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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

MCDONALD’S CORPORATION,

MCDONALD’S USA, LLC,

LEXI MANAGEMENT, LLC,

and DAK4, LLC,

No. 20-cv-5057

Plaintiffs,

Judge Charles P. Kocoras

v.

Magistrate Judge Jeffrey T. Gilbert

AUSTIN MUTUAL INSURANCE

COMPANY,

Defendant.

AUSTIN MUTUAL INSURANCE 

COMPANY,

Counter-Plaintiff,

v.

MCDONALD’S CORPORATION,

MCDONALD’S USA, LLC,

LEXI MANAGEMENT, LLC,

and DAK4, LLC,

Counter-Defendants.

AUSTIN MUTUAL INSURANCE COMPANY’S FIRST

AMENDED COUNTERCLAIMS FOR DECLARATORY JUDGMENT

Defendant/Counter-Plaintiff Austin Mutual Insurance Company (“Austin Mutual”) 

hereby files its First Amended Counterclaims for Declaratory Judgment against 

Plaintiffs/Counter-Defendants McDonald’s Corporation, McDonald’s USA, LLC, Lexi 

Management, LLC, and DAK4, LLC (collectively, the “Insureds”) and in support thereof, states 

as follows: 

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NATURE OF THE ACTION

1. Austin Mutual brings this declaratory judgment action to obtain a judicial finding 

that it has no duty to defend the Insureds in Massey, et al. v. McDonald’s Corp., et al., Case No. 

2020 CH 04247, in the Circuit Court of Cook County, Illinois (the Massey Lawsuit”) under 

commercial general liability insurance policies issued to Lexi Management, LLC and DAK4, 

LLC (the “Policies”). Plaintiffs in the Massey Lawsuit are individuals claiming to be workers at 

McDonald’s restaurants or persons living with those workers, and they seek to represent classes 

of individuals who have worked at the same restaurants since April 1, 2020 and those living with 

such workers. The Massey Lawsuit asserts that the Insureds have not taken adequate measures to 

limit employees’ risk of exposure to a 2019 novel coronavirus (2019-nCoV) (the “Virus”) that 

can lead to contracting COVID-19, an infectious respiratory disease, despite the Insured’s 

knowledge of these risks and of appropriate safety precautions. The Complaint in the Massey

Lawsuit seeks injunctive relief to require the Insureds to take steps to enhance the safety of the 

work environment and mitigate future risks to employees from contracting COVID-19 in the 

future. Because the allegations of the Massey Complaint make clear that there is no possibility 

that the claims asserted therein are covered under the Policies, Austin Mutual has no duty to 

defend.

2. First, the Massey Complaint does not allege claims on which the Insureds may 

become obligated to pay “damages because of ‘bodily injury,’” as required by the Policies. 

“Bodily injury” under the Policies refers to sickness or disease, but the Massey Complaint seeks 

no relief or remedy of any kind to redress any purported sickness, disease or mental anguish any 

of those plaintiffs might have allegedly sustained. The Massey Complaint seeks no monetary 

damages, nor any injunctive relief directed at diagnosing or treating COVID-19, or remediating 

any alleged consequence for anyone who has contracted COVID-19. Indeed, it seeks only a 

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declaration and injunctive relief to require the Insureds take measures to prophylactically 

mitigate the future risks of exposure to COVID-19—i.e., to provide protective gear such as 

gloves and masks without requiring workers to reuse them in an unsafe manner, supply hand 

sanitizer, require workers and customers to wear face coverings, inform workers if a fellow 

worker has been diagnosed with COVID-19, and provide workers with accurate information 

regarding COVID-19 and training on preventative measures such as hand washing. These 

allegations in the Massey Complaint do not create an obligation for Austin Mutual to defend the 

Massey Lawsuit.

3. Second, the Massey Complaint does not allege “bodily injury” that is the result of 

an “occurrence.” Under the Policies, an “occurrence” is defined as an accident. The occurrence 

here—the Insureds’ failure to take steps to control the risk of the workers’ exposure to COVID19—is not an accident. By the time the Massey Complaint was filed, COVID-19 was recognized 

as a global pandemic that reached all corners of the globe, and the risks of the disease were well 

known. Likewise, the alleged risks of contracting COVID-19 as a result of inadequate 

workplace safety precautions were also well known, both to the public in general and to the 

Insureds specifically. Because the alleged risks described in the Massey Complaint were the 

natural and foreseeable consequences of the allegedly insufficient safety precautions taken by the 

Insureds, even if the Massey Complaint had alleged “bodily injury” (which it has not), it was not 

the result of an accident and is not covered under the Policies.

4. Third, the very risks from COVID-19 and exposure to the Virus that the Massey

Complaint alleges are the injuries resulting from the Insureds’ failures to implement adequate 

safety measures were known – at least in part – to the Insureds prior to the inception of the 

Policies on March 1, 2020. Because the Policies do not extend coverage to “bodily injury” if the 

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Insured knew that the alleged injury had occurred, in whole or in part, before the Policies 

commenced, and because the Insureds were aware of the risks of COVID-19 and at least in part 

the safety precautions that businesses such as theirs should take before the Policies became 

effective, even if the Massey Complaint had alleged “bodily injury” (which it has not), it is 

deemed to have been known, and falls outside the coverage of the Policies.

5. Fourth, even if the Massey Complaint had alleged “bodily injury” (which it has 

not), coverage for the Massey Complaint is precluded by the Employers’ Liability exclusion, 

which provides that there will be no coverage for alleged “bodily injury” of an employee of the 

Insured or his family members, if such alleged injury occurred during the course and scope of the 

employees’ work for the Insured or while performing duties related to the conduct of the 

Insureds business. Here, the entirety of the Massey Complaint addresses the alleged risks that 

workers face while performing their duties at McDonald’s restaurants. Those claims fall within 

the clear terms of the Employers’ Liability exclusion.

6. Fifth, even if the Massey Complaint had alleged “bodily injury” (which it has 

not), coverage for the Massey Complaint is precluded by the Employment-Related Practices 

Exclusion endorsement. The decisions and actions by the Insureds regarding face masks, social 

distancing, hand sanitizer, surface cleaning, and monitoring the COVID-19-related health status 

of employees for the purposes of informing other employees, are all policies and practices of the 

Insureds specific to the employer-employee relationship and the work environment created by 

the Insureds for their employees.

7. Finally, even if the Massey Complaint had alleged “bodily injury” (which it has 

not), the exclusion in the Policies for “bodily injury” that is “expected or intended from the 

standpoint of the insured” also precludes coverage for the Massey Complaint. The Massey

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Complaint alleges that the plaintiffs are injured because they face an increased risk of exposure 

to the Virus, allegedly as a result of failures by the Insureds to implement basic safety measures 

recommended by the U.S. Center for Disease Control and Prevention (“CDC”) and other experts 

and allegedly as called for by McDonald’s corporate directives. The expected result of the 

alleged failure to implement and enforce safety precautions designed specifically to limit the 

spread of the Virus is necessarily an increased risk from exposure to the Virus. As a result, the 

claims in the Massey Complaint are excluded by the plain language of the Policies.

JURISDICTION AND VENUE

8. Austin Mutual is an insurance company organized under the laws of the state of 

Minnesota with its principal place of business in Maple Grove, Minnesota. 

9. Upon information and belief, McDonald’s Corporation is a Delaware corporation 

with its principal place of business in Chicago, Illinois. McDonald’s Corporation has already 

appeared in this action.

