IN THE UNITED STATES DISTRICT COURT 

 FOR THE NORTHERN DISTRICT OF ILLINOIS 

KEDZIE BOULEVARD CAFE, INC., ) 

an Illinois corporation; ) 

ELSEWHERE, LLC, an Illinois ) 

limited liability company; and ) 

FLYING SQUIRREL INDUSTRIES, ) 

LLC, an Illinois limited liability ) 

company, ) 

 ) 

Plaintiffs, ) Case No. 20 CV __ 

 ) 

 ) Judge _____ 

v. ) 

 ) Jury Trial Demanded 

 ) 

SOCIETY INSURANCE, INC., ) 

 ) 

) 

Defendant. ) 

Plaintiffs, Kedzie Boulevard Café, Inc., Elsewhere, LLC, and Flying Squirrel Industries, 

LLC, by and through their undersigned counsel, state as follows as their Complaint against 

Defendant Society Insurance, Inc. (“Society Insurance”): 

BACKGROUND 

1. Plaintiffs own and operate well known and successful bar/restaurants in the City 

of Chicago that conduct business under the names of “Scofflaw,” “The Moonlighter,” and 

“Slippery Slope.”1

2. Plaintiff employ dozens of individuals who depend in whole or in substantial part 

for their livelihood and income upon the continued operation of Plaintiffs’ operations. 

3. Plaintiffs have been forced, by the COVID-19 pandemic, as well as by 

1

 In addition, Plaintiffs also operate two other businesses, i.e., “Outside Voices,” and “The Heavy 

Feather,” inside of “Slippery Slope” and “The Moonlighter,” respectively, which are also covered under 

the Policies.

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governmental Orders issued by the State of Illinois to cease and close their normal operations. 

4. To safeguard and protect their businesses from the very types of situation and 

circumstances like the one now presented, Plaintiffs purchased, at significant premium costs, 

business income and interruption insurance policies from Defendant Society Insurance. True and 

correct copies of those policies of insurance are attached hereto as Exhibits 1-3. Those policies of 

insurance are collectively referred to hereinafter as the “Policies.” 

5. However, in total disregard and breach of its obligations to the Plaintiffs under 

the Policies, Society Insurance refuses to provide coverage to the Plaintiffs under those 

policies. 

6. Accordingly, Plaintiffs bring this action against Society Insurance based 

upon its calculated and intentional failure and refusal to fulfill its insurance obligations under the 

Policies. 

THE PARTIES 

7. Plaintiff, Kedzie Boulevard Café (“Kedzie”) is an Illinois corporation, with its 

principal place of business located in Chicago, Illinois. Kedzie is the entity that owns and 

operates the popular Chicago bar “Scofflaw,” which is located at 3201 W. Armitage. Kedzie has 

a Businessowners Liability policy issued by Society Insurance, Policy No. ROP 451854-13, with 

an effective date of May 20, 2019. See Exhibit 1, attached hereto. 

8. Plaintiff, Elsewhere, LLC (“Elsewhere”), is an Illinois limited liability company 

with its principal place of business in Chicago, Illinois. Elsewhere owns and operates the popular 

Chicago bar/restaurant “The Moonlighter,” located at 3204 W. Armitage. The members of the 

LLC consist of the following: Mr. Andrew Gould (“Gould”), a citizen and resident of the State of 

Illinois; Mr. Kristofer Nagy (“Nagy”), a citizen and resident of the State of Illinois; and Mr. 

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Daniel Shapiro (“Shapiro”), a citizen and resident of the State of Illinois. Elsewhere has a 

Businessowners Liability policy issued by Society Insurance, Policy No. BP17032398-1, with an 

effective date of October 30, 2019. See Exhibit 2. 

9. Plaintiff, Flying Squirrel Industries, LLC (“Flying Squirrel”), is an Illinois limited 

liability company with its principal place of business in Chicago, Illinois. Flying Squirrel owns 

and operates the popular Chicago bar/restaurant “Slippery Slope,” located at 2357 N. Milwaukee 

Avenue. The members of the LLC consist of the following: Gould, Nagy, and Shapiro, in 

addition to: Mr. Ronnie Kaplan, Mr. Ed Kavanaugh, and Mr. Maxwell Shapiro. Mr. Kaplan and 

Mr. Kavanaugh are citizens and residents of Illinois, and Maxwell Kaplan is a citizen and 

resident of the State of California. Flying Squirrel has a Businessowners Liability policy issued 

by Society Insurance, Policy No. TRM 589684-5, with an effective date of May 12, 2019. See 

Exhibit 3. 

