Exhibit 10
w,v

EnKM

CAUSE NO. DC-20-05751-A

LOMBARDI'S, INC., et al § IN THE JUDICIAL COURT

§

vs. § 14th district court

INDEMNITY INSURANCE

COMPANY OF NORTH AMERICA

DALLAS COUNTY

ORDER DENYING MOTION TO DISMISS PURSUANT TO RULE 91A

On this date came to be heard Defendant Indemnity Insurance Company of North

America's Amended Motion to Dismiss Pursuant to Rule 91 A. After considering the

pleadings on file and arguments of Counsel the Court is of the opinion that the Motion should

be DENIED

IT IS SO ORDERED

Signed this 1 5th day of October 2020

o

JUDGE ERIC MOYE

14th DISTRICT COURT
Complaint
FILED

4/16/2020 4:53 PM

FELICIA PITRE ClT/ESERVE

DISTRICT CLERK

DALLAS 00., TEXAS

Alicia Mata DEPUTY DC-20-05751 CAUSE NO:

LOMBARDI’S INC; LOMBARDI’S IN THE DISTRICT COURT 0F FAMILY CONCEPTS, INC; PENNE

SNIDER, LLC; PENNE PRESTON, LLC; ALBERTO LOMBARDI INTERESTS,

LLC; TAVERNA DOMAIN AUSTIN, LP; CAFE TOULOUSE RIVER OAKS

DISTRICT, LP; CAFE MONACO HPV,

LLC; PENNE LAKEWOOD, LLC; TAVERNA BUCKHEAD, LP; TAVERNA DOMAIN AUSTIN LP; TAVERNA

AUSTIN, L.L.C.; TAVERNA FT. WORTH,

LLC; TOULOUSE KNOX BISTRO, LLC; TAVERNA ARMSTRONG, L.L.C.; TOULOUSE DOMAIN AUSTIN, LP; BISTRO 31 LEGACY, LP; TAVERNA

LEGACY, LP; TAVERNA BUCKHEAD,

LP; AND LOMBARDI’S 0F DESERT

PASSAGE, INC.

GO?00300300?WWWWDWWWDWWWDWWWDWWWDWWWDWWWDW

PLAINTIFFS,

V. DALLAS COUNTY, TEXAS

INDEMNITY INSURANCE COMPANY

OF NORTH AMERICA, DEFENDANT. JUDICIAL DISTRICT

PLAINTIFFS’ ORIGINAL PETITION

TO THE HONORABLE JUDGE OF SAID COURT: COMES NOW Plaintiffs Lombardi’s Inc.; Lombardi’s Family Concepts, Inc.; Penne

Snider, LLC; Penna Preston, LLC; Alberto Lombardi Interests, LLC; Taverna Domain Austin,

LP; Café Toulouse River Oaks District, LP; Café Monaco HPV, LLC; Penne Lakewood, LLC;

Taverna Buckhead, LP; Taverna Domain Austin LP; Taverna Austin, L.L.C.; Taverna Ft. Worth,

LLC; Toulouse Knox Bistro, LLC; Taverna Armstrong, L.L.C.; Toulouse Domain Austin, LP;

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4

A-14TH

FILED

4/16/2020 4:53 PM

FELICIA PITRE CIT/ESERVE

DISTRICT CLERK

DALLAS 00., TEXAS

Alicia Mata DEPUTY

DC-20-05751 CAUSE NO:

LOMBARDI’S INC; LOMBARDI’S FAMILY CONCEPTS, INC; PENNE

SNIDER, LLC; PENNE PRESTON, LLC; ALBERTO LOMBARDI INTERESTS,

LLC; TAVERNA DOMAIN AUSTIN, LP; CAFE TOULOUSE RIVER OAKS

DISTRICT, LP; CAFE’ MONACO HPV,

LLC; PENNE LAKEWOOD, LLC; TAVERNA BUCKHEAD, LP; TAVERNA DOMAIN AUSTIN LP; TAVERNA

AUSTIN, L.L.C.; TAVERNA FT. WORTH,

LLC; TOULOUSE KNOX BISTRO, LLC; TAVERNA ARMSTRONG, L.L.C.; TOULOUSE DOMAIN AUSTIN, LP; BISTRO 31 LEGACY, LP; TAVERNA

LEGACY, LP; TAVERNA BUCKHEAD,

LP; AND LOMBARDI’S 0F DESERT

PASSAGE, INC.

IN THE DISTRICT COURT OF

000mmmw:mmmmmmmmmmmmmmmmmmmmmm

PLAINTIFFS,

V. DALLAS COUNTY, TEXAS

INDEMNITY INSURANCE COMPANY

OF NORTH AMERICA,

DEFENDANT. JUDICIAL DISTRICT

PLAINTIFFS’ ORIGINAL PETITION

TO THE HONORABLE JUDGE OF SAID COURT:

COMES NOW Plaintiffs Lombardi’s Inc.; Lombardi’s Family Concepts, Inc.; Penne

Snider, LLC; Penne Preston, LLC; Alberto Lombardi Interests, LLC; Taverna Domain Austin,

LP; Café Toulouse River Oaks District, LP; Café Monaco HPV, LLC; Penne Lakewood, LLC;

Taverna Buckhead, LP; Taverna Domain Austin LP; Taverna Austin, L.L.C.; Taverna Ft. Worth,

LLC; Toulouse Knox Bistro, LLC; Taverna Armstrong, L.L.C.; Toulouse Domain Austin, LP;

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4
PLAINTIFFS ORIGINAL PETITION 2

4853-0333-1258v.4

Bistro 31 Legacy, LP; Taverna Legacy, LP; Taverna Buckhead, LP; and Lombardi’s Of Desert 

Passage, Inc., (collectively “Lombardi’s”) complain of Indemnity Insurance Company of North 

America (“Chubb”) Defendant, as follows:

I. DISCOVERY CONTROL PLAN

1. Lombardi’s intends to conduct discovery under Level 3 of Texas Rule of Civil Procedure

190.4. 