10. Upon information and belief, McDonald’s USA, LLC is a Delaware limited 

liability company with its principal place of business in Chicago, Illinois. Upon information and 

belief and as pled in its Complaint, McDonald’s USA’s sole member is McDonald’s

Corporation. McDonald’s USA, LLC franchises McDonald’s restaurants in the United States.

McDonald’s USA, LLC has already appeared in this action. McDonald’s Corporation and

McDonald’s USA, LLC are collectively referred to herein as “McDonald’s.”

11. Upon information and belief, Lexi Management, LLC (“Lexi”) is an Illinois 

limited liability company with its principal place of business in Chicago, Illinois. Upon 

information and belief and as pled in its Complaint, Lexi’s members are Tonnette Williams and 

her minor daughter, both citizens of Illinois. Until approximately June 15, 2020, Lexi ownedand 

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operated a McDonald’s franchise located at 207 E. 35th Street in Chicago, Illinois. Lexi has 

already appeared in this action.

12. Upon information and belief, DAK4, LLC (“DAK4”) is an Illinois limited 

liability company with its principal place of business in Itasca, Illinois. Upon information and 

belief and as pled in its Complaint, DAK4’s members are John Dakajos, a citizen of Illinois, and

the John Dakajos Children’s Trust. Upon information and belief and as pled in DAK4’s 

Complaint, the trustees and beneficiaries of the John Dakajos Children’s Trust are citizens of

Illinois. DAK4 owns and operates a McDonald’s franchise located at 10320 S. Kedzie Avenue in 

Chicago, Illinois. DAK4 has already appeared in this action.

13. The amount in controversy in this case exceeds the sum or value of $75,000, 

exclusive of interests and costs. 

14. Accordingly, this Court has diversity jurisdiction over this action under 28 U.S.C. 

§ 1332. 

BACKGROUND

CORONAVIRUS AND COVID-19

15. The dispute between Austin Mutual and the Insureds arises in the context of the 

ongoing global pandemic caused by the Virus, which came to be referred to as severe acute 

respiratory syndrome coronavirus 2 (SARS-CoV-2). Persons exposed to the Virus run the risk of 

infection and contraction of the COVID-19 disease. Only some of those exposed to the Virus 

will actually contract COVID-19, and individuals are not injured from exposure to the Virus 

unless they contract the disease.

16. On January 6, 2020, the CDC issued its first travel notice for travelers to Wuhan, 

China, advising that they avoid living or dead animals, animal markets, and contact with sick 

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people, and that they wash hands often with soap and water. The New York Times also ran its 

first story on the outbreak of the Virus in China.1

17. On January 8, 2020, the CDC indicated that it was “closely monitoring” the 

outbreak in China and that it had established an Incident Management Structure and was using 

the alert to “inform[] state and local health departments and health care providers about this 

outbreak and request[] that health care providers ask patients with severe respiratory disease 

about travel history to Wuhan City.”2

18. On January 17, 2020, the CDC announced that it “will implement enhanced health 

screenings to detect ill travelers traveling to the United States on direct or connecting flights 

from Wuhan, China” at New York’s John F. Kennedy International Airport, the San Francisco 

International Airport, and the Los Angeles International Airport.3

19. On January 21, 2020, the CDC “confirmed the first case of 2019 Novel 

Coronavirus (2019-nCoV) in the United States in the state of Washington,” involving a person 

who had recently returned from Wuhan, China.4

20. On January 29, 2020, the U.S. Coronavirus Task Force was created, headed by 

Alex M. Azar II, the U.S. Secretary of Health and Human Services.

21. On January 30, 2020, the CDC confirmed that the Virus “had spread between two 

people in the United States, representing the first instance of person-to-person spread with this 

new virus here.”5

 The individuals were identified as Illinois residents.

1 Wee, Sui-Lee; Wang, Vivian, “China Grapples With Mystery Pneumonia-Like Illness”, The 

New York Times, Jan. 6, 2020.

2 https://emergency.cdc.gov/han/HAN00424.asp

3 https://www.cdc.gov/media/releases/2020/p0117-coronavirus-screening.html

4 https://www.cdc.gov/media/releases/2020/p0121-novel-coronavirus-travel-case.html

5 https://www.cdc.gov/media/releases/2020/p0130-coronavirus-spread.html

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22. On January 31, 2020, Secretary Azar declared that the Virus constitutes a public 

health emergency, retroactive to January 27, 2020.6

23. Also on January 31, 2020, President Donald J. Trump issued an executive order 

blocking entry into the United States of any foreign nationals who had been in China in the 

previous fourteen days, effective February 2, 2020.7

24. On February 26, 2020, the CDC confirmed “an infection with the virus that 

causes COVID-19 in California in a person who reportedly did not have relevant travel history or 

exposure to another known patient with COVID-19,” which the CDC noted would be the first 

instance of community spread of COVID-19.

8

25. On February 26, 2020, the CDC also issued an “Interim Guidance for Businesses 

and Employers to Plan and Respond to 2019 Novel Coronavirus (2019-nCoV).”9

26. Included in the February 26, 2020 guidance were recommendations to separate 

sick employees, encourage symptomatic employees to stay home, to instruct employees to wash 

their hands with soap and water for at least 20 seconds or to use a hand-sanitizer with at least 60-

95% alcohol. The CDC’s interim guidance further recommended providing soap and water as 

well as alcohol-based hand rubs in the workplace.

27. Regarding personal protective equipment (“PPE”), after noting that “[e]mployers 

are obligated to provide their workers with PPE needed to keep them safe while performing their 

jobs[,]” the CDC’s February 26 guidance recommended that “medium exposure risk” jobs, such 

as restaurants, should “[c]onsider offering face masks to ill employees and customers to contain 

6 https://www.phe.gov/emergency/news/healthactions/phe/Pages/2019-nCoV.aspx

7 https://trumpwhitehouse.archives.gov/presidential-actions/proclamation-suspension-entryimmigrants-nonimmigrants-persons-pose-risk-transmitting-2019-novel-coronavirus/

8 https://www.cdc.gov/media/releases/2020/s0226-Covid-19-spread.html

9 https://stacks.cdc.gov/view/cdc/85488

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respiratory secretions until they are able leave the workplace” or, if masks were unavailable due 

to supply issues, face shields. 

28. Reinforcing the CDC’s Guidance, on March 9, 2020 Illinois Governor J.B. 

Pritzker issued a Gubernatorial Disaster Proclamation.10 In his Proclamation, Governor Pritzker 

noted that the CDC recommendations included isolation for symptomatic individuals, regular 

hand washing or hand sanitizing, and cleaning frequently touched surfaces. 

29. Further underscoring the importance of workplace safety and cleanliness, in early 

March the Occupational Safety and Health Administration (“OSHA”) issued its “Guidance on 

Preparing Workplaces for COVID-19.”11 In its guidance, OSHA noted that the Virus was 

thought to spread between people who are in close contact (distances less than 6 feet) and as 

such recommended that employers “explore whether they can establish policies and 

practices...to increase physical distance among employees and between employees and 

others....” OSHA’s guidance also reinforced the importance of hand washing and using handsanitizer. 

