The filing of Opioid-related securities litigation is not a new development; indeed, more than six years ago, I published a post in which I noted the outbreak at the time of a number of opioid-related securities suits against opioid drug companies. Now, in the latest opioid-related securities suits to be filed, and in the wake of the U.S. Department of Justice’s filing of a False Claims Act complaint against the company, a plaintiff shareholder has filed an opioid-related securities class action lawsuit against Walgreens Boots Alliance. A copy of the January 30, 2025, complaint can be found here.

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The D&O Diary is on assignment in Europe, with first stops last week and over the weekend in Dublin and London. Neither late January nor early February are ideal times to visit Ireland or England. However, though the weather was chilly and darkness gathered early in the afternoon, it turned out not to be a bad time to visit after all.

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In my recent year-end wrap up, I noted that one of last year’s top stories was the rise of artificial intelligence (AI) as a source of corporate and securities litigation risk. Among the evidence reflecting the rise of AI as a source of risk was the onset of securities class action litigation containing AI-related allegations. Last week, in a new lawsuit filing showing that AI-related litigation risks are continuing, a plaintiff shareholder filed a securities suit against a Canadian technology services company whose revenues declined and whose margins shrunk as the company shifted its services to an AI-based model. A copy of the January 30, 2025, complaint against Telus International (CDA) Inc. can be found here.

Continue Reading Tech Company Hit with Securities Suit Alleging AI-Related Omissions

According to the latest report from Cornerstone Research, the number of federal and state securities class action lawsuits filed increased in 2024 for the second year in a row, to the highest level since 2020, even though the overall number of liability actions filings under the ’33 Act declined to the lowest level in the last ten years. As discussed below, a more detailed analysis of the 2024 securities class action lawsuit filing figures suggests that the 2024 filing activity was elevated compared to both recent and longer-term historical levels. The January 29, 2025, report, which was written in conjunction with the Stanford Law School Securities Class Action Clearinghouse, and which is entitled “Securities Class Action Filings: 2024 Year in Review,” can be found here. Cornerstone Research’s January 29, 2025 press release about the report can be found here.

Continue Reading Cornerstone Research: Securities Suit Filings Increased in 2024

Here at The D&O Diary we try to follow the latest events. And while we think it is important to keep track of what is happening now, we also think it is important to keep things in perspective. It is particularly important to maintain a historical perspective. It is for that reason that we read with interest a recent speech by outgoing FDIC Chair Martin Gruenberg, in which he gave a retrospective overview of the three banking crises of the last four decades, as well as a reflection of the lessons to be learned. Gruenberg’s speech is must reading for anyone that wants to understand the prior banking crises, as well as to appreciate the risks that may lie ahead. The text of Gruenberg’s January 14, 2025 speech can be found here.

Continue Reading The Lessons of Three Financial Crises

In my recent round-up of the top D&O stories of 2024, I noted as one of the key current issues the emergence of geopolitical issues as a source of D&O risk. Among other geopolitical concerns I speculated might contribute to this risk are anti-money laundering (AML) laws. Earlier this month, in the latest example of how AML issues can translate into a D&O claim, a plaintiff shareholder filed a securities class action lawsuit against the money transfer technology company Block and certain of its executives, based on allegations that the company’s failure to maintain basic AML protocols had created a “haven for criminal and illicit activities,” allegedly contrary to the company’s representations. A copy of the January 17, 2025, complaint can be found here.

Continue Reading Alleged Anti-Money Laundering Law Violations Leads to Securities Lawsuit

It was already understood that the SEC under the new Trump administration would be taking a different approach to cryptocurrency enforcement, but the announcement on January 21, 2025 that the agency under Acting Chair Mark Uyeda was forming a cryptocurrency task force “dedicated to developing a comprehensive and clear regulatory framework for crypto assets” certainly underscores the fact that the SEC will treating crypto differently than was the case during the Biden administration. But while we look ahead to what may be in store for crypto under the new administration, it is also worth looking back at what the agency’s approach to crypto enforcement has been up to this point. A new Cornerstone Research report entitled “SEC Cryptocurrency Enforcement: 2024 Update” (here) provides a comprehensive overview of the agency’s crypto enforcement so far.

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According to the latest annual report from NERA, and based on NERA’s inclusive counting methodology, the number of federal securities class action lawsuits was flat in 2024 relative to 2023, but the number of “traditional” securities class action suits increased in 2024 for the second year in a row. In addition, the number of case resolutions (including both settlements and dismissals), increased in 2024, reversing a six-year decline in the number of resolutions. NERA’s January 22, 2025 report entitled “Recent Trends in Securities Class Action Litigation: 2024 Full-Year Review,” can be found here.

Continue Reading NERA Reports Securities Suit Filings Level, Dismissals Increased in 2024
Sarah Abrams

In recent years, student athletes in the U.S. have gained the rights to profit from their “name, image, and likeness” (NIL). As these rights have emerged, NIL collectives have formed. The purpose of these collectives is for a school’s athletic supporters to have a way to pool their funds in order to create opportunities for their school’s student athletes. The collectives are in many ways new kinds of organizations, and they are certainly organized for new purposes. In the following guest post, Sarah Abrams, Head of Claims Baleen Specialty, a division of Bowhead Specialty, examines the challenges involved with trying to develop management liability insurance for these kinds of collectives. A version of this article previously was published on Law360. I would like to thank Sarah for allowing me to publish her 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 Sarah’s article.

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In what may be the SEC’s first AI-washing enforcement action against a reporting company, on January 14, 2025, the agency brought a settled enforcement action against Presto Automation, a restaurant services technology company, based on the company’s alleged misrepresentations “regarding critical aspects of its flagship artificial intelligence (“AI”) product, Presto Voice.” A copy of the SEC’s January 14, 2025 press release about the action may be found here. The agency’s January 14, 2025 Order in the proceeding can be found here.

Continue Reading SEC Files AI-Washing Enforcement Action Against Restaurant Technology Company