II. RULE 47 STATEMENT

2. Lombardi’s seeks monetary relief of more than $1,000,000 in costs, expenses, pre-judgment 

interest, and attorney fees. 

III. PARTIES, JURISDICTION & VENUE

3. The Plaintiffs are:

a. Lombardi’s Inc., a corporation organized under Texas law and doing business in 

Dallas County, Texas; 

b. Lombardi’s Family Concepts, Inc., a corporation organized under Texas law and 

doing business in Dallas County, Texas;

c. Penne Snider, LLC; Penne Preston, LLC; Alberto Lombardi Interests, LLC; 

Taverna Domain Austin, LP; Café Toulouse River Oaks District, LP; Cafe Monaco 

HPV, LLC; Penne Lakewood, LLC; Taverna Buckhead, LP; Taverna Domain 

Austin, LP; Taverna Austin, L.L.C.; Taverna Ft. Worth, LLC; Toulouse Knox 

Bistro, LLC; and Taverna Armstrong, L.L.C. each are limited liability companies 

organized under Texas law and doing business in Dallas County, Texas; 
d. Toulouse Domain Austin, LP; Bistro 31 Legacy, LP; Taverna Legacy, LP; and

Taverna Buckhead, LP each are limited partnerships organized under Texas law

and doing business in Dallas County, Texas; and

e. Lombardi's ofDesert Passage, Inc. is foreign corporation organized under Nevada

and doing business in Nevada.

4. Defendant, Indemnity Insurance Company of North America (“Chubb”), is foreign fire

and casualty insurance company domiciled in Pennsylvania and authorized by the Texas

Department of Insurance to conduct insurance business in Texas. This suit arises out 0f insurance

business purposefully and continuously conducted With plaintiff in the State 0f Texas. Chubb may

be served with process in this suit by delivering citation t0 the following serving as its registered

agent at the following rggjstered address: CT Corporation System, 1999 Bryan Street, Ste. 990,

Dallas, Texas 75201-3136.

5. Jurisdiction is proper in the District Court of Dallas County, Texas because the amount in

controversy is Within the jurisdictional limits 0f this court.

6. Venue is proper in Dallas County pursuant to Texas Civil Practice and Remedies Code

§15.002 because the cause 0f action arises out of events that occurred in Dallas County and

pursuant t0 Texas Civil Practice and Remedies Code §15.053 because insured properties are

situated in Dallas County.

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4

d. Toulouse Domain Austin, LP; Bistro 31 Legacy, LP; Taverna Legacy, LP; and

Taverna Buckhead, LP each are limited partnerships organized under Texas law

and doing business in Dallas County, Texas; and

e. Lombardi's ofDesert Passage, Inc. is foreign corporation organized under Nevada

and doing business in Nevada.

4. Defendant, Indemnity Insurance Company of North America (“Chubb”), is foreign fire

and casualty insurance company domiciled in Pennsylvania and authorized by the Texas

Department of Insurance to conduct insurance business in Texas. This suit arises out 0f insurance

business purposefully and continuously conducted With plaintiff in the State 0f Texas. Chubb may

be served with process in this suit by delivering citation t0 the following serving as its registered

agent at the following rggjstered address: CT Corporation System, 1999 Bryan Street, Ste. 990,

Dallas, Texas 75201-3136.

5. Jurisdiction is proper in the District Court of Dallas County, Texas because the amount in

controversy is Within the jurisdictional limits 0f this court.

6. Venue is proper in Dallas County pursuant to Texas Civil Practice and Remedies Code

§15.002 because the cause 0f action arises out of events that occurred in Dallas County and

pursuant t0 Texas Civil Practice and Remedies Code §15.053 because insured properties are

situated in Dallas County.

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4
IV. FACTUAL BACKGROUND

7. Chubbl entered into contract of commercial property insurance with the Lombardi’s

family 0f restaurants? Lombardi’s agreed to pay significant premiums in exchange for Chubb’s

promises of indemnify for losses, including but not limited t0, business income losses at several

different locations (“the Insured Properties”).

8. The Insured Properties are covered under policy number MCRD38196169, which was

renewed for the June 30, 2019, t0 June 30, 2020, policy period (“the Policy”). Lombardi’s fulfilled

all of their responsibilities under the insurance contract, dutifully paying hundreds of thousands of

dollars in premiums t0 Chubb over the years.

9. The Policy has been continuously in full force and effect since inception, providing firstparty property, business personal property and business income, extra expense and additional

coverages.

