Plaintiff Great American E & S Insurance Co.’s Original Complaint Page 1 

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF TEXAS

SAN ANTONIO DIVISION 

GREAT AMERICAN E & S INSURANCE

COMPANY 

v.

EVANSTON INSURANCE COMPANY

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Civil Action No. 5:20-cv-608

PLAINTIFF GREAT AMERICAN E & S INSURANCE COMPANY’S ORIGINAL COMPLAINT 

COMES NOW, Plaintiff Great American E & S Insurance Company and files this its 

Original Complaint against Evanston Insurance Company, and, in support of same asserts 

and would show the following: 

I. 

PARTIES

1. Plaintiff Great American E & S Insurance Company (“Great American”) is a 

corporation organized and existing under the laws of the State of Delaware with its principal 

place of business in the State of Ohio. 

2. Defendant Evanston Insurance Company (“Evanston”)is a corporation existing under 

the law of the State of Illinois with its principal place of business in the State of Illinois. 

Evanston is a surplus lines carrier eligible to write insurance policies in the State of Texas and is 

engaged in the business of insurance in Texas. Defendant Evanston has no registered agent in the 

State of Texas and can therefore be served with process per FED.R.CIV.P. 4(h), by serving the 

Commissioner of the Texas Department of Insurance at 333 Guadalupe, MC 112-2A, P. O. Box 

149104, Austin, Texas 78714-9104, and the Commissioner can then forward process to Bryan 

Williams Sanders, President & Director, or Any Other Officer of the Corporation, at 10 Parkway 

North, Deerfield, IL 60015. 

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II.

VENUE AND JURISDICTION 

3. There is complete diversity of citizenship among and between the parties to this civil 

action, and the amount in controversy, exclusive of interest and costs, exceeds seventy-five 

thousand dollars ($75,000) as this lawsuit concerns questions of insurance coverage and 

defense costs related to an underlying lawsuit in which the underlying plaintiffs are seeking 

more than $1,000,000 and in which Plaintiff Great American has incurred defense costs well 

in excess of $75,000 which it seeks to recover from Defendant Evanston. As such, jurisdiction 

in this judicial district exists pursuant to 28 U.S.C. §1332.

4. Venue is proper in this District under 28 U.S.C. 1391(b)(1) and 1391(c)(2) and (d)

because Evanston as a corporation is subject to personal jurisdiction in this District, and thus 

resides in this District. Alternatively, venue is proper in this District under 28 USC 

1391(b)(2) because a substantial part of the events, acts and omissions giving rise to the 

claims and issues involved occurred in this District and the underlying lawsuit for which 

coverage is being sought is pending in this District.

III. 

FACTS

5. Martina McCallum previously filed a products liability personal injury lawsuit that is 

currently pending: Martina McCallum v. Camping World, Inc., Barbara’s Development, Inc. 

a/k/a DirecSource, DirecSource Ltd., and Guangzhou Trinity Cycles Co., Ltd., Civil Action No. 

19-1021-OLG in the United States District Court for the Western District of Texas, San 

Antonio Division (“The Underlying Products Suit”). ‘ 

6. A true and correct copy of Plaintiff’s First Amended Complaint on file in the 

Underlying Products Suit is attached hereto as Exhibit A. 

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7. As set forth in Exhibit A, Ms. McCallum alleges in the Underlying Products Suit that on 

April 14, 2018, she purchased a 6-speed “Adventurer” foldable bicycle from a retail Camping 

World, Inc. (“Camping World”) store in New Braunfels, Texas, and thereafter, on April 27, 

2018, sustained injuries while riding the bike on the San Antonio Riverwalk when a safety 

ring on the bike came loose causing the bike’s handlebars to collapse as she was riding it.

8. Plaintiff’s First Amended Complaint alleges in paragraph 10 that Barbara’s 

Development, Inc. a/k/a DirecSource, DirecSource Ltd. and Guangzhou Trinity Cycles Co., 

Ltd. sold the bike to Camping World. 

9. Plaintiff’s First Amended Complaint alleges various products liability theories of 

recovery against all of the defendants named in the Underlying Products Suit, including 

Camping World.

