Darren Teshima, Co-Leader of Orrick's Complex Litigation and Dispute Resolution practice, litigates high stakes disputes on behalf of clients in the financial and technology sectors and advises corporate policyholders on cyber and D&O insurance issues.

Darren represents financial institutions and tech companies in a variety of commercial disputes, with a focus on litigation arising out of residential mortgage-backed securities (RMBS), directors & officers (D&O) coverage, and litigation for and advice to policyholders related to some of the largest data breaches in history. Darren also helps clients avoid potential litigation with their insurers by counseling them on innovative insurance strategies, including advising tech companies on issues facing their unique business models. Darren has been
recognized as a Law360 Rising Star.

In 2012, Darren spent three months on loan to the San Francisco District Attorney’s Office as an Assistant District Attorney, where he first-chaired four criminal jury trials to verdict.

Darren is passionate about pro bono work.  He has handled administrative trials and hearings on behalf of asylum seekers and low-income tenants, and has provided litigation advice to nonprofit organizations. Legal Services for Children twice has presented Darren with its Pro Bono Advocate Award.

Darren is active in Orrick’s recruiting and diversity initiatives, and is the recipient of Orrick’s Diversity Award. He is the Vice Chair of the board of directors of Asian Americans Advancing Justice | Asian Law Caucus, and serves on the boards of the Center for Gender & Refugee Studies and Legal Services for Children. In 2015, he was named one of the "Best Lawyers Under 40" by the National Asian Pacific American Bar Association (NAPABA).

An editor of Orrick's insurance recovery blog, the Policyholder Insider, and of Orrick's Financial Industry Week in Review, Darren frequently speaks and writes on novel cyber and D&O insurance issues.

Before joining Orrick, Darren was an associate at Heller Ehrman LLP, and clerked for U.S. District Court Judge David O. Carter in the Central District of California.

Darren's current clients include:

  • Premera Blue Cross in a lawsuit related to defense coverage under a commercial general liability (CGL) policy following a data breach affecting 11 million customers, an issue of first impression under Washington law.
  • Credit Suisse in a dozen lawsuits brought by monoline insurers and trustees alleging claims related to residential mortgage-backed securities (RMBS) transactions following the global financial crisis.
  • Pacific Pulmonary Services in a bad faith action against its D&O insurer in the Northern District of California, where the district court recently granted summary judgment establishing the insurer's duty to advance defense costs for a False Claims Act (FCA) investigation.
  • A mobile gaming company on tech E&O insurance coverage related to a trade secrets misappropriation claim.

Other notable recent representations include:

  • Sony Pictures, advising on insurance claims related to the November 2014 cyber-attack on its network and IT infrastructure.
  • Epson America, Inc., in a coverage action in the Central District of California against its D&O insurer seeking defense coverage for an underlying consumer class action and employment case.
  • A technology rideshare company advising about D&O, E&O and media liability coverage issues affecting its unique business model.


Posts by: Darren S. Teshima

Insurance Coverage Dispute Over Fraudulent E-mail Scam Heard by Ninth Circuit

Data Privacy Word Cloud Insurance Coverage Dispute Over Fraudulent E-mail Scam Heard by Ninth Circuit

Insurance coverage for “Business Email Compromise” (BEC) scams is a hot issue being litigated by companies and their insurance providers in jurisdictions across the country. The Ninth Circuit is poised to issue what may be an influential decision after hearing oral argument this week in a coverage action initiated by an accounting firm that lost its client’s money to a BEC scam.  Learn more from Orrick attorneys Darren Teshima and Harry Moren at our sister blog, Policyholder Insider.

Important Ruling for Policyholders Victimized by Business Email Compromise (BEC) Scams

“Business Email Compromise” (BEC) scams are becoming an increasingly prevalent concern for businesses—the FBI reports that incidents have increased 1,300% since January 2015. A federal district court in Georgia recently ruled that a BEC scam in which a fraudster deceived an employee into wiring $1.72 million to an account in China was covered a under a commercial crime policy. The court rejected the insurer’s argument that the wire transfer was not directly caused by the BEC scam, and determined that the policy language was ambiguous about whether intervening events affected coverage, thus resolving the ambiguity in favor of the policyholder. At our sister blog Policyholder Insider, Darren Teshima and Harry Moren discuss why this ruling is good news for policyholders who have fallen victim to a BEC scam.

Insurer’s Broad Interpretation of Data Breach Exclusion Rejected by Court

Non-cyber insurance policies often contain exclusions to limit or preclude coverage for data breaches. A Maryland federal district court recently addressed the scope of such exclusions.  The court analyzed the meaning of “data” in data breach policy exclusions in a multimedia liability policy and concluded that the undefined term “data” did not include satellite television programming. Having found that the exclusions did not apply, the court held that the underlying lawsuit involving allegations of unauthorized access to satellite television programming triggered the insurer’s duty to defend the policyholder. At Orrick’s Policyholder Insider blog, Darren Teshima and Harry Moren discuss this decision’s rejection of an insurer’s attempt to avoid coverage by broadening the scope of these data breach exclusions.

