A high-stakes insurance dispute has landed in federal court, with StarStone Specialty Insurance Company asking a California judge to rule it doesn’t have to cover lawsuits tied to View’s SPAC deal.
On August 1, 2025, StarStone filed a complaint in the US District Court for the Northern District of California, San Jose Division. The insurer is seeking a declaration that it owes no defense or indemnification to View Operating Corporation - formerly View, Inc. - and former CFO Vidul Prakash for a series of lawsuits and subpoenas that all stem from View’s public debut through a de-SPAC merger with CF Finance Acquisition Corp. II on March 8, 2021.
StarStone says it issued a management and professional liability follow form excess policy to Private View, providing $5 million in coverage above $20 million in underlying limits. The policy, according to StarStone, follows the terms of a primary policy from Ironshore Specialty Insurance Company. Both policies, as described in the complaint, include a Securities Exclusion. StarStone claims this exclusion means there’s no coverage for any claim “alleging, based upon, arising out of, or attributable to any public offering of equity securities of the Company or the purchase or sale of, or offer or solicitation of an offer to purchase or sell, such equity securities subsequent to such public offering.”
The lawsuits at issue include an SEC enforcement action, filed July 3, 2023, naming Prakash as the sole defendant. The SEC alleges Prakash deprived investors of material information about Private View’s financial condition before, during, and after its public offering. The complaint details allegations that Prakash failed to accrue for and disclose over $20 million in liabilities, resulting in misleading SEC filings, including a December 23, 2020 Form S-4 Registration and Proxy Statement, a January 26, 2021 Amended Form S-4, a February 16, 2021 Prospectus/Proxy Statement, a March 12, 2021 8-K, and a May 17, 2021 10-Q.
The second lawsuit, known as the Mehedi action, is a class action in the same court. It claims that Public View, its directors and officers, and others made materially false or misleading statements and failed to disclose material adverse facts about View’s business, operations, and prospects in SEC filings connected to the de-SPAC merger. The court entered an order preliminarily approving a settlement in the Mehedi case on July 18, 2025.
StarStone’s complaint also addresses subpoenas issued to Thomas Leppert and Harold Hughes in connection with the SEC lawsuit. StarStone argues these subpoenas do not qualify as a “Claim” or allege a “Wrongful Act” under the policy, and thus do not trigger coverage.
The insurer details a series of coverage position letters sent to View and Prakash, dating from January 19, 2023, through June 26, 2025, all denying coverage based on the Securities Exclusion and other policy terms. StarStone says it has not received written responses to some of these letters, but View and Prakash have challenged the denial of coverage, including demands for $2,148,982.53 in fees for the subpoenas and $100,503.96 in fees for the Mehedi lawsuit, according to a July 21, 2025 email.
At this stage, the case is at the complaint phase. StarStone is asking the court for a declaratory judgment that it has no obligation to provide coverage for the lawsuits and subpoenas. The outcome will depend on how the court interprets the Securities Exclusion and other policy language, as well as the facts alleged in the underlying lawsuits.
For insurance professionals, this case highlights the importance of policy wording in D&O coverage, especially when it comes to SPAC transactions and public offerings. With millions of dollars at stake, the industry will be watching closely as the case moves forward.
