lloyd's v. nickelback complaint.pdf

7/21/2019 Lloyd's v. Nickelback complaint.pdf

http://slidepdf.com/reader/full/lloyds-v-nickelback-complaintpdf 1/26

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ORIGINAL

FILED

Superior Court

of

California

County of

Los Angeles

OtC

102015

r, Executive

Officer/Cleri:

__,

Deputy

P.K.SCHRIEFFERLLP

Paul

K.

Schrieffer,

Esq.

(CSB 151358)

Wayne

H. Hammack, Esq. (CSB 202709)

100 N.

Barranca Avenue, Suite

1100

West Covina,

California

91791 w^ntd

Telephone: (626) 373-2444

fXWJ* *Facsimile:

(626)974-8403

^jl^jOjP

SherriR.Cj

B y_

'Judl Lara

Attorneys for

Plaintiffs

CERTAIN UNDERWRITERS AT

LLOYD'S OF

LONDON

rULlCY

NO.

Bl1672025a

£>< }?J~*

C

2L_

SUPERIOR COURT OFTHE STATE OFCALIFORNIA

COUNTY OF

LOS ANGELES,

CENTRAL DISTRICT

BC 6 0 I 7 1 §

CERTAIN UNDERWRITERS AT

LLOYD'S OF LONDONSUBSCRIBING

TO CONTINGENCYNON

APPEARANCEANDCANCELLATION

POLICY

NO. Bl

1672025a,

Plaintiffs,

vs

NICKELBACK; NICKELBACK

PRODUCTIONS, INC;CHAD

KROEGER; and DOES 1-75,

inclusive,

Defendants.

Case

No.:

ASSIGNEDFORALLPURPOSESTO: THE

HONORABLE

DEPT.:

COMPLAINT

FOR:

1. DECLARATORY RELIEF -

RESCISSION

2. DECLARATORY RELIEF-NO

DUTY

TO

INDEMNIFY

Plaintiffs CERTAIN UNDERWRITERS AT LLOYD'S OF LONDON SUBSCRIBING

TO CONTINGENCY NON-APPEARANCE

AND

CANCELLATION POLICY

NO.

Bl

1672025a ( Underwriters ), on

information

and belief

and

in

support of thgir^mplaint,

allege as follows:

INTRODUCTION

I. Ihis is an insurance dispute between sophisticated parties^o a*contjftg§n,Sy non<>

appearance and cancellation

policy.

Plaintiffs Certain Underwriters at Lloyd s?

of londorl

•j 5 £

Subscribing to Contingency

Non-Appearance and

Cancellation Policy No. Bl

1672025a

o o

CO •>.

1

COMPLAINT FORDECLARATORYRELIEF

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( Underwriters )

seek

rescission

of

the policy

or

alternatively

a

judicial determination that there

is

no

coverage

for any

claims

made under Contingency

Non-Appearance

and

Cancellation

Policy No.

Bl

1672025a (the Policy ) due to material misrepresentations and non-disclosures

regarding

Chad

Kroeger's

pre-existing

vocal cord

condition.

Underwriters issued the Policy

to

Nickelback

as

the Assured for coverage in connection

with

Nickelback's

series

ofconcerts known as

the

No Fixed

Address

Tour which was

to

consist

of performances

in North America,

Australia,

Asia,

and

Europe

between

February

and

late-November 2015. Nickelback is a Canadian rock band

from

Hanna, Alberta. The Insured

Persons under

the

Policy

are the members

ofthe

band

Nickelback,

specifically: Chad Kroeger

(lead vocalist and guitarist),

Ryan

Peake (guitarist and back-up vocalist), Mike Kroeger

(bassist)

and Daniel

Adair (drummer

and

percussionist), hereafter

collectively Nickelback.

2.

Between late-June and 2015 early July 2015, Underwriters were informed that

the lead singer

of

Nickelback,

Chad Kroeger, was

diagnosed with acondition

for

which

surgery

was needed and which

would

prevent Nickelback from performing any of the

remaining

scheduled

tour

dates, which included the entire 3rd

Leg

of the

tour (35

performances in North

America) and

the

4th Leg

(30

European performances).

As a

result,

those

dates

were

cancelled.

3. The Assured, Nickelback,

made

a claim for coverage under

the policy

and

Underwriters

have

sought

to

obtain

documents and

other

information necessary

to

determine

Nickelback's

entitlement

to coverage under the policy. The parties have

an

actual and

present

controversy regarding

what coverage,

if

any,

is afforded

under

the policy

and/or whether the

policy should be rescinded for non-disclosures and/or misrepresentations as more fully set forth

below. Nickelback has

failed

and refused to provide Underwriters with necessary information,

including but not

limited to, information

and

documents regarding

Chad

Kroeger's

medical

history, which Underwriters

are informed and

believe

are directly

relevant

to and necessary for

the determinationofwhetherNickelback's claim is covered.

// /

// /

// /

COMPLAINT FOR DECLARATORY RELIEF



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THE

PARTIES

4. Plaintiffs are Certain Underwriters at Lloyd s of London Subscribing to

Contingency Non-Appearance and Cancellation Policy

No.

Bl

1672025a

( Underwriters ).

Underwriters

are

authorized

to and do issue insurance to

California

residents

through licensed

surplus line brokers in

accordance with the laws

of

the

State ofCalifornia.

5.

Underwriters are informed and believe and thereon allege that defendant

Nickelback

is

a legal entity ofunknown

form,

existing in

the

State ofCalifornia, and identified

in the insurance Policy at issue

in

this proceeding as Nickelback, c/o GSO Business

Management, LLC,

15260

Ventura Blvd., Suite 2100, Sherman

Oaks,

CA

91403.