10. Chubb promised under the Policy t0 pay “for direct physical loss ofor damage t0 Covered

Property at the premises described in the Declarations caused by 0r resulting from any Covered

Cause of Loss.”

11. The Insured Properties covered under the Policy are subject t0 Business Income (and

Extra Expense) Coverage limit 0f $18,952,419. The Policy provides “all risks” insurance.

12. pneumonia of unknown origin was first reported t0 the World Health Organization (“WHO”) 0n December 31, 2019. China provided the genetic sequence for What has become

known as the 2019 Novel Coronavirus (2019-nCOV) 0n 0r about January 12, 2020. The WHO

Indemnity Insurance Company is part 0f the Chubb Group 0f Companies. “Chubb N.A. Claims” handled the

adjusting 0n behalf 0f Indemnity, what little there was, 0n Lombardi’s claim. “Chubb” is stamped in numerous places on the policy. In the April 3, 2020, denial letter, the Chubb N.A. adjuster used “Chubb” as the shorthand or synonymous reference to Indemnity Insurance Company of North America.

The Policy was commercial package policy including both commercial property and general liability coverage.

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4

IV. FACTUAL BACKGROUND

7. Chubbl entered into contract of commercial property insurance with the Lombardi’s

family 0f restaurants? Lombardi’s agreed to pay significant premiums in exchange for Chubb’s

promises of indemnify for losses, including but not limited t0, business income losses at several

different locations (“the Insured Properties”).

8. The Insured Properties are covered under policy number MCRD38196169, which was

renewed for the June 30, 2019, t0 June 30, 2020, policy period (“the Policy”). Lombardi’s fulfilled

all of their responsibilities under the insurance contract, dutifully paying hundreds of thousands of

dollars in premiums t0 Chubb over the years.

9. The Policy has been continuously in full force and effect since inception, providing firstparty property, business personal property and business income, extra expense and additional

coverages.

10. Chubb promised under the Policy t0 pay “for direct physical loss ofor damage t0 Covered

Property at the premises described in the Declarations caused by 0r resulting from any Covered

Cause of Loss.”

11. The Insured Properties covered under the Policy are subject t0 Business Income (and

Extra Expense) Coverage limit 0f $18,952,419. The Policy provides “all risks” insurance.

12. pneumonia of unknown origin was first reported t0 the World Health Organization (“WHO”) 0n December 31, 2019. China provided the genetic sequence for What has become

known as the 2019 Novel Coronavirus (2019-nCOV) 0n 0r about January 12, 2020. The WHO

Indemnity Insurance Company is part 0f the Chubb Group 0f Companies. “Chubb N.A. Claims” handled the

adjusting 0n behalf 0f Indemnity, what little there was, 0n Lombardi’s claim. “Chubb” is stamped in numerous places on the policy. In the April 3, 2020, denial letter, the Chubb N.A. adjuster used “Chubb” as the shorthand or synonymous reference to Indemnity Insurance Company of North America.

The Policy was commercial package policy including both commercial property and general liability coverage.

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4
PLAINTIFFS ORIGINAL PETITION 5

4853-0333-1258v.4

recognized on January 25, 2020, that the 2019 Novel Coronavirus is a “global threat to human 

health . . . .” On January 30, 2020, the Director of WHO declared the 2019 Novel Coronavirus 

“outbreak a Public Health Emergency of International Concern.” The disease caused by the 2019 

Novel Coronavirus was identified as “COVID-19” on February 11, 2020. On March 11, WHO 

characterized COVID-19 as a pandemic. WHO saw “alarming levels of spread and severity, and 

by the alarming levels of inaction.” WHO representatives stated: “Pandemic is not a word to use 

lightly or carelessly . . . We have never before seen a pandemic sparked by a coronavirus. This 

is the first pandemic caused by a coronavirus. And we have never before seen a pandemic that can 

be controlled, at the same time.” (Emphasis added.) The pandemic spread from China to 

surrounding countries and then to Italy, Iran, Spain and across the globe.

13. The Center for Disease Control (“CDC”) has stated that a “pandemic is a global outbreak 

of disease. Pandemics happen when a new virus emerges to infect people and can spread between 

people sustainably. Because there is little to no pre-existing immunity against the new virus, it 

spreads worldwide.”

14. On January 31, 2020, President Trump signed the Presidential Proclamation on Suspension 

of Entry as Immigrants and Nonimmigrants of Persons who Pose a Risk of Transmitting 2019 

Novel Coronavirus (the First Proclamation), suspending the entry of all aliens (i.e., non-citizens) 

who were physically present within the People’s Republic of China (excluding the Special 

Administrative Regions of Hong Kong and Macau) during the 14-day period preceding their 

attempted entry into the United States. On February 29, 2020, President Trump signed the 

Presidential Proclamation on the Suspension of Entry as Immigrants and Nonimmigrants of Certain 

Additional Persons Who Pose a Risk of Transmitting Coronavirus (the Second Proclamation), 

suspending the entry of all aliens who were physically present within the Islamic Republic of Iran 
PLAINTIFFS ORIGINAL PETITION 6

4853-0333-1258v.4

during the 14-day period preceding their attempted entry into the United States. On March 11, 

2020, President Trump signed the Presidential Proclamation on Suspension of Entry as Immigrants 

and Nonimmigrants of Certain Additional Persons Who Pose a Risk of Transmitting 2019 Novel 

Coronavirus (the Third Proclamation), resulting in a travel ban and of the entry of all aliens who 

were physically present in any of the 26 European countries that make up the Schengen Area during 

the 14-day period preceding their attempted entry into the United States. The Schengen Area 

included: Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, 

Greece, Hungary, Iceland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, 

Netherlands, Norway, Poland, Portugal, Slovakia, Slovenia, Spain, Sweden and Switzerland.

