Transcript Download Handout 1

D&O Claims Trends
Brian Kristiansen
Chubb & Son
Shareholder Claims
• Disclosure
• Mergers/Acquisitions
Disclosure Claims
• Securities Act of 1933
» stock offerings
• Securities Exchange Act of 1934
» after-market trading
Typical Disclosure Claim
• A statement by the company.
• A subsequent disclosure that surprises
the market.
• A large stock price drop.
• A perceived variance between the
statement and the disclosure.
Pre-Reform Act Litigation
• Professional plaintiffs.
• Race to the courthouse.
• Lawyer controlled.
• Settlements driven by fees.
Changes in the Law
• Private Securities Litigation Reform Act.
• Securities Litigation Uniform Standards Act.
• Court decisions.
Post-Reform Act Litigation
• Slower process.
• Pension funds as plaintiffs.
• Largely controlled by lawyers.
• Accounting/insider trading allegations.
• Larger settlements.
D&O Insurance
• Directors and officers liability
• Entity coverage for securities claims