6. Underwriters are informed and believe and thereon allege that defendant

Nickelback Productions, Inc. isa corporation

duly organized

under the laws of

Canada.

7. The true

names

and

capacities,

whether

individual, corporate, associate, or

otherwise,

of

defendants

DOE 1 through DOE 75,

inclusive,

are unknown toUnderwriters

who

therefore

sue such

defendants by

such fictitious names, and

Underwriters

will amend

their

complaint to

show

the true

names

and capacities when the

same have

been

ascertained.

Underwriters are informed and believe

and

thereon allege

that DOE

1 through

DOE 75,

inclusive, are

responsible

in some manner for the events and happenings referred to herein.

8. Underwriters

are

informed

and

believe

and

thereon allege that

the

complaint

is

filed in the judicial district

which

is the principal place where Nickelback, c/o

GSO

Business

Management, LLC does business.

FACTUAL

BACKGROUND AND

GENERAL ALLEGATIONS

A. The Policy

9.

In or about late-November/early-December 2014, Nickelback, by

and

through its

agent

and insurance

broker,

Doodson

Broking

Group, began seeking

insurance coverage from

Underwriters forNickelback's NoFixed Address Tour,

which

was scheduled to commence in

North America

onorabout

February

14,

2015.

10. Thereafter,

and in

exchange

for

valuable

consideration,

Underwriters

issued

Contingency Non-Appearance and Cancellation Policy

No.

Bl1672025a

(the

Policy ) to

3




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Assured Nickelback c/o GSO Business Management,

LLC,

and

Insured

Persons: Chad

Kroeger,

Ryan

Peake,Mike Kroeger and Daniel Adair, effective

January

29,2015 to November 25,2015,

with a$26,722,200 limitofindemnity.

11.

Over

the

ensuing months, the Policy was amended seven times via Contract

Endorsement. Endorsement

No.

7, effective June

15,

2015, reflected arevised total limit of

indemnity

of

22,780,953.75. The

revised limit of indemnity for Leg

3

of the

Tour (North

America) was 8,923,578.75. The revised limit of indemnity for Leg

4

of the Tour

(Europe)

was

4,182,375. Thus

as

of

the

date of

the cancellations, the total limit of indemnity for

the

remaining dates

was

$13,105,953.75.

12. The

Policy

provides coverage for

Insured Performance^) or Event(s) with

respect

to Nickelback

for the following

dates:

LCg l

~2015iOrth

American Performances between February 14 and April 7,

\*11 « 6U2alian Perforniances between May

15

and June

3,2015;

2015

Amencan Performances

between

June 19

and

September 4,

LC§

*~20°ifUr°Pean Performances between September 30 and November

24,

13. Underwriters are informed and believe and thereon allege that the first

two

Legs

of the

Tour were completed.

It was

just

before the commencement of Leg

3that Underwriters

were

informed

of

Chad

Kroeger s

illness,

which has been

widely reported on

in

the

press

and

social

media. Thereafter,

Underwriters were informed

that

Kroeger would need surgery for

a

vocal cord cyst and that the remaining dates (Legs 3and 4) would be cancelled.

14.

The

Policy

sets forth the Insured s

Duty

to disclose

material information

as

follows:

Material

information

is

information that would influence

an

Insurer

in

deciding whether arisk is acceptable and, if

so

the

premium, terms

S?,SSt£°™r°

£a?pHed,FailUre-t?

disdose such ^°rmation could

result in the policy being rendered

void

and as aresult claims may not be

AH material information must be disclosed

to

insurers to enable

terms to be negotiated

and

cover arranged. This is

not

limited to

answering

specific questions that may

be

asked. Any

changes

which

KoS *** ght** *qU°tati°nhasbeen«tan«uistak>

COMPLAINT FOR DECLARATORY

RELIEF



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The duty

of

disclosure is re-imposed

when

there are changes

or

variations in

cover and when the policy

is renewed or

extended

In addition, changes which substantially increase the

risk,

or relate to

compliance

with

awarranty

or condition in the policy must be

notified

at

on c e

Please

contact

us

if

you

are

in any doubt as to whether

or

not information

might be material

orif

you any concerns that ArthurDoodson (Brokers)

Limited might notbe aware ofallmaterial information.

The

Policy also states as a condition precedent that:

It is acondition precedent to

the

liability of Insurers that all Insured persons

have

been fit and healthy

for a

period

ofthirty (30)

days prior to

Inception.

15.

The

Policy provides indemnity to Nickelback for its Ascertained

Net Loss

and

Additional

Costs

as set

out in Clauses

1.1,1.2 and

3.1

of

the Policy.

16. The

Policy provides inpertinent

part

as follows:

1. INSURING CLAUSE

1.1

Subject

always tothe terms,

conditions, limitations

and exclusions

contained

herein

orendorsed

hereon this

Insurance is to

indemnify

the

Assured [Nickelback]

for their

Ascertained

Net

Loss

should any

Insured

Performance(s)

or Event(s)

specified in the

Schedule

be

necessarily

Cancelled,

Abandoned,

Postponed,

Interrupted orRelocated.

Provided that:

(1.1.1)

(1.1.2)

thenecessary Cancellation, Abandonment,

Postponement, Interruption or Relocation is the

sole

and direct result

ofone ormore of

the

perils

described in 2.1 to 2.6 below and

such peril is stated in the Schedule to be Insured

and

(1.1.3) such peril is beyond the control of:

(i) theAssured

[Nickelback]

and

(ii) each and every InsuredPersonand

(iii) in respect ofperil2.6belowtheAssured andthe

Insured Person(s).



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17 .

