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The Collaborative Clearinghouse for Lawsuits and Other Claims Against ACE Group Insurance Companies

VENUE MANAGEMENT SYSTEMS INC et al v. ACE FIRE UNDERWRITERS

ATTENTION: It is possible that this information may no longer be current and therefore may be inaccurate. The index contains both open and closed cases and is not a complete list of cases in which an ACE Insurance Group company is involved. This information is provided to give interested persons an idea of the issues disputed in the indexed cases. For a full understanding of a case, one should read the rest of the court file, including the response. For the most up-to-date and complete information on a case, visit www.pacer.gov or contact the clerk of the relevant court.

Case Number: 
BC496344 Search Pacer
Opposing Party: 
Venue Managemet Systems Inc.
Court Type: 
State
State Court: 
California.Supeior Court (Los Angeles County)
Date Filed: 
Nov 27 2012

"FIRST CAUSE OF ACTION
(For Declaratory Relief Regarding the Duty to Indemnify
By CABANA CLUB Against All Defendants)

21. CABANA CLUB repeats, re-alleges, and incorporates herein by reference, the allegations set forth in Paragraphs 1 through 20, inclusive, as though fully set forth herein.

22. CABANA CLUB contends that defendants, and each of them, had a duty to defend and indemnify CABANA CLUB as to all claims made, adjusted and paid pursuant to the ACE USA Policies.

23. A present dispute and controversy has arisen and now exists between CABANA CLUB on the one hand, and defendants, and each of them, on the other, with regard to the obligations of Defendants, and each of them, pursuant to ACE USA Policies. CABANA CLUB contends that, pursuant to the ACE USA Policies, Defendants, and each of them had a duty to defend and indemnify CABANA CLUB as to all claims made, adjusted and paid pursuant to the ACE USA Policies. CABANA CLUB is further informed and believes, and thereupon further alleges, that Defendants, and each of them, dispute this contention and take the position that Defendants, and each of them, owed no such obligation under the ACE USA Policies, and further deny any obligation whatsoever to defend and indemnify CABANA CLUB.

24. CABANA CLUB desires a judicial determination of the rights and obligations of the parties under their respective policies. Specifically, CABANA CLUB requests that the Court declare that Defendants, and each of them, has/had a duty to defend and indemnify CABANA CLUB as to all such claims made, adjusted and paid pursuant to the ACE USA Policies.

25. A declaration by this Court is necessary and appropriate in order to resolve the present dispute and controversy between the parties with regard to the obligation of Defendants, and each of them, to defend and indemnify CABANA CLUB as to all such claims made, adjusted and paid pursuant to the ACE USA Policies.

26. CABANA CLUB has no adequate remedy at law.

27. Declaratory relief from this Court will terminate the present dispute and

SECOND CAUSE OF ACTION
(For Breach of Contract By CABANA CLUB Against AH Defendants)

28. CABANA CLUB repeats, re-alleges, and incorporates herein by reference, the allegations set forth in Paragraphs 1 through 27, inclusive, as though fully set forth herein.

29. CABANA CLUB is informed and believes, and thereupon alleges, that as set forth above, CABANA CLUB has duly performed each and every covenant and/or condition of the ACE USA Policies and/or has been excused from so performing as a result of the breaches by Defendants, and each of them, of their respective insurance agreement(s).

30. CABANA CLUB is informed and believes, and thereupon alleges, that pursuant to the terms of the ACE USA Policies, Defendants, and each of them, agreed to defend and indemnify CABANA CLUB as to any and all damages for any claims potentially within the scope of coverage provided by ACE USA Policies. CABANA CLUB is further informed and believes, and thereupon further alleges, that said duty included a duty to defend all such claims and to conduct an adequate investigation of any claims.

31. CABANA CLUB is informed and believes, and thereupon alleges, that Defendants, and each of them, by their own act and/or omissions and/or the acts and/or omissions of others chargeable to them, materially breached the terms the of the ACE USA Policies including but not necessarily limited to, the failure and refusal of Defendants, and each of them, to do one or more of the following:
a. Adequately respond to the written notice of the claim, the demand for a defense and other correspondence;
b. Adequately investigate the underlying claim;
c. Provide an appropriate defense to CABANA CLUB;
d. Reimburse CABANA CLUB for attorneys' fees and other costs associated with the mitigation, investigation, defense and settlement of the claim.

