In this guest post, Frank Hülsberg and Burkhard Fassbach take a look at a recent Reuters special report about the use of cyber hacking and other espionage techniques in litigation and consider the D&O liability and insurance implications. Frank Hülsberg is a Chartered Accountant and Tax Advisor in Düsseldorf, Partner Advisory and Member of the Executive Board at Grant Thornton AG Wirtschaftsprüfungsgesellschaft in Germany, and Burkhard Fassbach is a D&O-lawyer in private practice in Germany. I would like to thank Frank and Burkhard 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 Frank and Burkhard’s article. Continue Reading Guest Post: Spy Phishing Attacks Against Lawyers and Litigants
In the following guest post, Sarah Abrams, Head of Professional Liability Claims at Bowhead Specialty Underwriters, takes a look at the implications for D&O insurers of the growing investment interest of private equity firms in the healthcare sector. I would like to thank Sarah for allowing me to publish her 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 Sarah’s article. Continue Reading Guest Post: As Private Equity Healthcare Investments Grow, Will D&O Liability Exposure Increase?
Many D&O insurance programs consist of multiple layers of insurance arranged with a layer of primary insurance and one or more layers of excess insurance. In order to ensure that the insurance in the program operates consistently and uniformly, the excess insurance is usually written on a so-called “follow form” basis, meaning that the excess insurance incorporates the primary’s policy’s terms and conditions, subject to any express provisions in the excess policy to the contrary. A recent case from the Court of Appeal for Ontario considered the meaning and impact of excess follow form coverage in the context of a dispute over whether a policyholder could exercise an option to purchase extended reported period coverage from its excess insurer. The decision, while arguable unremarkable in and of itself, nevertheless may have some important lessons for excess insurers. A copy of the Ontario Appeal Court’s July 13, 2022 decision can be found here. Continue Reading Thinking About Follow-Form Excess Insurance
In a long-standing tradition, I have annually reprised on this site over the July 4th holiday an essay I wrote several years ago about summertime at our lake house in Pentwater, Michigan. This year, I was in London during the July 4th weekend, and so I was unable to follow through on re-posting the essay. However, since we are still in the month of July, it is not too late, and the essay’s themes remain as timely as ever. And so in a slightly belated completion of my annual ritual, I am now posting a link to the essay about Time and Summer – the essay can be found here. I hope everyone has a great summer and that each one of you is able to take some time to savor July while it lasts.
In most instances, corporate officers cannot be held personally liable for the misconduct of the company they serve. However, there are occasions when corporate officers can be held personally liable in their individual capacities for corporate acts or omissions. A recent decision by a California intermediate appellate court held that an individual who served as a company’s CEO and CFO can be held liable for the claimants’ unpaid wages. As discussed below, the ruling represents an interesting example of the circumstances in which individuals can be held liable for company misconduct. A copy of the California Court of Appeal’s June 28, 2022 decision can be found here. A July 21, 2022 post on The CorporateCounsel.net blog about the decision can be found here. Continue Reading California Appellate Court Holds Corporate Officer Personally Liable for Unpaid Wages
In the following guest post, the authors revisit the question of whether or not securities class action lawsuits against development-stage biotech companies are likelier to survive a motion to dismiss compared to securities suits against other kinds of companies. As the authors report below, they conclude from their research that the suits against biotech companies are not likelier to survive dismissal motions. The authors of this guest post are: Doug Greene, BakerHostetler, Leader, Securities and Governance Litigation Team; Genevieve York-Erwin, BakerHostetler, Partner; Mike Tomasulo, Baldwin Risk Partners, Managing Partner, Management Liability National Practice Leader: Emily Baxter, BakerHostetler, Associate; and Alex Karambelas, BakerHostetler, Associate. A version of this article previously was published on the PLUS Blog. 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 site’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ article
Regular readers of this blog know my view that the rise of collective investor actions outside the United States is one of the most important developments in the world of directors’ and officers’ liability in recent years. The increase in collective investor actions has been particularly noteworthy in Europe. In the following guest post, ISS Securities Class Action Services and the FOX Williams law jointly report on the current state of play in European Class Actions. The ISS SCAS authors are Jeffrey Lubitz, Managing Director, and Elisa Mendoza, Esq., Associate Director. The Fox Williams authors are Andrew Hill, Partner; Anisha Patel, Senior Associate; and Sam Tarrant and Olwen Mair, Associates. A .pdf version of the report is available here. As the authors note, investors increasingly are finding innovative ways to bring such claims and the courts and legislatures across Europe appear willing to find solutions to ease the burden and costs traditionally associated with these actions, making them more accessible to investors. I would like to thank the authors for allowing me to publish their report 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: An Investor Roadmap: The Jurisdictional Differences and Impact of ESG in European Shareholder Class Actions
As I have noted in recent posts (most recently here), a few of the many SPAC-related securities lawsuits that have been filed in the last 18 months are so are reaching the dismissal motion stage, and in at least some cases the dismissal motions are being denied, at least in part. In the latest example, the federal judge presiding over the SPAC-related securities class action lawsuit involving commercial space travel firm Momentus and Stable Road Acquisition Corp, its SPAC partner, as well as the SPAC sponsor and certain SPAC executives, has largely denied the defendants’ motion to dismiss. As discussed below, the securities suit may be unusual in that it was only filed after the SEC launched a securities enforcement action against the same entities and individuals and involving the same allegations; however, the court’s rulings nevertheless may have some implications for the many other pending SPAC-related suits. Continue Reading Securities Suit Against SPAC and SPAC Merger Target Largely Survives Dismissal Motion
In what is the largest case dispositions of its type that I have ever seen, a court in Tokyo has ordered four executives of Tokyo Electric Power Holdings (Tepco) to pay the company 13.321 trillion yen – the equivalent of $97 billion — based on the court’s finding that the individuals had negligently failed to take steps that would have prevented the disaster at the Fukushima Daiichi nuclear plant after the March 2011 earthquake and tsunami. This verdict, which is described in a July 13, 2022 Wall Street Journal article (here), is noteworthy on many levels, as discussed below. Continue Reading Massive $97 Billion Verdict Awarded Against Fukushima Utility Executives
It is so interesting to me that, notwithstanding the passage of time since the initial coronavirus outbreak in the U.S. in March 2020, plaintiff shareholders continue to file COVID-19-related securities class action lawsuits — as we saw, for example, in the infrastructure overcapacity lawsuit filed last week against Amazon. In yet another case showing how COVID-related concerns are continuing to roil companies and attract securities suits, earlier this week a plaintiff shareholder filed a securities class action lawsuit against developmental-stage pharmaceutical company Molecular Partners AG in part owing to setbacks the company encountered in its efforts to develop a COVID-19 treatment candidate. A copy of the July 12, 2022 lawsuit filed against Molecular Partners can be found here. Continue Reading Drug Development Company Hit with COVID-19-Related Securities Suit