18 .

exclusions:

(1.1.4)

the

circumstances giving rise

to the loss

first

occurs

duringthe Period

of

Insurance statedin the

Schedule.

Additional Costs:

1.2

This insurance also

indemnifies

the Assured for

proven additional

costs

or

charges reasonably

and necessarily paid

by

the Assured to avoid or

diminish a loss herein insured.

The Policy's Perils includeat clause2:

Accident

Illness:

2.2 ACCIDENT

to

or ILLNESS ofany Insured

Person

which, in the opinion

of

an

independent

medical

practitioner

approved

by

the Underwriters,

entirely prevents any Insured

Person

from

appearing or continuing to

appear

in any or

all

of

the Insured

Performance^)

or

Event(s).

The

Policy also includes, in relevant

part,

the following

terms,

conditions and

4.

CONDITIONS PRECEDENT

Itisa

condition

precedent to

the

liability ofthe

Underwriters that the Assured

has:

Truth o f Statements:

4.1 truthfully declared all material facts

likely

to influence a

reasonable

Underwriter in determining:

(4.1.1) whether

or

not to

accept

the risk

orany subsequent

amendment,

(4.1.2) the premium,

(4.1.3) the

conditions,

exclusions and

limitations,

having

diligently

made

allnecessary

inquiries

toestablish those facts.

Pre-existing

Medical Conditions:

(4.2.1) established to their best knowledge and belief

after

making

diligent inquiry that

no

insured Person

has

any physical, mental

or

medical

condition

oris undergoing any treatment, medical or

otherwise, other than those advised to the Underwriters and

agreedby them inwriting,and that each Insured Personis fit to

fulfil the commitments insured herein.

COMPLAINT

FOR

DECLARATORY

RELIEF



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(4.2.2)

accepted that

any

such pre-existing

condition

in

(4.2.1) agreed by

the Underwriters

will

only

be

covered hereunder if the Insured

Person continues to follow any prescribed regime medical or

otherwise essential to the Insured Person's well-being during

the

period

of

this Insurance.

Other Pre-existing Conditions:

(4.3.1) no

knowledge at

inception, of

any undisclosed matter,

fact

or

circumstance,

actual

or threatened, that increases orcould

increase

the possibilityof a loss under this Insurance.

(4.3.2)

confirmed

that no

Insured Person

has knowledge at

inception,

of

any

undisclosed matter, fact orcircumstance, actual orthreatened,

that

increases orcould increase the possibility ofa loss

under

this

Insurance.

* * *

Materiality of Information:

(4.5)

declared that all information contained inthe written Proposal

Form

or

supplied

to support

such proposal

orother

application

for

this

Insurance

is in all respects true

and

complete

and

unchanged

at

the inception

ofthis

Insurance. Further the Assured agrees that

all such informationis material, such items form the basis of this

Insurance andare incorporated herein.

Obligation to Rearrange:

5.

(4.6)

an obligation to rearrange Cancelled or Abandoned Insured

Performance(s) or Event(s) to

another

timeinorderto avoid or

diminish a loss herein Insured.

* * *

WARRANTIES

It is

warranted that the Assured

shall:

* * *

Contractual requirements and authorizations:

(5.3) ensure that all necessary contractual arrangements

have been

madeandconfirmed inwriting with the

Assured

andthatall

necessary authorizations (which for the avoidance

of

doubt shall

include,

but

not belimited

to,

the obtaining of licenses, permits,



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visas, copyright and patents) are obtained

in a

timely manner and

valid

for

the

period of

the

Insured Performance^) or Event(s).

GENERAL CONDITIONS

False or Fraudulent Acts:

(6.1) Any fraud,

misstatement or concealment

in the

information

provided or in the

making

ofaclaim or

otherwise

howsoever,

shall render

all

claims

hereunder

forfeit.

Due DiligenceClause:

(6.2)

The

Assured

shall

at all times do and concur in doing all things

necessary

to avoid or

diminish

a

loss under this

Insurance.

* * *

Compliance with Terms:

(6.4)

The

Assured shall

observe

and fulfill

the

terms and

conditions

contained herein or endorsed hereon.

* * *

Maintenance

of

Records:

(6.9) The Assured shall

maintain

adequate

records

in

connection

with

the subjectmatter issuedhereunder.

* * *

EXCLUSIONS

This

Insurance does

not cover any loss

directly or indirectly arising out

of,

contributed to by, or resulting

from:

Personal Incapacity:

* * *

(7.3.3)

insufficient

voice quality, unless directly due

to illness

or disease

contracted

or

bodily injury occurring during

the

Period

of

Insurance,

* * *

(7.3.6) their

unreasonable

or

capricious

behavior,

* * *




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Duty ofCare:

(7.4) the

Assured's or

any

Insured Person's lack of care, diligence

or

prudent behavior, the result ofwhich would increase the risk,

and/or likelihood

of a loss, hereunder.

(7.5)

the

illegal possession

or

illicit taking ofdrugs and their effects.

* * *

Contractual Requirements and Authorizations:

(7.13.3) ensure that all necessary contractual arrangements were

made and

confirmed

in

writing

withtheAssured andthat

allnecessary authorizations,

(which

for the avoidance of

doubt shall include, but not

be limited to,

the obtaining of

licenses,

permits,

visas,

copyright and patents) be obtained

ina

timely manner

and

valid

for

the

period

of

the Insured

Performance(s) orEvent(s).

Fraud:

(7.14)

any fraud, misrepresentation

orconcealment by the Assured or

any Insured Person.

