On July 15, 2013, the FDIC provided the latest update on the web page on which the agency is tracking the litigation it has filed and that has been authorized against the directors and offices of failed banks. According to the latest update, the FDIC has now filed a total of 69 lawsuits against failed … Continue Reading
A recurring issue in the litigation the FDIC has filed against the directors and officers of failed banks is the question of whether or not officers – as opposed to directors – can rely on the business judgment rule as a defense under applicable state law. A July 8, 2013 decision by Judge Dean Pregerson applying … Continue Reading
Typically, the FDIC updates the professional liability lawsuits page about once a month, but on June 7, 2013, only about two weeks after its last update, the FDIC again updated the page to include new lawsuit information. According to the information in the latest update, the FDIC has now filed a total of 65 lawsuits … Continue Reading
According to the latest update on the FDIC’s website, the pace of the agency’s filing of failed bank lawsuits picked up considerably in the last month. According to the agency’s website (here), which the agency updated on May 22, 2013 the agency has now filed a total of 63 lawsuits against the directors of failed … Continue Reading
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 Minnesota Judge … Continue Reading
The fallout from the ongoing banking crisis continues to emerge, with the arrival in recent days of still more bank failures and of even more FDIC lawsuits involving failed banks. Unfortunately, the hopes that that all of the bank failures might be safely behind us, or, as I recently suggested on this blog, the hopes … Continue Reading
As it has been doing on a monthly basis during the current banking crisis, the FDIC has once again updated the page on its website describing the failed bank litigation that the agency has initiated. According to the latest update, as of April 12, 2013, the agency has now filed a total of 54 failed … Continue Reading
Much happened in recent days while The D&O Diary was away on extended travel. Some of the developments were significant. What follows is a brief summary of the more significant events over the last few days. Subprime-Related Citigroup Bondholders Action Settles for $730 Million: In what is the second-largest settlement of a subprime and … Continue Reading
Possibly as a result of a barrage of recent press criticism for its nonpublic settlements, the FDIC has launched a page on its website to publish details regarding the settlements it has reached in failed bank claims. The page, which can be found here, acknowledges that it is not yet complete. Even in its incomplete … Continue Reading
The pace of bank closures has slowed to a trickle. There have only been three bank failures so far in 2013 (including one this past Friday evening, involving the Covenant Bank of Chicago, Illinois). But while bank failures have dwindled, the number of failed bank lawsuit filings has surged. On February 15, 2013, the FDIC … Continue Reading
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 … Continue Reading
A shareholder of the holding company for a failed Virginia bank, the Bank of the Commonwealth, has filed a securities class action lawsuit in the Eastern District of Virginia against the holding company and certain of the company’s directors and officers. The lawsuit, filed on January 22, 2013, follows after the July 2012 indictment of … Continue Reading
Picking up where it left off at the end of the year, the FDIC has filed its first failed bank D&O lawsuit of 2013. The lawsuit, which the agency filed on January 17, 2013 in the District of New Mexico, names as defendants ten former directors and officers of the failed Charter Bank, New Mexico. … Continue Reading
As the current wave of bank failure litigation has unfolded, the directors and officers of banking institutions rightly have become more concerned about the own potential liability exposures and interested in learning more about how they might be able to reduce their risks and exposures. In the following guest post, Joseph T. Lynyak III , … Continue Reading
One of the most vexing problems that can arise in the D&O claims context is when the amount of insurance available proves to be insufficient to resolve the pending claims. Although this problem can arise in many claims contexts, one particular context in which the problem can arise is in the context of claims by … Continue Reading
As I have discussed in prior posts (refer here for example), one of the recurring D&O insurance coverage issues that has arisen in connection with the FDIC’s failed bank litigation is the question whether or not the FDIC’s claims as receiver for the failed bank against the bank’s former directors and officers trigger the D&O … Continue Reading
The FDIC’s filing of lawsuits against former directors and officers of failed banks increased “markedly” during the fourth quarter of 2012 after a “lull” during the second and third quarters of the year, according to a new study from Cornerstone Research. The study, released December 18, 2012 and entitled “Characteristics of FDIC Lawsuits Against Directors … Continue Reading
IndyMac CEO Michael Perry has reached an agreement with the FDIC to settle the lawsuit the agency filed against him in the Central District of California in July 2011 in its capacity as receiver of the failed bank. In the settlement agreement, filed with the court on December 14, 2012, Perry agreed to pay $1 … Continue Reading
As I noted in a post earlier this week, last Friday a jury in the Central District of California returned a $168.8 million verdict in the lawsuit the FDIC filed in its capacity as receiver of the failed IndyMac bank against three former officers of the bank. The verdict has occasioned a great deal of … Continue Reading
On December 7, 2012, in a comprehensive victory for the FDIC in its capacity as receiver of the failed IndyMac bank, a jury in the Central District of California entered a verdict of $168.8 million in the FDIC’s lawsuit against three former officers of the bank. As reflected in the verdict form (a copy of … Continue Reading
Insured depositary institutions continued to improve during the third quarter of 2012, while at the same time the number and percentage of “problems institutions” declined, according to the FDIC’s latest quarterly banking profile. The quarterly report for the quarter ending September 30, 2012, which the agency released on December 4, 2012, can be found here. … Continue Reading
Though the FDIC has filed failed bank lawsuits in a number of states during the current bank failure wave, the agency has filed a disproportionally large number of suits against former directors and officers of failed Georgia banks. On November 30, 2012, the FDIC filed yet another D&O lawsuit involving a failed Georgia bank, the … Continue Reading
According to a November 13, 2012 press release from their defense counsel (here), the five bank officer defendants in an action the FDIC filed against them as the failed bank’s receiver have settled the case for an assignment to the agency of their rights under the bank’s D&O insurance policy. The case involves the … Continue Reading
Trial in the FDIC’s failed bank lawsuit against three former officers of IndyBank commenced on November 6, 2012 in the federal court in Los Angeles. According Scott Reckard’s November 9, 2012 Los Angeles Times article (here), the parties’ counsel have delivered their opening statements. The case, which was the first failed bank lawsuit the FDIC … Continue Reading
