The wave of litigation involving private credit continues to expand. FS KKR Capital Corp. (“FSK”), one of the largest publicly traded business development companies (“BDCs”), is already defending a securities class action lawsuit (KKR SCA) alleging that it overstated asset valuations and misrepresented the effectiveness of its efforts to address troubled portfolio companies. On July 15, 2026, a shareholder of FSK filed a separate derivative lawsuit against the company’s external investment adviser, FS/KKR Advisor, LLC (FS/KKR), alleging that the adviser extracted grossly excessive advisory fees in violation of its fiduciary duties under Section 36(b) of the Investment Company Act of 1940.

Continue Reading Another Private Credit Excessive Fee Lawsuit

Many of us are still trying to get comfortable with the idea of autonomous vehicles. Turns out, we may soon need to get comfortable with the idea of autonomous companies.

A first-of-its-kind draft bill has been proposed to the Delaware legislature that would allow the creation of an Artificial Intelligence Company (AIC), a form of legal personhood for an entity that operates through an AI agent with no human at the controls, and with the same kind of limited liability for the entity’s owners as for a more traditional company.  

As discussed below, the proposed new AIC corporate form raises some very interesting questions. It also arguably represents an entirely new challenge for the D&O insurance industry.

Continue Reading Brave New World: Delaware’s Proposed New “Artificial Intelligence Company”

D&O Diary readers are aware of a growing trend over the past year: an increasing number of securities class actions arising from alleged market manipulation involving low-float public companies. These cases, ranging from pump-and-dump and spoofing schemes to stock promotion claims, now also include a lawsuit filed this week against Megan Holdings Limited (Megan), whose share price allegedly surged more than 400% in one month before plunging over 93% in a single trading day. The company, headquartered in Malaysia, develops, constructs, and maintains aquaculture farms and related infrastructure. 

Continue Reading Pump-and-Dump Securities Suit Adds to Growing Market Manipulation Litigation Trend

The fourth episode of The D&O Diary Podcast Series, discussing the D&O liability and insurance implications of the current Trump administration’s tariff policies, is now live.

The D&O Diary has closely followed the rapidly evolving tariff environment and the growing range of litigation and liability issues arising from it. Building on our prior posts examining tariff-related securities litigation, refund litigation, and emerging corporate disclosure challenges, we discuss in this latest episode how tariffs have become a D&O risk for both public and private companies.

Continue Reading The D&O Diary Podcast Series – Episode 4: Tariffs, Geopolitics, and D&O Risk

Both the number of securities class action lawsuit filings and the number and total value of securities lawsuit settlements during the first half of 2026 were on track for the highest annual levels in several years, according to reports published this week by National Economic Research Associates (NERA) and Cornerstone Research, respectively. The NERA report, entitled “Recent Trends in Securities Class Action Litigation: H1 2026 Update,” can be found here. The Cornerstone Research report, entitled “Securities Class Action Settlements,” can be found here. The D&O Diary’s own analysis of the securities suit filings in the year’s first six months can be found here.

Continue Reading Securities Suit Filings and Settlement Numbers and Values Increased in 1H26
Ben Dubin

In the following guest post, Ben Dubin, Managing Member of VC Expert Services LLC, discusses Delaware Vice Chancellor Laster’s January 29, 2026 opinion in the Calumet Capital Partners case. This article, which is the first of two discussing recent Delaware decisions regarding VC firm’s representative’s service on the firm’s portfolio company boards, argues that the Calumet decision creates greater litigation risk for venture capital firms whose employees or partners serve as board designees, because courts may more readily infer that the investor knowingly participated in a fiduciary breach when its own representative is involved. The author’s companion article to this one will be published on this site next week. Our thanks to Ben for allowing us to publish his article on our site. Here is Ben’s article.

Continue Reading Guest Post: Calumet and VC Board Designee Risk

Over the past couple of years, the D&O Diary has followed how geopolitical developments, including wars, sanctions, tariffs, export controls, and trade disputes, can create public company D&O exposure. These developments can present disclosure challenges and have led to securities suits arising from export controls, tariffs, and related business impacts.

A recently filed securities class action against Photronics, Inc. (Photronics) highlights how later statements about geopolitical tensions and supply chain challenges can be woven into broader claims that a company’s earlier disclosures were misleadingly incomplete. Photronics manufactures photomasks, the highly precise templates used in the process to produce semiconductors. While the complaint primarily alleges misstatements about product demand and financial performance, it also cites disclosure failures related to the U.S.-Iran conflict and supply chain disruptions.

Continue Reading What Constitutes Geopolitical Disclosure Risk?
Evan Bundschuh
Burkhard Fassbach

In the following guest post, Evan Bundschuh and Burkhard Fassbach share and analyze their research into the geopolitics-related Form 10-K disclosures of 26 large-cap U.S.-listed public companies, as well as 52 small-cap and mid-cap companies, in order to assess the level and significance of public companies’ disclosure statements pertaining to geopolitics. Evan is Vice President at GB&A, a retail insurance brokerage in New York, and Burkhard is a D&O lawyer in private practice in Germany. My thanks to Evan and Burkhard for allowing us to publish their article on this site. Here is their article.

Continue Reading Guest Post: Geopolitical Risk Mapping in the 2025 Filing Season

One of the questions that has accompanied the Securities and Exchange Commission’s changing approach to digital asset regulation is whether a decline in enforcement activity would lead to an increase private plaintiff litigation against cryptocurrency and crypto-adjacent companies.  A July 7, 2026, report by NERA Economic Consulting (NERA) suggests the answer may be more nuanced. While, according to NERA’s analysis, private securities litigation has become a larger share of crypto-related litigation, it has not fully replaced the reduction in SEC enforcement actions.  The changing nature of crypto-related claims could have a significant impact on D&O underwriters operating in the sector. The NERA report provides a useful framework for evaluating the D&O implications of these developments.

A link to the NERA report published by Simona Mola, Ph.D. can be found here.

Continue Reading Crypto D&O Risk Is Evolving

As readers know, in May, the SEC proposed a rule that would provide companies currently subject to the agency’s quarterly reporting requirements with the option to instead file interim reports semiannually. Following the agency’s announcement of the proposed rule, the proposal has been subject to public comment. The comment period is now closed, although apparently some late filed comments are still being made public. What does the commentary show?  The filed comments show that while public reaction to the proposal has varied, the filed comments were almost exclusively negative.

Continue Reading Commentators Respond to SEC’s Semiannual Reporting Proposal