* * *

8. CLAIMS

PROCEDURE

It isa condition

precedent

to

the

liability of

the

Underwriters

that

in the event of

a

happening

or

circumstance

which

could give rise

toa

claim

under this

Insurance, the Assured shall:

(8.1.1)

as

amatter ofurgency

give notice by the

most expeditious

means

ofthe happening of

any

circumstance, to

the

name(s) designated

in theattached Schedule;

(8.1.2) confirm the facts inwriting assoon aspossible, with asmuch

informationas available;

(8.1.3)

make no

admission

of liability without the prior written

consent

of

the Underwriters;

(8.1.4)

take all steps

tominimize oravoid

any loss

hereunder;

(8.1.5) provide

the

Underwriters ortheir appointed representatives

with:

(i) all

necessary

assistance ina

timely manner,

(ii) all information required,




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(iii) all documentation and records necessary to

establish and

assess indemnity hereunder and copies ofextracts as may

be required;

(8.1.6) prove the

loss

to

the

satisfaction

of

the

Underwriters;

(8.1.7) forward immediately to the Underwriters or their representatives

any letter, writ or other document received in connection with any

claim made under this insurance.

8.2

asoften asmay bereasonably required submit

to

examination

under

oath

on all matters connected with a claim, by any person

named

by

the Underwriters at

such

reasonable

time

and

place

as

may

bedesignated

by

the Underwriters or

their

representatives.

8.3

as

soon

as

ispracticable render a signed

and

sworn

proof

ofloss to

theUnderwriters or theirrepresentative to substantiate the

occurrence,

nature, cause

and

amount of

loss

claimed under

this

Insurance.

B. The Insurance Claim

19. After

Chad

Kroeger's reported illness and

Nickelback's

ensuing decision to

cancel the remaining performances for

the

3rd and

4th

legs of the tour, Nickelback made a claim

for

benefits

under the Policy.

As

has

been widely reported

in

the media and by

Nickelback

on

its social media accounts and in the press, Mr. Kroeger underwent surgery to remove a cyst

fromhis vocal cord in July

2015.

20.

Underwriters

are informed and

believe

and thereon

allege

that Mr. Kroeger had a

pre-existing condition

on his vocal

cord ( the condition ), pre-dating

inception

of

the

policy,

which

was

never

disclosed

to

Underwriters

prior to the inception of the Policy. The condition

constitutes material information as defined in

the

Policy which should

have

been disclosed and

which was

material to Underwriters' decision whether to issue

the

Policy, set premium

for

the

Policy,

and/or setting the terms,

conditions and

exclusions

of

the Policy.

21.

Underwriters are

informed and

believe, and thereon allege, that their ability to

investigate

and

evaluate

the

claim remains impaired because all requested information

has not,

to date, been providedbyNickelback.

/ //

/ //

10

COMPLAINT FOR

DECLARATORY

RELIEF



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22.

While Underwriters have continued

to

conduct

their

investigation,

they

have

continued

to

reserve

all of

their rights under

the Policy's terms and conditions

and California

law, specifically including their right to

rescind

the

Policy.

FIRST

CAUSE

OF

ACTION

(Declaratory

Relief-

Rescission

AgainstAll Defendants)

23.

Underwriters incorporate paragraphs 1 through 22 as if

set

forth

in full in

their

First

Cause

of

Action

for Declaratory Relief -Rescission.

24.

Underwriters

allege that the

Policy

benefit is

not

due and/or owing to defendants

and

that the Policy is properly subject to rescission.

Underwriters

allege that

the

Policy is void

ab

initio

based

on

material

non-disclosures and/or

misrepresentations

and/or concealments by,

and/or on

behalf

of

defendants during the underwriting

of

the Policy.

25.

Underwriters are informed

and

believe

and thereon

allege

that

defendants

failed

to communicate to Underwriters and ought to have communicated to Underwriters that

which

defendants

knew

about

Mr.

Kroeger's medical history, including but not limited

to

the pre

existing condition

which was material to

Underwriters'

decision whether to issue

the

Policy,

set

premium

for

the Policy, and/or

set

the

terms,

conditions and exclusions of the Policy.

Underwriters

are informed

and

believe that Mr. Kroeger had been previously treated for

the

condition

dating back

as

far as the

Spring

of

2012, and that the

condition

was diagnosed

as

of

the Spring

of

2012.

26.

Underwriters

are further informed and believe and

thereon

allege that defendants

knew or

should

have

known, based

upon

a diligent

inquiry

as required by

the Policy, that the

condition

had been

diagnosed and

treated

since the

Spring

of

2012.

27. Underwriters

are informed and

believe

and

thereon allege that

defendants

contend

that

they are entitled to coverage under

the

Policy in

the

amount of $13,105,953.75.

Underwriters further allege

on

information and belief

that

defendants do not agree

that the

Policy is properly

subject

to rescission nor do they agree that the

Policy

is void ab

initio

based

upon material misrepresentations and/or concealment.

// /

u




e

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3^£

N « .

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« «

fi 41

v «n

ft S

*©*

9

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

28. Underwriters accordingly have no adequate

remedy at

law.

Underwriters

therefore request that

the

Policy

be

declared

null

and void ab initio, and that

the

Policy

be

rescinded andUnderwriters hereby tender repayment

of

all premiums

received.

29. By

reason

of

the

foregoing, there

exists

now an

actual, justiciable

controversy

between the parties

and

with respect to their

rights

and obligations under the policy. This Court

is

vested

with the

power to

declare

and adjudicate

the rights

and

legal

obligations of

the parties

to this action with reference to the issues raised

by

this Complaint.

Underwriters

desire a

judicial

determination

of

the rights

and obligations ofeach of

the

parties to this action under

the

Policy.