15. On March 12, 2020, the Mayor of Dallas “declared a local state of disaster” for the City of 

Dallas resulting “from the COVID-19 Pandemic” and issued an order prohibiting public gatherings 

of more than 500 people. Texas Government Code Section 418.108 authorizes the Mayor to order 

the evacuation of all or part of the population from a stricken or threatened area under the 

jurisdiction and authority of the Mayor if the Mayor considers the action necessary for the 

preservation of life or other disaster mitigation, response or recovery. Section 418 further 

authorizes the Mayor to control ingress to and egress from a disaster area under the jurisdiction 

and authority of the Mayor and control the movement of persons and the occupancy of premises 

in that area. Moreover, the Mayor’s initial order and all subsequent orders note that Section 14B7 of the Dallas City Code authorizes the City Manager to "promulgate such regulations as he or 

she deems necessary to protect life and property and preserve critical resources" while a state of 

disaster is in effect. (Emphasis added.)

16. On March 12, 2020, under authority of Texas Government Code section 108, Dallas County 

Judge Clay Jenkins issued a DECLARATION OF LOCAL DISASTER FOR PUBLIC HEALTH 
EMERGENCY. The Declaration noted that WHO had declared world-Wide pandemic. The

Declaration stated that “a local state of disaster for public health emergency is hereby declared for

Dallas County, Texas, pursuant t0 section 418.108(a) of the Texas Government Code.” Also 0n

March 12, 2020, Judge Jenkins issued an order stating: “The Virus that causes 2019 Coronavirus

Disease (COVID—19) is easily transmitted through person t0 person contact, especially in group

settings, and it is essential that the spread of the Virus be slowed t0 protect the ability ofpublic

andprivate health careproviders to handle the influx of new patients and safeguard public health

and safety.” (Emphasis added.) Accordingly, community gatherings 0f more than 500 were

prohibited.3

17. On March 14, 2020, President Trump signed the Proclamation 0n the Suspension 0f Entry

as Immigrants and Nonimmigrants 0f Certain Additional Persons Who Pose Risk 0f Transmitting

Coronavirus (the Fourth Proclamation), further suspending the entry of all aliens Who were

physically present in the United Kingdom (excluding overseas territories outside 0f Europe) 0r the

Republic ofIreland during the 14-day period preceding their attempted entry into the United States.

18. Four days later, on March 16, 2020, an Amended Order was issued by the County 0fDallas.

This order barred public, private or community gatherings of more than fifty. It also provided:

“Restaurants with or without drive-in 0r drive-through services and microbreweries, microdistilleries, 0r wineries may only provide take out, delivery, 0r drive-through services as allowed

by law.”

Similar orders were entered in Georgia and Nevada, the locations 0f two 0f the Lombardi’s Plaintiffs, declaring emergencies and setting forth orders for how the states were going to respond to the pandemic. These orders also noted

the extreme risk, pointing out that there is correlation between the density of persons gathered and transmission of

the Virus. The Georgia Order (0 0) emphasized that “proximity to other persons is currently contraindicated by public

health and medical best practices t0 combat” the spread 0f COVID-19.

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4

EMERGENCY. The Declaration noted that WHO had declared world-Wide pandemic. The

Declaration stated that “a local state of disaster for public health emergency is hereby declared for

Dallas County, Texas, pursuant t0 section 418.108(a) of the Texas Government Code.” Also 0n

March 12, 2020, Judge Jenkins issued an order stating: “The Virus that causes 2019 Coronavirus

Disease (COVID—19) is easily transmitted through person t0 person contact, especially in group

settings, and it is essential that the spread of the Virus be slowed t0 protect the ability ofpublic

andprivate health careproviders to handle the influx of new patients and safeguard public health

and safety.” (Emphasis added.) Accordingly, community gatherings 0f more than 500 were

prohibited.3

17. On March 14, 2020, President Trump signed the Proclamation 0n the Suspension 0f Entry

as Immigrants and Nonimmigrants 0f Certain Additional Persons Who Pose Risk 0f Transmitting

Coronavirus (the Fourth Proclamation), further suspending the entry of all aliens Who were

physically present in the United Kingdom (excluding overseas territories outside 0f Europe) 0r the

Republic ofIreland during the 14-day period preceding their attempted entry into the United States.

18. Four days later, on March 16, 2020, an Amended Order was issued by the County 0fDallas.

This order barred public, private or community gatherings of more than fifty. It also provided:

“Restaurants with or without drive-in 0r drive-through services and microbreweries, microdistilleries, 0r wineries may only provide take out, delivery, 0r drive-through services as allowed

by law.”

Similar orders were entered in Georgia and Nevada, the locations 0f two 0f the Lombardi’s Plaintiffs, declaring emergencies and setting forth orders for how the states were going to respond to the pandemic. These orders also noted

the extreme risk, pointing out that there is correlation between the density of persons gathered and transmission of

the Virus. The Georgia Order (0 0) emphasized that “proximity to other persons is currently contraindicated by public

health and medical best practices t0 combat” the spread 0f COVID-19.

