In the following guest post, Geoffrey B. Fehling and Machaella Reisman of the Hunton Andrew Kurth law firm,take a look at a recent Delaware federal court decision involving a D&O insurance coverage dispute in which one of the key issues was the timing of the policyholder’s declaratory judgment action against its excess insurers. A version of this article was previously published on the Hunton Insurance Recovery Blog. I would like to thank Geoff and Machaella for allowing me to publish their article as a guest post 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 the author’s article.Continue Reading Guest Post: Del. Court Tells Wiring Manufacturer It’s Too Early and Too Late
One of the perennial D&O insurance coverage issues has to do with whether a later claim made during the policy period is interrelated with an earlier claim made prior to the policy period, and whether the later claim therefore is deemed under the policy to have been made prior to the policy periods. These issues were front and center in a recent coverage dispute in which the door manufacturer Jeld-Wen argued that earlier antitrust liability actions were not interrelated with the later securities class actions. In an interesting November 18, 2022 opinion by Western District of North Carolina Judge 
When a management liability insurance policyholder seeks to increase the limits of liability of their insurance program, the insurers will typically require a statement warranting that the policyholder is not aware of any facts or circumstances that could give rise to a claim. This warranty statement typically specifies that if there is a subsequent claim based on facts or circumstances of which the applicant has knowledge, the subsequent claim is precluded from coverage. This warranty exclusion is often referred to as the prior knowledge exclusion. In an interesting 
Many D&O insurance programs consist of multiple layers of insurance arranged with a layer of primary insurance and one or more layers of excess insurance. In order to ensure that the insurance in the program operates consistently and uniformly, the excess insurance is usually written on a so-called “follow form” basis, meaning that the excess insurance incorporates the primary’s policy’s terms and conditions, subject to any express provisions in the excess policy to the contrary. A recent case from the Court of Appeal for Ontario considered the meaning and impact of excess follow form coverage in the context of a dispute over whether a policyholder could exercise an option to purchase extended reported period coverage from its excess insurer. The decision, while arguable unremarkable in and of itself, nevertheless may have some important lessons for excess insurers. A copy of the Ontario Appeal Court’s July 13, 2022 decision can be found 
In the latest development in Pfizer’s long-running efforts to recover from its D&O insurers amounts the company paid in defense and settlement of prior securities litigation (the “Morabito Action”), a Delaware Superior Court Judge, applying Delaware law, has held that the company’s settlement with a lower level excess insurer for less than that insurer’s policy limit did not create a gap relieving an upper layer excess insurer of its payment obligations. The court also found that the company’s earlier notice of a different securities litigation did not trigger the policy’s Prior Notice exclusion. The court’s August 28, 2020 opinion can be found 
The Second Circuit recently took up the insurance coverage dispute arising out of the 
In the following guest post, Syed Ahmad, Brittany Davidson, and Andrea DeField of Hunton & Williams LLP take a look at a very interesting New York trial court decision relating to D&O insurers’ duty to advance defense costs. I would like to thank the authors for their willingness to allow me to publish their article as a guest post on my 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 the authors’ guest post.
Everyone involved with D&O insurance knows that it is important to keep up with case law developments, in order to appreciate how courts are interpreting and applying various policy terms and conditions. But sometimes there is an additional reason why it is a good to keep up with court decisions – sometimes the cases provide practical lessons in the form of cautionary tales. That was certainly the case in a recent decision in which the Sixth Circuit, applying Kentucky law, affirmed a lower court ruling that late notice of claim precluded coverage under an excess D&O insurance policy. The policyholder had provided timely notice of claim to the primary carrier, but failed to provide notice to the excess carrier until six months after the policy had expired. The court’s conclusion that the late notice precluded coverage under the excess policy may not be surprising, but nevertheless the practical lesson – that is, that notice of claim should be provided to all of the carriers in the D&O insurance program – is an important one, as discussed further below. A copy of the Sixth Circuit’s February 29, 2016 opinion can be found