A

judicial determination

is

necessary and

appropriate at this

time in

order

that each

of

the

parties

may ascertain their respective rights and duties as to each other and may conduct

themselves accordingly nowandinthe

future.

30.

Underwriters request

that this Court make and enter its biding judicial

declarations

in

accordance with their contentions

above.

The requested declarations are both

necessary and

proper

at this time under the

circumstances in

that the interests of

judicial

economy andsubstantial justice will be served thereby.

SECOND

CAUSE

OF

ACTION

For

Declaratory Relief-

No Duty

to Indemnify

Against

All Defendants)

31. Underwriters incorporate

paragraphs 1

through 29 as

if

set

forth

in

full in their

Second Cause ofAction for Declaratory

Relief- No

Duty

to

Indemnify.

32. In the

alternative,

an actual controversy has

arisen

and

now

exists between

Underwriters and defendants. Underwriters contend that they have

no

duty

to

indemnify

defendants because

the tender is

expressly excluded

by

Conditions Additional,

Conditions

Precedent, General Conditions, and Exclusions in

the

Policy and

because

defendants are in

breach

of

the Policy conditions regarding

providing necessary information,

assistance, and

documentation.

// /

// /

// /

12

COMPLAINT FOR

DECLARATORY

RELIEF



o

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M•

os

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« 8 g 5 «

v «m

ftS

J * 8 5 *

»;©£

©

H-

H-

0

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Peril Not

Beyond

the

Control of

the Insured

33.

Underwriters

contend

that

they have

no

duty to

indemnify

defendants based upon

the Policy s Insurance Clause because such peril, as described in the Policy,

was not

beyond

the

control

of

defendants. The Insurance Clause states:

1.

INSURING

CLAUSE

1.1

Subject

always to the terms, conditions,

limitations

andexclusions

contained herein

or

endorsed hereon

this

Insurance

is to

indemnify

the

Assured [Nickelback]

for theirAscertained Net

Loss should

anyInsured Performance^) orEvent(s) specified inthe

Schedule

be necessarily Cancelled,

Abandoned,

Postponed, Interrupted or

Relocated.

Provided that:

(1.1.1)

the

necessary

Cancellation, Abandonment,

Postponement, Interruptionor Relocation is the

soleand

direct result

ofoneormore ofthe

perils

described

in 2.1 to

2.6 below and

(1.1.2) such peril is stated in the Schedule to be Insured

and

(1.1.3) such peril is beyondthe control of:

(i) theAssured [Nickelback] and

(ii) each and every Insured Person and

(iii) in respect of peril 2.6 belowtheAssured andthe

Insured Person(s).

(1.1.4)

thecircumstances

giving

riseto the loss first

occurs

during the Period

of

Insurance stated in the

Schedule.

34. Underwriters allege on information and belief that

the

peril was

not beyond

the

control

of the

Insured, in this

case, Chad Kroeger.

Underwriters are informed

and believe, and

on that basis allege, that

Nickelback

has

contended or will

contend to the contrary.

Underwriters request that

this Court make and

enter its binding judicial

declarations

in

accordance with their contentions above. The requested

declarations

are both

necessary

and

proper

at this time under the circumstances in

that

the

interests

of

judicial economy and

13




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©

vi u a

a;©?

I

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

H-

24

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-. .

25

H -

26

0

27

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28

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y i

substantial

justice

will be served thereby.

Pre-existing

Medical

andOther Conditions

35. Underwriters contend that they do

not have

a

duty to indemnify

defendants

based

upon

the

Policy s

applicable Conditions

Precedent,

including

but not

limited

to

Pre-existing

Medical Conditions and Other

Pre-existing

Conditions. The

Policy states

as Conditions

Precedent as follows:

4.

CONDITIONS PRECEDENT

Itisa

condition precedent to the liability

ofthe

Underwriters

that

the

Assured has:

Truth

of

Statements:

4.1

truthfully declared

all

material

facts

likely

to

influence

a

reasonable Underwriter indetermining:

(4.1.1) whether or not to

accept

the

risk or

any

subsequent amendment,

(4.1.2) thepremium,

(4.1.3)

the

conditions, exclusions and

limitations,

having

diligently

made

all

necessary

inquiries to establish

those

facts.

Pre-existing Medical Conditions:

(4.2.1)

established

to their best knowledge

and belief

after making

diligent inquiry that no insured Person has any physical, mental or

medical

condition

or

is

undergoing any treatment, medical

or

otherwise, other than those advised to

the

Underwriters

and

agreed

by them inwriting, and

that each Insured Person

is fit to

fulfil the commitments insuredherein.

(4.2.2) accepted

that

any such

pre-existing condition

in

(4.2.1) agreed by

the

Underwriters will only be covered hereunder

if

the

Insured

Person

continues

to follow

any prescribed

regime

medical or

otherwise essential to

the

Insured

Person's

well-being during the

period of this Insurance.

Other Pre-existing Conditions:

(4.3.1)

no

knowledge at inception, ofany undisclosed matter, fact or

circumstance,

actual or

threatened,

that increases orcould increase

thepossibilityof a loss under this Insurance.

14

COMPLAINT FORDECLARATORY RELIEF



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j 2 5

fltai(U

•Mil

Kg*

0 ;

0

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

(4.3.2) confirmed that no Insured Person has knowledge at inception, of

any

undisclosed matter,

fact

or

circumstance, actual

or

threatened,

that

increases

orcould increase

the

possibility ofa

loss

under this

Insurance.

* * *

Materiality

of

Information:

(4.5) declared that

all information contained

in the written

Proposal

Form orsupplied

to support such proposal

orother

application for

this

Insurance

is in

all respects true

and

complete

and unchanged

at the inception of this Insurance. Further the

Assured

agrees that

all such information is material, such items form the basis of this

Insurance andare incorporated herein.