10. Defendant, Society Insurance, Inc., is a corporation organized and existing under 

Wisconsin law. It maintains its principal place of business located within that State at 150 

Camelot Drive, in Fond du Lac, Wisconsin. Society Insurance is engaged in the business of, inter 

alia, selling insurance policies to commercial and other entities like the Plaintiffs, in Illinois and 

elsewhere throughout the country. 

JURISDICTION AND VENUE 

11. This Court can exercise subject matter jurisdiction over the claims asserted herein 

pursuant to 28U.S.C. §1332, because there is complete diversity between the Plaintiffs 

and the Defendant, and the amount in controversy exceeds the sum of $75,000, exclusive of 

interest and costs. This Court has personal jurisdiction over Society because, inter alia, Society 

submitted to the jurisdiction of the Illinois courts by regularly and continuously doing business 

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within this State, and pursuant to the Illinois “Long-Arm statute,” 735 ILCS 5/2-209, et. seq., by 

transacting business within this State, contracting to insure the Plaintiffs within this State, and by 

making and entering into contracts with the Plaintiffs that are substantially connected to this 

State. This Court can also exercise jurisdiction to grant declaratory relief to the 

Plaintiffs pursuant to 28 U.S.C. § 2201 because an actual controversy exists between the 

Plaintiffs and the Society Insurance as to their respective rights and obligations under the 

insurance policies at issue. Venue is appropriate in this Judicial District pursuant to 28 U.S.C. § 

1391(b)(2) because a substantial part of the events or omission giving rise to Plaintiffs’ claims 

occurred within this District. 

FACTS 

12. On or about March 15, 2020, during the term of the above-referenced policies of 

Insurance issued by Defendant Society Insurance, Governor Pritzker issued an Executive Order 

closing all restaurants, bars, and movie theaters in an attempt to control and respond to the 

COVID-19 pandemic. That, of course, included all of three restaurants/bars and other businesses 

owned and operated by the Plaintiffs. Plaintiffs have complied with that Order. 

13. That Order stated, in relevant part, “the Illinois Department of Public Health 

recommends Illinois residents avoid group dining in public settings, such as in bars and 

restaurants, which usually involves prolonged close social contact contrary to recommended 

practice for social distancing,” and that “frequently used surfaces in public settings, including 

bars and restaurants, if not cleaned and disinfected frequently and properly, also pose a risk of 

exposure.” 

14. Thereafter, on or about March 20, 2020, Governor Pritzker issued an Executive 

Ordered providing that all “non-essential businesses” must close. That March 20, 2020 closure 

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Order, shuttering or limiting all “non-essential” businesses in Illinois, including all restaurants 

and movie theaters, was made in direct response to the continued and increasing presence of 

COVID-19, including on the properties constituting Plaintiffs’ insured premises. That Order 

prohibited the general public from accessing Plaintiffs’ premises and restaurants, thereby causing 

the necessary suspension of Plaintiffs’ operations and triggering the “Civil Authority” coverage 

under each of the Policies, as further described below. 

15. Governor Pritzker has now extended the closure Orders through at least May 30, 

2020. 

16. As a direct result of those closure Orders, each of the Plaintiffs has been forced to 

to stop ordinary operations. This has in turn resulted in the loss of significant revenues, and 

forced the Plaintiffs to terminate, furlough, or lay off most of their employees. Plaintiffs have 

likewise suffered direct physical loss and damage to their above-referenced properties. 

17. Accordingly, each of the Plaintiffs made demands upon Defendant Society 

Insurance for coverage under the Policies. 

18. Society Insurance issued an almost immediate denial letter to Plaintiff Kedzie. 

See denial letter, attached hereto as Exhibit 4. Society Insurance took that position despite the 

language in the Policies that Kedzie requires it to provide coverage for just the type of business 

business income interruption losses that are at issue in this case. Moreover, Society Insurance did 

so without first conducting any type of legitimate and meaningful coverage investigation, 

including but not limited to one that constituted a reasonable investigation based upon all 

available information, as required under Illinois law. 

