Follow-On Developments in Pump-and-Dump Litigation
Recent securities class actions against Ostin Technology, ChowChow Cloud, and Concorde International illustrate a growing wave of pump‑and‑dump litigation targeting low‑float issuers. The suits allege coordinated social‑media campaigns, AI‑generated deepfakes, and WhatsApp groups that inflated stock prices by over 1,100% before collapsing, erasing roughly $950 million in market value. A March 24 federal ruling allowing claims against Meta Platforms signals that courts may hold social‑media platforms liable for facilitating such schemes. Collectively, these developments expand D&O exposure and force underwriters to reassess risk factors tied to digital promotion and disclosure failures.
Contract Exclusion Does Not Bar Coverage for Tortious Interference Claim
The Northern District of Illinois ruled that a management liability policy’s contractual liability exclusion does not bar coverage for a tortious interference claim. Metropolis Condominium Association faced a lawsuit alleging breach of its garage management agreement and tortious interference with...
Guest Post: The Audit Committee: D&O Underwriting Is Behind Delaware Law
Stephen Hourigan argues that Delaware courts have redefined audit committees, demanding management‑independent, real‑time reporting, yet D&O insurers still base underwriting on outdated governance metrics. He cites Boeing, Wells Fargo, Walmart and McDonald’s cases to show that traditional audit‑committee scores missed structural...
Lending Platform Hit with AI-Related Securities Suit
Upstart Holdings, an AI‑driven lending platform, faced a securities class‑action after its Model 22 AI credit‑scoring tool underperformed, prompting a 10% share‑price drop. The company disclosed that Model 22 over‑reacted to macroeconomic signals and was deliberately made more conservative, leading to lower...
A Delaware Take-Private Suit and Controller Buyout D&O Risk
A Delaware Chancery Court complaint filed by Detroit’s Police and Fire Retirement System alleges that the 2025 take‑private of Skechers by 3G Capital was driven by the Greenberg founders, who control roughly 60% of voting power, and that the deal...
The Continuing Rise of Collective and Mass Actions Outside the U.S.
Collective and mass actions are rapidly expanding beyond the United States, with hundreds of securities class or group lawsuits filed since 2021 across Europe, Australia, and the Asia‑Pacific. The European Union’s new collective redress directive and the United Kingdom’s opt‑out...
A Writ Challenging Qui Tam and D&O Implications
Eli Lilly has petitioned the U.S. Supreme Court to declare the False Claims Act’s qui tam provisions unconstitutional, arguing that private relators exercise executive power without presidential oversight. The challenge stems from a $60 million government loss and $600 million revenue gain verdict in...
Later Acts that Are Not “Wrongful” Don’t Bar D&O Run-Off Coverage
A New York federal court ruled that subsequent acts after a run‑off policy cut‑off date do not bar coverage unless they are unlawful. Judge Jed Rakoff found AmTrust’s 2019 preferred‑share delisting was a lawful corrective disclosure, so the insurer’s reliance...
D&O Insurance: Not a “Securities Claim” If No Securities of the “Company” Involved
A Maryland district court dismissed Supernus Pharmaceuticals' attempt to secure D&O insurance coverage for an antitrust lawsuit, holding the claim did not qualify as a “Securities Claim” under the policy. The court focused on the policy’s definition, which requires the...
D&O Lessons From the Beyond Meat SCA
A securities class action filed in January 2026 accuses Beyond Meat’s board and executives of misleading investors by failing to disclose a material asset impairment before the third quarter of 2025. Plaintiffs allege the company continued to tout cost‑reduction initiatives...
Tariff-Related Securities Suit Hits Social Media Platform Pinterest
Pinterest, an ad‑driven social platform, faced a securities class‑action suit after it disclosed that tariffs on its retail advertisers were curbing ad spend, prompting a near‑17% share decline. The complaint alleges the company misled investors by overstating its ability to...
Power Supply Company Hit with AI-Related Securities Suit
Power Solutions International, a maker of engines and power systems, was hit with a securities class‑action lawsuit on March 20, 2026 alleging it overstated the growth and margins of its AI data‑center power solutions. The company’s 2025 results showed an...
Tariff Pass-Through Litigation Expands
The U.S. Supreme Court’s February 20, 2026 decision invalidating IEEPA tariffs has triggered consumer class actions against retailers such as Fabletics and Costco for allegedly passing tariff costs to shoppers. The lawsuits claim violations of state consumer‑protection statutes and seek...
Private Credit Firm Hit with Securities Suit After Short Seller Report
Hercules Capital, a $5.7 billion‑asset Business Development Company, was hit with a securities class‑action lawsuit after a short‑seller report alleged the firm overstated its due‑diligence and loan‑valuation processes. The report claimed the lender copied investments from Google Ventures and relied on...
Prediction Markets and Emerging D&O Risk
The Gemini Space Station IPO promised crypto‑exchange growth, but within months the company announced a strategic shift to a prediction‑market platform called “Gemini 2.0,” cutting staff by roughly 25 % and prompting the exit of its CFO, COO and CLO. Shareholders filed...
