In my recent roundup of the top stories in the world of directors’ and officers’ liability and insurance, I noted that a host of macroeconomic factors – such as supply chain disruptions and labor supply constraints — continue to weigh on companies and, in some instances, translate into securities class action litigation. I have also noted in numerous prior posts how COVID-19 has itself resulted in securities lawsuit filings. In the latest example of a securities suit filing resulting from these various phenomena, last week a shareholder plaintiff filed a securities lawsuit against the robotic aircraft systems development and service company AeroVironment after the company delivered disappointing results due to supply chain woes resulting from COVID-19. The complaint is both representative of these types of cases and illustrative of how these kinds of concerns, even after a significant time lag, can result in a current securities lawsuit filing. A copy of the plaintiff’s August 30, 2023, complaint can be found here.
Continue Reading Robotic Aircraft Company Hit with COVID-19 and Supply Chain-Related Securities Suit
Every year after Labor Day, I take a step back to survey the most important current trends and developments in the world of Directors’ and Officers’ liability and insurance. This year’s review is set out below. As the following discussion shows, this is a particularly eventful time in the world of D&O.
It is so interesting to me that, notwithstanding the passage of time since the initial coronavirus outbreak in the U.S. in March 2020, plaintiff shareholders continue to file COVID-19-related securities class action lawsuits — as we saw, for example, in the infrastructure overcapacity lawsuit 
The number of securities class action lawsuit filings in the first half of 2022 remained at the lower levels that prevailed last year and below the more elevated levels that prevailed during the period 2017-2020. Though the number of securities class action lawsuit filings in the year’s first six months is below the recent higher levels, the number of suits filed is still consistent with long-term averages. The difference in the number of filings so far this year and the elevated numbers during the recent period were both largely due to merger objection lawsuit filings patterns.
In the now more than two-and-a-quarter years since the initial COVID-19 outbreak in the U.S., a significant number of COVID-related securities class action lawsuits have been filed. What is surprising is not that the suits have been filed; rather, it is that even at this late date, the COVID-related suits continue to be filed. As time has gone by, however, it has become increasingly challenging to say with clarity whether a particular lawsuit is or is not “COVID-related.” The securities class action lawsuit filed late last week against online information platform, Yext, illustrates the increasing difficulty of making the COVID-related categorization, as discussed below.
Almost from the very outset of COVID-19 in early 2020, investors and others have filed pandemic-related securities suits and other claims against companies and their executives. Even though the initial outbreak is now nearly 27 months in the past, claims activity continues. In the latest development, a grand jury has returned an indictment against a health care company’s former CEO concerning statements the CEO made in April 2020 about the company’s ability to profit from sales of COVID-19 rapid tests. The SEC filed a parallel enforcement action against the company and the CEO as well.
In the latest edition of its annual report, the Sidley Austin law firm takes a detailed look at important securities litigation developments in 2021 relating to life sciences companies. The report includes not only a review of life sciences companies’ securities litigation class action filings trends but also examines life sciences companies’ track record in the courts, both with respect to motions to dismiss in the district courts and on appeal. The law firm’s report, entitled “Securities Class Actions in the Life Sciences Sector: 2021 Annual Survey” can be found 
As I have noted in numerous prior posts on this site, over the course of the last two years plaintiffs’ lawyers have filed a host of COVID-19-related securities claims. With the passage of time, many of these cases have now worked their way to the motion to dismiss stage. Although the results have been mixed, the dismissal motions have been granted in several cases. In the latest example of favorable outcome for a COVID-19-related lawsuit defendant, the court in the COVID-19-related securities suit pending against Chembio Diagnostics and its executives recently granted the corporate defendants’ dismissal motion. However, in an odd twist, the court denied the dismissal motion of the company’s offering underwriters. A copy of the court’s February 23, 2022 order in the case can be found