10. Plaintiff Great American issued a Products and Completed Operations Liability policy 

No. PL1745311 to Camping World covering the date of the bike accident at issue in the 

Underlying Products Suit (“the Great American Policy”). As such, Great American previously 

retained defense counsel to defend Camping World in the Underlying Products Suit and 

Great American continues to defend Camping World in the Underlying Products Suit.

11. A true and correct copy of the Great American Policy is attached hereto as Exhibit B. 

12. Defendant Evanston issued a “claims-made” Products Liability insurance policy No.

MKLV5PPD000065 to Barbara’s Development, Inc. d/b/a DirecSource (“Barbara’s”), among 

other named insureds (“the Evanston Policy”). 

13. The Evanston Policy generally affords $1 Million in liability coverage on a “claimsmade” basis for the policy period of December 15, 2018-December 15, 2019. Since Ms. 

McCallum’s claim was made within, and the Underlying Products Suit was filed within, that 

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stated policy period, the claims involved in the Underlying Product Suit fall within the time 

period covered by the Evanston Policy.

14. A true and correct copy of the applicable Evanston policy no. is attached hereto as 

Exhibit C (“the Evanston Policy”). 

15. On information and belief, Evanston retained defense counsel to represent both 

Barbara’s Development, Inc. d/b/a DirecSource and DirecSource, Ltd. in the Underlying 

Products Suit. 

16. On information and belief, DirecSource, Ltd. uses the same California address as 

Barbara’s and its individual sole shareholder is also a founder and principal in Barbara’s. 

17. In addition to its listed named insureds named in the Evanston Policy, the Evanston 

Policy also covers retail sellers of the Evanston named insureds’ products pursuant to an 

“Additional Insured-Vendors” endorsement (no. CG 20 15 07 14)(“the Evanston Vendors 

Endorsement”). A true and correct copy of the Evanston Vendors Endorsement is attached 

hereto as Exhibit D. 

18. Specifically, the Evanston Vendors Endorsement states:

A. Section II-Who Is An Insured is amended to include as an additional insured 

any person(s) or organization(s) (referred to below as vendor) shown in the 

Schedule, but only with respect to “bodily injury” or “property damage” arising 

out of “your products” shown in the Schedule which are distributed or sold in 

the regular course of the vendor’s business. . . “. 

The Evanston Vendors Endorsement’s Schedule states that the “Your Products” covered by 

the Endorsement are those listed in a separate “Policy Changes” endorsement IL 12 01 11 

85.

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19. The referenced “Policy Changes” endorsement IL 12 01 11 85, on the Evanston Policy, 

i.e., “Policy Changes” endorsement No. 5 (attached hereto as Exhibit E), lists various types 

of products that are subject to the Evanston Vendors Endorsement, including “bike 

components”, “sport training aids” and “sporting goods”. 

20. Thus, the Evanston policy extends “additional insured” product liability coverage to 

retail sellers — “vendors”-- of the listed products to the extent that such products were sold 

to supplied to the vendor by the Evanston named insureds . 

21. In light of the specific allegations in paragraph 10 of Plaintiff’s First Amended Petition 

alleging that Barbara’s and DirecSource, Ltd. sold the bike involved to Camping World and 

the allegations of paragraph 18 alleging that Camping World then sold the bike to Ms. 

McCallum at Camping World’s New Braunfels store, on April 20, 2020, Camping World’s 

defense counsel formally demanded that Evanston afford defense and coverage to Camping 

World under the Evanston Policy. By letter dated April 21, 2020, Evanston denied Camping 

World’s request for coverage and defense. 

22. Evanston’s April 21,2020 denial of defense and coverage to Camping World was 

based on two stated grounds: (a) Notwithstanding the allegations to the contrary in 

Paragraph 10 of Plaintiff’s First Amended Petition in the Underlying Products Suit, the court 

in the Underlying Products Suit has determined in an interlocutory summary judgment order 

dated April 17, 2020 that there is no evidence that Barbara’s was the entity that sold and 

supplied the bike to Camping World, and (b) DirecSource, Ltd. was the actual seller of the 

bike to Camping World and, even though the Evanston Policy lists its named insured as 

Barbara’s Development, Inc. d/b/a DirecSource and even though Evanston is defending 

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DirecSource, Ltd. through the same lawyers it hired to also defend Barbara’s, DirecSource, 

Ltd., is not an insured on the Evanston Policy. 

