The D&O Diary was on assignment this past week in New York City for the Professional Underwriting Liability Society (PLUS)’s annual D&O Symposium, held at the Marriott Marquis in Times Square. It was great to once again see and meet with so many of our industry friends, who conveniently for us were all gathered together briefly in one place. Continue Reading PLUS D&O Symposium in NYC
Two decisions last week by the New York Court of Appeals – New York’s highest court – may represent the end of plaintiffs’ lawyers’ recent attempts to turn the state’s courts into a focal point for derivative litigation involving non-U.S. companies. Both of the Court’s decisions affirmed the dismissals of derivative suits that had been filed in New York state court against directors of non-U.S. companies — Barclays and Bayer, respectively — asserting claims against them under their respective home countries’ laws. A copy of the court’s May 20, decision in the Barclays case can be found here. A copy of the court’s May 20 decision in the Bayer case can be found here.Continue Reading NY’s Highest Court Affirms Dismissals of Derivative Suits Involving Non-US Companies
This week I was in New York for the 2025 PLUS D&O Symposium, along with a thousand or so other professionals from around the D&O insurance community. The Symposium took place at the Marriott Marquis hotel in Times Square, the bright, beating heart of NYC. No matter how many times you visit, there is still something special about being in New York. The conference was great as well, a great chance to catch up on the latest news and developments, to meet with my many friends in the industry, and to make some new friends, as well.Continue Reading PLUS D&O Symposium 2025
As readers know, issues surrounding the timeliness of notice of claim are among the most frequently litigated insurance coverage issues. Notice of claims delays occur for many reasons; sometimes, for example, the policyholder does not recognize a particular matter as constituting a claim within the meaning of the policy; sometimes there are process or communications issues that interfere with notice timeliness.
In a recent case and that touches on many of these issues, the Second Circuit, applying New York law, held that an earlier demand letter met the policy’s claim definition, and that the question of whether the provision of notice of claim on Monday morning just after the Saturday expiration of the policy was untimely must be remanded for further consideration by the district court. This case is a cautionary tale in many ways and provides an appropriate occasion to review of some of the first principles of claim notice. The Second Circuit’s August 13, 2024, Summary Order can be found here. (Hat Tip to Geoff Fehling of the Hunton Andrews Kurth law firm for his August 15, 2024 LinkedIn post about the decision, here).Continue Reading Thinking About Notice of Claim Timeliness
Regular readers know that a recurring topic on this site is the question of the proper scope of the contractual liability exclusion found in many professional liability and management liability insurance policies. In prior posts I have argued that insurers sometimes apply the exclusion over-broadly so as to exclude matters I believe should otherwise be covered under the policy.
A recent Second Circuit, applying New York law, again examined the scope of the contractual liability exclusion’s preclusive effect, rejecting a policyholder’s claim that the exclusion did not apply to an underlying declaratory judgment claim, one of several claims asserted against the company in the underlying action. Although I often disagree with courts’ conclusions about the reach of the contractual liability exclusion, in this case the appellate court appears to have gotten it right, given the policy language at issue, in affirming the district court’s exclusion precludes coverage for the declaratory judgment claim. A copy of the Second Circuit’s June 17, 2024, opinion can be found here. (Hat tip to Paul Curley of the Kaufman Borgeest & Ryan law firm, for his June 21, 2024 LinkedIn post, here, about the decision.)Continue Reading Contractual Liability Exclusion Precludes Coverage for Declaratory Judgment Claim
Long-time readers may recall that just a short time ago there was growing concern that New York’s courts might be becoming a preferred forum for aggrieved investors to pursue liability claims against non-U.S. companies’ executives, based on the companies’ home country laws. However, in early 2022, just as the alarm bells began to sound, New York courts issued a series of rulings dismissing various cases of this kind, suggesting that the furor might have been overblown. But even following these events, concern remained that New York’s courts might still prove to be available in at least certain circumstances for claims under home country law against non-U.S. companies and their executives.
A recent decision from a New York trial court, in which the court denied the defendants’ motion to dismiss a breach of fiduciary duty claim brought under Cayman law against former officers and directors of a Cayman company, confirms that, under some circumstances at least, New York courts may be an available forum for litigants to pursue these kinds of claims involving non-U.S. companies. The fact that the Court accepted the case, and the considerations that proved to be relevant to the court, are both instructive.Continue Reading NY Court Keeps Cayman Law D&O Suit Involving a Cayman Company
It is not news that ESG has become a battleground issue, with prominent ESG efforts now facing an anti-ESG backlash. And while in the recent past institutional investors and advocacy groups tried to push publicly traded companies to establish their ESG credentials, the ESG-related litigation (such as it has been, so far at least) has primarily been filed not against ESG laggards, but rather against companies that have tried to promote their sustainability efforts and other climate-friendly measures.
In the latest example of litigation against a company in connection with its efforts to promote its ESG qualifications, the New York Attorney General, Letitia James has filed a fraud lawsuit in New York state court against the U.S. subsidiary of JBS, a Brazil-based meat and poultry producer, alleging that its sustainability claims and its publicized goal of achieving net zero greenhouse gas emissions by 2040 misled consumers. A copy of the New York Attorney General’s February 28, 2024, press release about the lawsuit can be found here. The NYAG’s February 28, 2024, complaint can be found here.Continue Reading NYAG Sues Meat Company for Its Net Zero Emissions Claims
Policyholders and their representatives have long pushed to have the definition of “claim” in professional and management liability insurance policies expanded, to bring an increasingly larger kinds of circumstances within the policies’ coverage. However, there are consequences when more kinds of circumstances constitute a “claim,” such as, for example, with respect to the claims-made date and notice obligations. A recent insurance coverage ruling by a New York state court interpreting a lawyers’ professional liability insurance policy underscores how an expanded definition of the term “claim” — in this case, pertaining to a request to toll the statute – can affect the availability of coverage. The court, applying New York law, determined that a tolling request prior to the policy period met the applicable policy’s definition of claim, and therefore, because the claim was first made before the policy incepted, the subsequent claim during the policy period was not covered.Continue Reading Tolling Agreement Prior to the Policy Period Precludes Coverage for Later Claim
The D&O Diary was on assignment this week at the PLUS D&O Symposium. As reflected the accompanying picture of Times Square, the weather in New York was uncharacteristically sunny and warm for this time of year. The Symposium itself was also superlative; the event was surprisingly well-attended and the sessions were great. My congratulations to the event co-chairs, and to the PLUS staff and volunteer leadership for another successful event. Continue Reading PLUS D&O Symposium in New York
Most D&O insurance policies preclude loss resulting from fraudulent or criminal misconduct. However, most policies specify that the exclusion applies only if there has been a judicial determination that the precluded misconduct has taken place. What specific judicial determination is required in order to trigger the exclusion is a matter of policy wording. In an interesting recent ruling, Southern District of New York Judge Denise Cote reaffirmed her prior conclusion that a credit union executive’s criminal conviction precluded coverage for the executive’s cost of appeal – even though his appeal remains pending and even though the applicable policy had the “final adjudication” language. A copy of Judge Cote’s October 18, 2022 opinion can be found here.
Continue Reading Court Holds Fraud Exclusion with “Final Adjudication” Language Precludes Coverage for Post-Conviction Appeal