30. On March 11, 2020, President Trump signed an executive order barring entry into 

the United States of any foreign nationals who had visited the Schengen Area (defined to include 

26 European states) in the fourteen days prior to their attempted entry into the United States.12

31. On March 13, 2020, President Trump declared COVID-19 a National 

Emergency13 and, on March 16, 2020, issued “The President’s Coronavirus Guidelines for 

10 https://www2.illinois.gov/sites/gov/Documents/CoronavirusDisasterProc-3-12-2020.pdf

11 https://www.osha.gov/sites/default/files/publications/OSHA3990.pdf

12 https://trumpwhitehouse.archives.gov/presidential-actions/proclamation-suspension-entryimmigrants-nonimmigrants-certain-additional-persons-pose-risk-transmitting-2019-novelcoronavirus/

13 https://trumpwhitehouse.archives.gov/presidential-actions/proclamation-declaring-nationalemergency-concerning-novel-coronavirus-disease-covid-19-outbreak/

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America: 30 Days to Slow the Spread”14 of COVID-19. The President’s guidance again 

affirmed that washing hands and disinfecting frequently used items was key to slowing the 

spread of the Virus. 

32. On March 19, 2020, the Illinois Department of Public Health (“IDPH”) issued its 

Guidance for Food Establishments relating to COVID-19.15 Among the IDPH’s 

recommendations for businesses that remained open was hand washing and wearing single-use 

disposable gloves. 

33. In Illinois, Gov. Pritzker issued the first Stay at Home Order on March 20, 2020.16 

Pursuant to this order, restaurants were permitted to stay open for carry-out and delivery service 

only. Further, any businesses that remained open were required to designate six-foot distances to 

ensure compliance with Social Distancing Requirements and ensure that hand sanitizer and 

sanitizing products were readily available to both employees and customers. 

34. As early as April 4, 2020, the CDC recommended wearing a face covering (mask) 

in all public settings where social distancing was difficult to maintain.17 Specifically, the CDC 

stated: 

It is critical to emphasize that maintaining 6-feet social distancing 

remains important to slowing the spread of the virus. CDC is 

additionally advising the use of simple cloth face coverings to slow 

the spread of the virus and help people who may have the virus and 

do not know it from transmitting it to others.

35. Further underscoring the importance of the CDC’s recommendation that face 

coverings be worn in all public settings, on April 6, 2020 the IDPH issued its “Guidance on the 

14https://trumpwhitehouse.archives.gov/wp-content/uploads/2020/03/03.16.20_coronavirusguidance_8.5x11_315PM.pdf

15https://web.archive.org/web/20201017031212/https://www.dph.illinois.gov/sites/default/files/2

0200319_COVID-19_Closure-Opening_Guidance_for_Food_Establishments.pdf

16 https://www2.illinois.gov/pages/executive-orders/executiveorder2020-10.aspx

17 https://web.archive.org/web/20200404023508/https://www.cdc.gov/coronavirus/2019-

ncov/prevent-getting-sick/cloth-face-cover.html

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Use of Masks by the General Public,”18 which recommended that “[a]ll Illinoisans should wear 

as mask or face covering when they must leave their home or report to work for essential 

operations and they either cannot or it is impractical to maintain 6 feet of physical distance 

between themselves and others.”

36. On April 30, 2020, Gov. Pritzker mandated that masks be worn in all public 

settings, including in restaurants.19 As part of this mask-mandate, Gov. Pritzker mandated that 

all essential businesses that remained open, including any restaurants open for carry-out, 

“provide face coverings to all employees who are not able to maintain a minimum six-foot social 

distance at all times[.]”

MCDONALD’S RESPONSE TO COVID-19

37. McDonald’s has stated that its response to COVID-19 has been informed by its 

own health experts and the CDC, indicating that McDonald’s has remained informed as to 

federal and local guidelines concerning COVID-19, as well as the risks associated with the Virus 

in its operations, and that McDonald’s has worked closely with its franchisees in this area. 

Indeed, its public statements and actions reflect this knowledge.

38. In the McDonald’s 2019 annual report issued February 26, 2020, McDonald’s 

CEO addressed McDonald’s response to the emerging COVID-19 situation. He first stressed 

that the “strength of our business is rooted deeply in alignment across the three legs of our 

system—company employees, independent franchisees and global suppliers. Our top priority is 

to protect the health and safety of our people and customers. That has guided our response to 

date, through actions like implementing paid sick leave in the U.S. and enhancing hygiene 

18 https://www.dph.illinois.gov/sites/default/files/SIREN%20Memo%20-

%20IDPH%20Guidance%20for%20the%20Use%20of%20Masks%20by%20the%20General%2

0Public%2004.06.2020.pdf#overlay-context=covid19/community-guidance/mask-use

19 https://www2.illinois.gov/Pages/Executive-Orders/ExecutiveOrder2020-32.aspx

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measures at all company-owned restaurants, as well as closing in-restaurant dining where 

necessary, and working with franchisees to support financial liquidity. We are supporting each 

other through this crisis, and while we will certainly have to make some difficult decisions as the 

situation evolves, we will work through these together, as one McDonald’s system.”

39. Consistent with that message, on March 16, 2020, McDonald’s closed indoor 

dining at its company-owned restaurants nationwide.20 Reflecting the fact that McDonald’s was 

in close contact with its franchisees regarding the response to COVID-19, the statement 

announcing this decision stated that “franchisees are strongly encouraged to adopt similar 

operations procedures while keeping the needs of their people and communities at the center of 

their decisions. This guidance is supported by franchisee leadership and is expected to be 

adopted by the majority of franchisees.”

40. In an SEC filing on March 16, 2020, McDonald’s recognized that “[s]everal 

governments around the world have declared a State of Emergency and/or closed or partially 

closed all restaurants.”

41. At a March 17, 2020 press briefing of the White House Coronavirus Task Force, 

President Trump stated that he had spoken that morning with executives from America’s fastfood industry, including McDonald’s, about the important role of drive-through, pick-up and 

delivery food services. The President also noted that the government was asking “everyone to 

work at home, if possible, postpone unnecessary travel, and limit social gatherings to no more 

than 10 people.”21

20 https://corporate.mcdonalds.com/corpmcd/en-us/our-stories/article/OurStories.covid19-updateus.html

21 https://www.c-span.org/video/?470426-1/president-trump-urges-states-follow-coronavirusguidelines

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42. In an SEC filing on March 21, 2020, McDonald’s stated that in the face of the 

COVID-19 pandemic, “the Company has taken several steps focused on the safety and wellbeing of restaurant crew, franchisees, employees, and customers.”

43. Further demonstrating McDonald’s awareness of the serious nature of the Virus, 

the risks it posed, and the need to take appropriate safety precautions, on March 23, 2020 

McDonald’s released a statement on “What We’re Doing to Support Our Customers, Employees 

and Communities[.]”22 In its statement, McDonald’s noted that it had already “taken significant 

precautions to protect our customers and employees from COVID-19: closing many of our dinein sections, closing all play areas, increasing cleanings, particularly in high-traffic areas, and 

making hand sanitizer available in our restaurants.” 

44. On April 1, 2020, McDonald’s announced “Additional Precautionary Measures 

for Restaurant Employee Health and Well-Being” related to COVID-19.23 In this press release, 

McDonald’s committed to adopting social distancing guidelines, increasing cleanings, and 

making hand sanitizer available in all of its restaurants. The statement also indicated that 

McDonald’s was “partnering with our independent franchisees to take additional steps to ensure 

restaurant employees are feeling their best at the beginning of each shift,” including a series of 

questions to screen for COVID-19 related health issues.

45. In an SEC filing on April 8, 2020, McDonald’s stated that, in the face of the 

coronavirus outbreak, “[o]ne thing that has not changed ... is McDonald’s focus on protecting 

the health and safety of our people and our customers. We are implementing measures across 

markets to keep customers and crew safe, such as contactless Drive-thru and Delivery, social 

22 https://corporate.mcdonalds.com/corpmcd/en-us/our-stories/article/OurStories.we-supportcommunity.html

23 https://corporate.mcdonalds.com/corpmcd/en-us/our-stories/article/ourstories.safetymeasures.html

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distancing guidelines, protective equipment for crew and enhanced hygiene and cleaning 

procedures.”

