Directors and Officers Liability

For decades, Williams & Connolly LLP has been the firm of choice for directors and officers facing civil litigation and government investigations of all types, including by federal agencies and congressional committees. The types of actions brought against directors and officers vary widely — from administrative proceedings and lawsuits brought by federal agencies, such as the Securities and Exchange Commission, the Department of Justice, the Office of the Comptroller of the Currency, the Federal Housing Finance Agency, and the Federal Deposit Insurance Corporation, to congressional investigations, to suits brought by private parties, to claims in the wake of a company collapse brought by court-appointed trustees and receivers. Our lawyers have experience in all these types of litigation. They draw on that experience to protect the interests and reputation of our individual clients, often working to foreclose cases before they are ever filed and fighting zealously when they are filed.

Many firm lawyers have extensive experience representing directors and officers in litigation brought by governmental agencies. In recent years, the firm has successfully defended directors and officers against threatened or actual enforcement actions resulting from allegedly misleading financial disclosures or other issues related to the financial crisis, alleged unsafe and unsound practices, alleged violations of Section 5 of the Federal Trade Commission Act (which prevents unfair or deceptive acts or practices), and actions involving claims of breach of fiduciary duty.

The firm’s representations commonly include handling all aspects of investigations (whether brought by the SEC, DOJ, or other governmental agencies). Williams & Connolly attorneys are also skilled at crafting substantive responses to threatened formal enforcement actions, and presenting the client’s position to regulators in both informal and, should it be necessary, formal settings.

The firm also has represented directors and officers in derivative suits and related litigation. A number of these cases have been in Chancery Court in Delaware, but others have been in state and federal courts across the country. Our lawyers also have handled demands for corporate records under Delaware Code Section 220, a frequent precursor to derivative litigation.

In the area of financial institution litigation, the firm has successfully dealt with alleged violations of prudent lending standards or breaches of fiduciary duties owed to the institution itself.  Likewise, the firm regularly confronts demands by the FDIC that directors and officers personally compensate the Deposit Insurance Fund for all losses sustained by the financial institution.  One of the firm’s senior partners, John Villa, is the author of Bank Directors’, Officers’ and Lawyers’ Civil Liabilities (originally published by Aspen Law and Business 1991, and most recently updated 2016) and a recognized leader in defending cases involving directors and officers.

Some of the firm’s representative matters for directors and officers areas include:

  • Defense of Broadcom co-founder and former CEO and Chairman Henry Nicholas after indictment for stock options backdating and related offenses and in related civil litigation. The criminal case was dismissed in pre-trial proceedings after misconduct of a government prosecutor was brought to light.
  • Representation of the former CEO of Fannie Mae in litigation brought by the Office of Federal Housing Enterprise Oversight (OFHEO), the government agency responsible for overseeing Fannie Mae, as well as in related securities litigation. The firm obtained summary judgment on behalf of the CEO dismissing all claims.
  • Representation of the CEO of one of the country’s largest management consultancies after the company’s bankruptcy in trustee-driven litigation seeking over $2 billion and alleging breaches of fiduciary duty during the pre-bankruptcy sales process.
  • Representation of another CEO of the same company in an SEC investigation and derivative and shareholder litigation.
  • Representation of the former president of one of the country’s largest mortgage service providers in litigation arising from the company’s collapse.
  • Representation of the former CEO of an investment bank in an SEC investigation and related civil litigation involving alleged improper disclosures of various funds. After receiving the firm’s response to the agency’s Wells Notice, the SEC elected not to proceed and dropped the case.
  • Representation of the former CEO of international consulting firm in SEC and related securities and derivative litigation. The SEC elected not to pursue claims and both the securities and derivative claims were dismissed and settled with the CEO paying nothing.
  • Representation of the directors and officers of an investment bank in a derivative suit alleging breach of fiduciary duty in connection with executive compensation.
  • Representation of private equity firm officers and directors and portfolio company officers and directors in domestic and international securities litigation and in litigation filed by bankruptcy trustee seeking over $1 billion.
  • Representation of CEO of one of the nation’s largest travel industry concessions in criminal investigation into participation of minority joint venture partners.
  • Representation of CEO of major food producer in congressional investigation into food contamination and food-borne illness.
  • Representation of a bank in Texas in connection with an OCC enforcement action.
  • Representation of directors and officers of failed banks in connection with FDIC demands to compensate the Deposit Insurance Fund in connection with the banks’ failure.
  • Representation of two of the founders of a major technology company in a derivative suit alleging breach of fiduciary duty in connection with their acceptance of shares in IPOs from investment banks.
  • Representation of numerous officers of major corporations in SEC investigations.
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