19. Society Insurance has failed and refused to respond to Plaintiff Elsewhere’s and 

Plaintiff Flying Squirrel’s multiple requests to it for coverage under their policies of insurance, 

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or to acknowledge its coverage obligations to them. 

20. However, because the language of each of the Policies is identical, further 

demands for coverage by Plaintiff Elsewhere or Plaintiff Flying Squirrel upon Society Insurance 

would be futile. 

21. Indeed, based upon publicly filed documents in connection with other recent 

lawsuits brought by other Chicago area businessowners against Society Insurance for coverage 

based upon the circumstances confronted by the Plaintiffs in the present case, it is come to be 

known that, on or about March 16, 2020, Society Insurance actually drafted and circulated a 

memo to its insurance agents and partners, including within the State of Illinois, taking the 

preemptive position that its policies of insurance would likely not provide coverage for the type 

of circumstances now facing the Plaintiffs and other businessowners in the Chicago area and 

State of Illinois. 

22. Plaintiffs have paid substantial premiums to Society Insurance in exchange for 

its agreement to issue and honor the Policies, and to provide coverage and indemnity to the 

Plaintiffs for losses resulting from, inter alia, occurrences - including the “necessary suspension” 

of business operations and corresponding loss of income at the above-referenced insured 

locations. 

23. The provisions that set forth the scope of coverage for business interruption losses 

are the same under each of the Policies. 

24. Such losses include, but are not limited to, those caused by governmental Orders 

of the type issued by Governor Pritzker. 

25. Each of the Policies is an “all risk” policy that provides broad coverage for losses 

resulting from by any cause, unless expressly excluded by the clear language of the Policies. 

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26. The Policies do not exclude losses from arising or resulting from viruses or 

pandemics, including the COVID-19 pandemic. That is unlike many of the commercial property 

policies available in the marketplace. In other words, Society Insurance could have simply 

chosen to exclude the very type of pandemic-related losses now at issue under the Plaintiffs’ 

Policies – but knowingly and intentionally did not. 

27. Thus, Plaintiffs reasonably expected and relied upon the fact that the Policies 

that they purchased from Society Insurance specifically included coverage for the very type of 

property damage and business interruption losses caused by viruses like COVID-19. 

28. In addition to agreeing to and providing for property damage losses under the 

terms of the Policies, Society Insurance also agreed to “pay for the actual loss of Business 

Income” sustained by Plaintiffs “due to the necessary suspension” of Plaintiffs’ operations 

during the period of business interruption caused by “by direct physical loss of or damage to 

covered property” at the Plaintiffs’ above-referenced insured premises. 

29. With regard to business interruption losses, “suspension” is defined by the 

Policies as: (1) “[T]he partial slowdown or complete cessation of your business activities;” or (2) 

“[T]hat a part or all of the described premises is rendered untenantable if coverage for Business 

Income applies.” 

30. With respect to “Business Income,” it is defined under the Polices, in relevant 

part, as “Net Income (Net Profit or Loss before income taxes) that would have been earned or 

incurred if no physical loss or damage had occurred,” in addition to “[C]ontinuing necessary 

operating expenses incurred.” 

31. Society Insurance also agreed and promised to pay Plaintiffs’ “necessary Extra 

Expense” incurred by them during the period of interruption that Plaintiffs “would not have 

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incurred if there had been no direct physical loss or damage to covered property at the described 

premises.” 

32. With respect to “Extra Expense,” it is defined under the Policies, in relevant part, 

as any expenses incurred by the Plaintiffs: (1) “[T]o avoid or minimize the suspension of 

business and to continue ‘operations’ . . . at the described premises;” (2) “[T]o minimize the 

suspension of business if you cannot continue ‘operations;’” or (3) “to [R]epair or replace 

any property.” 

33. The Policies also expressly provide for “Civil Authority” coverage, pursuant to 

which Society Insurance promised and agreed to pay the Plaintiffs for the loss of “Business 

Income” and necessary “Extra Expense” that the Plaintiffs sustained, “caused by action of civil 

authority that prohibits access” to the Plaintiffs’ above-referenced insured premises. 

