Current Litigation Risks

MACUMA

January 9, 2017

E. Andrew Keeney, Esq.

Kaufman & Canoles, P.C.

2

E. Andrew Keeney, Esq.

Kaufman & Canoles, P.C.

150 West Main Street, Suite 2100

Norfolk, VA 23510

(757) 624-3153

eakeeney@kaufcan.com

http://www.kaufmanandcanoles.com/movies/credit-unions.html

3

Overview and Agenda

• Trends and Traps

• Class Action Litigation

• Bond

• Indemnification

• Methods or Means to Reduce Litigation Risks

• Best Practices and Takeaways

4

Trends and Traps

• Repossessions

• ADA

• FMLA

• FCRA

• Courtesy Pay

• MLA

5

Management & Professional Liability: Trend Losses

Point of Emphasis: Always consider both frequency and severitySource: 2011-2015 CUNA Mutual Group internal claims data

6

Management Liability (D&O) Coverage Drill Down

90% 10%

Percentage Of CUs That Include The Entity Option As An Insured Person In The D&O Coverage

Entity (CreditUnion) Included

Entity (CreditUnion) Not Included

The above charts references natural person credit unions only (No Corporate Credit Unions)

7

Management Liability (D&O) Losses Drill Down

99%

1%

Percentage of Entity vs Individual Suits Within The D&O Coverage

Entity (CreditUnion) Only NamedD&O Suits

Individual NamedD&O Suits

The above charts references natural person credit unions only (No Corporate Credit Unions)

8

Class Action Litigation

Class Action Fairness Act of 2005

“Class actions can be a way of leveling the

playing field for poor or economically less

powerful individuals.”

9

Class Action Litigation

• Numerosity

• Commality

• Typicality

• Adequacy of representation

10

Methods or Means to ReduceClass Action Litigation Risks

• Promptly investigate all of the facts

• Fix any mistakes – immediately

• Class action counsel

• Consider arbitration

• Pleadings – Motion to Dismiss

• Settlement

11

Bond

• Who is covered?

• What is covered?

• What are the coverage limits and the

deductible?

12

Indemnification

• Credit union bylaws

• State laws

• Board resolution

13

©™

14

©™

15

©™

16

©™

17

Courtesy Pay

18

Best Practices and Takeaways

• Documentation

• Credit union policies

• Litigation hold

• Bond coverage

• Reports and monitoring

• Fight or settle?

19

E. Andrew Keeney, Esq.

Kaufman & Canoles, P.C.

150 West Main Street, Suite 2100

Norfolk, VA 23510

(757) 624-3153

eakeeney@kaufcan.com

http://www.kaufmanandcanoles.com/movies/credit-unions.html

Current Litigation Risks

MACUMA

January 9, 2017

E. Andrew Keeney, Esq.

Kaufman & Canoles, P.C.