46. In response to and demonstrating its awareness of the State and Federal Guidance, 

on April 16, 2020 McDonald’s issued a statement on “Keeping Safety Top of Mind for 

Restaurant Employees and Communities.”24 This press release noted that McDonald’s had 

secured over 100 million ono-medical grade masks for its employees and was encouraging its 

employees to wear DIY masks if masks were not available. 

47. Reflecting its continued awareness of the importance of mask wearing to 

preventing the spread of COVID-19, on May 7, 2020, McDonald’s published its statement on 

“How McDonald’s Is Prioritizing Health, Safety and Community During the Outbreak.”25 In 

this release, McDonald’s noted that it had committed to wellness checks, social distancing, 

masks and gloves for employees, and protective barriers. 

THE MASSEY LAWSUIT

48. Plaintiffs Taynarvis Massey, Maria Villasenor, Noemi Villasenor, Sujey Figueroa, 

Edwin Pilego, Truvon Turner, Jayvonna Gardley, Ryan Freeman and Joyce Freemen (hereinafter 

the “Massey Plaintiffs”) filed a Complaint for Injunctive Relief against McDonald’s Corporation, 

McDonald’s USA, LLC, McDonald’s Restaurants of Illinois, Inc., Lexi Management LLC, and 

DAK4, LLC (collectively, the “Massey Defendants”) in the Circuit Court of Cook County, 

Illinois, Case No. 2020-CH-04247 (the “Massey Lawsuit”). A true and accurate copy of the 

complaint in the Massey Lawsuit is attached hereto as “Exhibit 1.”

24 https://corporate.mcdonalds.com/corpmcd/en-us/our-stories/article/OurStories.safety-topmind.html

25 https://corporate.mcdonalds.com/corpmcd/en-us/our-stories/article/OurStories.safetystandard.html

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THE MASSEY PLAINTIFFS

49. Plaintiff Taynarvis Massey alleges that she works at the McDonald’s restaurant at

207 E. 35 St., Chicago, owned and operated by Lexi. Massey alleges that she tested positive for 

COVID-19 on April 22, 2020, but she does not allege that she contracted COVID-19 at the 

McDonald’s where she works.

50. Plaintiff Ryan Freeman alleges that he works at the McDonald’s restaurant at 207 

E. 35 St., Chicago, owned and operated by Lexi. Freeman does not allege that he has contracted 

COVID-19 or had any symptoms consistent with COVID-19.

51. Plaintiff Joyce Freeman alleges that she is Ryan Freeman’s mother and that Ryan 

Freeman lives with her. Joyce Freeman does not allege that she has been to any McDonald’s 

restaurants, that she has been exposed to the coronavirus, or that she has contracted COVID-19 

or had any symptoms consistent with COVID-19.

52. Plaintiff Maria Villasenor alleges that she works the McDonald’s restaurant at 

2438 W Cermak Rd, Chicago, which is alleged to be a “corporate store” operated by 

McDonald’s Restaurants of Illinois, Inc. Villasenor does not allege that she has contracted 

COVID-19 or had any symptoms consistent with COVID-19.

53. Plaintiff Noemi Villasenor alleges that she is Maria Villasenor’s daughter and 

lives with her. Noemi Villasenor does not allege that she has been to any McDonald’s 

restaurants, that she has been exposed to the coronavirus, or that she has contracted COVID-19 

or had any symptoms consistent with COVID-19.

54. Plaintiff Truvon Turner alleges that he works at the McDonald’s restaurant at 

10320 S. Kedzie Ave., Chicago, owned and operated by DAK4. Turner alleges that he felt sick 

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quarantine because he was exhibiting the symptoms of the infection. Turner does not allege that 

he contracted COVID-19 at the McDonald’s where he works.

55. Plaintiff Jayvonna Gardley alleges that she is Truvon Turner’s girlfriend and lives 

with him full-time. Jayvonna Gardley does not allege that she has been to any McDonald’s 

restaurants, that she has been exposed to the coronavirus, or that she has contracted COVID-19 

or had any symptoms consistent with COVID-19.

56. Plaintiff Sujey Figueroa alleges that she works at the McDonald’s restaurant at 

3867 S. Archer Ave., Chicago, which is alleged to be a “corporate store” operated by 

McDonald’s Restaurants of Illinois, Inc. Figueroa alleges that she was sick with symptoms 

consistent with COVID-19 in mid-March 2020, but that she was unable to be tested to confirm 

whether she was infected. Figueroa does not allege that she contracted COVID-19 at the 

McDonald’s where she works.

57. Plaintiff Edwin Pliego alleges that he is Sujey Figueroa’s son and lives with her. 

Edwin Pliego does not allege that he has been to any McDonald’s restaurants, that he has been 

exposed to the coronavirus, or that he has contracted COVID-19 or had any symptoms consistent 

with COVID-19.

58. The Massey Complaint also seeks to bring claims on behalf of a class of all 

workers who worked at one of the identified McDonald’s restaurants since April 1, 2020 and all 

persons who cohabitated with those workers during the same period.

The Massey Complaint’s Allegations Regarding the Virus

59. The Massey Complaint lays out a series of allegations regarding the nature of the 

Virus and expert and government efforts to provide guidance to the public and to employers 

regarding safety for employees and members of the public with whom they interact.

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60. The Massey Complaint alleges that “[t]he most common ways for COVID-19 to 

spread are through: (1) close interaction with an infected person that allows the virus to spread 

through airborne particles or via aerosolized droplets, which are secretions from talking, 

coughing and sneezing; or (2) contact with a contaminated surface.” Ex. 1, Massey Comp. ¶ 29. 

It alleges that “[s]pread is more likely when people are in close contact with one another for 

sustained periods of time (i.e., within about 6 feet of each other for longer than 10 minutes).” 

Ex. 1, Massey Comp. ¶ 30.

61. According to the Massey Complaint, the CDC and others “have recommended 

that all individuals take steps to avoid close contact with others, even those who may not appear 

infected, to avoid transmission—a process known as ‘social distancing.’” Ex. 1, Massey Comp.

¶ 31.

62. The Massey Complaint alleges that the World Health Organization declared 

COVID-19 to be a global pandemic on March 11, 2020, followed on March 13, 2020 by a 

declaration of a national state of emergency by President Trump. Ex. 1, Massey Comp. ¶¶ 34-35.

63. The Massey Complaint further alleges that “[t]he World Health Organization, the 

CDC, and virtually every level of government have recognized that the only way to minimize 

casualties from COVID-19 is to slow the disease’s spread, primarily by limiting human-tohuman contact or, where that is impossible, taking other preventative measures.” Ex. 1, Massey 

Comp. ¶ 36.

64. The Massey Complaint describes the potential exposure to the Virus that the 

Massey Plaintiffs allegedly face because of the nature of their work at McDonald’s, citing the 

CDC’s statement that “potential sources of exposures for food retail workers ‘include close 

contact for prolonged periods of time with a customer with COVID-19 and touching your nose, 

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mouth, or eyes after handling items, cash, or merchandise that customers with COVID-19 have 

touched.’” Ex. 1, Massey Comp. ¶ 38. The Massey Complaint alleges that because they cannot 

distance themselves from their co-workers, “it is all the more important for workers to have 

access to necessary personal protective equipment.” Ex. 1, Massey Comp. ¶ 39.

