Summary
Unfortunately, plaintiffs have been persistent and had considerable success tapping into current anti-corporate sentiment and winning verdicts in eases against Vivendi, Household Finance, Apollo Croup (jury verdict, later reversed on appeal), maries Conaway, formerly of Kmart (in a suit by the SEC, even though Conaway had previously won a bankruptcyrelated arbitration), Gregory Reyes, tonner CEO ot Brocade (convicted for the second time, after his prior conviction was overturned) and Richard Scrushy, formerly of Healthsouth $2.9-billion judgment in a corporate derivative suit, wen though Scrushy had previously won a criminal trial in 2005 1. [...] they should not allow themselves to be complacent where their D&O insurance coverage is concerned.
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Extract
Risks Rising
Directors and officers of American public companies face many substantial risks, not just the risk of their companies' success or failure in the marketplace. Every year, hundreds of directors and officers are sued, most notably in securities-fraud class actions filed by professional plaintiff law linns. Tor decades, it has seemed even time a company's stock price drops by more than 10 percent in a two-day period, one or more plaintiff firms are likely to bring an action.
For a corporate director or officer, worrying about one's own prospective liability can create an unfortunate distraction from the primary goal ol delivering sh...See the full content of this document
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