there was the added prospect that the SEC would finally release its own climate change disclosure guidelines by April 2024. While the California requirements have not yet been implemented and the final SEC disclosure guidelines have not yet even been released, there are growing signs that these climate change-related disclosure requirements may face significant hurdles and challenges.

It is not news that the SEC disclosure guidelines, whenever they are finally released, likely will face significant legal challenges, as I have previously noted on this site (here). However, this past week, in a Congressional hearing before a House Financial Services subcommittee, as reported in a January 18, 2024, Law360 article (here), spokespersons for conservative and business interests reiterated their belief that the SEC’s climate change disclosure guidelines, as proposed, reflect “several deficiencies,” and likely will face significant legal challenges.

Continue Reading Climate Change Disclosure Requirements Face Hurdles and Challenges
Sarah Abrams

Many readers may have seen the recent news that the New York Times had sued Microsoft and OpenAI alleging that OpenAI’s use of New York Times content to train their AI tool’s database infringed the newspaper’s copyright. The lawsuit raises its own set of issues but lawsuits of this type relating to AI development also pose an interesting set of insurance coverage related issues. In the following guest post, Sarah Abrams, Head of Professional Liability Claims at Bowhead Specialty, takes a look at the insurance questions that these kinds of lawsuits present. The views of the author are her own and not necessarily that of Bowhead Specialty Underwriters. I would like to thank Sarah for allowing me to publish her article 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: Can There Be “Misappropriation of Trade Secret[s]” in the Age of AI?’

In my recent round-up of the Top D&O stories of 2023, I noted that one of the key drivers contributing to the number of securities class action lawsuit filings last year was the presence of macroeconomic factors affecting company operations and financial results. Among these factors was supply chain disruption. While the pandemic-related disruptions that snarled supply chains in 2021 and 2022 appeared to have eased during 2023, the impact from the earlier supply chain disruptions continues to weigh on some businesses.

 In the latest example of how the prior supply chain disruption continues to affect businesses and how that can translate into securities litigation, on January 16, 2024, a plaintiff shareholder filed a securities lawsuit against advanced driver assistance system company Mobileye Global, after the company announced that it anticipated lower than expected sales of its key product because its leading customers had built up product in 2023 in order to avoid supply disruptions of the type that resulted from supply chain constraints in 2021 and 2022. This latest lawsuit shows how the consequences from pandemic related supply chain disruptions are continuing to weigh on businesses and result in securities litigation. A copy of the January 16, 2024 complaint can be found here.

Continue Reading Supply Chain Woes Causing Inventory Build-Up Leads to Securities Suit
Nessim Mezrahi
Stephen Sigrist

One of the perennial securities class action litigation issues is the question of how courts should view plaintiff’s allegations made in reliance on short seller reports. In the following guest post, Nessim Mezrahi and Stephen Sigrist take a look at the conflicted role that short seller reports play in securities class action litigation. Nessim is co-founder and CEO, and Stephen Sigrist is a senior vice president, at SAR LLC. A version of this article previously was published on Law360. I would like to thank Nessim and Stephen for allowing me to publish their article 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 Nessim and Stephen’s article.

Continue Reading Guest Post: Conflicts Abound When Activist Short-Sellers Publish Reports

In an insurance coverage dispute arising out of an unusual underlying criminal proceeding, the Fourth Circuit Court of Appeals, applying Maryland law, has held that a Maryland attorney indicted for his alleged actions on behalf of certain Somalian entities is not entitled to insurance for his fees incurred in defending against the indictment. The Court’s decision raises interesting issues about the applicable professional liability insurance policy’s definition of Claim and the definition’s application in the context of the attorney’s criminal proceedings. A copy of the Fourth Circuit’s January 4, 2024 opinion can be found here.

Continue Reading Attorney’s Post-Indictment Defense Fees Not Covered Under Professional Liability Policy

One of the most distinct securities class action lawsuit filing phenomena since the outbreak of COVID-19 in the U.S. in March 2020 has been the surge of pandemic-related securities suits,  particularly during the period 2020 through 2022. This securities suit filing trend even continued into 2023, although the incidence of COVID-related suits dwindled during the year. However, in an unexpected development, a plaintiff shareholder has now filed yet another COVID-related securities suit against BioNTech, the German biotechnology company that, along with its partner Pfizer, was lionized for helping to develop a COVID-19 vaccine. The company was hit with a securities suit after its share price declined following a sizeable inventory write-off. A copy of the January 12, 2024, complaint against the company can be found here.

Continue Reading A New COVID-Related Securities Suit for the New Year
Nelson Kefauver

In the following guest post, Nelson Kefauver, Head of Profin Underwriting at Intact Insurance, takes a look at how three frequent industry predictions from the recent past have turned out.  Nelson’s comments are specific to the private and non-profit D&O insurance space and not do not refer to the public company D&O insurance…