New rules proposed by the US Securities and Exchange Commission on cybersecurity and climate impact disclosures may generate more lawsuits that will generate claims against directors & officers policies, panelists said Wednesday during the Professional Liability Underwriting Society’s conference.
“More disclosure, more securities litigation,” said attorney Noelle M. Reed, a partner with the Skadden law firm in Houston. “Any time you have more disclosure you’ll have plaintiffs scrubbing, looking for more claims.”
Reed and fellow panelist Doru Gavril, a partner with Freshfields Bruckhaus Deringer, said cyber disclosure rules proposed by the SEC in March may be counterproductive if not amended. The proposed rules would require public companies to disclose any “material cybersecurity incident” within four business days.
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