Director and officer litigation by the Federal Deposit Insurance Corporation against financial institutions that failed during the financial crisis spiked last year, according to a new report, due to the large number of failures in 2009 and 2010. And now, the outcome of those lawsuits could redefine the relative negotiating strength of the FDIC as well as the defendants going forward.
Of the 297 financial institutions that failed in 2009 and 2010, nearly 40% have either been the subject of an FDIC lawsuit or settled claims with the FDIC prior to the filing of a lawsuit, according to the report by Cornerstone Research, a firm that provides economic and financial analysis for commercial litigation and regulatory proceedings.