65. The Massey Complaint alleges that Illinois Governor Pritzker issued an executive 

order on April 30 that extended his prior executive order dated March 20, which orders required, 

with certain exceptions, that individuals remain at home; individuals wear a face covering in 

public; retail stores designated as essential and remaining open must provide face coverings to 

employees and inform customers about social distancing; and retail stores designated as essential 

and remaining open must take steps to enforce social distancing, provide hand sanitizer, establish 

separate hours for vulnerable populations and provide face coverings and other personal 

protective equipment. Ex. 1, Massey Comp. ¶ 40.

66. Following Governor Pritzker’s April 30 executive order, the Massey Complaint 

alleges that “the Health Commissioner for the City of Chicago reissued an order implementing 

the Governor’s stay-at-home order” on May 1, 2020, which required those in Chicago to 

“practice a strict and disciplined adherence to stay-at-home and social distancing requirements.” 

Ex. 1, Massey Comp. ¶ 41

CDC Guidance to Food Retailers Described in the Massey Complaint

67. The Massey Complaint also alleges the details of CDC guidance for food retailers 

and generally for all businesses remaining open during the pandemic. As alleged, the CDC 

recommended several steps for food retailers, including encouraging sick employees to stay 

home, encouraging those diagnosed with COVID-19 not to return to work early; providing 

employees accurate information about COVID-19; implementing policies to limit contact with 

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customers and contact with other workers for those employees who are at higher risk; training 

employees on proper hand washing and preventative measures; providing access to soap, water, 

and hand sanitizer at stations spread around the business; increasing the distance between 

workers; providing signage to remind everyone to distance at least 6 feet; placing floor decals to 

guide customers on distancing; creating spacing in employee breakrooms or using other available 

space for overflow of employees on breaks; providing warning posters encouraging workers to 

stay home when they are sick and to practice good hygiene; providing tissues and no-touch 

disposal receptacles for employees; providing wipes or cleaners to allow employees to wipe 

down surfaces frequently; providing flexible sick leave and other supportive policies; providing 

information on who to contact if the employee is sick and information on co-workers, consistent 

with the ADA, who have been diagnosed with COVID-19 in order to inform employees on 

possible exposure; and rotating cashiers to allow those employees to frequently engage in 

handwashing. Ex. 1, Massey Comp. ¶ 43.

68. The Massey Complaint alleges that the CDC recommends that everyone should 

wear cloth face coverings in public situations where they cannot otherwise maintain social 

distancing. Ex. 1, Massey Comp. ¶ 44.

The Massey Allegations Regarding McDonald’s Response to the Virus

69. According to the Massey Complaint, “McDonald’s issued a detailed statement 

about its response to COVID-19 on April 16, 2020,” noting that it was “‘committed to staying 

open’” while also recognizing its responsibility to “‘proactively monitor the impact of the 

coronavirus, [and] continuously mak[e] changes to processes and restaurant operations with 

safety top of mind.’” Ex. 1, Massey Comp. ¶ 47. The statement purportedly stressed 

McDonald’s focus on keeping employees safe. Ex. 1, Massey Comp. ¶ 48.

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70. The Massey Complaint alleges that McDonald’s statement indicated its “actions 

were ‘informed by guidance from both our own third-party contagious disease experts and the 

CDC.’” Ex. 1, Massey Comp. ¶ 49.

71. The Massey Complaint alleges, however, that the Massey Defendants “are failing 

to take important steps to contain the virus, such as providing adequate protective equipment, 

hand sanitizer, and safety training for employees, or enforcing safety protocols.” Ex. 1, Massey 

Comp. ¶ 3.

72. The Massey Complaint also alleges that “McDonald’s has failed to take adequate 

steps in response to the pandemic. These stores are operating in disregard of expert 

recommendations and government guidance on how to best protect workers and customers from 

spread of the disease.” Ex. 1, Massey Comp. ¶ 5.

73. The Massey Complaint alleges that the McDonald’s Defendants “have failed to 

take proper precautions to protect employees, including the worker plaintiffs, and the public, 

from the spread of COVID-19” and “have failed to implement government guidance and expert 

recommendations at the stores where the worker plaintiffs are employed.” Ex. 1, Massey Comp.

¶ 59.

74. Despite the CDC recommendations and McDonald’s statements, the Massey

Complaint describes how the restaurants at issue did not inform workers when others contracted 

COVID-19, did not provide basic information on the disease, did not implement social 

distancing, provided inadequate masks and other protective equipment, did not enforce the 

requirement that workers or customers wear masks, and failed to provide hand sanitizer. Ex. 1, 

Massey Comp. ¶¶ 65-98.

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The Alleged Harm to the Massey Plaintiffs

75. The Massey Complaint alleges that “COVID-19 is an infectious respiratory 

disease caused by a novel coronavirus. If a person is infected with the disease, it can cause 

serious long-term health complications....” Ex. 1, Massey Comp. ¶ 22 (emphasis added). 

76. The Massey Complaint alleges that as a result of the Massey Defendants’ failure 

to provide a safe work environment, “Defendants have exposed McDonald’s workers and the 

public to an increased risk of infection.” Ex. 1, Massey Comp. ¶ 59.

77. The Massey Complaint further alleges that “[b]ecause COVID-19 is highly 

contagious, a worker or customer infected at a McDonald’s restaurant is likely to spread the 

disease to others, possibly before showing symptoms. Thus, the damage done by inadequate 

safety practices is not confined to the walls of a restaurant, but instead has broader public health 

consequences for the Chicago community, the State of Illinois, and the entire country.” Ex. 1,

Massey Comp. ¶ 99.

78. It is further alleged that “[i]f customers are infected because of a visit to a 

McDonald’s restaurant, they will then return to their daily routine and begin infecting others, 

who will then infect others, and so on.” Ex. 1, Massey Comp. ¶ 104 (emphasis added). 

79. The Massey Complaint addresses the alleged risk to the worker plaintiffs, alleging 

that they “not only risk exposure to the disease and the potential deadly health consequences that 

come with it, but also risk being responsible for spreading the disease to their family members.”

For “Plaintiffs who are family members of McDonald’s workers ... their risk of exposure comes 

with living with a McDonald’s worker.” Ex. 1, Massey Comp. ¶ 121.

80. According to the Massey Complaint, “[i]f injunctive relief is not granted, 

Plaintiffs face a significant risk of irreparable harm in the form of physical and emotional 

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injuries from the continuing maintenance of the public nuisance. Indeed, Plaintiffs are 

vulnerable to severe bodily injury or death from infection caused by the unsafe environment in 

which they work.” Ex. 1, Massey Comp. ¶ 123; see also Ex. 1, Massey Comp. ¶ 136 (same as to 

“continuing acts of negligence”).

81. The Massey Complaint alleges that the purported injuries to the Massey Plaintiffs 

include “exposure to the COVID-19 virus and an increased likelihood of infection.” Ex. 1,

Massey Comp. ¶ 133 (emphasis added). 

82. As to the Massey Plaintiffs who live with McDonald’s workers, the Massey

Complaint alleges that “they are likely to suffer the consequences of infections originating in the 

workplace. Not only may they be forced to care for—or grieve—a sick relative, but they 

themselves risk infection given the highly contagious nature of the disease.” Ex. 1, Massey

Comp. ¶ 4 (emphasis added).

The Injunctive Relief Sought by the Massey Plaintiffs

83. The Massey Complaint seeks declaratory relief finding that the McDonald’s 

defendants are maintaining a public nuisance and have violated Illinois law prohibiting 

negligence. Ex. 1, Massey Comp. at p. 32. 

