More On "Socialized Risk, Private Gain?"

      

    In a March 21, 2008 post on Insurance Claims Bad Faith Law Blog at www.insuranceclaimsbadfaith.typepad.com, this question was asked in response to a newspaper editorial that contained the assumption that certain corporate executives would not have to disgorge allegedly ill-gotten gains:  "Why not?"

    Michael J. Missal may have an answer to that question in at least one case.  He is reportedly "a U.S. Bankruptcy Court examiner".  E. Scott Reckard, "Mortgages/Sub-prime Lender Allegedly Inflated its Profit" (Los Angeles Times Online, Thursday, March 27, 2008).   Mr. Mittal filed a Report with the Bankruptcy Court in connection with the Bankruptcy proceeding of former Mortgage Company New Century Financial Corporation.  Bonuses paid to certain former "top executives" and "senior managers" of that  company "were tied to reported financial results".  "These and other bonus payments to executives may be recovered 'under unjust enrichment and bankruptcy law theories,' he said."

    Would Directors and Officers Insurance Coverage respond in the event that such bonus payments are recovered under similar circumstances, or not?

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