Claims and Bad Faith Law Blog

Economy Falls, Litigation Rises: Fiduciary Duty, D & O Claims Rise, Too.

    The falling economy has already produced corporate bankruptcies, job layoffs, and Government investigations.  And a rise in the numbers of claims and lawsuits.  Reportedly, "[i]insurance companies [are] the top target for litigation ...."  Lindsay Fortado, "U.S. Company Lawyers Expecting Litigation Surge, Survey Says" (Bloomberg. com, Tuesday, October 14, 2008).

    Lawsuits filed in the last 12 months included a large number of lawsuits against Insurance Companies.  Id.  In such a climate, many claims implicating Fiduciary Duties, Good Faith and Fair Dealing, or not, and Director's and Officer's Insurance Coverage, are on the horizon, and many others are already here.

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"Let's Fiduciary At The Spa!"

    An AIG decision to spend over $441,000.00 at the spa was hooted down in the United States Congress and in much of the popular press as a bad idea.  See, e.g., Michael Janofsky, "Lehman, AIG Chiefs Should 'Man Up,' Stop 'Kissing the Mirror'" (Bloomberg.com, Friday, October 10, 2008); Scott Lanman, "Frank Asks Paulson, Bernanke to Tighten Their Oversight of AIG" (Bloomberg.com, Friday, October 10, 2008).

    Their reaction was because the AIG decision came days after AIG asked for, and got, $85,000,000.00 or $85 Million Dollars from the Federal Taxpayers.  AIG's decision was greeted with a larger amount, which some reports put at another $37.2 Million and other reports put at an additional $37.8 Million Dollars, of further Federal Taxpayer money from the current regime.  Total bailout extended to AIG so far:  Over $122,000,000.00 Dollars.

    And no end in sight short of January, 2009, if then.

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