84. The Massey Complaint further seek an injunction that requires the Massey

Defendants to: 

a. Supply workers with adequate protective equipment, including face coverings and 

gloves; 

b. Cease and desist from forcing workers to reuse face coverings and gloves in a 

manner that makes them unsafe; 

c. Supply hand sanitizer for workers and customers entering the restaurant; 

d. Establish and enforce policies that require employees to wear face coverings 

during their shifts, and require customers entering the restaurant to wear face 

coverings; 

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e. Monitor infections among workers and, if an employee experiences COVID-19 

symptoms or is confirmed to be infected with COVID-19, inform fellow 

employees immediately of their possible exposure; and 

f. Provide employees with accurate information about COVID-19, how it spreads, 

and risks of exposure, and train employees on proper hand washing practice and 

other preventative measures established by the CDC.

Ex. 1, Massey Comp. at p. 32.

85. The Massey Complaint makes it clear that the Massey Plaintiffs “seek only 

declaratory and injunctive relief to order Defendants to adhere to their legal responsibilities and 

provide a safe working environment.” Ex. 1, Massey Comp. ¶ 6. 

86. The Massey Complaint concedes that “Plaintiffs seek no damages from the 

Franchisee Defendants.” Ex. 1, Massey Comp. ¶ 146.

87. While the Massey Complaint alleges that certain of the Massey Plaintiffs have 

contracted COVID-19 or had symptoms consistent with being infected (Ex. 1, Massey Comp. ¶¶ 

66, 87, 94), the Complaint seeks no recovery or injunctive relief related to their alleged illness, 

such as monitoring of their ongoing health, or treatment for any medical conditions allegedly 

resulting from COVID19.

THE INSUREDS’ REQUEST FOR A DEFENSE OF THE MASSEY LAWSUIT

88. Austin Mutual first received a notice of loss related to the Massey Lawsuit on or 

about May 20, 2020.

89. In a letter dated June 12, 2020, Senior Counsel for McDonald’s Corporation 

forwarded a copy of the Massey Complaint to the Claims Department at Austin Mutual. On 

behalf of McDonald’s Corporation and McDonald’s USA, the June 12 letter requested that 

Austin Mutual “acknowledge and undertake all insuring obligations..., including but not limited 

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to its duties to defend and indemnify McDonald’s against the Massey Lawsuit” under the 

Policies. 

90. McDonald’s counsel sent a similar letter dated June 12, 2020, to the Claims 

Department for American Family Mutual Insurance Company, S.I. (“American Family”), which 

is an affiliate of Austin Mutual, pursuant to policy 12XR461701.

91. In-house counsel for American Family began having communications on behalf 

of Austin Mutual with McDonald’s in-house counsel regarding coverage issues on or about July 

2, 2020. Discussions continued through July and August.

92. In the course of the discussions, American Family and Austin Mutual informed 

counsel for McDonald’s that policy 12XR461701 had been cancelled, effective March 1, 2020. 

93. The Insureds filed their Complaint in this case on August 27, 2020. 

94. At the time that the Insureds filed their Complaint in this action, Austin Mutual 

had not taken a final position on coverage and defense of the Insureds under the Policies, and 

believed the parties were continuing to discuss and attempt to resolve the coverage issues.

THE POLICIES

THE LEXI POLICY

95. Austin Mutual issued a policy providing Businessowners coverage to Lexi 

Management LLC, with effective dates of March 1, 2020 to March 1, 2021, Policy No. 

BPP1691Q (the “Lexi Policy”). A true and accurate copy of the Lexi Policy is attached hereto as 

“Exhibit 2.”

THE DAK4 POLICY

96. Austin Mutual issued a policy providing Businessowners coverage to DAK4, 

LLC, with effective dates of March 1, 2020 to March 1, 2021, Policy No. BPP1620Q (the 

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“DAK4 Policy”). A true and accurate copy of the DAK4 Policy is attached hereto as “Exhibit 3.” 

The Lexi Policy and the DAK4 Policy are collectively referred to herein as the “Policies.”

Common Provisions in the Policies

97. Unless stated otherwise, the provisions set forth below appear in both the Lexi 

Policy and the DAK4 Policy.

98. The Business Liability section of the Policies provides:

We will pay those sums that the insured becomes legally obligated to pay 

as damages because of “bodily injury”, “property damage” or “personal and 

advertising injury” to which this insurance applies. We will have the right and 

duty to defend the insured against any “suit” seeking those damages. However, 

We will have no duty to defend the insured against any “suit” seeking those 

damages for “bodily injury” , “property damage” or “personal and advertising 

injury” to which this insurance does not apply. 

99. The Policies provide that business liability coverage applies “to ‘bodily injury’

and ‘property damage’ only if ... [t]he ‘bodily injury’ or ‘property damage’ is caused by an 

‘occurrence’ that takes place in the ‘coverage territory’.”

100. The Policies, as modified by endorsement, define “bodily injury” as “bodily 

injury, sickness, disease or mental anguish sustained by a person, including death resulting from 

any of these at any time.”

101. The Policies define “occurrence” as “an accident, including continuous or 

repeated exposure to substantially the same general harmful conditions.”

102. The Policies provide that business liability coverage applies “to ‘bodily injury’ ... 

only if ... [p]rior to the policy period, no insured listed under Paragraph C.1. Who Is An Insured 

and no ‘employee’ authorized by you to give or receive notice of an ‘occurrence’ or claim, knew 

that the ‘bodily injury’ ... had occurred, in whole or in part. If such a listed insured or 

authorized ‘employee’ knew, prior to the policy period, that the ‘bodily injury’ ... occurred, then 

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any continuation, change or resumption of such ‘bodily injury’ ... during or after the policy 

period will be deemed to have been known before the policy period.” 

103. The Policies contain an exclusion removing coverage for “‘bodily injury’ ... 

expected or intended from the standpoint of the insured.”

104. In an exclusion labeled “Employer’s Liability,” the Policies exclude coverage for:

“Bodily injury” to: 

(1) An “employee” of the insured arising out of an in the course of:

(a) Employment by the insured; or 

(b) Performing duties related to the conduct of the insured’s business; or 

(2) The spouse, child, parent, brother or sister of that “employee” as a 

consequence of Paragraph (1) above. 

105. The Policies include an Employment-Related Practices Exclusion endorsement 

which provides, in part, as follows:

The following exclusion is added to Paragraph B. Exclusions in Section 

II – Liability:

This insurance does not apply to:

1. “Bodily injury” or “personal and advertising injury” to:

a. A person arising out of any:

(1) Refusal to employ that person;

(2) Termination of that person’s employment; or

(3) Employment-related practices, policies, acts or 

omissions, such as coercion, demotion, evaluation, 

reassignment, discipline, defamation, harassment, 

humiliation or discrimination directed at that 

person; or

b. The spouse, child, parent, brother or sister of that person 

as a consequence of “bodily injury” or “personal and 

advertising injury” to that person at whom any of the 

employment-related practices described in Paragraphs (1), 

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(2) or (3) above is directed.

2. This exclusion applies:

a. Whether the insured may be liable as an employer or in 

any other capacity; and

b. To any obligation to share damages with or repay 

someone else who must pay damages because of the 

injury.

COUNT I – DECLARATORY JUDGMENT –

NO DUTY TO DEFEND BECAUSE THE MASSEY COMPLAINT DOES NOT SEEK 

“DAMAGES BECAUSE OF BODILY INJURY”

(AGAINST LEXI MANAGEMENT, LLC, MCDONALD’S CORPORATION, AND 

MCDONALD’S USA, LLC)

In support of Count I – Declaratory Judgment, Austin Mutual states as follows: 

106. Austin Mutual incorporates the allegations set forth in paragraphs 1 through 105

as if fully set forth herein. 