34. That “Civil Authority” coverage is triggered under the Policies where, as in the 

present case, any non-excluded cause results in “damage to property other than property” at the 

Plaintiffs’ premises, and includes losses to the Plaintiffs arising out of governmental actions and 

Orders. 

35. The continuous presence of COVID-19 in and around Plaintiffs’ premises has 

has prohibited access to them, and rendered them unsafe and unfit for their intended use, and 

therefore has caused physical property damage or loss under the Policies. 

36. The Plaintiffs have each suffered substantial Business Income losses and incurred 

Extra Expense. These covered losses incurred by the Plaintiffs continue to increase by the day. 

37. Society Insurance’s coverage denials to the Plaintiffs under the Policies are 

arbitrary and unreasonable, and inconsistent with the facts and plain language of the Policies. 

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COUNT I 

(Declaratory Judgment) 

38. Plaintiffs incorporate by reference, as though fully set forth herein, Paragraphs 1 

through 37 above, as though fully set forth herein as Paragraph 38 of Count I. 

39. Each of the Policies is a valid and enforceable contract supported by good and 

valuable consideration. 

40. Plaintiffs have complied with all of the applicable provisions of the Policies, and 

otherwise satisfied all conditions precedent. 

41. Society Insurance has arbitrarily and without justification refused to provide 

coverage to the Plaintiffs under the Policies, and to reimburse them for any of the losses incurred 

in connection with the covered business losses caused by the closure Orders, the interruption of 

their businesses stemming from the COVID-19 pandemic, and the damages to their covered 

premises and properties. 

42. An actual and justiciable case or controversy exists regarding Plaintiffs’ rights 

and Society Insurance’s obligations under the Policies to reimburse Plaintiffs for the full amount 

of losses incurred by Plaintiffs. 

43. Pursuant to 28 U.S.C. § 2201, the Plaintiffs seek a Declaratory Judgment from 

this Court, declaring at least the following: (a) Plaintiffs’ losses are insured losses under the 

Policies; (b) Society Insurance has waived any and all rights to assert defenses to coverage or 

otherwise seek to bar or limit coverage for Plaintiffs’ losses; and (c) Society Insurance is 

obligated to pay the Plaintiffs for the full amount of the losses they have already incurred, and 

that they will continue to incur, in connection with their business interruption and loss of 

business income arising out of the COVID-19 pandemic. 

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COUNT II 

(Breach of Contract) 

44. Plaintiffs incorporate by reference, as though fully set forth herein, Paragraphs 1 

through 37 above, as though fully set forth herein as Paragraph 44 of Count II. 

45. Each Policy is a valid and enforceable insurance contract pursuant to which 

the Plaintiffs paid Society Insurance substantial premiums in consideration for its promise and 

agreement to pay Plaintiffs’ covered claims and losses arising from such claims, including the 

above-described business losses incurred as a result of governmental Orders and property 

damage to Plaintiffs’ property and premises. 

46. Plaintiffs have complied with all applicable provisions of the Policies, and all 

other conditions precedent. 

47. Society Insurance has breached each of the Policies by denying coverage for the 

business losses suffered and incurred by the Plaintiffs. 

48. As a direct and proximate cause of Society Insurance’s breaches of the Policies, 

Plaintiffs have sustained, and will continue to sustain substantial damages for which Society 

Insurance is liable, in an amount to be more fully established at trial - but in an amount in excess 

of several hundred thousand dollars under each of the Policies and to be more fully established 

by way of discovery and trial. 

COUNT III 

(Bad Faith - 215 ILCS 5/155) 

49. Plaintiffs incorporate by reference, as though fully set forth herein, Paragraphs 1 

through 37 above, as though fully set forth herein as Paragraph 49 of Count III. 

50. As referenced above, Society Insurance either immediately denied the requests 

and claims for coverage made by or on behalf of the Plaintiffs under the Policies, or simply 

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failed and refused to respond to at all. 

51. Society Insurance engaged in such actions without conducting any legitimate 

inquiry or investigation, let alone a “reasonable investigation based on all available information,” 

as mandates by Illinois law. See, e.g., 215 ILCS 5/154.6. 

