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Directors Liability Consulting
It is imperative that directors and officers of privately
held companies understand the full scope of their personal
exposure to executive liability as interpreted by the courts.
Directors and officers’ personal assets are at risk
from these suits that may include allegations including unfair
trade practices, antitrust, fraud, and defamation or breach
of contract. Deltennium specializes in solutions-focused consultation
services aimed at reducing the liability risks your directors
and officers may face, including claims from employees, shareholders,
and government agencies.
Directors and officers of corporations face serious scrutiny
in today’s ever-changing business environment. Deltennium’s
team of experienced intermediaries will be involved from start
to finish providing effective and efficient consultation,
while offering creative insights and expert counsel. We engage
professional standards in providing you with a detailed analysis
of every available option to manage your exposures, including
non-traditional risk financing approaches.
First and foremost, we assist your corporation’s directors
in securing some form of Directors and Officers Liability
Insurance if they have not already done so; that way, they
can afford expert legal defense should the need arise. Acquiring
D&O insurance lessens the chance of exposing the personal
assets of one’s self, one’s spouse and one’s
estate to the risk of uninsured loss. Without this coverage,
the corporation and its shareholder owners/operators often
struggle with the litigation and settlement costs that they
ultimately might not be able to afford.
Allegations against directors and officers have largely been
employment-related in recent years. This is generally in regards
to employment practices issues such as termination, harassment,
and discrimination. Also, the number of shareholders of the
private company and the amount of capital invested should
also be considered, since the more stock that is held outside
of the founders and insiders, the greater the risk of litigation.
As for shareholder claims, even if the corporation is not
publicly traded, it does not mean that it has not issued a
"security" that is subject to U.S. securities laws.
Actually, directors and officers of privately held corporations
owe the same duties to shareholders as do their counterparts
at publicly held corporations. Additional shareholder litigation
can arise from situations such as private placements, hostile
takeovers and failure to complete an IPO.
Deltennium also assists in providing counsel and formulating
a strategy that effectively addresses specific claims that
are in recent years being brought directly against the directors
and officers of privately held companies by government agencies.
Violations of regulatory acts, monopolistic practices, and
other charges might possibly create additional liability for
the company and directors and officers as individuals.
Unfortunately, in today’s fickle legal and regulatory
environs, the risk of suits and allegations is higher than
ever. Now more than ever, directors and officers should not
operate without the benefit of strategic advice and sound
solutions should the possibility of litigation emerge. Deltennium’s
consultation programs are designed to help protect the personal
assets of a privately owned company’s directors and
officers, as well as the financial well being of the company
itself.
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