107. The Insureds have called upon Austin Mutual to provide a defense for the Massey

Lawsuit under the Policies. 

108. Austin Mutual does not have a duty to defend the Insureds against the Massey

Lawsuit because the Policies require only that Austin Mutual “pay those sums that the insured 

becomes obligated to pay as damages because of ‘bodily injury’ ... to which this insurance 

applies.”

109. “Bodily injury” is defined under the Policies as “bodily injury, sickness, disease 

or mental anguish sustained by a person, including death resulting from any of these at any 

time.”

110. As detailed above, the Massey Complaint does not seek any relief to redress or 

remedy any claim that the Massey Plaintiffs have suffered any alleged “bodily injury, sickness, 

disease or mental anguish.” Indeed, the Massey Complaint makes clear that “seek only 

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declaratory and injunctive relief to order Defendants to adhere to their legal responsibilities and 

provide a safe working environment.” Ex. 1, Massey Comp. ¶ 6. 

111. Not only does the Massey Complaint fail to seek relief or redress for any past 

“bodily injury, sickness, disease or mental anguish,” but even those plaintiffs who alleged that 

they had contracted COVID-19 or had symptoms consistent with COVID-19 in the past do not 

allege that they contracted COVID-19 from exposure at the McDonald’s where they work.

112. Likewise, the Massey Complaint contains no allegations of “bodily injury” for the 

mother, daughter, son and girlfriend of the worker plaintiffs. Indeed, the Massey Complaint does 

not allege that the non-worker plaintiffs have even been exposed to COVID-19, that they have 

been to a McDonald’s restaurant during the pandemic, that they have contracted COVID-19, or 

that they have demonstrated any symptoms consistent with COVID-19.

113. As noted above, the Massey Plaintiffs also seek to assert claims on behalf of two 

subclasses. Members of the class are not required to have suffered any actual bodily injury to be 

members of the subclasses. The only requirements to be in the subclasses are to have worked 

from April 1, 2020, at one of the McDonald’s restaurants that are the subject of the Massey

Complaint, or to have co-habitated with such a McDonald’s worker during the same period. Ex. 

1, Massey Comp. ¶ 107. 

114. Thus, the class allegations in the Massey Complaint demonstrate the absence of 

any actual bodily injury as the basis of the claims. In fact, the Massey Complaint alleges that 

“the members of each subclass suffered the same legal violations” and seek[] the same remedy 

for the legal violations attributable to Defendants, i.e., injunctive and declaratory relief.” Ex. 1, 

Massey Comp. ¶¶ 108-109. 

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115. The Massey Complaint seeks to require the Insureds to take actions in the 

workplace to reduce or limit the risk that the Massey Plaintiffs will suffer “bodily injury, 

sickness, disease or mental anguish” in the future, including mandating that the employers 

provide masks, gloves, other personal protective equipment, and hand sanitizer; enforce 

requirements for face coverings; inform workers about co-workers who contract COVID-19; 

supply workers with accurate information regarding COVID-19 and its risks; and train workers 

on preventative measures, including hand washing.

116. The Massey Complaint does not seek injunctive or declaratory relief seeking to 

impose any obligation on the Insureds that would require them to pay sums to compensate for or 

to remediate in any way any actual alleged bodily injury, such as any monitoring of the Massey

Plaintiffs’ health condition, or treatment for any medical conditions related to COVID-19.

117. Any sums that the Insureds are required to expend to comply with any injunctive 

relief requested by the Massey Plaintiffs would be entirely for the prevention of future exposure 

to the Virus and the risk that such exposure could result in such persons contracting COVID-19.

118. Any sums that the Insureds are required to expend to comply with any injunctive 

relief requested by the Massey Plaintiffs would not address or remedy any actual alleged bodily 

injury from past exposure.

119. Because any sums that the Insureds could be required to spend to comply with the 

injunctive relief requested in the Massey Complaint would not be sums the Insureds are required 

to pay as “damages because of ‘bodily injury,’” as defined by the Policies, there is no potential 

that such sums would be within the coverage of the Policies.

120. Plaintiffs have not claimed that any of the relief sought in the Massey Complaint 

would constitute damages because of “property damage,” which requires physical damage to or 

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loss of use of tangible property. Indeed, any sums that the Insureds are required to expend to 

comply with any injunctive relief requested by the Massey Plaintiffs would not address or 

remedy any “property damage” as defined by the Policies.

121. Because there is no potential for coverage under the Policies for sums the 

Insureds may be required to spend to comply with the injunctive relief sought in the Massey

Complaint, Austin Mutual has no duty to defend the Massey Lawsuit.

122. An actual controversy exists between the parties concerning their respective rights 

under the Policies and, therefore, there is a justiciable controversy that is ripe for determination 

by declaratory judgment pursuant to 28 U.S.C. § 2201. 

123. Therefore, a declaratory judgment is both necessary and proper in order to set 

forth and determine the rights, obligations and liability that exist between the parties under the 

Policies in connection with the Massey Lawsuit. 

WHEREFORE, Counterclaim Plaintiff Austin Mutual Insurance Company prays that 

this Court enter judgment in its favor and declare the following: 

1. Austin Mutual does not have a duty to defend the Insureds against the 

Massey Lawsuit because that action does not seek “damages because of 

bodily injury”; 

2. Any other and further relief this Court may deem just and proper.

COUNT II – DECLARATORY JUDGMENT –

NO DUTY TO DEFEND BECAUSE THE MASSEY COMPLAINT 

DOES NOT ALLEGE AN “OCCURRENCE”

(AGAINST DAK4, LLC, MCDONALD’S CORPORATION, AND 

MCDONALD’S USA, LLC)

In support of Count II – Declaratory Judgment, Austin Mutual states as follows: 

124. Austin Mutual incorporates the allegations set forth in paragraphs 1 through 123

as if fully set forth herein. 

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125. The Insureds have called upon Austin Mutual to provide a defense for the Massey

Lawsuit under the Policies. 

126. Austin Mutual does not have a duty to defend the Insureds against the Massey

Lawsuit because the business liability coverage under the Policies applies “to ‘bodily injury’ ... 

only if ... [t]he ‘bodily injury’ ... is caused by an ‘occurrence’ that takes place in the ‘coverage 

territory’.”

127. Even if the Massey Complaint alleged “bodily injury,” which as set forth above it 

does not, the Policies define “occurrence” as “an accident, including continuous or repeated 

exposure to substantially the same general harmful conditions.”

128. The injury alleged in the Massey Complaint is not the result of an accident as that 

term is used in the Policies. The Massey Complaint alleges that the plaintiff workers at 

McDonald’s restaurants are allegedly injured because they face an increased risk of exposure to 

the Virus, which creates an increased likelihood that they might contract COVID-19 in the 

future. The alleged increased risk of exposure to COVID-19 or increased risks of contracting 

COVID-19 are not the result of unexpected, unintended, or unusual events. Instead, those 

alleged increased risks are the natural and ordinary consequences of the alleged failures of the 

Insureds to adopt and enforce adequate safety precautions at their restaurants. Accordingly, the 

alleged injuries do not result from an accident.

129. Prior to the filing of the Massey Complaint, the CDC, numerous government 

agencies, and health experts had already provided guidance to the public and, in particular, to 

food retailers like the Insureds, regarding steps that are necessary to reduce the risks associated 

with operating businesses during the pandemic. As a result, the Insureds were well aware of the 

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risks related to COVID-19 and the risks of failing to implement the recommended safety 

precautions.