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4
PLAINTIFFS ORIGINAL PETITION 8

4853-0333-1258v.4

19. An Amended Order by the City of Dallas was also entered March 16, 2020, prohibiting 

access and use of any premises operated as dine-in restaurants, but allowing operation only as 

regulated take-out services. The Amended Dallas City Order further provided that “[t]he owner, 

manager, or operator of any facility that is likely to be impacted by these regulations shall post a 

copy of these regulations onsite and visible to users of the facility and provide a copy to any user 

of the facility asking for a copy.”

20. On March 18, 2020, Dallas County issued another Amended Order. This Order noted: “On 

March 16, 2020, President Trump acknowledged the gravity of the COVID-19 pandemic, releasing 

strict new guidelines to limit people’s interactions, including that Americans should avoid groups 

of more than 10 people.” The March 18th Amended Dallas County Order prohibited “Public or 

private Recreational Gatherings and Community Gatherings.” It further ordered that “[b]ars, 

lounges, taverns, private clubs, arcades, and gyms shall close.”

21. On March 20, 2020, Governor Greg Abbott announced that the U.S. Small Business 

Administration (SBA), at his request, had included the entire state of Texas in its Economic Injury 

Disaster Declaration. The Governor’s request for inclusion in this Declaration was based on 

economic losses being suffered across Texas Related to major event cancellations, loss of walk-in 

customers, depletion of stock from suppliers, and client cancellations. "The overriding message of 

this time in history is that we are all in this together," said Governor Abbott. "From people 

responsibly remaining at home to protect themselves and their communities to the small businesses 

adapting to serve them, Texans are showing their willingness to serve the greater good and that’s 

why we’ll overcome this together. That’s what Texans do. We are not only Texas Strong, we are 

#TexasBizStrong."
PLAINTIFFS ORIGINAL PETITION 9

4853-0333-1258v.4

22. On March 24, 2020, the World Health Organization indicated that the United States had 

the potential to become the center of the COVID-19 pandemic. Also on March 24, 2020, Dallas 

County issued is Stay Home Stay Safe Order, requiring those living in Dallas County to shelter at 

their residence. Only essential businesses were allowed to continue to operate. 

23. On March 29, 2020, Dallas County issued another Amended Order, again recognizing: 

“[I]t is essential that the spread of the virus be slowed to protect the ability of public and private 

health care providers to handle the influx of new patients and safeguard public health and safety. 

Because of the risk of the rapid spread of the virus, and the need to protect the most vulnerable 

members of the community, this Order requires all individuals anywhere in Dallas County to 

shelter in place – that is, stay at home – except for certain essential activities and work to provide 

essential business and government services or perform essential public infrastructure construction, 

including housing.” (Emphasis added.)

24. Dallas County issued an Amended Order on April 6, 2020, continuing the extraordinary 

rules and regulations previously adopted. This Amended Dallas County Order stated:

WHEREAS, this Emergency Order is necessary because of the propensity of the 

virus to spread person to person and also because the virus is physically causing 

property damage due to its proclivity to attach to surfaces for prolonged periods of 

time;

WHEREAS, this Emergency Order is necessary to protect the lives, health, welfare, 

and safety of the County’s residents from the devastating impacts of this pandemic 

. . . .

The Amended Dallas County Order further provides as to Restaurants: 

Restaurants. Restaurants with or without drive-in or drive-through services and 

microbreweries, micro-distilleries, or wineries may only provide take out, delivery, 

or drive-through services as allowed by law. In-person service is prohibited. 

Customers may order and pay inside, but are prohibited from waiting inside the 

restaurant for their food. All food must be brought outside to customers. To allow 

for increased access to restaurants, this Order hereby suspends all laws and 

regulations prohibiting people from walking in a drive-through.
PLAINTIFFS ORIGINAL PETITION 10

4853-0333-1258v.4

(Emphasis added.)

25. As of April 11, 2020, all 50 states as well as the U.S. Virgin Islands, the Northern Mariana 

Islands, Washington, D.C., Guam and Puerto Rico have received a federal disaster declaration as 

a result of the pandemic. American Samoa is the only U.S. territory that is not under a major 

disaster declaration.

26. On March 16, 2020, prior to submitting any claim, Lombardi’s insurance agent represented 

to Lombardi’s that Chubb had been asked how BI [business interruption] might respond in 

connection with the restaurant program in which Lombardi’s was insured, and the response was 

that “Chubb [was] having high level discussions and we are awaiting their direction.”

27. Lombardi’s provided a notice of a claim under the Policy and other policies in connection 

with the recent events involving the 2019 Novel Coronavirus pandemic on March 17, 2020. Chubb 

acknowledged the notice was received on March 18, 2020.

28. On March 18, 2020, the same day notice was provided, Chubb adjuster Jennifer Dixon 

informed Lombardi’s in a telephone call that Chubb was going by the “black and white” written 

word in the Policy and that there were no physical damages to cause the payment of a business 

interruption claim. No other basis for this preemptive and pre-textual denial was provided.