32. CABANA CLUB is further informed and believes, and thereupon further alleges, that Defendants, and each of them, by their own act and/or omissions and/or the acts and/or omissions of others chargeable to them, materially breached the terms the of the ACE USA Policies including but not necessarily limited to, the acts by Defendants, and each of them, as follows:
a. Wrongfully and without proper justification initiating a fraud investigation in connection with the ACE Policies;
b. Wrongfully, incorrectly, and illegally, takking the position that the aforementioned claims that were made, adjusted and paid pursuant to the ACE USA Policies were done so improperly, illegitimately and illegally;
c. Wrongfully, incorrectly, and illegally, demanding reimbursement for all sums paid pursuant to the ACE USA Policies.

33. PLAINTIFFS are informed and believe, and thereupon allege, that Defendants, and each of them, refused, and continue to refuse, to indemnify, CABANA CLUB pursuant toth terms of the ACE USA Policies.

34. CABANA CLUB is informed and believes, and thereupon alleges, that as a direct and proximate result of each of the breaches by Defendants, and each of them, of their contractual duties under the ACE USA Policies, CABANA CLUB has been damaged in an amount to be determined at trial, according to proof, but in an amount within the jurisdiction of this Court.

THIRD CAUSE OF ACTION
(For Breach of the Implied Covenant of Good Faith and Fair Dealing
By CABANA CLUB Against AH Defendants)

35. CABANA CLUB repeats, re-alleges, and incorporates herein by reference, the allegations set forth in Paragraphs 1 through 34, inclusive, as though fully set forth herein.

36. CABANA CLUB is informed and believes, and thereupon alleges, that at all material times, Defendants, and each of them, had the duty to act fairly and in good faith toward PLAINTIFF'S Assignee in carrying out their responsibilities under their respective policy(ies) of insurance.

37. CABANA CLUB is informed and believes, and thereupon alleges, that pursuant to the ACE USA Policies, Defendants, and each of them, had an implicit obligation to act fairly and in good faith to CABANA CLUB, to promptly and reasonably investigate claims, and to make reasonable coverage decisions.

38. CABANA CLUB is informed and believes, and thereupon alleges, that Defendants, and each of them, among other things, agreed to defend and indemnify CABANA CLUB against claims and suits brought against CABANA CLUB even if said claims or suits were groundless, false or fraudulent. CABANA CLUB is further informed and believes, and thereupon further alleges, that Defendants, and each of them, also had a duty to conduct an adequate investigation of all claims made, adjusted and paid pursuant to the ACE USA Policies.

39. CABANA CLUB is informed and believes, and thereupon alleges, that Defendants, and each of them, without proper cause, breached their obligation to act fairly and in good faith toward CABANA CLUB by doing one or more of the following:
a. Failing to conduct a reasonable, prompt and unbiased investigation into all claims made, adjusted and paid pursuant to the ACE USA Policies;
b. Delaying and/or failing to reach a decision as to whether to provide a defense and/or coverage for all claims made, adjusted and paid pursuant to the ACE USA Policies;
c. Failing to provide a defense and/or coverage to CABANA CLUB as to all claims made, adjusted and paid pursuant to the ACE USA Policies without proper cause and without regard to the provisions of the ACE USA Policies, relevant case law, facts alleged in said claims or otherwise available to Defendants, and each of them, through reasonable investigation;
d. Basing coverage decisions on the desire of Defendants, and each of them, to reduce or avoid their obligations to CABANA CLUB;
e. Refusing to defend and indemnify CABANA CLUB as to all claims made, adjusted and paid pursuant to the ACE USA Policies, with the intention of coercing CABANA CLUB to forego the benefits of the ACE USA Policies;
f. Failing to acknowledge communications from, or on behalf of, CABANA CLUB in violation of Sections 2695.5, 2695.6 and 2695.7 of the California Code of Regulations;
g. Instituting and maintaining procedures, policies and/or employment compensation plans which impair or preclude fair claims handling;
h. Wrongfully and without proper justification initiating a fraud investigation in connection with the ACE Policies;
i. Wrongfully, incorrectly, and illegally, takking the position that the aforementioned claims that were made, adjusted and paid pursuant to the ACE USA Policies were done so improperly, illegitimately and illegally;
j . Wrongfully, incorrectly, and illegally, demanding reimbursement for all sums paid pursuant to the ACE USA Policies.
k. Taking the actions referenced in subparagraphs "a" through "k," inclusive, as referenced above, as part of a systematic and deliberate scheme to withhold policy benefits that would otherwise be due.

40. CABANA CLUB is informed and believes, and thereupon alleges, that Defendants, and each of them, have refused, and continues to refuse, to defend and indemnify CABANA CLUB as to all claims made, adjusted and paid pursuant to the ACE USA Policies, in violation of the express terms of the ACE USA Policies.

