Is Over-Regulation Really the Reason There are Fewer IPOs?

One of the recurring themes of financial commentators has been the decline in the number of IPOs compared to prior years. Articles about the dearth of IPOs are something of a staple in the financial press. The decline in the number of IPOs has also drawn the attention of Congress. One of the intended purposes of the Jumpstart Our Business Startups Act of 2012 was to try to encourage more companies to go public. A number of other initiatives to try to encourage more IPOs are currently circulating through Congress. The premise behind these various legislative initiatives is that if the regulatory burdens can be eliminated and costs reduced, more companies will go public. Columbia Law School Professor John Coffee recently testified before a Congressional committee about these latest initiatives. His testimony is set out in a May 29, 2018 CLS Blue Sky Blog article entitled “The Irrepresssible Myth That SEC Overregulation Has Chilled IPOs” (here),  reflecting his skepticism that further deregulation alone will result in increased numbers of IPOs. Continue Reading

Guest Post: Why the Crypto-Enforcement Onslaught by U.S. Regulators Has Just Begun

John Reed Stark

One of the most significant recent developments in the financial world has been the sudden proliferation of cryptocurrencies. The quick rise of digital currencies seemingly caught regulators by surprise; regulatory action and involvement was slow to develop. But as John Reed Stark, President of John Reed Stark Consulting and former Chief of the SEC’s Office of Internet Enforcement, documents in the following guest post, U.S. regulators have heard the bell and are now rising to action, and for good reason. A version of this article previously appeared on Cybersecurity Docket. I would like to thank John for his willingness to allow 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 and article. Here is John’s guest post. Continue Reading

D&O Insurance: Court Rejects Insurers’ Argument That Coverage for a DOJ Subpoena is Precluded

As I have noted in numerous prior posts, the question of whether or not a D&O insurance policy provides coverage for a subpoena is a recurring issue. A recent decision out of the Northern District of Illinois denied the relevant D&O insurers’ motion to dismiss a declaratory judgment action in which a policyholder sought coverage for its costs incurred of responding to a DOJ subpoena. The decision is interesting in a number of respects, including in particular the court’s willingness to consider all of the circumstances in concluding that the policy’s Wrongful Act requirement had been met. Northern District of Illinois Judge Manish S. Shah’s May 30, 2018 decision in the case can be found here. Continue Reading

Dubrovnik and Mostar

The D&O Diary’s European itinerary continued with a last stop over the Memorial Day weekend in Dubrovnik, Croatia’s famous Adriatic port city. We added a fascinating day trip to Mostar, in Bosnia-Herzegovina. People have been telling me basically my whole life that I needed to visit Dubrovnik. Turns out, they were right. Despite the crowds from the cruise ships in the city’s narrow streets, Dubrovnik is my new favorite place. It also may the most photogenic city in the world. Continue Reading

D&O Insurance: Coverage Precluded for Insured Director Acting in Multiple Capacities

One of the key elements to establish coverage under a directors and officers insurance policy is the existence of claim is for actions undertaken by an insured individual in an insured capacity – that is, in his or her capacity as a director or officer of the company. Things in life are never simple, and lawsuits often allege that corporate director or officer defendants were acting in multiple capacities – that is, both in their capacity as a director or officer and in other capacities as well. These multiple capacity claims often present policy interpretation and coverage issues under D&O insurance policies.

 

In a recent case, the District Court of North Dakota (applying North Dakota law) held that coverage under a D&O insurance policy does not apply to a claim alleging that the insured defendant was acting in multiple capacities. The court also held that the Insured vs. Insured exclusion precluded coverage where the claimants included both insured persons and individuals that were not insured persons. The decision raises some interesting policy language and policy interpretation issues. A copy of May 18, 2018 decision by District of Massachusetts Judge William G. Young, sitting by designation in the District of Nevada, can be found here. Continue Reading

Ljubljana, Slovenia

The D&O Diary’s Eastern European sojourn continued last week with a stop in Ljubljana, the capital of Slovenia. Ljubljana may not be familiar to many readers, so here’s what you need to know about the place: Ljubljana is an absolute gem – compact and beautiful. Ljubljana has a great vibe, great wine, and interesting architecture. Ljubljana, my friends, is a seriously cool place. Continue Reading

Bratislava, Slovakia

The Bratislava Castle, overlooking the Danube

The D&O Diary’s Eastern European sojourn continued earlier this week with a very brief stop in Bratislava, the capital of Slovakia, which is about a two-hour train ride from Budapest. With a population of only about 450,000, Bratislava is small, but it has a rich history and interesting setting on the Danube, only about 30 miles downstream from Vienna. Continue Reading

Guest Post: Cybersecurity and D&O Liability: Emerging Concerns under Indian Law

One of the most closely watched issues in the world of D&O is the extent to which cybersecurity-related issues will lead to liability for corporate directors and officers. In the following guest post, Tarun Krishnakumar, a New Delhi attorney qualified in India and California specializing on issues relating to emerging technology , takes a look at the corporate liability framework under Indian laws with respect to emerging cybersecurity exposures. I would like to thank Tarun 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 Tarun’s article. Continue Reading

Budapest on the Danube

The Hungarian Parliament Building on the Danube River in Budapest

The D&O Diary is on assignment in Eastern Europe this week, with multiple destinations on the itinerary, starting with a weekend stop in Hungary’s capital city of Budapest. With a city population of 1.7 million and an urban population over 3 million, Budapest is a large, sprawling place. The taxi ride from the airport into the central city cuts through some pretty scruffy parts of town, so it was startling to arrive at the river and encounter the Danube’s sweeping beauty as it rolled through the city’s central district. Continue Reading

Guest Post: DOJ Issues New Policy on Coordination of Corporate Penalties to Address “Piling On”

Deputy Attorney General Rod Rosenstein recently announced a new policy at the U.S. Department of Justice to address the “piling on” problem that corporate defendants can sometimes face – that is, the accumulation of penalties that can arise when multiple different federal agencies pursue enforcement actions against the corporate target based on the same alleged misconduct. In the following guest post, attorneys from the Paul Weiss law firm take a look at the new policy and its practical implications. 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 Paul Weiss attorneys’ article. Continue Reading

LexBlog