Articles & Updates - Priya Cherian Huskins

M&A deals have small issues, big issues...and “landmine” issues: issues that can seem small but, if mishandled, can end up being significant. Regardless of whether your company is seeking to merge with another company or is looking to acquire or be acquired, here are several key insurance risk management factors worth considering prior to the drafting of a merger agreement.

Download PDF

Public companies routinely purchase directors and officers (“D&O”) liability insurance, and regard the purchase as part of the cost of being a public company. But does a private company need D&O insurance?

Download PDF

Woodruff-Sawyer & Co. is pleased to present the latest information concerning securities litigation filed against public companies in the United States. The information below comes from the D&O Databox as of June 30, 2011. The D&O Databox tracks securities class action litigation filed against public company issuers and their directors and officers. Settlement figures include amounts paid by issuers, their directors and officers, and insurance carriers. Settlement figures exclude amounts paid in settlement by third party defendants.

Download PDF

One consequence of the global, interconnected nature of the economic markets is that plenty of non-U.S. companies list their shares on U.S. Exchanges. For most foreign filers, listing in the U.S. is entirely unproblematic. However, there has been some interesting news in the U.S. securities class action lawsuit arena that involves directors of foreign-based companies.

Download PDF

Is the Dodd-Frank Act (“Dodd-Frank”), signed into law on July 21, 2010, potentially a game-changer when it comes to the exposure of officers and directors of public companies to litigation? Yes. And unfortunately for directors and officers and the companies they serve, the scope of insurance coverage afforded by director and officer (“D&O”) liability insurance policies can be problematic.

Download PDF

Insurance remains the best, most effective hedge against a director or officer’s worst-case scenario—the one-two punch of lawsuit that comes on the heels of his or her corporation’s filing for bankruptcy.

If you are sued as a director or officer, you would normally expect your company to advance legal fees to you and indemnify you. Unfortunately, that expectation will be dashed if you are sued while your company is in bankruptcy or if your company goes into bankruptcy while you are being sued. In bankruptcy, you are at best an unsecured creditor standing in line with all the other unsecured creditors hoping the company’s limited assets don’t run out. Your D&O policy may be the only thing left protecting you.

Download PDF

Directors and officers of companies face the possibility that — even if they diligently discharge their duties to their stockholders — their stockholders may still sue them. During the period leading up to an IPO, directors and officers may be particularly concerned about their personal liability because the chance that they will be sued by their stockholders substantially increases once the company’s shares are publicly traded. Recognizing that the risk of personal liability makes being a director or officer of a public company unattractive, most companies purchase director and officer liability insurance, or “D&O Insurance”, to protect their directors and officers. This insurance can in turn help companies recruit and retain good directors and officers.

Download PDF

When a non-US company (a “foreign filer”) decides to list its stock for trading on a US stock exchange, the following question arises: will the foreign filer’s directors and officers be adequately protected from shareholder lawsuits brought pursuant to US securities laws? The answer is likely “no,” unless the foreign filer consults with experts on US-style securities litigation as well as director and officer liability insurance.

Download PDF

It was smooth sailing for quite a while for the company on whose board of directors you serve. Products were selling well, the management team was impressive and the company appeared on everyone’s hot list.
Then the waters got choppy. Maybe some key executives left. Or the product was eclipsed by something newer, faster, cheaper or better. The economy might have taken a toll on customers or suppliers. Whatever the reason, the ship has begun to take on water, and it seems that no amount of frenetic bailing is going to keep it afloat.

Download PDF

What would happen if a company’s director and officer insurance proves to be inadequate or is otherwise unavailable to settle a claim alleging wrongful acts by independent directors? Or what would happen if the company lacked the resources to meet its obligations to indemnify its independent directors from such a claim? In such instances, how might an independent director nevertheless protect his or her personal assets?

Download PDF