29. On March 19, 2020, the Chubb adjuster informed Lombardi’s by telephone that Chubb 

would be drafting a reservation of rights letter to send to Lombardi’s. The adjuster said this letter 

would state the claim was under investigation and was ongoing and that this would not be a hard 

“no.” She stated the letter would look like a declination letter, and it would outline what parts of 

Lombardi’s policy were under review/investigation and might be used to deny coverage at some 

point. She advised that this allowed Chubb to keep the claim open with the opportunity to learn 

of changes that would allow them to pay the claim.
30. On March 24, 2020, Lombardi’s emailed letter to Chubb stating: We strongly disagree with the approach Chubb has taken to regarding this claim.

Just few hours after it was submitted, you made very clear in phone conversation

... there was n0 physical damage to property. You stated that Chubb was strictly following the letter of the contract. Then, the next day you said Chubb would be

issuing reservation ofrights letter that would 100k like declination letter. Clearly, Chubb is denying for now, and the reservation is tool for Chubb to try and keep

the claim open in the event it sees something that might change its mind.

Your insured is less than twenty-four hours from having t0 let go of over 700

employees. We do not have week or ten days t0 wait to see what Chubb's position

is. You have obviously as company been working 0n these issues in anticipation 0f such claims. You noted all of these letters, being sent t0 insureds across the country, were part 0f Chubb special review process for these events.

Lombardi’s received n0 acknowledgement 0r response t0 this letter.

31. On April 6, 2020, Chubb finally provided its coverage position letter. It was not “soft”

reservation of rights as promised. It was “hard” denial. The letter contained several blatant

misrepresentations:

“Indemnity Insurance Company ofNorth America (“Chubb”) has completed its factual investigation

Chubb made no request to Lombardi’s for documents 0r information

relating to the claim.

Chubb denied 0n the same day the claim was presented and could not have done proper 0r thorough investigation.

“There is n0 information supporting any direct physical loss or damage has occurred that caused such orders t0 be issued.”

Chubb misstates the terms 0f the Policy. The Policy actually states: “We

will pay for direct physical loss gfor damage to Covered Property

.” (Emphasis added. The same requirement is stated in the Business

Interruption insuring agreement.) Chubb rewrote the policy to try to make it look like only physical impact or change to the property was

covered and would permit coverage for business income loss. At the very

least, Lombardi’s suffered physical loss 0f the covered property as

result of actions taken to limit the impact 0f the pandemic 0n the health

care system. Further, Lombardi’s clearly suffered loss 0f use 0f

PLAINTIFFS ORIGINAL PETITION 11

4853-0333-1 258v.4

30. On March 24, 2020, Lombardi’s emailed letter to Chubb stating: We strongly disagree with the approach Chubb has taken to regarding this claim.

Just few hours after it was submitted, you made very clear in phone conversation

... there was n0 physical damage to property. You stated that Chubb was strictly following the letter of the contract. Then, the next day you said Chubb would be

issuing reservation ofrights letter that would 100k like declination letter. Clearly, Chubb is denying for now, and the reservation is tool for Chubb to try and keep

the claim open in the event it sees something that might change its mind.

Your insured is less than twenty-four hours from having t0 let go of over 700

employees. We do not have week or ten days t0 wait to see what Chubb's position

is. You have obviously as company been working 0n these issues in anticipation 0f such claims. You noted all of these letters, being sent t0 insureds across the country, were part 0f Chubb special review process for these events.

Lombardi’s received n0 acknowledgement 0r response t0 this letter.

31. On April 6, 2020, Chubb finally provided its coverage position letter. It was not “soft”

reservation of rights as promised. It was “hard” denial. The letter contained several blatant

misrepresentations:

“Indemnity Insurance Company ofNorth America (“Chubb”) has completed its factual investigation

Chubb made no request to Lombardi’s for documents 0r information

relating to the claim.

Chubb denied 0n the same day the claim was presented and could not have done proper 0r thorough investigation.

“There is n0 information supporting any direct physical loss or damage has occurred that caused such orders t0 be issued.”

Chubb misstates the terms 0f the Policy. The Policy actually states: “We

will pay for direct physical loss gfor damage to Covered Property

.” (Emphasis added. The same requirement is stated in the Business

Interruption insuring agreement.) Chubb rewrote the policy to try to make it look like only physical impact or change to the property was

covered and would permit coverage for business income loss. At the very

least, Lombardi’s suffered physical loss 0f the covered property as

result of actions taken to limit the impact 0f the pandemic 0n the health

care system. Further, Lombardi’s clearly suffered loss 0f use 0f

PLAINTIFFS ORIGINAL PETITION 11

4853-0333-1 258v.4
Covered Property because was unable t0 operate and use the restaurant

for in—person dining.

This same deliberate and significant omission has been used by Chubb

in hundreds 0f letter notifications regarding its position on coverage

provided to policyholders in the State of New York. These coverage

position statements were issued by Chubb in response t0 an order of the New York Department of Financial Services t0 provide policyholders with detailed information regarding Chubb’s position regarding the various types 0f policies written in that state in connection with the 2019

Novel Coronavirus.

Chubb wrongly suggests that “independent adjusters or experts” were

retained by it t0 investigate and adjust the claim when there is n0

evidence that any investigation was actually undertaken.