52. In fact, as referenced, above, Society Insurance actually directed its insurance 

agents that Society Insurance was going to deny claims of the type now asserted by the Plaintiffs, 

before such claims were even made. 

53. Society Insurance’s denials of Plaintiffs’ claims, and its failure and refusal to 

respond to Plaintiffs’ claims is vexatious and unreasonable. 

54. Society Insurance’s conduct and denials constitute improper claims handling 

Practices under Illinois law. 

55. Society Insurance has failed to proffer any legitimate reason for its denials and/or 

for its failure and refusal to respond to the Plaintiffs, and has failed to raise any bona fide 

disputes as to the whether the claims were covered by the Policies. 

56. Pursuant to 215 ILCS 5/155, Plaintiffs respectfully request that, in addition 

to entering judgment in favor of the Plaintiffs and against Society Insurance for the amounts 

due and owing under the Policies at the time of judgment, this Court also enter judgment in 

favor of the Plaintiffs and against Society Insurance for an amount equal to the greater of (1) 

60% of the amount that the fact finder determines that Plaintiffs are entitled to recover under the 

Policies, exclusive of costs; and $60,000 per Plaintiff. See also 215 ILCS 5/155. 

56. Plaintiffs further request that this Court enter judgment in favor of the Plaintiffs 

and against Society Insurance in an amount equal to the reasonable attorneys’ fees and costs 

incurred by Plaintiffs in connection with the bringing of this action, in an amount to be more 

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fully proved during discovery and trial. See 215 ILCS 5/155. 

WHEREFORE, Plaintiffs respectfully pray that the Court: 

Enter a Declaratory Judgment on Count I in favor of the Plaintiffs and against Defendant 

Society Insurance, Inc., declaring that: Plaintiffs’ losses and the necessary interruption of 

their businesses arising from the COVID-19 pandemic are insured losses under the 

Policies; 

Order that Defendant Society Insurance, Inc. has waived its rights to assert defenses to 

coverage, or otherwise seek to bar or limit coverage for the Plaintiffs’ losses; 

Order that Defendant Society Insurance, Inc. is estopped from asserting defenses to 

coverage, or otherwise seek to bar or limit coverage for the Plaintiffs’ losses; 

Order that Defendant Society Insurance, Inc. is obligated to pay Plaintiffs the full amount 

of the losses they have incurred, and will incur, in connection with their covered business 

losses arising from the COVID-19 pandemic 

Enter judgment on Count II in favor of the Plaintiffs and against Defendant Society 

Insurance, Inc., and award the Plaintiffs all damages to which they are entitled to recover 

for breach of contract, in an amount to be more specifically proven through discover and 

at trial; 

Enter judgment on Count III in favor of the Plaintiffs and against Defendant Society 

Insurance, Inc., in the amount equal to or greater than 60% of the amount which the 

finder of fact determine that the Plaintiffs are entitled to recover under the Policies, 

exclusive of costs, in addition to the sum of $60,000 for each of the Plaintiffs; 

Enter judgment in favor of the Plaintiffs and against Defendant Society Insurance, Inc., in 

an amount equal to the attorneys’ fees and costs incurred in connection with the bringing 

of this action, in an amount to be more specifically proven through discovery and at trial; 

Enter judgment in favor of the Plaintiffs and against Defendant Society Insurance, Inc., 

awarding them prejudgment interest 

Enter judgment in favor of the Plaintiffs and against Defendant Society Insurance, Inc., 

awarding them all other and further relief as is allowable and appropriate. 

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 JURY TRIAL DEMANDED 

Respectfully submitted, 

 By: /s/ Michael I. Leonard 

 Counsel for Plaintiffs 

LEONARDMEYER LLP 

Michael I. Leonard 

Rebeca Chacko 

120 North LaSalle, Suite 2000 

Chicago, Illinois 60602 

(312)380-6559 (direct) 

(312)264-9671 (fax) 

mleonard@leonardmeyerllp.com 

rchacko@leonardmeyerllp.com 

CERTIFICATE OF SERVICE 

 

The undersigned states that, on May 4, 2020, he caused the above to be filed by way of 

this Court’s ECF filing system. 

 RESPECTFULLY SUBMITTED, 

 

 

 By: s/Michael I. Leonard 

 Counsel for Plaintiffs 

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