 

IV.

CLAIMS FOR RELIEF

A. Declaratory Judgment

23. Great American incorporates by reference the preceding paragraphs in this 

Complaint.

24. Great American requests that the court enter a declaratory judgment under 22 U.S.C. 

§2201 as follows:

a. That Evanston’s duty to defend Camping World in the Underlying Products Suit is 

determined solely by a comparison of the Ms. McCallum’s pleadings, without regard to the 

truth or falsity of the pleaded facts and without regard to any ruling by the court in the 

Underlying Products Suit or other extrinsic evidence outside of the pleadings. Zurich 

American Ins. Co. v. Nokia Inc., 268 S.W.3d 487, 491 (Tex. 2008) (rejecting the insurer’s 

extrinsic evidence indicating that the Plaintiff had not, in fact, sustained any “bodily injury” 

when the pleading alleged same because such evidence contradicted the pleading); Guide 

One Elite Ins. Co. v. Fielder Road Baptist Church, 197 S.W. 3d 305, 308 (Tex. 2006); Pine Oak 

Builders, Inc. v. Great American Lloyds Ins. Co., 279 S.W.3d 650 (Tex. 2009) (no extrinsic 

evidence outside pleadings allowed on duty to defend, especially if it contradicts the 

allegations). 

b. That applying that proper standard to the duty to defend analysis here, 

Evanston owed a duty to defend Camping World in the Underlying Product Suit as of the 

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April 20, 2020 formal tender of Camping World’s defense and coverage to Evanston by 

Camping World’s defense counsel;

c. That, accordingly, Evanston’s denial of Camping World’s request for defense 

on April 21, 2020 was wrongful and Evanston owed on April 20, 2020, and continues to owe, 

defense to Camping World in connection with the Underlying Product Suit under the 

Evanston Policy;

d. That in accordance with the respective “Other Insurance” provisions of the 

Great American and Evanston policies, respectively, Evanston’s duty to defend Camping 

World is either primary with Great American’s duty to defend being purely excess, or in the 

alternative, Evanston’s duty to defend is co-primary with Great American’s so that each 

insurer owes 50% of Camping World’s defense.

e. That the Evanston Policy covers, or alternatively was intended to cover, 

DirecSource, Ltd. as a named insured under it, as evidenced by the facts that (a) both 

Barbara’s and DirecSource, Ltd. share the same California office address, (b) “DirecSource” 

is one of the Barbara’s “d/b/a” names specifically referenced in the Evanston Policy’s list of 

named insureds, and (c) Evanston has and continues to defend DirecSource, Ltd. in the 

Underlying Product Suit through the same lawyers that it hired to defend Barbara’s, and, 

thus, the Evanston Policy actually covers, or should be reformed to cover Camping World 

under the Evanston Vendors Endorsement insofar as the bike was purchased by Camping 

World from DirecSource, Ltd. instead of Barbara’s. 

B. Breach of Contract/Subrogation 

25. Great American incorporates by reference the preceding paragraphs in this 

Complaint.

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Plaintiff Great American E & S Insurance Co.’s Original Complaint Page 8 

26. Great American asserts that Evanston’s denial of defense to Camping World breached 

the Evanston Policy and that Great American, through its equitable or contractual 

subrogation rights, is entitled to recover the defense costs that it has incurred since such 

wrongful denial by Evanston as damages for Evanston’s breach of contract. 

PRAYER

WHEREFORE PREMISES CONSIDERED, Great American prays that the Court enter 

declaratory judgment declaring that Defendant Evanston owes a duty to defend Camping 

World in the Underlying Products Suit from April 20, 2020 forward, that Great American is 

entitled to recover is reasonable and necessary defense costs incurred in defending Camping 

World to date from Evanston, and for such other and further relief at law or in equity as Great 

American may show itself justly entitled to.

Respectfully submitted,

David J. Schubert—Attorney in Charge

State Bar No. 17820800

E-Mail: DSchubert@SchubertEvans.com 

Schubert & Evans, P.C.

900 Jackson, Suite 630

Dallas, Texas 75202

Telephone: (214) 744-4400

Facsimile: (214) 744-4403

ATTORNEYS FOR PLAINTIFF GREAT 

AMERICAN

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