In a May 16, 2013 decision (here), Eastern District of Missouri Magistrate Judge Terry Adelman, applying Missouri law, determined that the failure of an insured under a management liability insurance policy to provide timely notice of claim precluded coverage under the policy, even in the absence of a showing of prejudice to
Management Liability Insurance for Law Firms and the Dewey & LeBoeuf Bankruptcy
The collapse of the venerable Dewey & LeBoeuf law firm is a cautionary tale from which observers have drawn many lessons, including cautions about the perils associated with large law firm mergers and the challenges associated with various forms of law firm partner compensation. The firm’s failure and the claims that have subsequently arisen against
D&O Insurance: Notice to Claims Department Required to Satisfy Notice Requirements
Disputes over notice of claim requirements usually involve questions about the timing or content of the notice. A recent notice dispute involving UnitedHealth Group raised neither questions of timing or content; rather, the dispute involved the question of “to whom” the notice must be sent. In an April 25, 2013 opinion (here), District of
M&A Representations and Warranties Insurance:What Every Buyer and Seller Needs to Know
Insurance to provide coverage for breaches of representations or warranties in M&A transaction documents has been available in the marketplace for several years, but the specialty insurance product has not always been fully understood. More recently, interest in the product has grown and the product has improved, and so take-up for the product has increased
D&O Insurance: Fourth Circuit Affirms That Convicted Exec Must Repay Insurer for Defense Expenses
Lee Farkas, the criminally convicted former Chairman and majority shareholder of the defunct Taylor Bean and Whitaker Mortgage Corporation, must repay the nearly $1 million in defense fees the company’s D&O insurer had advanced on his behalf, according to an April 11, 2013 Fourth Circuit opinion. The terse three-page appellate opinion adopts the ruling of
Towers Watson Releases 2012 D&O Insurance Survey
By now, many readers may have seen the 2012 Towers Watson D&O insurance survey, entitled “Directors and Officers Liability: 2012 Survey of Insurance Purchasing Trends,” which can be here. (I am only belatedly posting a link to the survey now owing to my travel schedule last week, when Towers Watson released the survey report).
D&O Insurance: Actions Not Undertaken in an “Insured Capacity” Not Covered
Many organizations purchase management liability insurance to provide liability and defense cost protection for their directors and officers. But the management liability insurance protects the individuals only for their actions undertaken in an “insured capacity.” The policies are not intended to not protect them for actions they undertake in a capacity other than as a
D&O Insurance: So What is a “Securities Claim”?
The modern public company D&O insurance policy provides coverage not only for the directors and officers of the company but also for the company itself – however, in the public company D&O insurance policy, the entity coverage applies only to securities claims, a limitation that sometimes leads to disputes whether or not a particular matter
D&O Insurance: Advancing Defense Costs in Bankruptcy
After entity coverage began to be added to the D&O insurance policy a couple of decades ago, a recurring problem in the bankruptcy context was whether or not the D&O policy proceeds were property of the estate under Bankruptcy Code Section 541(a) and subject to the automatic stay under Bankruptcy Code Section 362.
D&O Insurance: Bank Directors’ Notice of FDIC Failed Bank Suit Held Timely
On February 5, 2013, in a detailed opinion exploring the nuances of a D&O policy’s extended reporting period provisions, Western District of North Carolina Judge Henry Herlong Jr. determined that the directors of the failed Bank of Ashville of Asheville, North Carolina timely provided their D&O insurer notice of the FDIC’s lawsuit against them as