David H. Topol

In the following guest post, David H. Topol of the Wiley law firm reviews the important legal and regulatory developments affecting private investment funds during 2020. I would like to thank David 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 David’s article. Continue Reading Guest Post: Private Investment Funds: Major Developments from 2020

In the following guest post, Francis Kean provides us with ten reasons to be cheerful notwithstanding the current D&O insurance market. Francis is a Partner, Financial Lines, at McGill and Partners. A version of this article previously was published Insurance Day. 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: The State of the D&O Market: 10 Reasons to Be Cheerful

In prior posts on this site, I have identified privacy-related issues as a potentially important source of future D&O claims. In making these projections, one thing I had in mind was the possibility of claims as a result of the enforcement of the EU’s General Data Protection Regulation, which went into effect in May 2018. There have in fact already been GDPR-related securities class action lawsuits filed in the U.S., including the securities suit filed in August 2018 against U.K.-incorporated media tracking company Nielsen Holdings. In a January 4, 2021 opinion, Southern District of New York Judge Jesse Freeman granted in part and denied in part the defendants’ motion to dismiss the Nielsen Holdings lawsuit. Of significance to the questions concerning privacy-related claims, the plaintiff’s allegations concerning defendants’ statements after GDPR went into effect about the GDPR’s impact on the company survived the dismissal motion. A copy of Judge Furman’s opinion can be found here. Continue Reading GDPR-Related Securities Suit Against Nielsen Holdings in Part Survives Dismissal Motion

In my recent survey of key 2020 D&O developments I highlighted the surge of SPAC IPOs last year and conjectured about the possible increase in the number of D&O claims that might arise following the transactions in which private companies merge into the public traded SPACs ( the so-called de-SPAC transaction). A securities suit filing this week demonstrates how these claims might well arise and does suggest we could indeed be in for an influx of securities suits and other D&O claims filed following de-SPAC transactions. Continue Reading Post-SPAC Merger Company Hit with Post-Transaction Securities Suit  

In my round-up of the Top D&O Stories of 2020, which I published earlier this week, I noted that the recent massive state-actor hack of U.S. government agencies and technology companies underscored the fact that cybersecurity represents a significant operational and management risk for organization of every type. I also noted that cybersecurity-related issues represent an ongoing D&O claims risk. As if to confirm these propositions, the first securities class action lawsuit of the New Year was filed against Solar Winds, the network infrastructure management company whose breached software is believe to have contributed to the recent massive hack. As discussed below, the newly filed complaint highlights the fact that cybersecurity represents a significant potential source of management liability risk. Continue Reading SolarWinds Hit with Securities Suit Based on Third-Party Governmental Actor Cyber Attack

The directors’ and officers’ liability environment is always changing, but 2020 was a particularly eventful year, with important consequences for the D&O insurance marketplace. The past year’s many developments also have significant implications for what may lie ahead in 2021 – and possibly for years to come.  I have set out below the Top Ten D&O Stories of 2020, with a focus on the future implications. Please note that on Wednesday, January 13, 2021 at 11:00 AM EST, my colleague Marissa Streckfus and I will be conducting a free, hour-long webinar in which we will discuss The Top Ten D&O Stories of 2020. Registration for the webinar can be found here. I hope you will please join us for the webinar. Continue Reading The Top Ten D&O Stories of 2020

The number of federal court securities class action lawsuit filings declined in 2020 relative to the most recent prior years, largely due to short-term filing lulls during the second and fourth quarters of the year. Though the number of filings last year was below the record-setting levels seen during the years 2017 to 2019, the number of 2020 filings was still well above historical annual averages. Continue Reading Securities Suit Filings Declined in 2020 But Remained Above Historical Levels

As I noted in a recent post, one of the most distinctive phenomena in the U.S. financial markets this year has been the tremendous amount of IPO activity involving Special Purpose Acquisition Companies (SPACs). According to SPACInsider (here), there have been 243 SPAC IPOs so far in 2020 (as of December 22, 2020), raising total gross proceeds of over $81.3 billion. As I also noted in my prior post, lawsuits relating to SPACs are starting to accumulate. In the latest example of a securities suit relating to a SPAC transaction, a plaintiff shareholder has filed a securities class action against the surviving company following a SPACs acquisition of a target company; the complaint in the lawsuit names as defendants not only the CEO of the surviving company, but also the former president of the SPAC. As discussed below, this new lawsuit may have implications for possible future SPAC-related securities litigation in 2021, and possibly even beyond. Continue Reading SPAC-Acquired Company Hit with Post-Acquisition Securities Suit

In the latest coronavirus outbreak-related securities suit, a Canadian diagnostic medical testing company that hoped to obtain emergency regulatory authorization for its rapid COVID-19 antigen test has been hit with a securities class action lawsuit after the company failed to obtain the regulatory approvals. A copy of the plaintiff’s complaint, filed on December 17, 2020 in the Central District of California, can be found here. In addition, as discussed below, this past week, the SEC separately filed a coronavirus-related enforcement action against a biotechnology company that touted its ability to provide a blood-based diagnostic test for the coronavirus. Continue Reading Canadian Testing Company Hit with COVID-19-Related Securities Suit

As I have noted in prior posts (most recently here), allegations of bribery and improper payments often lead to follow-on securities class action lawsuits. Although historically claimants in these kinds of securities suits have had mixed results, some of these lawsuits have resulted in significant settlements (including most notably the $3 billion settlement in the Petrobras case). In the latest of these bribery follow-on lawsuits to result in a significant settlement, on December 11, 2020, the parties to the securities lawsuit pending against the Chilean company Chemical and Mining Company of Chile Inc. (a/k/a Sociedad Química y Minera de Chile S.A., or “SQM’) filed with the  court their agreement to settle the lawsuit based on SQM’s agreement to pay $62.5 million. The parties’ December 11, 2020 stipulation of settlement can be found here. The lead plaintiff’s motion for preliminary approval of the settlement can be found here. Continue Reading Chilean Company Pays $62.5 Million to Settle Bribery-Related Securities Suit