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Stephen Hourigan

In the following guest post, Stephen Hourigan argues that a key driver of D&O claim severity is not necessarily board ignorance or misconduct, but the delay between when warning signs are known somewhere within the organization and when they are effectively communicated to the board. Steve suggests that there are questions underwriters can ask to determine the effectiveness of information communication to corporate boards. Steve is the Founder and CEO of Heardsafe, LLC. Our thanks to Steve for allowing us to publish his article as a guest post on our site.

Continue Reading Guest Post: Governance Signal Decay as a D&O Severity Problem

A frequently recurring coverage issue litigated in Delaware courts is the treatment of related claims and the consequences that flow from a determination that multiple proceedings are related. A recent Delaware Superior Court decision revisits those issues, this time in a dispute involving an insurer’s reliance on related-claims language in a policy retention provision to deny coverage for a derivative action.

Continue Reading Delaware Court: Retention Provision Is Not a Related-Claims Exclusion
Vijay Jyotish

In the following guest post, Vijay Jyotish, who writes on forecasting and decision-making under uncertainty, argues that launch-day decisions for self-insured space missions can expose companies to hundreds of millions of dollars in risk, yet often bypass board-level oversight because they are treated as engineering decisions rather than enterprise risks. The author contends that evolving Delaware case law increasingly requires boards to have documented systems for monitoring mission-critical risks, and recommends a process for recording and reviewing launch-day risk assessments before each launch. Our thanks to Vijay for allowing us to publish his article on this site. Here is Vijay’s article.

Continue Reading Guest Post: Board Oversight of Self-Insured Launch Risk
Benjamin Edwards
Nancy Rapoport

In the following guest post, Professors Benjamin Edwards and Nancy B. Rapoport, of Boyd School of Law, UNLV, present their views that a corporate law loophole in advancement and indemnification rules can force companies to pay exorbitant legal fees and even unreasonable personal expenses for directors’ defenses. The authors contend that courts should impose stricter scrutiny to prevent unethical billing practices and protect shareholders. We would like to thank Ben and Nancy for allowing us to publish their article as a guest post on this site. Here is their article.

Continue Reading Guest Post: Legal Fees and Expenses Gone Wild Thanks to a Corporate Law Loophole

In recent years, the D&O Diary has followed the growing debate over whether companies should reincorporate outside Delaware, particularly in states such as Nevada and Texas.  We have also followed Delaware’s efforts to address the trend through measures including the enactment of SB 21 and the Delaware Supreme Court’s decision upholding the statute.

And we queried whether DExit could prove to be a new source of D&O exposure. A newly amended class action complaint against Dropbox may provide yet another example of that risk, as shareholders are challenging Dropbox’s reincorporation to Nevada, alleging that the move was undertaken to protect management and the controlling stockholder from accountability for underlying business and governance decisions.

Continue Reading Dropbox Derivative Suit Over a DExit
Ben Dubin

In the following guest post, Ben Dubin, Managing Memberof VC Expert Services, LLC, examines Vice Chancellor Laster’s May 2026 opinion in the Zync v. Porsche case, a decision that highlights the legal and D&O insurance risks for investor-appointed directors and their sponsoring venture firms, particularly when directors are accused of acting as agents of the investor rather than exercising independent fiduciary judgment on behalf of the company. This post is the second of two guest post from Ben discussing D&O risks associated with venture capital board seats. Ben’s prior post on the topic can be found here. We would like to thank Ben for allowing us to publish his articles as guest posts on this site. Here is Ben’s article.

Continue Reading Guest Post: Zync v. Porsche and the D&O Risks of VC Board Seats

Many of us are still trying to get comfortable with the idea of autonomous vehicles. Turns out, we may soon need to get comfortable with the idea of autonomous companies.

A first-of-its-kind draft bill has been proposed to the Delaware legislature that would allow the creation of an Artificial Intelligence Company (AIC), a form of legal personhood for an entity that operates through an AI agent with no human at the controls, and with the same kind of limited liability for the entity’s owners as for a more traditional company.  

As discussed below, the proposed new AIC corporate form raises some very interesting questions. It also arguably represents an entirely new challenge for the D&O insurance industry.

Continue Reading Brave New World: Delaware’s Proposed New “Artificial Intelligence Company”
Ben Dubin

In the following guest post, Ben Dubin, Managing Member of VC Expert Services LLC, discusses Delaware Vice Chancellor Laster’s January 29, 2026 opinion in the Calumet Capital Partners case. This article, which is the first of two discussing recent Delaware decisions regarding VC firm’s representative’s service on the firm’s portfolio company boards, argues that the Calumet decision creates greater litigation risk for venture capital firms whose employees or partners serve as board designees, because courts may more readily infer that the investor knowingly participated in a fiduciary breach when its own representative is involved. The author’s companion article to this one will be published on this site next week. Our thanks to Ben for allowing us to publish his article on our site. Here is Ben’s article.

Continue Reading Guest Post: Calumet and VC Board Designee Risk
John McCarrick

Those who follow Directors’ and Officers’ indemnification and advancement issues know that there are a host of recurring questions surrounding executives’ advancement rights, including whether there are duration or amount limits on a company’s advancement obligations. In the following guest post, John McCarrick, a partner at the Robinson & Cole law firm in New York, takes a look at these issues in the context of recent high-profile dispute involving executives at JPMorgan. Our thanks to John for allowing us to publish his article guest post on this site. Here is John’s article.

Continue Reading Guest Post: When D&O Advancement Becomes a Blank Check

Since the dawn of time, one of the biggest D&O insurance coverage issues has been allocation – that is, the division of loss between covered and noncovered claims or between covered and noncovered parties. After a series of developments in the mid-90s, including the standardization of policy allocation language, litigated allocation disputes became less frequent (though to be sure, allocation is still very much an issue in many D&O insurance claims.) However, in recent years, there has been a series of Delaware court decisions revisiting both allocation issues and what has become the standard D&O insurance allocation provision.

In the latest example of the reemergence of litigated allocation disputes, a Delaware court has held that the “Larger Settlement Rule” should be used to resolve an allocation dispute, notwithstanding the presence in the applicable allocation provision of relatively standard “relative exposures” language. With this latest decision, and in light of the other recent Delaware allocation decisions, some differentiating principles can be discerned, as discussed below.

A copy of the Delaware Superior Court’s June 18, 2026, decision in the Hemisphere Media Group case can be found here. The July 10, 2026, LinkedIn post of Geoffrey Fehling of the Hunton Andrew Kurth law firm discussing the court’s allocation decision in the Hemisphere case can be found here.

Continue Reading Del. Court: “Larger Settlement Rule” Applies to Insurance Allocation Dispute