Buzz Archive:
Less is More - Why PE Firms Should Limit Indemnification Rights to Their Director-Representatives

by Laurie B. Smilan and Howard Sobel of Latham & Watkins LLP, 3/10/2010

With the increase in private securities, derivative and bankruptcy-related litigation against portfolio companies, private equity firms need to maximize the protections for the private equity firm, the funds they organize and the individuals who agree to serve as their representatives on portfolio company boards. Ironically, however, a private equity firm's effort to provide "more" protection to its director-representatives may be far more expensive than the firm expects or intends.

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