1. Navigating Current IssuesNavigating Current Issues
Under E&O and D&O PoliciesUnder E&O and D&O Policies
Your Moderator:
Gary L. Gassman
Meckler Bulger & Tilson LLP
YOUR PANELISTS
Ellen Van Vechten, Esq. Paul Douglas, Esq.
Team Leader, Prof. Liab. Claims Asst. V.P., Sr. Claims Atty.
Fireman’s Fund Ins. Co. Chubb & Son
Roberta Anderson, Esq. Rob Cutbirth, Esq.
K&L Gates Tucker Ellis & West
2. Where We’re GoingWhere We’re Going
Our Road map for Today:
1. Coverage Grant:
Who’s Covered And For What (Conduct &
$$)
2. Exclusions and Conditions:
When does Bad Conduct Mean You May
Lose Your Coverage (i.e., coverage denial or
rescission)
Interrelated Claims and the Effect on the
Date of Claim and on Deductibles/Limits
3. The Effect of Bankruptcy on Coverage
Exclusions and Claims Management
4. How Might these Principles Apply to the
3. Who’s CoveredWho’s Covered
Executives who may
not have their act (or
outfit) quite together
Mid- & Lower level
accounting and
compliance employees
“Missing” Directors or
Officers or their
Replacements (maybe a
Bankruptcy Trustee?)
General Counsel
5. LOSSLOSS
THE OTHER 4-LETTER WORDTHE OTHER 4-LETTER WORD
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-1
REGISTRATION STATEMENT
Under
The Securities Act of 1933
Section 11 vs. Section 10(b) – When
does “Loss” Exist”?
Fraud and Theft can come in many
forms; when does it trigger “Loss”
issues?
Neither side wants to “waste” money in
“wasting” policies – So, how do we manage
“Loss” issues in complex cases often involving
“equitable” or “disgorgement” remedies, as
well as potentially conflicting exposures for the
Insureds?
6. Bad Conduct/Tainted MoneyBad Conduct/Tainted Money
The Conduct and Improper Profit LimitationsThe Conduct and Improper Profit Limitations
From “pickpockets,” to embezzlement, to falsified
financial results, when does an Insured’s
conduct cross the line and become excluded?
When does the receipt or
access to special or
different compensation,
benefits or “opportunities”
become an excludable
event?
7. One little, two little, three little Claimants …One little, two little, three little Claimants …
Just How Many Claims Do You Have?Just How Many Claims Do You Have?
While many claimants think
they are unique, they are often
fed from the same trough or
source. When should claims be
considered “related” or merely
distant cousins for purposes of
determining policy limits and/or
policy deductibles?
The “wayback machine” worked well for
Poindexter, but when does it work for
grouping claims together and taking
them “wayback” to an earlier policy
period or within a “Prior Claim” or “Prior
Notice” Exclusion
8. The Insured vs. Insured ExclusionThe Insured vs. Insured Exclusion
(Really, we need to stop fighting among(Really, we need to stop fighting among
ourselves, it’s not a pretty sight)ourselves, it’s not a pretty sight)
Debtors in
Possession. . .
Bankruptcy Trustees. . .
When they start fighting
with Insureds (corporate
and individual), can the
IVI provide comfort in
these increasingly nasty
storms?
9. Coverage ConditionsCoverage Conditions
The Risk of Losing Important RightsThe Risk of Losing Important Rights
“Plays nicely with others” is something we like to hear
with respect to our kids. It also applies to our
Insureds. Three tips on “playing” nicely with Insurers
include:
• Giving timely notice of Claims
• Seeking “permission” for defense activities
• Seeking “permission” to settle (and try to
spend someone else’s (the insurers’) money
And if when our Insureds don’t play nicely,
coverage may end up “lost,” but never “found”
10. Policy ValidityPolicy Validity
When Should you Pull the Plug?When Should you Pull the Plug?
We all make mistakes, but some mistakes have
greater consequences than others
When do you pull the plug?
How do Insureds try to keep the
lights on?
Knowing the consequences ...
