D&O litigation against private and non-profit organizations has increased 450% in the past decade.  Directors’ and Officers’ of public, private and not for profit organizations face a significant risk of a lawsuit for their participation as an Officer or on a Board of Directors.  Our team uses its deep experience in these matters to identify the risks, create a strong defense and leverage the case to a successful conclusion.

A few recent examples of our team’s success:

• Former owner of a music festival company sued the purchaser of his company for breach of fiduciary duty and breach of the shareholder agreement. After getting the breach of fiduciary duty claim dismissed, the client was able to resolve the matter for a fraction of the claim.
• A Board of Directors of a software company was sued by a former Board Member and minority shareholder for breaches of fiduciary duty and breach of contract. The former Board Member alleged the company and the current Board took illegal actions to reduce the overall value of the shares of the company to buy back shares at a discounted price. We defended the company and won.
• Investors filed a $7 million derivative lawsuit against a private company alleging breach of fiduciary duty. The investors claimed that some of the company’s officers had personal connections to the third-party contractor hired to re-tool the company’s assembly line and hired that contractor to further their personal interests, not the interests of the company. Other officers and directors were alleged to have either knowingly colluded with one another, or at least breached their duty of care in undertaking the project without properly investigating the qualifications of the contractor.
• Interference with Competitor’s Contract: A company recruited a top executive who had an employment contract with a competitor company. The competitor sued the company for damages suffered as a result of losing its Executive Vice President of Sales on the grounds that the company interfered with the competitor’s contractual relationship with its employee. We defended the company and won on summary judgment.
• Supplier Detrimental Reliance: A company advised one of its suppliers that it ought to increase inventory because business was expected to increase significantly. Business did increase for the company but it decided to use a different supplier for the increased inventory. The original supplied sued the retailer alleging that he relied on the retailer’s promise of more business and suffered damages as a result of having relied on that promise.
• Interference with Business Relations: During a press conference the president of a service company stated that the success of his company was due in large part to a competitor’s lack of customer service and inferior product. The competitor filed suit alleging that the president had negligently interfered with business relations.
• Defense verdict in a $45 million suit brought against former employees and owners of a money management firm brought by an owner of the firm for Conspiracy, Fraud, Breach of Contract, Breach of Fiduciary Duty and Conversion after LLC abandoned and new LLC started with all clients moved to new firm.
• A health insurance co-op organized under Obamacare failed and was liquidated. The liquidators filed breach of fiduciary duty claims against the three founders alleging that their poor management and inadequate strategic planning led to the failure. The liquidators alleged more than $160 million in damages. The parties exchanged detailed mediation statements. Our mediation statement discussed the various causes of the failure–from state regulatory changes to poor underwriting to reduced federal funding–and explained how the founders/directors worked closely with state regulators to try to navigate the new exchange market and novel reimbursement framework to save the co-op. Mediation failed, but the attorneys continued to negotiate. The matter will be settled within the $5 million policy limits.
• Complex shareholder’s suit involving breach of fiduciary duty and shareholder derivative claims relating to the alleged dissolution of a corporation and the undervaluation of pharmaceutical drug. This matter involved trial court litigation as well as appellate work.
• Board of directors dispute for alleged mismanagement that resulted in litigation related to an attempted hostile takeover by some board members due to allegations of fraud and insider trading.
• Defense of Board Members and Corporate officers in shareholder derivative suit alleging mismanagement and the theft of funds and property as a result of the dissolution and sale of the corporation’s assets.
• Defense of Corporate officers accused to have improperly competed and failed to develop company’s most value asset (software technology) thereby causing a forced dissolution of the company.
• Defense of C Suite employees in sexual harassment and retaliation claims and alleged ineffective handling by the Board members.
• Defended successfully the President of a printing ink company in a Rule 10(b)(5) stock fraud claim before a federal jury in Northern District of Illinois. The president bought out a shareholder’s 60% interest in the company for $150,000 two years later sold the company for $3,000,000. It was alleged, the president had been in contact with the firm that brokered the sale while discussing the buyout.
• A health insurance co-op organized under Obamacare failed and was liquidated. The liquidators filed breach of fiduciary duty claims against the three founders alleging that their poor management and inadequate strategic planning led to the failure. The liquidators alleged more than $160 million in damages. The parties exchanged detailed mediation statements. Our mediation statement discussed the various causes of the failure–from state regulatory changes to poor underwriting to reduced federal funding–and explained how the founders/directors worked closely with state regulators to try to navigate the new exchange market and novel reimbursement framework to save the co-op. Mediation failed, but the attorneys continued to negotiate. The matter will be settled within the $5 million policy limits.