The global data center industry is experiencing unprecedented growth. According to Fortune Business Insights, the global data center market reached $269.79 billion in 2025. This market is projected to grow to $300.64 billion in 2026, and then more than double to $699.13 billion by 2034, reflecting a compound annual growth rate (CAGR) of approximately 11.10%. North America accounted for roughly 38.5% of the global market share in 2025. The capital flowing into this sector is staggering: McKinsey estimates that companies across the compute power value chain will need to invest $5.2 trillion into data centers by 2030 to meet worldwide artificial intelligence (“AI”) demand, with an accelerated scenario requiring as much as $7.9 trillion in capital investments. Goldman Sachs projects total hyperscaler capital expenditure from 2025 through 2027 will reach $1.15 trillion—more than double the $477 billion spent from 2022 to 2024—and anticipates roughly $7.6 trillion of cumulative AI-related capital expenditure between 2026 and 2031. BloombergNEF reports that the 14 largest publicly owned data center operators globally are projected to spend close to $750 billion in capital expenditures in 2026 alone, up from approximately $450 billion in 2025. The data center industry has become a behemoth in a shockingly short amount of time.
Continue Reading The Data Center Boom and D&O Insurance: Navigating Uncharted Liability Exposure in a High-Growth Industry
When Your D&O Insurer Wants Its Money Back — With Interest
Most policyholders purchasing directors and officers (D&O) liability insurance never contemplate the possibility that their insurer will one day demand repayment of advanced defense costs, let alone seek interest on top of repayment. Although many D&O policies preserve an insurer’s contractual right to seek reimbursement of defense costs that are ultimately determined not to be covered, insurers rarely exercise that right. Even rarer is a case in which an insurer not only litigates to recoup the advanced defense costs, but then seeks prejudgment interest on top of the amounts repaid. A recent decision by the U.S. District Court for the District of Maryland in Navigators Insurance Co. v. Under Armour, Inc., No. CV RDB-22-2481 (D. Md. July 7, 2026), presents precisely this seldom-litigated scenario. This case serves as a cautionary lesson to policyholders regarding reimbursement provisions and interim funding agreements, which can have significant consequences.
Continue Reading When Your D&O Insurer Wants Its Money Back — With InterestNon-Deal Exposure: Practical Tips for Enhancing Insurance Coverage For Private Equity Funds and Portfolio Companies
When private equity fund managers think about insurance, they usually think of Representations & Warranties Insurance (“RWI”). That makes sense—RWI covers representations baked into the deal itself that are front of mind when buying and selling portfolio companies (“PortCos”). But once a deal closes and a PortCo continues operations under new PE ownership, a whole new set of operational issues unrelated to pre-closing representations can surface, giving rise to potential claims under a host of different lines of insurance, including directors and officers (“D&O”), errors and omissions (“E&O”), cyber, crime/fiduciary, general/limited partner (“GP/LP”), commercial general liability (“CGL”), and property policies, among others. To make matters worse, coverage gaps between policies issued at the fund level and the PortCo level, finger-pointing between insurers, lapsed policies, and inadequate coverage can result in substantial financial losses for the PE Fund and PortCo alike.
Continue Reading Non-Deal Exposure: Practical Tips for Enhancing Insurance Coverage For Private Equity Funds and Portfolio CompaniesDelaware Supreme Court Affirms D&O Coverage in Harman International Bump-Up Exclusion Dispute
On January 27, 2026, the Delaware Supreme Court issued a significant pro-policyholder decision affirming that directors and officers (“D&O”) insurers must cover a $28 million settlement paid by Harman International Industries Inc., to resolve stockholder litigation arising from its multi-billion dollar sale to Samsung Electronics Co., Ltd. The Court affirmed the Superior Court’s ruling that
Obtaining Insurance Recoveries From FAA-Mandated Flight Reductions
Government and Federal Aviation Administration (FAA) safety directives have led to a reduction in flights beginning November 7, 2025, to protect people and property from potential accidents. The FAA’s Emergency Order Establishing Limitations on the Use of Navigable Airspace explains that the restrictions are necessary “to ensure the safety of aircraft” and “[t]o maintain the highest standards of safety” in the National Airspace System. For companies whose operations or revenues are affected, these measures may give rise to recoveries under general liability and property insurance policies.
