On the panel in which I participated during last week’s PLUS D&O Symposium, one of the important topics we discussed was the question of coverage under a D&O insurance policy for claims under the Telephone Consumer Protection Act, a topic about which I have previously written on this blog. That a once-obscure statute like the TCPA has become an important topic of conversation is no accident. The fact is that the number of TCPA actions filed has absolutely exploded, as detailed in a recent study published by the Institute for Legal Reform, an affiliate of the U.S. Chamber of Commerce.
Continue Reading There’s a Reason You Are Suddenly Hearing About the TCPA Everywhere You Go
Spanish Class Action is the Latest Collective Investor Action Filed Outside U.S.
The filing of securities class action lawsuits is, of course, well-established in the United States, and in recent years has become a regular phenomenon in Australia and Canada as well. In the wake of various recent scandals, numerous group or mass investor actions, if not full-blown class actions, have been filed or will be filed in a number of other countries, including the U.K. (for example, in connection with the Tesco accounting scandal), Germany (in connection with the VW emissions scandal), Japan (in connection with the Toshiba scandal), Italy (in connection with the Saipem scandal), and possibly Brazil (in connection with various companies’ involvement in the Petrobras scandal).
Now it appears that investors in the troubled Spanish banking company Bankia have initiated a class action lawsuit against the company. According to news reports (here), counsel for 660 individual investors has filed an action in a Madrid court seeking to have the individuals compensated for their investment losses in connection with the company’s 2011 stock flotation. The investors collectively seek recovery of 6.3 million euros (about $7 million).
Continue Reading Spanish Class Action is the Latest Collective Investor Action Filed Outside U.S.
Cornerstone Research: U.S.-Listed Companies’ Securities Suit Susceptibility at Record High Levels in 2015
Not only were securities class action lawsuit filings in 2015 at their highest levels since 2008, but the likelihood that a U.S.-listed company would get hit with a securities suit was at the highest level at any time since the PSLRA was enacted, according to the latest annual report from Cornerstone Research. Cornerstone Research’s report, issued in conjunction with the Stanford Law School Securities Class Action Clearinghouse and entitled “Securities Class Action Filings: 2015 Year in Review,” can be found here. Cornerstone Research’s January 26, 2016 press release about the report can be found here. My own analysis of the 2015 securities class action lawsuit filings can be found here.
Continue Reading Cornerstone Research: U.S.-Listed Companies’ Securities Suit Susceptibility at Record High Levels in 2015
NERA Report: 2015 Securities Class Action Filings at Highest Level Since 2008
Securities class action lawsuit filings in 2015 were at their highest level since 2008, according to the latest annual report from NERA Economic Consulting. The report also states that not only as the number of lawsuits filed increased in 2015, but the rate of lawsuit filings relative to the number of publicly traded companies has also increased compared to historic levels as well. The report entitled “Recent Trends in Securities Class Action Litigation: 2015 Full-Year Review,” can be found here. NERA’s January 25, 2016 press release describing the report can be found here. My own analysis of the 2015 securities class action filings can be found here.
Continue Reading NERA Report: 2015 Securities Class Action Filings at Highest Level Since 2008
Big Changes in the Merger Objection Litigation Marketplace
Since merger objection litigation became one of the most distinctive phenomena on the corporate and securities landscape, it has been both chronicled and measured in a series of annual papers by Matthew Cain, now an SEC economist, and Steven Davidoff Solomon, a law professor at the U.C. Berkeley. In their latest update, “Takeover Litigation in 2015” (here), published last week, the authors confirm that while merger objection litigation continued to be filed at significant levels last year, the litigation levels declined compared to recent years. Of particular note, starting in the Fall 2015, after Delaware Vice Chancellor Laster rejected the disclosure only settlement in the Aruba/H-P merger lawsuit, the filings of the merger objection lawsuits showed a decline that was “sharp and significant” and that the authors expect will continue in the new year.
Continue Reading Big Changes in the Merger Objection Litigation Marketplace
PLUS Webinar This Thursday: “The Top Ten D&O Stories of 2015”
On Thursday, January 21, 2016, I will be participating as the speaker in a Professional Liability Underwriting Society (PLUS) webinar to discuss this past year’s top stories in the world of directors and officers’ liability and insurance. The webinar will be based on my recent blog post, The Top Ten D&O Stories of 2015. This webinar, which is free for both PLUS members and non-members, is a lead-in for the 2016 PLUS D&O Symposium, to be held February 3-4, 2016, in New York. The webinar will begin at 11 am EST and last one hour. Information about the webinar, including registration instructions, can be found here.
Continue Reading PLUS Webinar This Thursday: “The Top Ten D&O Stories of 2015”
Report: SEC Filed a Record Number of Enforcement Actions in FY 2015, Aggregate Fines and Penalties Declined
The SEC filed a record number of enforcement actions during FY 2015, but the aggregate value of fines, penalties, and disgorgements the agency collected during the fiscal year was well below the prior year’s total and long term averages, according to a detailed January 12, 2016 report produced in cooperation between the NYU Pollack Center for Law Business and Cornerstone Research. The report, which can be found here, is entitled “SEC Enforcement Activity Against Public Company Defendants: Fiscal Years 2010-2015,” is based on date collected in the Securities Enforcement Empirical Database (SEED), which is an online resource the two organizations sponsor and that provides data on SEC actions filed against public companies traded on the U.S. exchanges. The January 12, 2016 press release that accompanied the report can be found here.
Continue Reading Report: SEC Filed a Record Number of Enforcement Actions in FY 2015, Aggregate Fines and Penalties Declined
Delaware Courts’ Rejection of Disclosure-Only Settlements Results in Fewer Merger Objection Lawsuit Filings
In my recent survey of the top stories in 2015 in the world of D&O, I noted that one of last year’s most important developments was the signal that several of the judges on the Delaware Court of Chancery sent in a series of rulings that they would not longer routinely approve the kind of “disclosure-only settlement” that frequently resolves merger objection lawsuits. According to Liz Hoffman’s January 11, 2016 Wall Street Journal article focused on Delaware Vice Chancellor J. Travis Laster and entitled “The Judge Who Shoots Down Merger Lawsuits” (here), after Laster’s October 2015 decision rejecting the proposed settlement in the H-P/Aruba Networks merger objection lawsuit, there were dramatically fewer merger objection lawsuits filed in Delaware, and in fact some previously filed lawsuits are being withdrawn.
Continue Reading Delaware Courts’ Rejection of Disclosure-Only Settlements Results in Fewer Merger Objection Lawsuit Filings
The Top Ten D&O Stories of 2015
It was an eventful year in the world of directors’ and officers’ liability in 2015. Many of the year’s key events significantly changed the D&O liability environment, while other developments during the year could alter the D&O insurance marketplace itself. Many of 2015’s developments have important implications for 2016 – and possibly for years to come. The list of the Top Ten D&O Stories of 2015 is set out below with an eye toward these future possibilities.
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U.S. Securities Class Action Lawsuit Filings in 2015 at Highest Level in Years
The number of securities class action lawsuits filed in 2015 rose to the highest annual level in several years. As detailed below, a number of factors contributed to the increase in securities class action lawsuit filings during the year, including in particular the number of lawsuits filed against IPO companies (owing to the fact that IPO activity has been up in recent years), as well as the elevated number of lawsuits against foreign-domiciled companies.
Continue Reading U.S. Securities Class Action Lawsuit Filings in 2015 at Highest Level in Years