Scott Seaman Quoted in Law360 Article Discussing Bear Stearns Disgorgement Insurance Coverage Case
Hinshaw attorney Scott Seaman, a Chicago-based partner and co-chair of the firm's national Insurance Services Group, was quoted by Jeff Sistrunk of Law360 in an article titled "NY Ruling Undercuts SEC Disgorgement Coverage." The article reviews the decision last week by a New York Appeals Court that determined that a $140 million Bear Stearns disgorgement paid as part of a settlement with the SEC represented a penalty and therefore was not covered by insurance. The Court applied the U.S. Supreme Court decision in Securities and Exchange Commission v. Charles Kokesh in its ruling.
Seaman said the appellate panel made the right call. "Generally, disgorgement is imposed as a consequence of a wrong against the public as opposed to particular people, it is intended to punish and deter, and often the victims are not directly compensated," he noted. "That is a penalty whether an insured is disgorged of its own ill-gotten gains or those generated for customers."
Read "NY Ruling Undercuts SEC Disgorgement Coverage," on the Law360 website (subscription may be required)
"NY Ruling Undercuts SEC Disgorgement Coverage" was published by Law360, September 26, 2018.