Continue Reading Obtaining Insurance Recoveries From FAA-Mandated Flight ReductionsXerox Obtains Important Pro-Policyholder Decision in New York’s First Department, Adopting Narrow Construction of “Arising From” Exclusions and Confirming That Insurers Who Show Indifference to Policyholders’ Rights May Be Liable for Bad Faith in New York
In March last year, New York’s Appellate Division – First Department issued Xerox an important pro-policyholder decision in its D&O insurance recovery action against Travelers, arising from Xerox’s failed 2018 merger with Fujifilm. In a thoughtful order, the court issued three key pro-policyholder rulings that: (1) reinforce the rule that the words “arising from” when used in policy exclusions should be narrowly construed under New York law; (2) recognize that an insurer who shows bad faith indifference to its policyholder’s rights may be held liable for a breach of the duty of good faith and extracontractual damages under New York law; and (3) held that the reasonableness of an underlying settlement is an issue of fact that should go to the jury. A copy of the Court’s decision is available here.
Continue Reading Xerox Obtains Important Pro-Policyholder Decision in New York’s First Department, Adopting Narrow Construction of “Arising From” Exclusions and Confirming That Insurers Who Show Indifference to Policyholders’ Rights May Be Liable for Bad Faith in New YorkRecent Decision from Eastern District of New York Confirms D&O Coverage for False Claims Act Defense Costs
A recent decision by a federal court in the Eastern District of New York illustrates how directors and officers (“D&O”) policies can provide valuable insurance coverage for defense costs and potential liabilities arising from False Claims Act (“FCA”) litigation. In Northern Metropolitan Foundation for Healthcare, Inc. v. RSUI Indemnity Company, Case No. 20-CV-2224 (EK)
PFAS Liability and Insurance: Potential Avenues to Mitigate Exposure for PFAS Risks through Insurance
Manufacturers face an ever increasing risk of liability exposure for pollution caused by polyfluoroalkyl substances, commonly known as “PFAS.” In early June this year, it was reported that 3M, as have other large chemical manufacturers, settled pending litigation involving PFAS-contamination in U.S. cities for an estimated $10 billion and aimed to resolve allegations that 3M polluted bodies of water in several U.S. cities.[1] This reported settlement comes after another recent $1.19 billion settlement related to the contamination of water systems.[2] Moreover, environmental regulators—including the Environmental Protection Agency (“EPA”) under the Biden Administration—have made PFAS a priority in recent years.[3]
Continue Reading PFAS Liability and Insurance: Potential Avenues to Mitigate Exposure for PFAS Risks through InsuranceNew York’s Highest Court Sides With Insured: $140M Disgorgement Payment Is Covered Loss
On Nov. 23, 2021, the New York Court of Appeals sided with the policyholder, resolving a decades-long insurance coverage dispute, J.P. Morgan Sec. Inc. v. Vigilant Ins. Co., __ N.E.3d __, 2021 N.Y. Slip Op. 06528, 2021 WL 5492781 (Nov. 23, 2021). It held that a $140 million disgorgement payment to the Securities and Exchange Commission (SEC) was a covered “loss” rather than an uninsurable “penalt[y]” under the error and omissions/professional liability policies at issue.
The 6-1 majority opinion is a landmark decision on the insurability of disgorgement and restitution damages that will likely have ramifications for policyholders seeking to recover similar losses from their insurers in disputes in New York and throughout the country.Continue Reading New York’s Highest Court Sides With Insured: $140M Disgorgement Payment Is Covered Loss