I have noted for some time now in posts on this site the development of an ESG backlash, which has taken a variety of forms, including through both political action and litigation. For example, I recently noted two ESG backlash lawsuits that had been filed against major U.S. airlines. Now in the latest example of an ESG backlash lawsuit, a plaintiff shareholder has filed a securities suit against the retailing giant Target Corporation and certain of its directors and officers based on allegations that the defendants “betrayed both Target’s core customer base … and its investors by making false and misleading statements concerning Target’s Environmental, Social and Governance (ESG) and Diversity, Equity, and Inclusion (DEI) mandates that let to its disastrous children-and-family themed LGBT-Pride campaign.” A copy of the complaint in the new Target lawsuit can be found here.

Continue Reading Target Hit with ESG-Backlash Securities Suit

In a June 29, 2023, decision in Students for Fair Admissions v. Harvard, the U.S. Supreme Court held that the college’s use of affirmative action in its admissions program was unconstitutional. The discrimination case against the college not only went all the way to the Supreme Court but was also the subject of a long-running insurance coverage dispute involving the college’s excess employment practices insurance. In an August 9, 2023, ruling, the First Circuit held in the insurance coverage dispute that the college’s late provision of notice of claim regarding the underlying discrimination lawsuit precluded excess coverage for the claim. This high-profile insurance coverage ruling has some important lessons about the provision of notice to insurers in connection with liability claims. A copy of the appellate court’s August 9, 2023, ruling can be found here.

Continue Reading Late Notice Precludes Excess Coverage for High-Profile Harvard Suit
Umesh Pratapa

Many of us have personal checklists that we use when we review D&O insurance policies. In the following guest post, Umesh Pratapa, an independent insurance consultant based in India, shares his checklist of items to look for in D&O insurance policies. Because Umesh works in the Indian insurance market, some of the items may be less relevant in other markets. I appreciate Umesh’s willingness to share his checklist with the readers of this site. By publishing Umesh’s checklist, I hope to encourage others also to share their checklists to post on this site for other readers to benefit from. Umesh published a prior version of this article on his website, here. I would like to thank Umesh for allowing me to publish his article on this site. Here is Umesh’s article.

Continue Reading Guest Post: D&O Liability Insurance Policy – Assumed Vs. Available Coverage

There have recently been a number of Delaware court decisions relating to the Duty of Oversight. In the following guest post, Frederick M Zauderer, Esq., Senior Vice President, Head of Complex Claims – North American Liability at AXIS Capital Holdings, Ltd., Joseph P. Monteleone, Esq., Partner at Weber Gallagher, and Alvin H. Fenichel, CPA, Senior Advisor at H.S. Grace & Company, Inc., take a look at the recent Delaware Duty of Oversight decisions and consider their implications. A version of this article previously was published on the Association of Corporate Counsel (ACC) Docket site (here).   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 submit a guest post. Here is the authors’ article.

Continue Reading Guest Post: Board Oversight Duties: Recent Adventures in the Delaware Chancery

Long-time readers know that a litigation phenomenon on which I have frequently commented is the filing of securities class action lawsuits in the wake of antitrust enforcement actions. These follow-on civil actions represent something of a translation of an antitrust matter into a securities lawsuit. In the latest example of this phenomenon, a plaintiff shareholder has filed a securities suit against the concert company Live Nation following news reports of an imminent U.S. Department of Justice antitrust lawsuit against the company and its ticketing service Ticketmaster relating to allegations that the concert company pressures clients to use the ticketing service. The new lawsuit raises a number of interesting issues, as discussed below. A copy of the August 4, 2023 complaint can be found here.

Continue Reading Antitrust Enforcement Leads to Follow-On Securities Suit Against Live Nation

The number of federal court securities class action lawsuit filings in the first half of 2023, if annualized, suggests a year-end total number of filings that would represent a 15% increase over the number of filings in 2022, according to a new report from NERA Economic Consulting. The report, which is entitled “Recent Trends in Securities Class Action Litigation: H1 2023 Update,” also reports that while average securities suits settlement values were down in the year’s first half compared to 2022, the median suit settlement increased compared to 2022. A copy of the August 2, 2023, NERA report can be found here. NERA’s August 2, 2023 press release regarding the report can be found here.

Continue Reading NERA: First Half Securities Suit Filings Point to Overall Full-Year Increase

Earlier this year, challenges arising from rising interest rates, as well as concerns surrounding liquidity and other issues, led to three of the largest banking failures in U.S. history. The three that failed were not the only banks facing challenges in the rising interest rate environment, and while there have been no further failures since May, questions from the turbulence earlier this year remain for many banks. Now, in a sign that these kinds of challenges and questions can lead to securities litigation even in the absence of bank failure, a plaintiff shareholder has filed a securities class action lawsuit against KeyCorp (the bank holding company of KeyBank) after questions about the bank’s liquidity and interest rate income in a rising interest rate environment caused a drop in the company’s share price. A copy of the August 4, 2023, complaint filed against Key can be found here.

Continue Reading Liquidity and Interest Income Concerns Draw Securities Suit Against Bank

In a milestone development in the long-running Dutch collective investor action brought against Petrobras and related entities, a Netherlands court has ruled on the merits in favor of the Foundation bringing the action on behalf of investors, holding that Petrobras harmed investors by publishing misleading financial information. Though the case is not done – the Court will next consider certain legal issues pertaining to the investors’ claimed damages – the Court’s recent ruling is an important step in this significant and high-profile case. An English translation of the Court’s July 26, 2023, judgment can be found here. The July 26, 2023, press release of the International Securities Association & Foundations Management Company, the administrator of the Foundation brining the action, which summarizes the rulings in the Court’s judgment, can be found here.

Continue Reading Dutch Court Enters Interim Merits Judgment in Favor of Petrobras Investors

Earlier this week (here), I noted the securities class action lawsuit that a plaintiff shareholder filed against AT&T in the wake of the Wall Street Journal’s series of articles about the network of lead telephone cables in the U.S. Now, another plaintiff has initiated a separate but parallel lawsuit against Verizon. This latest lawsuit, which was filed by the same plaintiff law firm as filed the AT&T lawsuit, alleges that Verizon was aware of but failed to disclose to investors the risks and hazards the company faced owing to its ownership of the lead telephone cables. A copy of the August 1, 2023, complaint against Verizon can be found here.

Continue Reading Verizon Hit with Lead Telephone Cable-Related Securities Suit

Many of you may have read the recent series of Wall Street Journal articles raising the alarm about the sprawling U.S. network of lead telephone cables. The articles suggest not only that the lead cables represent a health hazard to workers and to nearby residents, but that the telephone companies (including AT&T) allegedly have known about these hazards but have failed to take corrective measures. The revelations in the Journal series have led to governmental investigations. And now a plaintiff shareholder has filed a securities class action lawsuit against AT&T alleging that the company misled investors about the allegedly known but undisclosed risks the companies faced as a result of the lead telephone cable hazards. This new event-driven lawsuit shows that dangers that unacknowledged environmental and health hazards may represent for reporting companies. A copy of the July 27, 2023, complaint can be found here.

Continue Reading Lead Telecom Cables Exposé Leads to Securities Suit Filing