Federal District Court Finds No Cyber Insurance Coverage For Costly Credit Card Fraud Assessments

In one of the first court decisions to analyze in depth the coverage provided by a cyber policy, a federal judge has found that PF Chang’s policy came up short.  Following a 2014 data breach in which hackers accessed and posted online 60,000 credit card numbers belonging to PF Chang’s customers, the company sought coverage under its “CyberSecurity by Chubb” insurance policy.  Although PF Chang’s insurer, Federal Insurance Company (“Federal”), agreed to reimburse nearly $1.7 million for customer claims and other breach-related expenses, it refused to reimburse an additional $2 million in fees and assessments levied against P.F. Chang’s by the credit card brands.  Last week a federal district judge in Arizona, applying Arizona law, denied PF Chang’s claim for reimbursement and granted summary judgment for Federal.  While it held that these fees and assessments fell within the scope of coverage, the court held that the “contractual liability” exclusion barred coverage.

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Eighth Circuit Affirms Coverage for Fraudulent Wire Transfer Despite Employee Negligence

financial services

A recent Eighth Circuit ruling on cybercrime coverage held that the issuer of a financial institution bond must cover a bank’s losses after a hacker’s malware attack resulted in unauthorized fund transfers. The court rejected the insurer’s claim that employee negligence—a factor in the loss—excluded coverage. This is a good decision for financial institutions and crime insurance policyholders, and Orrick attorneys Russell Cohen, Darren Teshima, and Harry Moren discuss the decision and its potential impact on coverage for the trending Business E-mail Compromise (BEC) scam.

Fourth Circuit Finds Potential Coverage For Data Leak As Publication Under CGL Policy

data leak

This week, a Fourth Circuit panel in an unpublished decision validated arguments long made by policyholders:  that commercial general liability policies may provide coverage for certain data breach liabilities.  In this case, Travelers Indemnity Company v. Portal Healthcare Solutions, the appellate court affirmed the district court’s 2014 ruling that an insurer had the duty to defend a company that provides electronic medical record management services in a class action alleging that the company made patients’ confidential records publicly accessible by posting the records to an unsecured public website.

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Closing the Courthouse Door to Insurance Disputes: Mandatory Arbitration Clauses in Insurance Policies Gain Traction

Your insurer wrongfully denies coverage—so you file a complaint in court, right? Not so fast! Many new insurance policies now include mandatory arbitration provisions. While at one time arbitration clauses were common only in policies issued by foreign insurers, they are now finding their way into policies issued by domestic insurers and in all types of coverages, including commercial liability insurance policies, D&O, E&O, employment liability, and cyber insurance. While the terms of these clauses vary, to the extent they are enforceable or cannot be negotiated out of the coverage, arbitration provisions close the courthouse doors to insurance disputes and force policyholders and their insurers to resolve disputed issues in private and free from judicial scrutiny. READ MORE

General Liability Coverage for a Data Breach? Just Might Be…NY Appellate Court to Decide

As previously discussed, the question of whether Commercial General Liability (“CGL”) coverage applies to cyber-attacks or data breaches is a hot point of contention between policyholders and insurers. One of our cases to watch in 2015Zurich American Insurance Company v. Sony Corporation of America—may resolve this question in New York shortly.

On February 25, 2015, a hearing was held in a closely-watched New York appeal involving coverage under CGL policies for privacy claims filed in the wake of a data breach.Zurich American Insurance Company v. Sony Corporation of America is pending in the New York Supreme Court Appellate Division. The Sony parties are represented by Richard DeNatale and Steve Foresta of Orrick’s Insurance group. They are seeking coverage under a clause that appears in all standard CGL policies and covers claims for “publication, in any manner, of material that violates a person’s right of privacy.” The lower court ruled that there was no duty to defend because the alleged publication of information was perpetrated by the hackers rather than by the policyholder. In their appeal, the Sony parties argue that this ruling is contrary to the plain language of the insurance policies. The hearing on February 25 lasted about 30 minutes, with active questioning from the panel of five justices. A decision from the Appellate Division is pending.

The Road Ahead: 2015 Insurance Case Watch

Happy New Year! For a sneak peek at the developments the year may bring to the legal landscape for insurance policyholders, here are five cases worth watching in 2015:

  1. Fluor Corporation v. Superior Court (Hartford Accident and Indemnity Company), No. S205889 (Cal. filed Oct. 10, 2012)

The California Supreme Court likely will issue its long-awaited decision in Fluor and, in doing so, may overturn its controversial 2003 decision concerning the assignment of insurance policies to successor corporations in Henkel Corporation v. Hartford Accident and Indemnity Company, 29 Cal. 4th 934 (2003). If the Court overturns Henkel,California would join the majority of states that permit a successor corporation to recover under the predecessor’s liability insurance policies for pre-assignment liabilities, regardless of a “no-assignment” provision in the policies. The Fluor case has been fully briefed for more than a year, and many California attorneys expected the Court to issue its decision in 2014. In the interim, California Governor Jerry Brown has recently appointed two new justices to the Court, which some commentators believe may push the court in a more liberal direction and could affect the Court’s decision.   READ MORE