Class Actions and D&O Policies
In our Class Action practice, we want to know if the Defendant company has D&O or E&O insurance?
D&O insurance is important to us for several reasons:
1) Is the insurance company providing the defense lawyers, and paying those lawyers?
2) Is there insurance coverage for our suit?
3) Is the D&O insurer denying coverage?
In a recent successful Class Action that we handled, the D&O carrier had denied coverage to the insurance company that we were in suit with, by msicharecterizing what our lawsuit was about, and what relief we were seeking.
Aside from the fact that I was personally insulted! (not really!) The D&O carrier’s denial of coverage impaired our ability to reach a fair settlement on behalf of the Class.
We did settle, and I agreed to be a witness in the subsequent covarage lawsuit that the insurance company defendant filed against the D&O carrier, which was resolved favorably as a result.
In these uncertain times and claims of corpoate and insurance company malfeasance, you need to be aware of the availability of D&O or E&O coverage, and whether that carrier is indeed covering the claim. Also if you or your company is threatened with a claim, one of your first steps is to report the claim to your D&O or E&O carrier, and be agressive in pursuing the coverage that you purchased to protect you.