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How Preclusion of an FDIC Action Under the Insured v. Insured Exclusion Could Change D&O Coverage
The 2008 financial crisis might be behind us, but coverage disputes stemming from the flood of lawsuits brought by the Federal Deposit Insurance Corporation (“FDIC”) against directors and officers of failed banks are far from over. With the FDIC filing lawsuits against more than 1,200 individuals for directors and officers liability between January 2009 and August 2015, coverage continues to be hotly contested across the country, with the most heavily litigated issue being whether a lawsuit commenced by the FDIC as a receiver of a failed bank is precluded by the “insured v. insured” exclusion commonly contained in Directors and Officers liability (“D&O”) policies. See FDIC, http://1.usa.gov/1NdXuA1.
The application of this exclusion, which precludes coverage for claims based on suits brought by one insured against another, has yielded mixed results. Although some courts have held that insured v. insured exclusions preclude coverage because the FDIC “steps into the shoes” of the company when it brings lawsuits against directors and officers in its capacity as a receiver; other courts, representing a growing consensus favoring coverage, have held that the application of the exclusion in the FDIC context is ambiguous and must be construed against the insurer. However, a recent decision by the U.S. Court of Appeals for the Tenth Circuit departs from the coverage trend and raises issues that are likely to change the D&O landscape going forward.
Why So Many Great Lawyers Stink at Business Development and What Law Firms Are Doing About It
Why is it that those who are best skilled at advocating for others are ill-equipped at advocating for their own skills and what to do about it?
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.
Protecting Innovation in the Cyber World from Patent Trolls
With trillions of dollars to keep watch over, the last thing we need is the distraction of costly litigation brought on by patent assertion entities (PAEs or "patent trolls"), companies that don't make any products but instead seek royalties by asserting their patents against those who do make products.