Obligation to Rearrange:

(4.6) an obligation to rearrangeCancelled or Abandoned Insured

Performance(s) or Event(s) to another time in order to avoid or

diminish

a

loss herein Insured.

36.

Underwriters

are

informed

and believe and thereon allege that they have no

duty

to indemnify

defendant because Underwriters are informed

and believe

and thereon allege that

Mr. Kroeger had a pre-existing condition

on his vocal

cord

( the

condition ),

pre-dating

inception of the policy, which was

never

disclosed to Underwriters prior to

the

inception of the

Policy. The

condition

constitutes material information as

defined in

the

Policy which

should

have been disclosed and which was material to Underwriters' decision whether to issue the

Policy,

set

premium

for the

Policy,

and/or setting the

terms,

conditions and exclusions of

the

Policy.

37. Underwriters allege further

based upon

information

and

belief that

they have

no

duty to indemnify defendant to the extent that

defendant has

failed to comply

with

its obligation

under the Policy to rearrange cancelled or abandoned dates in order to diminish the loss under

the Policy.

38. Underwriters request that this

Court

make

and

enter

its

binding

judicial

declarations

in

accordance with

their

contentions above. The requested declarations

are

both

necessary and proper at

this time under the circumstances

in that

the

interests of judicial

economyand substantial justice willbe servedthereby.

// /

15

COMPLAINT

FOR DECLARATORY RELIEF



©

I

2 > ©a

• • ft

4

t

H-

H-

14.

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

No Loss - Leg 4 European

Dates)

39.

Underwriters are

informed and believe and

thereon

allege

that

there is no

obligation

to

indemnify defendant for

any

purported loss with respect

to

the fourth Leg

of

the

Tour.

Even

if

coverage were found to

exist

under the

Policy, Defendants

have failed

to

provide

evidence

ofproperly executed contractual obligations

with

respect

to any

ofthe

venues at which

defendants were scheduled to perform

in Europe

during

the

fourth leg

of the Tour. The

only

documents

provided

by defendants are unsigned

contracts, dated

after

defendants

reported

the

claim to Underwriters, which are unenforceable and impose no contractual

obligations

on

defendants.

Absent enforceable contracts for

those

performances, Underwriters have no duty

to

indemnify

Nickelback

for those performances pursuant

to

Clause 5ofthe Policy:

5.

WARRANTIES

It is warranted that the Assured shall:

* * *

Contractual requirements and authorizations:

(5.3) ensure thatallnecessary

contractual

arrangements have

been

madeandconfirmed inwritingwith theAssuredand that all

necessary authorizations (which for the avoidance

of

doubt shall

include, butnotbe limited to,the obtaining of licenses, permits,

visas,

copyright andpatents) areobtained in a

timely manner

and

valid fortheperiod ofthe Insured Performance(s) orEvent(s).

40. Underwriters

request

that this

Court

make and enter its

biding judicial

declarations

in

accordance with

their contentions

above. The

requested declarations

are both

necessary and

proper at

this

time

under the circumstances

in that

the interests

of judicial

economy andsubstantial justice

will

be

served

thereby.

General

onditions

41. Underwriters are further informed and

believe

and thereon

allege

that

they

have

no

duty

to

indemnify

defendants

based upon the

Policy's

General

Conditions,

including,

but not

limited to, False or Fraudulent Acts,

Due

Diligence Clause, Compliance with Terms and

Maintenance ofRecords. ThePolicy

sets

forth the

following General

Conditions:

// /

16




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in-

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2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17 >

18

19

20

21

22

23

24

25

26

27

28

False or

Fraudulent Acts:

(6.1) Any fraud, misstatementor concealment in the information

provided

orin

the making

of a

claim

or

otherwise howsoever,

shall render all claims hereunder forfeit.

Due Diligence Clause:

(6.2) The Assured

shall atall times

do and

concur in

doing all things

necessary to avoid or diminish a loss under this Insurance.

* * *

Compliance with Terms:

(6.4) The Assured shall observe and fulfill the terms and conditions

contained

herein or

endorsed hereon.

* * *

Maintenance o f

Records:

(6.9) TheAssured shall maintainadequaterecords in connection with

the subject matter issued hereunder.

42.

Underwriters

are

informed

and

believe

and thereon allege that there isno duty to

indemnify Defendantbaseduponthe

above,

and thatDefendantcontendsotherwise.

43.

Underwriters request that this Court make and enter

its

biding

judicial

declarations in

accordance with

their

contentions

above.

The

requested

declarations are

both

necessary

and proper at

this time under the circumstances

in that the

interests

of judicial

economy and substantialjustice will be served thereby.

Personal

Incapacity,

Duty

ofCare, Contractual Requirements

and

Authorizations,

Misrepresentation

44. Underwriters further allege on information and belief

that

they have no duty to

indemnify Nickelback based upon

the Policy's

applicable Exclusions, including,

but

not limited

to, Personal Incapacity,

Duty

of

Care, Contractual

Requirements and Authorizations,

and

Misrepresentation.

The

Policy includes the following:

/ //

// /

17

COMPLAINT

FOR

DECLARATORY

RELIEF



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0

i

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

7. EXCLUSIONS

This

Insurance

does

not

cover any loss directly or indirectly

arising out

of, contributed to

by,

or resulting

from:

Personal

Incapacity:

* * *

(7.3.3) insufficient voice quality, unless directly due to illness ordisease

contracted

orbodily injury

occurring

during the

Period

of

Insurance,

* * *

(7.3.6)

their

unreasonable orcapricious

behavior,

* * *

Duty

of

Care:

(7.4) the Assured's

or

any Insured Person's lack ofcare,

diligence or

prudent behavior, the

result of

which

would increase

the risk,

and/orlikelihood of a loss, hereunder.

