In my recent year-end summary of corporate and securities liability trends (here), I identified privacy as an important area of growing area of corporate risk and specifically mentioned biometric privacy issues of particular concern. Almost as if to prove my point, on January 29, 2020, in its SEC filing on Form 10-K, Facebook announced that it had agreed to pay $550 million dollars to settle a biometric data privacy class action lawsuit that had been filed on behalf Illinois users in connection with the company’s use of facial recognition software.  According to plaintiffs’ lawyers involved in the case, the settlement represents the largest-ever cash settlement to resolve a privacy-related lawsuit. This massive settlement shows the significance of privacy issues and underscores the likelihood that privacy issues – particularly biometric privacy issues – are likely to be an important corporate liability battleground concern. Continue Reading Facebook to Pay $550 Million in Largest-Ever Privacy Settlement

If you have not yet seen it, you will want to be sure to read the January 29, 2020 Harvard Law School Forum on Corporate Governance post entitled “Challenging Times: The Hardening D&O Insurance Market” by Carl Metzger and Brian Mukherjee of the Godwin Proctor law firm (here). Continue Reading The Current D&O Insurance Market Turmoil: Causes, Effects, and What to Do

Cornerstone Research has released its annual survey of securities class action lawsuit filings for 2019. The year’s version of the report introduces some notable innovations. In prior years, the annual report focused exclusively on federal court securities suit filings. In last year’s report, the survey also incorporated significant state court securities litigation data. This year for the first time the report fully incorporates the state court data in the presentation and analysis. The updated report also includes several new interesting perspectives on the past year’s securities litigation filings, particularly with respect to state court lawsuit filings. As the report details, the state court filings “helped push filing activity to record levels.” Continue Reading Cornerstone Research: Combined Federal and State Data Shows Securities Filings at “Record Levels”

One of the areas of significant concern in the global insurance underwriting community is the potential exposures insurers face from “silent cyber” – that is, the coverage of cybersecurity-related losses under traditional insurance policies that are not expressly designed to cover cyber losses. In a recent ruling in an insurance coverage dispute in which a small business sought insurance coverage for its losses following a ransomware attack, a Maryland federal court judge, applying Maryland law, held that the company’s business owner’s policy (BOP) covered the damages the company incurred.   The ruling highlights the potential coverage available for companies experiencing cyber-security losses under their traditional insurance policies. As discussed below, there are a number of interesting features to this ruling. Continue Reading Court Holds Business Owner’s Policy Covers Ransomware Caused Losses

Berlin Cathedral

The D&O Diary was on assignment in northern Europe last week, with stops in Berlin, Hamburg, and Paris. I know from past experience that traveling in northern Europe in January can be a formidable experience. On this trip, however, mild and dry weather conditions generally prevailed, allowing for some really pretty enjoyable travel experiences. Continue Reading January in Northern Europe

As I noted in my recent analysis of the 2019 securities class action litigation filings, one of the significant factors driving the near-historical levels of securities suit filings during the year was the elevated levels of securities litigation against life sciences companies. A January 21, 2020 report from the Dechert law firm, entitled “Dechert Survey: Developments in Securities Fraud Class Actions Against U.S. Life Sciences Companies: 2019 Edition” (here), details the 2019 securities lawsuit filings against life sciences companies, and reports that once again life sciences companies were “popular targets” for securities litigation claims. Continue Reading A Closer Look at 2019 Securities Litigation against Life Sciences Companies

Nessim Mezrahi

In the following guest post, Nessim Mezrahi, takes a look at event analysis, price impact, and damages in securities class action lawsuits. Mezrahi is cofounder and CEO of SAR, a securities class action data analytics and software company.  A version of this article previously was published on Law 360. 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 Assessing Securities Class Action Risk with Event Analysis

Securities class action lawsuit filings remained at elevated levels in 2019, but the mix of cases changed during the year, according to the recently published annual report from NERA Economic Consulting. According to the report, which is entitled “Recent Trends in Securities Class Action Litigation: 2019 Full-Year Review,” there were relatively fewer merger objection lawsuits during the year, and relatively more standard securities suits. NERA’s January 21, 2020 press release about the report can be found here, and the report itself can be found here. My own analysis of the 2019 securities litigation can be found here. Continue Reading NERA Economic Consulting: Federal Securities Suit Filings Remain at Recent Elevated Levels

As the various stories and revelations came to light during the peak of the #MeToo movement, there were also a number of D&O lawsuits filed against companies whose executives were the target of the stories. Among these lawsuits was the #MeToo-related securities class action lawsuit filed against CBS. On January 15, 2020, in a lengthy and detailed opinion, Southern District of New York Judge Valerie Caproni largely granted the defendants’ motion to dismiss the lawsuit, although the lawsuit did survive as to one set of allegations involved alleged statements by former CBS executive Leslie Moonves. The court’s ruling underscores the difficulty for plaintiffs in trying to translate sexual misconduct allegations into securities claims. Continue Reading CBS #MeToo-Related Securities Suit Largely Dismissed, Though Some Allegations Survive

Francis Kean

As long time readers know, I have long been warning that climate change-related issues could have a significant impact on directors and officers liability exposures. In the following guest post, Francis Kean provides a summary outline of the specific litigation exposures that corporate directors and officers may face as a result of emerging climate change-related concerns. Francis is Executive Director FINEX Willis Towers Watson. Francis will be joining McGill and Partners in early spring 2020. I would like to thank Francis 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 blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Francis’s article. Continue Reading Guest Post: Climate Change Litigation Threats to Directors and Officers