Chubb states: “[I]t is our understanding that governmental authorities ordered the captioned premises to reduce occupancy and subsequently

close as precaution to prevent the spread 0f the COVID-19 virus.” (Emphasis added.) The orders prohibited any occupancy for in-person

dining. Moreover, Chubb’s statement admits the widespread nature of

the pandemic and that the threat it presents requires prohibiting the use 0fthe insured property. This is clearly loss ofthe property that is caused by pandemic and the need to protect the health system and the community.

Chubb relies alternatively on the EXCLUSION OF LOSS DUE TO

VIRUS OR BACTERIA as basis for denial even though it was not

stated basis in Chubb’s initial denial. Contrary t0 Chubb’s assertion, this

is not pandemic exclusion. Chubb ignores the fact that the exclusion

states that it applies only Where Virus, that is microorganism, is the

fully realized and actual cause 0f the loss. It does not state that it applies

t0 loss caused by the need t0 prevent against the threat of Viral transmission.

V. CAUSES OF ACTION

A. Breach 0f Contract

32. The Plaintiffs incorporate each and every allegation set forth in this Petition as if fully

set forth in this section.

PLAINTIFFS ORIGINAL PETITION 12

4853-0333-1 258v.4

Covered Property because was unable t0 operate and use the restaurant

for in—person dining.

This same deliberate and significant omission has been used by Chubb

in hundreds 0f letter notifications regarding its position on coverage

provided to policyholders in the State of New York. These coverage

position statements were issued by Chubb in response t0 an order of the New York Department of Financial Services t0 provide policyholders with detailed information regarding Chubb’s position regarding the various types 0f policies written in that state in connection with the 2019

Novel Coronavirus.

Chubb wrongly suggests that “independent adjusters or experts” were

retained by it t0 investigate and adjust the claim when there is n0

evidence that any investigation was actually undertaken.

Chubb states: “[I]t is our understanding that governmental authorities ordered the captioned premises to reduce occupancy and subsequently

close as precaution to prevent the spread 0f the COVID-19 virus.” (Emphasis added.) The orders prohibited any occupancy for in-person

dining. Moreover, Chubb’s statement admits the widespread nature of

the pandemic and that the threat it presents requires prohibiting the use 0fthe insured property. This is clearly loss ofthe property that is caused by pandemic and the need to protect the health system and the community.

Chubb relies alternatively on the EXCLUSION OF LOSS DUE TO

VIRUS OR BACTERIA as basis for denial even though it was not

stated basis in Chubb’s initial denial. Contrary t0 Chubb’s assertion, this

is not pandemic exclusion. Chubb ignores the fact that the exclusion

states that it applies only Where Virus, that is microorganism, is the

fully realized and actual cause 0f the loss. It does not state that it applies

t0 loss caused by the need t0 prevent against the threat of Viral transmission.

V. CAUSES OF ACTION

A. Breach 0f Contract

32. The Plaintiffs incorporate each and every allegation set forth in this Petition as if fully

set forth in this section.

PLAINTIFFS ORIGINAL PETITION 12

4853-0333-1 258v.4
PLAINTIFFS ORIGINAL PETITION 13

4853-0333-1258v.4

33. Lombardi’s has satisfied and performed all applicable terms and conditions of the Policy. 

Alternatively, Chubb has waived any such term or condition and may not assert any term or 

condition in the Policy as a defense to liability thereunder.

34. The pandemic and health care crisis has resulted in the Plaintiffs suffering a physical 

loss of the insured properties, and alternatively damage to the insured properties and suspension 

of their businesses that are covered under the business income loss (and extra expense) 

provisions of the Policy. Alternatively, coverage is available under civil authority coverage 

under the Policy.

35. The Exclusion of Loss Due to Virus or Bacteria has no application to the Lombardi’s 

claims in light of its plain language. Alternatively, the exclusion is ambiguous and must be 

construed in the light most favorable to Lombardi’s. Contrary to the assertions of Chubb, this 

exclusion is not a pandemic exclusion.

36. Chubb is estopped and/or has waived the right to rely on the exclusion as a result of its 

premature and limited denial of coverage. 

37. Chubb failed to give proper notice and disclosure of the presence of the exclusion and is 

thus barred from reliance upon it.

38. On information and belief, Chubb is barred from relying on the exclusion as a result of 

regulatory and/or administrative estoppel.

39. Alternatively, the exclusion as interpreted by Chubb is unconscionable and/or contrary 

to public policy and cannot be enforced as written.

40. Lombardi’s operations remain suspended as a result of the threat presented by the current 

circumstances. 
PLAINTIFFS ORIGINAL PETITION 14

4853-0333-1258v.4

41. Chubb has breached the contract by its wrongful denial, causing delay and/or loss of 

receipt of the policy benefits and additional actual and/or consequential damages.

42. Chubb is entitled to recovery of attorney’s fees incurred in the prosecution of these 

claims. TEX. CIV. PRAC. & REM CODE §38.001(8).

B. Breach of The Duty of Good Faith and Fair Dealing

43. The Plaintiffs incorporate each and every allegation set forth in this Petition as if fully 

set forth in this section. 

44. A special relationship exists and continues to exist between Chubb and the Plaintiffs as 

a result of the first-party insurance policy issued by Chubb. Inherently unequal bargaining 

power exists between Lombardi’s and Chubb.

