Journal article
The Role of Directors' and Officers' Insurance in Securities Fraud Class Action Settlements
The Journal of law & economics, Vol.58(4), pp.747-778
11/01/2015
DOI: 10.1086/684296
Abstract
Because of previous data unavailability, it is unclear how important directors' and officers' (D&O) insurance is in securities fraud class action settlements. Using a unique data set of US D&O policies, we find that D&O insurance coverage is a less significant determinant of settlement amounts than estimated damages and proxies for the merits of cases. Limits on D&O insurance are related to settlements in only the weakest cases (those without allegations of accounting violations or institutional lead plaintiffs) where proxies for cases' merits play a minimal role. Our findings suggest that most securities fraud class action settlements are meritorious and that accounting-related cases are a reasonable proxy for fraud.
Details
- Title: Subtitle
- The Role of Directors' and Officers' Insurance in Securities Fraud Class Action Settlements
- Creators
- Dain C. Donelson - Univ Texas Austin, Austin, TX 78712 USAJustin J. Hopkins - University of VirginiaChristopher G. Yust - Texas A&M Univ, College Stn, TX 77843 USA
- Resource Type
- Journal article
- Publication Details
- The Journal of law & economics, Vol.58(4), pp.747-778
- Publisher
- Univ Chicago Press
- DOI
- 10.1086/684296
- ISSN
- 0022-2186
- eISSN
- 1537-5285
- Number of pages
- 32
- Grant note
- Red McCombs School of Business Darden Graduate Business School Deloitte Doctoral Fellowship
- Language
- English
- Date published
- 11/01/2015
- Academic Unit
- Accounting; Law Faculty
- Record Identifier
- 9984380493602771
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