In the largest such award so far this year, the SEC has awarded more than $27 million to a whistleblower, an award amount that the Commission increased above staff recommendations in recognition that the whistleblower had “repeatedly and tenaciously” voiced his concerns about the misconduct within his organization before reporting it to the agency. As discussed below, there are a number of noteworthy features about this award. The Commission’s April 16, 2020 order about the award can be found here. The Commission’s April 16, 2020 press release about the award can be found here. Continue Reading “Tenacious” SEC Whistleblower Awarded More Than $27 Million

In a now infamous August 7, 2018 post on his Twitter account, Tesla CEO Elon Musk stated that he was “considering taking Tesla private at $420. Funding secured.” This post and several subsequent messages ultimately were the subject of an SEC enforcement proceeding (later settled) as well as several securities class action lawsuits (later consolidated). On April 15, 2020, Northern District of California Edward Chen denied the defendants’ motion to dismiss the consolidated securities lawsuit, finding that the “take private” Tweet and other messages were false and misleading. Judge Chen’s opinion is of interest because of the high-profile nature of the allegations, but also for what it says about corporate securities liability exposure for executives’ social media statements. Judge Chen’s opinion can be found here. Continue Reading Musk’s “Take Private” Tweets Held Actionable

As I have noted in numerous post on this blog (most recently here), among the many different types of fallout from the current coronavirus outbreak are the potentially significant implications for corporate liability and for D&O insurance. In the following guest post, Lawrence J. Bracken, Geoffrey B. Fehling and Lorelie S. Masters of the Hunton Andrews Kurth LLP law firm consider these implications, including the types of claims that may arise and the impact the pandemic may have D&O insurance policyholders and their insurers. 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 blog’s readers. Please contact me directly if you would like to publish a guest post. Here is the authors’ article. Continue Reading Guest Post: D&O Insurance Issues Arising from the COVID-19 Crisis

Tim Hoeffner
Paul Ferrillo

The Second Circuit issued its latest decision in the long running Goldman Sachs Group securities class action litigation on April 7, 2020 (here). In the following guest post, Tim Hoeffner and Paul Ferrillo of the McDermott, Will & Emery law firm take a look at the Second Circuit’s decision and analyze its implications. I would like to thank Tim and Paul 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 Time and Paul’s article. Continue Reading Guest Post: Close Call in New Second Circuit Class Certification Decision

Nessim Mezrahi

In the following guest post, Nessim Mezrahi discusses his analysis of the First Quarter 2020 securities class action lawsuit exposure. Mezrahi is cofounder and CEO of SAR, a securities class action data analytics and software company. SAR’s April 10, 2020 press release discussing its 1Q20 securities class action litigation analysis can be found here. A version of the following article previously was published on Law360. I would like to thank Nessim for allowing me to publish his 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’s article. Continue Reading Guest Post: First-Quarter Securities Class Actions Respond To Outbreak

Many readers may have seen the news this past week that the estate of a deceased Walmart employee who had died of complications from COVID-19 has filed a Wrongful Death lawsuit against the company. According to the lawyer who filed the complaint, the lawsuit is the “first known COVID-19 wrongful death lawsuit.” Even though a Wrongful Death lawsuit is far outside this blog’s usual remit, I tracked the complaint down and read it carefully, in order to think more about possible future coronavirus blame casting that could arise in the D&O claims arena. While the wrongful death lawsuit may be the first of its type, it surely will not be the last, and its filing may foreshadow other possible claims. Continue Reading Thinking About Coronavirus Blame and the Possible Course of D&O Claims

More than a month ago, when I first wrote about the possibility that the coronavirus outbreak could lead to D&O claims, I noted that the pandemic was having a devastating impact on certain industries. At the same time, I noted that the viral outbreak could prove a boon for other industries; among the industries I cited as a possible winner was the video teleconferencing industry. Indeed, since the onset of the outbreak’s onset, many of us have for the first time used the services of Zoom Video Telecommunications and Zoom video teleconferences have been proliferating. But while Zoom usage has soared, privacy and security concerns have also arisen.

 

Now Zoom has been hit with a securities class action lawsuit based on allegations that the surge in usage following the coronavirus outbreak allegedly revealed allegedly undisclosed weaknesses in company’s security, and alleged privacy and security weaknesses contrary to the company’s alleged representations. As discussed below, in addition to representing an example of a coronavirus-related securities suit, the new lawsuit also represents an example of the ways in which privacy concerns can lead to D&O claims. Continue Reading Zoom Hit With Securities Suit Raising Pandemic-Linked Allegations Based on Privacy Concerns

Here at The D&O Diary, we make it our business to watch securities class action lawsuit filings as they come in, to keep an eye on filing trends as they develop. For example, recently we have been looking for coronavirus-related securities class action lawsuits. But while we were scanning the horizon for COVID-19 suits, something else unexpectedly materialized – all of the sudden, on April 3, 2020, a great big pile of cryptocurrency-related securities class action lawsuits were filed in the Southern District of New York. The filing of eleven total cryptocurrency-related securities suits in a single day is really unprecedented in my experience. Continue Reading Plaintiffs File a Slew of Cryptocurrency-Related Securities Suits

As I have noted in prior posts (most recently here), the current coronavirus outbreak presents corporate boards with a number of challenging issues. In the following guest post, Nick Goldin, Eric Swedenburg and Brad Goldberg of the Simpson Thacher law firm review the considerations that corporate boards should take into account as their companies grapple with the challenges that the pandemic poses. The authors extend their appreciation to Sarah Eichenberger for her substantial contributions to this piece. A version of this article previously was published as a Simpson Thacher client memorandum. 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 Guest Post: Considerations for Corporate Directors As Their Companies Confront COVID-19

Frank Hülsberg
Burkhard Fassbach

In the following guest post, Frank Hülsberg, partner and member of the board of directors of Grant Thornton Germany, and Burkhard Fassbach, a D&O-lawyer in private practice in Germany, take a look at key whistleblower considerations relating to GDPR compliance. I would like to thank Frank and Burkhard for allowing me to publish their article. 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 Frank and Burkhard’s article. Continue Reading Guest Post: GDPR and Whistleblowing