An appellate court in New Zealand has “quashed” the controversial ruling of a lower court ruling that former directors of the defunct Bridgecorp companies are not entitled to defense expense reimbursement under the companies’ D&O insurance policy where the companies’ liquidators have raised (but not yet proven) claims against them exceeding the policy’s limits of
D&O Insurance: Professional Services Exclusion Does Not Preclude Coverage
In a December 6, 2012 opinion (here), a New York state court judge applying New York law has denied a D&O insurer’s motion seeking a summary judgment determination that its policy’s “professional services” exclusion precluded coverage for attorneys’ fees that the Andy Warhol Foundation incurred in defending claims brought by art owners disgruntled by
InSights: “What to Watch Now in the World of D&O”
Every fall, I assemble a list of the current hot topics in the world of Directors and Officers (D&O) Liability Insurance. While the past 12 months have not seen as many headline-grabbing D&O related events as in some past years, the issues that are currently unfolding have had a significant impact on the marketplace. In
Management Liability Insurance: Amounts Due Based on “Pre-Existing Duty” Not Covered Loss
An employer’s management liability insurance policy does not provide coverage for employees’ claims that – contrary to statutory requirements — the employer collected and failed to remit gratuities, because amounts owing due to a preexisting statutory duty do not represent covered loss, according to a recent decision of a Massachusetts federal court applying Massachusetts law.
D&O Insurance: When Can a D&O Insurer Recoup Amounts It Has Paid Out?
As Alison Frankel recently reported in her On the Case blog (here), the insider trading charges to which former Morgan Stanley hedge fund manager Joseph “Chip” Skowron pled guilty cost the company a lot of money. And, as demonstrated in the lawsuit the company recently filed against Skowron, Morgan Stanley wants its money
Professional Liability Insurance: The Antitrust Exclusion Isn’t Just About Antitrust Claims
Many professional liability insurance policies contain an exclusion that, though referred to as the antitrust exclusion, precludes coverage for a much broader array of claims than just claims alleging violation of the antitrust laws. A recent decision by the First Circuit, interpreting an Errors and Omissions insurance policy and applying Massachusetts law, in which the
The Looming “Fiscal Cliff” and Business Risk
Next Tuesday, the country will elect its President for the next four years. Exactly one week later, Congress will return to take up a critical piece of deferred business that could dramatically affect the country for the next four years and even beyond, regardless of who wins the Presidential election.
In a culmination
D&O Insurance: Layers and Tears
One of the critical issues in building a D&O insurance program is the question of how to structure the insurance. Among the more complex issues is how to divide the program between “traditional” D&O insurance coverage and Excess Side A DIC insurance (which in effect provides catastrophic protection for individual directors and officers in certain
District Court: Insured vs. Insured Exclusion Does Not Preclude Coverage for FDIC’s Claims Against Failed Bank’s Directors and Officers
A significant side-effect from the current bank failure wave has been the FDIC’s assertion of claims against the former directors and officers of many of the failed banks. The FDIC’s claims have in turn raised significant questions of insurance coverage under many of the failed banks’ D&O insurance policies. As discussed in a prior post
Guest Post: Settlor Capacity v. Fiduciary Capacity — Does Wearing Two Hats Mean You May be Denied Coverage?
I am pleased to publish below a guest post from Rhonda Prussack, Executive Vice President and Product Manager, Fiduciary Liability, for Chartis, and her colleague at Chartis, Larry Fine, Global Head Professional Liability Claims, Financial Lines Claims. Rhonda’s and Larry’s guest post is written in response to a recent guest post on this blog about the