Further D&O Exposure?

There have been many predictable types of actions taken against companies related to the subprime meltdown.

The newer actions are less predictable and more interesting.

Advisen's database of large losses now tallies 76 actions related to subprime. But as noted by Kevin Lacroix on the D&O Diary (here) the exposures by undisciplined loan underwriting are likely to blow up in credit card, auto loans, commercial real estate and perhaps beyond.

As Advisen has pointed out, this is the tip of the iceberg. While subprime mortgage defaults can be predicted to peak and then fall off (there is no new issuance), the ripple effect of this credit crunch will mean increased D&O exposure for many types of companies that have exhibited poor loan underwriting.

Since the success of new and different cases may depend on the ability for plaintiffs to win subprime cases, readers will be interested in following the developing story on Front Page News, in Advisen's database of cases and indeed on excellent blogs such as Kevin's.