The payment technology firm Block, Inc. (formerly known as Square) has been hit with a securities class action lawsuit related to the company’s announcement earlier this year that a former employee had improperly accessed and downloaded company customer data. The new lawsuit is the latest example of the ways in which data security incidents can translate into D&O claims. The complaint, filed on October 11, 2022, can be found here. Continue Reading Payments Company Hit With Data Breach-Related Securities Suit

Bryan Coffey
Peter Gillon

The Delaware General Assembly has amended the Delaware General Corporation Law Section 102(b)(7), effective August 1, 2022, to permit the exculpation of corporate officers. In the following guest post, Bryan Coffey and Peter Gillon of the Pillsbury Winthrop Shaw Pittman LLP law firm examine the new statutory provision and consider the provision’s D&O insurance implications. The authors’ article previously was published on Law360 and is republished here with permission. I would like to thank Bryan and Peter 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 Bryan and Peter’s article. Continue Reading Guest Post: What Del. Officer Exculpation Law Means For D&O Insurance

In the latest lawsuit to emerge in the aftermath of the recent SPAC frenzy, a plaintiff shareholder has filed a securities class action suit against Opendoor Technologies, a residential real estate digital platform, which merged into a publicly traded SPAC in December 2020. The SPAC involved was one of the many financial vehicles launched by the so-called “King of SPACS,” Chamath Palihapitiya, while the SPAC craze was picking up steam. A copy of the October 7, 2022 complaint can be found here. Continue Reading SPAC-Merged Real Estate Platform Hit with Securities Suit

A recurring issue concerning directors’ duties is the question whether or not directors have duties to their company’s creditors when the company is in the “zone of insolvency.” In an interesting recent decision, the U.K. Supreme Court addressed the duty of directors to creditors when their company becomes insolvent or when it approaches or is at risk of insolvency. In a case in which it decided that the directors for the company before the Court were not liable, the Court ruled that the creditor duty may arise not only when the company is insolvent but when it is “bordering on insolvency,” though the creditor duty does not become paramount until insolvency is “inevitable.” The Court’s October 5, 2022 decision in BTI 204 LLC v. Sequana SA can be found here. The Press Summary of the Court’s Judgement can be found here. Continue Reading U.K. Supreme Court Addresses Directors’ Duties for Companies “Bordering on Insolvency”

In an interesting and unusual development, the victims’ trust that was created as part of the Pacific Gas & Electric (PG&E) bankruptcy has reached an agreement to settle the trust’s assigned claims against PG&E’s directors and officers for $117 million. According to the parties’ settlement agreement, the settlement is to be funded entirely with proceeds from PG&E’s D&O insurance program. As discussed below, there are a number of interesting aspects and implications to this settlement A copy of the Fire Victim’s Trust’s September 29, 2022 press release about the settlement can be found here. A copy of the parties’ settlement agreement can be found here. Continue Reading Wildfire Victims Reach $117 Million Settlement with PG&E Executives for Assigned Liability Claims

After several quarters in a hard market, the D&O insurance marketplace is now in transition, with important implications for buyers, brokers, and underwriters. On October 11, 2022, I will be participating in a Tuesdays with Lloyd’s seminar with Michelle Comtois of Marsh and Johnathan Tritton of Acrisure London Wholesale. The free 45-minute webinar begins at 11 am EDT. For more information and to register, please refer here. I hope everyone will attend and I look forward to speaking to all of you then.

The D&O Diary’s sojourn in Asia continued last week with a visit to Penang, an island along the northwestern coast of peninsular Malaysia. In addition to being an island, Penang (along with a bit of the adjacent mainland) is one of the states in the Malaysian federation. We visited George Town, the state’s colorful and multicultural capital, located on the island’s Northeast. For a few brief days, we enjoyed Penang’s rich, diverse, and interesting sights, sounds, and tastes. Continue Reading Penang

The D&O Diary is on assignment in Asia this week, with the first stop on the itinerary in the equatorial city state of Singapore. It was great to finally be back in Singapore after a three-year pandemic-caused hiatus. It was also great to see this dynamic attractive city again and to enjoy its many colorful sights and attractions. Continue Reading Singapore, Again. (Finally.)

I hope many readers saw and read my recent post “What to Watch in the World of D&O.”  A few days ago I recorded a podcast as part of the Rising Edge Ltd’s podcast series in which I discuss several of the themes raised in the “What to Watch” post. In the podcast recording, I am joined by two co-hosts, Rising Edge’s Head of Claims, Owen Dacey, and Richard Cutcher, a well-known voice in the insurance market, as well as by Rising Edge’s Chief Executive Officer, Philippe Gouraud, and Managing Director, Yoel Brightman.   Among other things, in the podcast I discuss, with Phillipe and Yoel, the current state of the D&O insurance market, both in the US and in London; how the current macroeconomic challenges might impact securities litigation; and the challenges corporations and directors and officers face in addressing ‘ESG’ issues. The podcast can be found on Rising Edge’s website (here), as well as on  SoundCloud,  Apple Podcasts, and Spotify

In a September 15, 2022 speech, Deputy Attorney General Lisa Monaco announced new Department of Justice guidelines for prosecutors to use when assessing corporate criminality. Although the new guidelines address several issues, the primary focus of the guidelines is on individual accountability. Monaco emphasized at the outset of her speech that “the Department’s number one priority is individual accountability.” The new guidelines represent a clear signal of the Department’s renewed focus on corporate criminality enforcement. The text of Monaco’s speech can be found here, and the September 15, 2022 DOJ memo outlining the new guidelines can be found here. Continue Reading Updated DOJ Corporate Enforcement Policies Emphasize Individual Accountability