(7.5) the illegal

possession or illicit

taking of

drugs

and

their effects.

Contractual Requirements and Authorizations:

(7.13.3)

Fraud:

ensure

that all necessary contractual arrangements

were

made

andconfirmed inwriting withthe

Assured

andthat

allnecessary

authorizations,

(which fortheavoidance of

doubt

shall include,

but

not be limited

to,

the

obtaining

of

licenses, permits, visas,

copyright

and patents)

be

obtained

ina

timely manner and valid for

the

period

of

the

Insured

Performance(s)

or

Event(s).

(7.14)

any fraud, misrepresentation

or

concealment by

the

Assured or

any

Insured Person.

* * *

45.

Underwriters request

that

this

Court

make and

enter

its

biding judicial

declarations

in accordance

with their contentions

above. The requested

declarations

are both

necessary

and proper

at this

time

under

the

circumstances

in

that the interests of judicial

economy

and substantial justice will be

served thereby.

18




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* 8S ••

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« «i ti a

©

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IV

0

I

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Failure to

Cooperate and

Provide Necessary Information and

Proof

ofLoss

46. Underwriters further allege on information and belief

that

they

have

no duty to

indemnify

Nickelback based

upon

condition

precedent 8

of the

Policy which states

that

Nickelback

shall comply

with

the claims

procedure

as

follows:

8.

CLAIMS PROCEDURE

Itisa

condition precedent

to the

liability

ofthe

Underwriters that

in the

event ofa

happening

orcircumstance which could give

rise

to

a claim

under this insurance, the Assured shall:

(8.1.1) as amatter ofurgency give notice

by the most

expeditious means

of the happening ofany circumstance, to the name(s) designated

in the attachedSchedule;

(8.1.2) confirm the

facts

in

writing

as

soon

as

possible, with

as

much

information as available;

(8.1.3)

make

no admission of liability without the prior written consent of

the Underwriters;

(8.1.4)

take

all steps

to

minimize

or

avoid

any

loss hereunder;

(8.1.5) provide

the

Underwriters

or their

appointed representatives

with:

(i) all necessary assistance in a timely manner,

(ii) all information required,

(iii) all

documentation

and

records

necessary to

establish

and

assess indemnity hereunder and copies

of

extracts

asmay

be required;

(8.1.6) prove the loss to the satisfaction oftheUnderwriters;

(8.1.7) forward immediately to the Underwriters or their representatives

any letter, writ

orother

document received

in

connection with any

claim made under this insurance.

8.2

8. 3

as oftenas maybe reasonably required submitto examination

under

oath

onall matters

connected with

a

claim, by

any

person

named

by

the

Underwriters

at

such reasonable

time and place as

may be

designated

by

the Underwriters

or their

representatives.

as soon asis

practicable

render a signed and

sworn

proofof loss to

theUnderwriters or their representative to substantiate the

occurrence, nature, cause and amount of loss claimed under this

Insurance.

19

COMPLAINT

FOR

DECLARATORY

RELIEF



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4 ^ « a

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5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

47. UNDERWRITERS

desire

a

judicial determination and declaration

of

their

rights

and obligations

under

the Policy with

respect

to the

Insurance Clause

and Conditions

Additional, Conditions

Precedent,

General Conditions,

and

Exclusions

in the Policy.

48.

A

judicial

determination

of

the

respective obligations

of

the

parties

to

this

Complaint

is

appropriate under the circumstances,

and

no other

adequate

remedy

is available to

Underwriters.

PRAYER

FOR RELIEF

THEREFORE, Underwriters pray for judgment as

follows:

FIRST CAUSE

OF

ACTION

(1)

An

order declaring

and adjudging

that

Contingency

Non-Appearance and

Cancellation

Insurance Policy

No.

Bl

1672025a

is

null and

void

ab

initio

and

is

rescinded;

(2)

An order declaring and adjudicating that defendants are not

entitled

to benefits

under the

Policy and that defendants are only entitled to refund

of

the

premium

paid

for

the

Policy andnothing further;

(3) An

order

entering

judgment

in

favor ofUnderwriters

and against

defendants;

(4) An order awarding

Underwriters

all recoverable costs

ofsuit incurred

herein; and

(5) For such

other

and further reliefas the Court may deem just and proper.

SECOND CAUSE OF ACTION

(1) An order

declaring

and

adjudging that

Underwriters

have

no duty

to indemnify

defendants because the tender

is

expressly excluded by Conditions Additional, Conditions

Precedent, General Conditions, and/or Exclusions in the Policy, in addition to defendants'

failure to cooperate

and

provide

necessary

information

and

proof

ofloss;

(2) An order entering judgment

in favor

ofUnderwriters and against

defendants;

(3) An order

awarding

Underwriters ail recoverable costs ofsuit incurred herein; and

/ / /

// /

// /

// /

20




9 38

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i© ^ . ^

m 5

«\fl 0

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v n

ft a

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10

11

12

13

14

15

16

17

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19

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21

22

23

H-

24

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25

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26

0 ;

27

N.1

28

0 ;

K

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(4) For such

other and further relief as the Court may

deem just

and

proper.

Dated: December 9,2015

By

PauTK. Schrieffer>

Wayne

H.

Hammack, Esq.

Attorneys for Plaintiffs, CERTAIN

UNDERWRITERS AT LLOYD S OF

LONDON SUBSCRIBING TO

CONTINGENCYNON-APPEARANCE

AND CANCELLATION POLICY

NO.