41. CABANA CLUB is informed and believes, and thereupon alleges, that the officers, directors and/or managing agents and/or employees of Defendants, and each of them, participated in, authorized and/or ratified the wrongful conduct alleged above.

42. CABANA CLUB is informed and believes, and thereupon alleges, that as a direct and proximate result of each of the breaches by Defendants, and each of them, of their respective contractual duties under their respective policy(ies) of insurance, CABANA CLUB has been damaged in an amount to be determined at trial, according to proof, but in an amount within the jurisdiction of this Court.

43. CABANA CLUB is informed and believes, and thereupon alleges, that it is further entitled to recover as damages from Defendants, and each of them, all fees, expenses and costs incurred in bringing this action to enforce its rights under the ACE USA Policies issued by defendants, and each of them, plus interest thereupon, according to proof.

44. CABANA CLUB is informed and believes, and thereupon alleges, that the above described conduct of Defendants, and each of them, has been, and continues to be, unreasonable, capricious and arbitrary, and constitutes a breach of the covenant of good faith and fair dealing contained in their respective policies of insurance. CABANA CLUB is further informed and believes, and thereupon further alleges, that the above described conduct further constitutes malicious, oppressive and despicable conduct and conscious disregard of the rights of CABANA CLUB, and stems from improper and evil motives, including the desire of Defendants, and each of them, to reduce or avoid their obligations to CABANA CLUB so as to justify an award of punitive and exemplary damages. Additionally, CABANA CLUB is informed and believes, and thereupon alleges, that the acts of Defendants, and each of them, as described in the above paragraphs, constitute a systematic, methodical and general scheme to improperly, unfairly and unreasonably deprive insureds, such as CABANA CLUB, of the benefits of insurance coverage to which they are entitled.

FOURTH CAUSE OF ACTION
(Intentional Interference with Prospective Economic
Advantage By VMS Against All Defendants)

45. VMS repeats, re-alleges, and incorporates herein by reference, the allegations set forth in Paragraphs 1 through 44, inclusive, as though fully set forth herein.

46. At all material times hereto, an economic relationship existed between VMS andits client, CABANA CLUB, whereby VMS provided services to CABANA CLUB as a PEO, as alleged herein. The relationship between VMS and CABANA CLUB existed at all material times hereto and represented a probable future economic benefit for VMS.

47. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, knew and/or should have known of the existence of this relationship.

48. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, by and through their agents, including, but not necessarily limited to, Mr. Michael Santangelo, contacted CABANA CLUB and represented, stated, intimated and/or implied that VMS engaged in wrongful conduct toward CABANA CLUB, including that VMS may have misappropriated, misapplied and/or embezzled funds from CABANA CLUB which were to have been applied to the premiums for the ACE USA Policies and/or represented premium refunds from the ACE USA Policies.

49. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, knew and/or should have known that the aforementioned statements were false. Furthermore, Defendants had no good cause for making the aforementioned statements to VMS's client, CABANA CLUB.

50. VMS is informed and believes, and thereupon alleges, that in making the aforementioned false statements, Defendants, and each of them, intentionally engaged in wrongful conduct designed to interfere with or disrupt the relationship between VMS and its client, CABANA CLUB.

51. VMS is informed and believes, and thereupon alleges, that as a result of this interference, the economic relationship between VMS and its client, CABANA CLUB was actually interfered with insofar as Defendants, and each of them, has attributed and/or suggested inappropriate, unethical and/or illegal conduct by VMS as to its clients, which has materially impaired the economic relationship between VMS and its client, CABANA CLUB, and has wrongfully, improperly and without proper justification created the prospect of distrust by CABANA CLUB of VMS.

52. VMS is informed and believes, and thereupon alleges, that the conduct by Defendants, and each of them, was designed to interfere with and disrupt the relationship between VMS and its client, CABANA CLUB, and has, in fact, done so.

53. VMS is informed and believes, and thereupon alleges, that as a direct result of the wrongful conduct by Defendants, and each of them, VMS has been damaged in an amount to be proven at trial.

54. VMS is informed and believes, and thereupon alleges, that Defendants and each of them acted willfully, maliciously, oppressively, and with the intent of harming VMS, as alleged herein, thereby entitling VMS to punitive and exemplary damages as against Defendants, and each of them.

FIFTH CAUSE OF ACTION
(Negligent Interference with Prospective Economic

Advantage By VMS Against All Defendants)

55. VMS repeats, re-alleges, and incorporates herein by reference, the allegations set forth in Paragraphs 1 through 54, inclusive, as though fully set forth herein.

