Securities Fraud Action Against Bank
In Bender v. Jordan, No. 08-7150, a securities fraud action against a bank, its then-directors and its president and CEO, the court affirmed the district court's order requiring the ex-directors to reimburse the bank for their defense costs, holding that, as the former directors satisfied neither the conditions for mandatory nor those for permissive entitlement, and the board made a determination embodying that fact, the former directors were obligated under the agreements to repay the bank for the cost of their legal defense.
As the court wrote: "This is a fee dispute arising out of prolonged litigation between various parties interested in Independence Federal Savings Bank ("IFSB" or the "Bank"), a federal stock savings association regulated at the time of the relevant events by the Office of Thrift Supervision ("OTS"). One substantive phase, possibly the last, began in 2006 when shareholders Morton and Grace Bender filed a securities law suit against IFSB, five then directors and its president and CEO."
- Read the DC Circuit's Decision in Bender v. Jordan, No. 08-7150