45. Chubb had no reasonable basis for denying or delaying payment of Lombardi’s claims 

and it knew or should have known that it had no reasonable basis for denial. Chubb considered 

only its own interests, proceeded only according to its one-sided and self-serving interpretation 

of the Policy, and attempted to conceal from Lombardi’s that Chubb in fact made no effort to 

consider Lombardi’s interests. Chubb pre-textually looked only for ways to avoid coverage 

rather than first trying to find coverage. 

46. Chubb had a duty to investigate the claims fairly and objectively but it clearly failed to 

make any attempt to do so. Nonetheless, it is deemed to have it is charged with full and complete 

knowledge of what a reasonable investigation would have revealed, and its actions must be 

judged accordingly. 

47. Accordingly, Chubb failed to attempt in good faith to effectuate a prompt, fair and 

equitable settlement of a claim where its liability had become reasonably clear.
PLAINTIFFS ORIGINAL PETITION 15

4853-0333-1258v.4

48. Chubb’s breach of the duty of good faith and fair dealing proximately caused actual and 

consequential damages to the Plaintiffs.

C. Punitive Damages

49. The Plaintiffs incorporate each and every allegation set forth in this Petition as if fully 

set forth in this section. 

50. Chubb’s breach of the duty of good faith was malicious and/or grossly negligent and 

therefore supports an award of punitive damages. Chubb was directly informed of and had actual 

knowledge of the grievous damages and extraordinary harm that would be caused by breach of 

its duty of good faith in the event of a wrongful denial of coverage.

D. Violation of Texas Prompt Pay Act

51. The Plaintiffs incorporate each and every allegation set forth in this Petition as if fully 

set forth in this section. 

52. Chubb has failed to timely and promptly pay as required under TEX. INS. CODE §§ 

542.055-542.059.

53. Chubb should be ordered to pay “in addition to the amount of the claim, interest on the 

amount of the claim at the rate of 18 percent a year as damages, together with reasonable and 

necessary attorney’s fees. Nothing in this subsection prevents the award of prejudgment interest 

on the amount of the claim, as provided by law.” TEX. INS. CODE sec. 542.060(a). 

54. The Plaintiffs were forced to retain the services of an attorney and law firm to represent 

them with respect to their claims against Chubb because of Chubb’s wrongful acts or omissions.

Id. at sec. 542.060(b).

VI. JURY TRIAL DEMANDED

55. Plaintiffs demand a jury trial and tenders the appropriate fee with this petition.
PLAINTIFFS ORIGINAL PETITION 16

4853-0333-1258v.4

VII. WRITTEN DISCOVERY REQUESTS

56 Pursuant to Rule 194, Defendant is hereby requested to disclose the information or 

material described in Rule 194.2 (a)-(1) within fifty (50) days of the service of this request. 

Additionally, under Texas Rules of Civil Procedure 196, 197, 198 and 193.3 (b), Plaintiffs 

request that within fifty (50) days of service of this request that Chubb respond to Plaintiffs’ 

First Request for Production and Request for Privilege Log, made a part of this petition as 

Exhibit “A.”

VIII. INTENT TO USE DEFENDANT’S DOCUMENTS

57. In accordance With Texas Rules of Civil Procedure 193.7, any documents produced

by Defendant in response to written discovery will be used by Plaintiffs at any pre-trial 

proceeding or trial.

IX. PRAYER

58. The Plaintiffs pray that Chubb be served with process and appear herein and that, upon 

final hearing hereof, this Honorable Court enter a judgement for Plaintiffs awarding the 

following relief:

a. Actual and consequential damages for Chubb’s breach of contract; 

b. Actual damages for Chubb’s breach of the duty of good faith and fair dealing; 

c. Punitive damages for Chubb’s grossly negligent and/or malicious violations of 

the duty of good faith and fair dealing;

d. An 18% penalty under TEX. INS. CODE section 542.060 et seq.;

e. Reasonable and necessary attorney’s fees and costs;

f. Pre-judgment and post-judgment as allowed by law;
g. Such other and further relief as is equitable and just, both at law and in equity, as

Plaintiffs may, at the time 0f trial, show themselves justly entitled.

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4

Respectfully submitted,

/s/Michael W. Huddleston Michael W. Huddleston Texas State Bar N0. 104841 Munsch Hardt Kopf Harr, P.C. 3800 Ross Tower

500 North Akard Street Dallas, TX 75201-7584

(214) 855-7500 Main Tel. (214) 855-7584 Facsimile

(214) 855-7572 Direct Tel. mhuddleston@munsch.com

ATTORNEY FOR PLAINTIFFS

17

g. Such other and further relief as is equitable and just, both at law and in equity, as

Plaintiffs may, at the time 0f trial, show themselves justly entitled.

PLAINTIFFS ORIGINAL PETITION

4853-0333-1 258v.4

Respectfully submitted,

/s/Michael W. Huddleston Michael W. Huddleston Texas State Bar N0. 104841 Munsch Hardt Kopf Harr, P.C. 3800 Ross Tower

500 North Akard Street Dallas, TX 75201-7584

(214) 855-7500 Main Tel. (214) 855-7584 Facsimile

(214) 855-7572 Direct Tel. mhuddleston@munsch.com

ATTORNEY FOR PLAINTIFFS

17