56. At all material times hereto, an economic relationship existed between VMS and its client, CABANA CLUB, whereby VMS provided services to CABANA CLUB as a PEO, as alleged herein. The relationship between VMS and CABANA CLUB existed at all material times hereto and represented a probable future economic benefit for VMS.

57. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, knew and/or should have known of the existence of this relationship.

58. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, by and through their agents, including, but not necessarily limited to, Mr. Michael Santangelo, contacted CABANA CLUB and represented, stated, intimated and/or implied that VMS engaged in wrongful conduct toward CABANA CLUB, including that VMS may have misappropriated, misapplied and/or embezzled funds from CABANA CLUB which were to have been applied to the premiums for the ACE USA Policies and/or represented premium refunds from the ACE USA Policies.

59. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, knew and/or should have known that the aforementioned statements were false. Furthermore, Defendants had no good cause for making the aforementioned statements to VMS's client, CABANA CLUB.

60. VMS is informed and believes, and thereupon alleges, that In making the aforementioned false statements, Defendants, and each of them, intentionally engaged in wrongful conduct designed to interfere with or disrupt the relationship between VMS and its client, CABANA CLUB.

61. VMS is informed and believes, and thereupon alleges, that As a result of this interference, the economic relationship between VMS and its client, CABANA CLUB was actually interfered with insofar as Defendants, and each of them, has attributed and/or suggested inappropriate, unethical and/or illegal conduct by VMS as to its clients, which has materially impaired the economic relationship between VMS and its client, CABANA CLUB, and has wrongfully, improperly and without proper justification created the prospect of distrust by

CABANA CLUB of VMS.

62. VMS is informed and believes, and thereupon alleges, that The conduct by Defendants, and each of them, was designed to interfere with and disrupt the relationship between VMS and its client, CABANA CLUB, and has, in fact, done so.

63. VMS is informed and believes, and thereupon alleges, that As a direct result of the wrongful conduct by Defendants, and each of them, VMS has been damaged in an amount to be proven at trial.

SIXTH CAUSE OF ACTION
(Defamation Per Se By VMS Against All Defendants)

64. VMS repeats, re-alleges, and incorporates herein by reference, the allegations set forth in Paragraphs 1 through 63, inclusive, as though fully set forth herein.

65. At all material times hereto, VMS provided services to its client, CABANA CLUB, as a PEO, as alleged herein.

66. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, knew and/or should have known of the existence of this relationship.

67. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, by and through their agents, including, but not necessarily limited to, Mr. Michael Santangelo, contacted CABANA CLUB and represented, stated, intimated and/or implied that VMS engaged in wrongful conduct toward CABANA CLUB, including that VMS may have misappropriated, misapplied and/or embezzled funds from CABANA CLUB which were to have been applied to the premiums for the ACE USA Policies and/or represented premium refunds from the ACE USA Policies.

68. VMS is informed and believes, and thereupon alleges, that CABANA CLUB reasonably understood the aforementioned statements by Defendants, and each of them, were of and concerning VMS.

69. VMS is informed and believes, and thereupon alleges, that CABANA CLUB reasonably understood the aforementioned statements by Defendants, and each of them, to mean that VMS was not fit to perform its function as a PEO for CABANA CLUB by reason of, including, but not necessarily limited to false assertions, intimations suggestions and/or implications that that VMS may have misappropriated, misapplied and/or embezzled funds from CABANA CLUB which were to have been applied to the premiums for the ACE USA Policies and/or represented premium refunds from the ACE USA Policies:

70. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, have attributed and/or suggested inappropriate, unethical and/or illegal conduct by VMS as to its client, CABANA CLUB.

71. VMS is informed and believes, and thereupon alleges, that Defendants, and each of them, knew and/or should have known that the aforementioned statements were false. Furthermore, VMS is further informed and believes, and thereupon further alleges, that, Defendants, and each of them, failed to use and exercise reasonable care to determine the truth or falsity of the aforementioned statements.

72. In making the aforementioned false statements, Defendants, and each of them, intentionally engaged in wrongful conduct with knowing falsity of the aforementioned statements and/or a reckless regard for the truth or falsity thereof.

73. As a direct result of the wrongful conduct by Defendants, and each of them, VMS has been damaged in an amount to be proven at trial.

74. VMS is informed and believes, and thereupon alleges, that Defendants and each of them acted willfully, maliciously, oppressively, and with the intent of harming VMS, as alleged herein, thereby entitling VMS to punitive and exemplary damages as against Defendants, and each of them.

WHEREFORE, PLAINTIFFS pray for relief against Defendants, and each of them, as follows:"

The provided text is an excerpt from a document filed in this case. For a full understanding of the case, one should read the complete court file, including the response.

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