When a corporate crisis hits, boards of directors, their independent committees, and executive officers must navigate a host of difficult governance-related issues in a short time frame and in a manner that will chart the course for eventual resolution. How these entities respond is often subject to close scrutiny by regulators, prosecutors, shareholders, customers, and the media. Missteps can be damaging and costly.
Leading companies regularly turn to Sidley for advice on high-stakes, sensitive situations that may require independent committee or board oversight and often involve governance-related concerns. Sidley has deep experience and a proven track record with crises requiring quick action and strategic insight across the full spectrum of potential risks, including governance, regulatory, litigation, political, and public relations considerations.
Comprehensive, Multidisciplinary Experience
We have decades of experience serving as the frontline response team for boards. We provide tailored solutions that meet directors’ needs in responding to multi-faceted crises, such as:
- Board, audit committee, and special committee investigations, including whistleblower complaints, sexual misconduct claims, accounting irregularities, shareholder demands, and other allegations of wrongdoing.
- Government investigations and enforcement actions, including by Congress, the Department of Justice (DOJ), the Securities and Exchange Commission (SEC), the Consumer Financial Protection Bureau (CFPB), state attorneys general, and other oversight bodies.
- Shareholder activism and environmental, social, and governance (ESG) issues.
- Shareholder litigation, including securities fraud class actions and shareholder derivative litigation, M&A challenges, and ERISA class actions.
- Financial reporting and disclosure issues.
- Cybersecurity breach incidents, product recalls and safety issues, regulatory actions, unexpected business downturns, and other corporate emergencies.
We understand the level of trust and sensitivity that is required to advise directors and management during a crisis. Our lawyers know how to balance internal and external effects, relationship dynamics, and optics, and how to craft both initial and long-term strategies for multiple overlapping and high-profile proceedings, all with the overarching goal of protecting the company’s business and reputation.
Harnessing our firm’s global resources, Sidley is able to quickly assemble the right team for complex matters spanning multiple legal disciplines. Our team includes former U.S. federal and state prosecutors and officials, many of whom served at high levels within the DOJ, SEC, and other government agencies. It includes pathbreaking leaders in governance and shareholder disputes, who have been at the forefront of the development of corporate and securities laws. And it includes first-chair trial lawyers, seasoned litigators, and appellate specialists who have seen and done it all, from trying securities class actions to winning seminal Supreme Court decisions.
While no crisis or situation is the same, Sidley has the experience to guide you. Our extensive experience with board-level crises includes the following:
- Represented the board of a Fortune 20 healthcare company in shareholder derivative claims related to the Theranos fraud, as well as related government investigations, civil litigation, and consumer class action litigation. Achieved landmark win in the Delaware Supreme Court affirming dismissal of all claims against the board.
- Representing the board of a Fortune 50 life sciences company in connection with a high-profile and sensationalized media report about the alleged knowledge of product safety issues related to the largest product liability multi-district litigation (MDL) in the country, including a special committee investigation, shareholder demands, shareholder derivative litigation, securities fraud class action, and ERISA class action.
- Represented the board and special cybersecurity committee of an international technology company in connection with its independent investigation of the company’s handling of the two largest data breaches ever reported.
- Assisted the board and audit committee of a multinational consumer electronics retailer in an independent investigation into the highly public allegations of sexual misconduct against the company’s CEO.
- Represented the special committee of a Fortune 100 insurance company in internal investigation and shareholder derivative litigation regarding allegations of financial impropriety. Won dismissal of challenge to the special committee’s investigation.
- Advising the board of a Fortune 50 pharmaceutical company in connection with the special committee investigation, shareholder demands, and shareholder derivative litigation regarding opioids.
- Representing the board of a Fortune 20 life sciences company in derivative litigation, securities litigation, and a government investigation arising from missed merger guidance and a defamation suit by the former CFO, which received regular front-page news coverage.
Click here for a pdf of our Board Crisis Management and Strategic Response brochure.