Priya Cherian Huskins

Many readers undoubtedly have heard that, in lieu of D&O insurance, Tesla Motors CEO Elon Musk has personally agreed to protect the company’s board with an indemnification undertaking. In the following guest post, Priya Cherian Huskins discusses another situation in which a company official has agreed to indemnify the company’s directors in lieu of insurance, and discusses the issues and implications of this type of arrangement. Priya is a Senior Vice President and Partner at Woodruff Sawyer. A version of this article previously appeared in the D&O Notebook. I would like to thank Priya 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 Priya’s article. Continue Reading Guest Post: When a Wealthy Individual, Not D&O Insurance, Indemnifies Directors

As regular readers know, over the last few months, I have been closely following the rise of coronavirus outbreak-related securities class action lawsuits. To date, though the pandemic is a global health and economic phenomenon, the pandemic-related securities litigation activity has been limited to the United States. In the following guest post, Jason Symons, Persia Navidi, Claudia George, and Luke Roper of the HWL Ebsworth Lawyers take a look at the possibilities for COVID-19-related securities class action lawsuits in Australia. 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 authors’ article. Continue Reading Guest Post: The Potential for COVID-19-Related Securities Class Actions in Australia

In the latest coronavirus outbreak-related securities class action lawsuit to be filed, a plaintiff shareholder has filed a securities class action lawsuit against The GEO Group, a publicly traded private corrections facilities operator, alleging that the company misled investors about the effectiveness of its COVID-19 response. The complaint alleges that the company’s “inadequate” procedures subjected residents of the Company’s halfway houses to significant health risks. The company’s share price declined following news reports of a COVID-19 outbreak at one of the company’s facilities. A copy of the plaintiff’s complaint can be found here. Continue Reading Private Prison Firm Hit with COVID-19 Outbreak-Related Securities Suit

In an interesting decision that touches on a number of basic D&O insurance coverage issues, a federal district court judge applying Oklahoma law has ruled that a company’s management liability insurance policy does not provide coverage for legal expenses a former company executive incurred in a declaratory judgment action that had been filed by another company executive to determine the parties’ rights under a profit sharing agreement. The court concluded that there was no coverage because the individual seeking coverage had not been named as a defendant in the lawsuit by reason of his status as an insured person. Even more interestingly, the court concluded further that, even though the individual had been named as a defendant in the declaratory judgment lawsuit, he had not incurred “Defense Expenses” in the lawsuit, and therefore suffered no “Loss.” Western District of Oklahoma Judge David Russell’s June 30, 2020 redacted opinion in the insurance coverage action can be found here. Continue Reading No Coverage for Legal Expenses Incurred in Declaratory Judgment Action

After the recent civil disturbances and social unrest, there has been a renewed focus on equality and diversity issues. Among many other things, investors and activists are raising concerns about the lack of racial diversity on corporate boards. For example, just last week, a California legislator introduced a bill that would require corporations to include on their boards persons from “underrepresented communities.” Now, in addition to these legislative efforts, an activist investor seeking to advance board diversity objectives has launched a shareholder derivative lawsuit against the directors of Oracle Corporation, accusing the board of violating their legal duties by failing to diversify the company’s board and otherwise failing to address diversity and equality issues. A copy of the investor’s complaint can be found here. Continue Reading Oracle Directors Hit with Derivative Suit on Board Diversity Issues

As the pandemic has unfolded, a recession has followed in its wake, as a result of which many companies are struggling. Some will not survive – a number of high profile companies, such as Hertz and Neiman Marcus, have already filed for bankruptcy. Many others have issued financial filings containing a “going concern” disclosure or received an audit opinion with a going concern modification. The government shutdowns and other disruptions that have followed in the wake of the coronavirus outbreak have placed an enormous burden on many businesses. The going concern disclosures filed in the year’s first half reveal how many companies are struggling to stay afloat and what might be in store in the months ahead. Continue Reading Concerns About “Going Concern”

In recognition of the Independence Day holiday in the U.S., and in what is now an annual tradition, I reprise my 2012 essay about Time and Summer, which can be found here. In the midst of the very strange time in which we are all now living, life’s timeless lessons somehow seem more important than ever. Thank you to all of my loyal readers. I hope that all of you and your families are able to enjoy a healthy and safe Fourth of July holiday.

Largely due to a significant decline in the number of filings during May and June, the number of federal court securities class action lawsuit filings in the first half of 2020 was well below the number of filings at the same point last year – although still well above long-term historical levels. The number of first half filings was significantly boosted by a cluster of securities suit filings against cryptocurrency companies that were sued on a single day in April, as well as by the number of coronavirus outbreak-related securities suits. Continue Reading Securities Suit Filings Decline in Year’s First Half

As noted in a prior post, on June 22, 2020, the U.S. Supreme Court entered its opinion in Liu v. SEC, in which the Court addressed a number of questions surrounding the SEC’s authority to seek disgorgement. In the following guest post, Stephen Cutler, Michael Osnato, Meaghan Kelly and M Moore of the Simpson Thacher law firm take a closer look at the Court’s opinion and consider its 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 authors’ article. Continue Reading Guest Post: Supreme Court Affirms SEC’s Disgorgement Remedy, but Places Limits on Its Use

One of the shorthand expressions sometimes used to refer to shareholder class action litigation is to call them “stock drop lawsuits.” Securities suits do indeed involve stock drops. But how often do stock drops actually result in lawsuits? That is the interesting questions asked in the following guest post from Stanford Law School Professor Michael Klausner and Sam Blake Curry and Jason Hegland of Stanford Securities Litigation Analytics. 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 authors’ article. Continue Reading Guest Post: “Stock Drop” Lawsuits