B11672025a

21




Wayne H.Hammacki Esq. (CSB

202709)

P.K.SchriefferLLP

100

N.

Barranca

Ave^Ste.l 100,

West Covina,

CA

91791

TELEPHONE NO

626-373-2444

FAX NO

626-974-8403

attorney

FOR Name).Certain Underwriters

atLloyd sof

London,

Plaintiff

ORIGINAL

FOR COURTUSe ONLY

CM-010

SUPERIOR COURT

OF

CALIFORNIA. COUNTY

OF

LOS

AngeleS

streetaodress: 111

N. Hil l S tr ee t

MAILING

AODRESS: Same

city and zip code: Los Angeles, CA 90012

branch

name:

Central District - Stanley Mosk Courthouse

CASE

NAME:

CertainUnderwriters at Lloyd's

of

Londonv. Nickelback, et al.

,^Srt^iCalifornia

r),secuUveO«icer/CUrk

1

.Oepttt)'

CIVIL

CASE

COVER

SHEET

CI]

Unlimited

•

Limited

(Amount (Amount

demanded demanded

is

exceeds 25,000) 25,000or less)

Complex Case Designation

I 1 Counter fZZD Joinder

Filed with

first

appearance bydefendant

(Cal.

Rulesof

Court,

rule3.402)

CASE

NUMBER

JUOGE:

BC fi 0 3 7 l 8

DEPT:

Items

1-6 below mustbe completed see

instructions on

page

2).

1.

Check

one

box

below

for

thecase type thatbest describes thiscase

Auto Tort

Auto (22)

Uninsured motorist (46)

Other

PVPO/WD

(Personal Injury/Property

Damage/Wrongful Death) Tort

(ZH Asbestos (04)

[Z]

Product

liability (24)

j Medical malpractice (45)

• Other Pl/PD/WD (23)

Non-PI/PD/WO

(Other)

Tort

Business

tort/unfair

business practice

(07) L j Other real property (26)

Civilrights (08)

Defamation (13)

Fraud (16)

Intellectual property (19)

Professional negligence (25)

Other non-PI/PD/WD tort (35)

5 l o ymen t

Wrongful termination (36)

I I Other

employment

(15)

Contract

J Breach of contract/warranty (06)

• Rule

3.740 collections

(09)

I I

Other collections

09

LX-I Insurance coverage (18)

I I Other contract (37)

Real

Property

I I Eminent domain/Inverse

condemnation (14)

I I Wrongful eviction (33)

Unlawful Detainer

l

Commercial

(31)

CZ3

Residential

(32)

•

Drugs (38)

Judic ia l Review

Asset forfeiture (05)

L—J Petition re;

arbitration award

(11)

• Writ of mandate (02)

Provisionally Complex CivilLitigation

(Cal. Rules of Court,

rules

3.400-3.403)

I,. J AntitrustrTrade regulation (03)

I j

Construction

defect

(10)

CZ3 Mass tort

(40)

I I

Securities

litigation

(28)

| j

Environmental/Toxic

tort (30)

I—I Insurance coverage

claims

arising from the

above

listed provisionally complex

case

types (41)

Enforcement of Judgment

I I

Enforcement

of judgment (20)

Miscellaneous CivilComplaint

• RICO (27)

I I Other

complaint

not specified above (42)

Miscellaneous Civil Petit ion

j j

Partnership

and

corporate governance

(21)

I I

Other petition not specified above)

43

^ I I Other

judicial

review 39

2.

This

case I—I

is

ODisnot

complex

under rule 3.400

of the

California Rules

of Court. If

the

case is complex,

mark

the

factors requiring

exceptional

judicial

management:

a.

LJ

Large number of separately

represented

parties d. • Large number of

witnesses

b. L_J Extensive motion

practice

raising difficult or novel e. •

Coordination

with

related actions

pending in one ormore courts

issues*a t will be time-consuming to resolve inother

counties,

states,orcountries, orina federal court

c. •

Substantial

amount of

documentary evidence

f. •

Substantial

postjudgment

judicial

supervision

3. Remedies sought (check

all that apply : aO monetary b.

QD

nonmonetary;

declaratory

or injunctive relief c. •

punitive

4.__Wumber of

causes

of action specify : Two (2) -—^

5._ This case L_J is IXI

js

not a class action suit.

6. ' Ifthere are any knownrelated cases, fileand serve a noticeof related

case.,

Date: December 9,2015

_

Paul K. Schrieffer

TYPE OR PRINTNAME)

Font Adopted forMandatory Use

Judicial Council of

California

CM-010 [Rev. July 1,2007]

NOTICE

••Plaintiff

must

file this

cover sheet

with

the

first paper filed

in theaction orproceeding

(except

small claims casesorcases

filed

xgnder the

Probate

Code,

Family Code,

or

Welfare and Institutions Code). (Cal. Rules

of

Court, rule 3.220.) Failure

to

file may result

In

sanctions.

£File this

cover

sheet

in

addition toanycover sheet required by

local

court

rule.

this caseis

complex under

rule

3.400

et seq. ofthe California

Rules

ofCourt, you

must

serve a

copy of

this cover sheet

on

all

other parties to the actionor proceeding.

VUnless this is a

collections

case under

rule

3.740 ora complex

case,

this

cover

sheet will be used

for

statistical purposes only.

~— ——— Pago 1 of i

CIVIL CASE COVER SHEET

Cal. Rules of Court,rules 2.30.3.220.3.400-3.403,3.740:

Cal.Standards of JudicialAdministration,std, 3.10

www.courtinfo.ca.sov

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