130. Illinois Governor Pritzker’s April 30, 2020, executive order addressed the need 

for essential businesses to provide face coverings and other personal protective equipment, 

comply with social distancing requirements, and provide hand sanitizer and other sanitizing 

products.

131. McDonald’s itself publicly acknowledged the need to take significant 

precautionary steps in its restaurants in corporate statements in March and April, 2020, at the 

same time emphasizing that it was working closely with its franchisees. In its statement on April 

1, 2020, for example, McDonald’s committed to the implementation of social distancing 

guideless, increased cleanings, and making hand sanitizers available in all restaurants.

132. Indeed, in a May 7, 2020 statement, McDonald’s stated that it had committed to 

wellness checks, social distancing, masks and gloves for employees, and protective barriers. 

133. The Massey Complaint alleges that “[c]ontrary to their promises, Defendants have 

failed to take proper precautions to protect employees, including the worker plaintiffs, and the 

public, from the spread of COVID-19. McDonald’s and the defendant franchisees have failed to 

implement government guidance and expert recommendations at the stores where the worker 

plaintiffs are employed.” Ex. 1, Massey Comp. ¶ 59. 

134. By mid-May 2020 when the Massey Complaint was filed, COVID-19 was truly 

global in its reach and a constant, over-arching reality everywhere for everyone. The public was 

inundated with information regarding the risks of COVID-19 and its spread among the 

population, as businesses and the public navigated stay-at-home orders and restrictions on 

business operations. 

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135. The Massey Complaint alleges that workers at the McDonald’s restaurants 

operated by Lexi, DAK4 and McDonald’s Restaurants of Illinois, Inc. have apparently missed 

work because of illness potentially related to COVID-19 from at least early March 2020, but the 

management of the restaurants has not provided information to the workers. 

136. In that environment and with the information publicly available, the alleged 

increased risk of exposure to the Virus as alleged in the Massey Complaint was the natural and 

foreseeable result of the Insureds’ alleged conduct in failing to adopt or implement proper 

safeguards, even those set out in McDonald’s own policies, as well as the recommendations of 

the CDC and other government agencies and health experts.

137. Because the risks posed by the Virus and the alleged increased risk of exposure to 

the Virus asserted in the Massey Complaint was the natural and foreseeable result of the 

Insureds’ conduct, it was not the result an “accident” as that term is used in the Policies.

138. Because the increased risk of exposure to the Virus asserted by the Massey

Plaintiffs was not an “accident,” even if the Massey Complaint alleged “bodily injury” (which it 

does not), it was not caused by an “occurrence” as that term is defined in the Policies.

139. Because the Massey Complaint does not allege an “occurrence” as that term is 

defined in the Policies, there is no potential that any sums the Insureds are required to pay as a 

result of the Massey Lawsuit would be within the coverage of the Policies.

140. Because there is no potential for coverage under the Policies for sums the 

Insureds may be required to pay as a result of the Massey Lawsuit, Austin Mutual has no duty to 

defend the Massey Lawsuit.

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141. An actual controversy exists between the parties concerning their respective rights 

under the Policies and, therefore, there is a justiciable controversy that is ripe for determination 

by declaratory judgment pursuant to 28 U.S.C. § 2201. 

142. Therefore, a declaratory judgment is both necessary and proper in order to set 

forth and determine the rights, obligations and liability that exist between the parties under the 

Policies in connection with the Massey Lawsuit. 

WHEREFORE, Counterclaim Plaintiff Austin Mutual Insurance Company prays that 

this Court enter judgment in its favor and declare the following: 

1. Austin Mutual does not have a duty to defend the Insureds against the 

Massey Lawsuit because any alleged “bodily injury” was not caused by an 

“occurrence”; 

2. Any other and further relief this Court may deem just and proper.

COUNT III – DECLARATORY JUDGMENT –

NO DUTY TO DEFEND BECAUSE THE MASSEY COMPLAINT 

ALLEGES “BODILY INJURY” KNOWN TO THE INSUREDS

(AGAINST DAK4, LLC, MCDONALD’S CORPORATION, AND 

MCDONALD’S USA, LLC)

In support of Count III – Declaratory Judgment, Austin Mutual states as follows: 

143. Austin Mutual incorporates the allegations set forth in paragraphs 1 through 142

as if fully set forth herein. 

144. The Insureds have called upon Austin Mutual to provide a defense for the Massey

Lawsuit under the Policies. 

145. Austin Mutual does not have a duty to defend the Insureds against the Massey

Lawsuit because the business liability coverage under the Policies applies “to ‘bodily injury’ ... 

only if ... [p]rior to the policy period, no insured ... knew that the ‘bodily injury’ ... had 

occurred, in whole or in part.”

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146. The policy period for each of the Policies commenced on March 1, 2020.

147. Prior to the policy period, on January 21, 2020, the first case of COVID-19 in the 

U.S. was confirmed in the state of Washington. 

148. Prior to the policy period, on January 30, 2020, the CDC confirmed the first 

instance of person-to-person spread of the Virus, which occurred between Illinois residents.

149. Prior to the policy period, on January 31, 2020, HHS Secretary Azar declared that 

the Virus constitutes a public health emergency, retroactive to January 27, 2020. 

150. Prior to the policy period, on January 31, 2020, reflecting widespread knowledge 

regarding risks associated with exposure to anyone with COVID-19, President Trump issued an 

executive order banning foreign nationals who had been in China in the previous fourteen days 

from entering the United States.

151. Prior to the policy period, on February 26, 2020, the CDC confirmed the first 

instance of community spread of the Virus in the U.S., reflecting the risk of spreading the Virus 

from contact with others. 

152. Prior to the policy period, on February 26, 2020, the CDC issued “Interim 

Guidance for Businesses and Employers to Plan and Respond to Coronavirus Disease 2019 

(COVID-19).” This guidance recommended a number of steps that employers should take to 

“help prevent workplace exposures to acute respiratory illnesses, including COVID-19.”

153. The steps recommended in the February 26, 2020 CDC guidance included, at least 

in part, actions that the Massey Complaint alleges as the relief requested in that suit, including 

providing hand sanitizer for workers and employees to use and informing fellow employees 

when another employee is confirmed to have contracted COVID-19.

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154. Given the extraordinary focus of the government, the CDC, the press and 

businesses on the Virus in January and February 2020 and the disruption in their businesses, on 

information and belief, the Insureds were aware of the risks to workers and customers from their 

business and physical contact among those employees and customers.

155. Indeed, in its 2019 Annual Report, filed on February 26, 2020, prior to the policy 

period, McDonald’s stated that in developing a response to COVID-19, it was building on its 

business “alignment across the three legs of our system— company employees, independent 

franchisees and global suppliers.” It further stated that its “top priority is to protect the health 

and safety of our people and customers” and referenced its response to the Virus “through 

actions like implementing paid sick leave in the U.S. and enhancing hygiene measures at all 

company-owned restaurants, as well as closing in-restaurant dining where necessary.” These

statements reflect the Insureds’ knowledge of the risks to workers and customers from exposure 

to the Virus.

156. Because the alleged increased risk of exposure to COVID-19 from inadequate 

safety measures, as alleged in the Massey Complaint, was known in whole or in part to the 

Insureds prior to the policy period, there is no potential for coverage of the Massey Lawsuit 

under the Policies.

157. Because there is no potential for coverage under the Policies for sums the 

Insureds may be required to pay as a result of the Massey Lawsuit, Austin Mutual has no duty to 

defend the Massey Lawsuit.

158. An actual controversy exists between the parties concerning their respective rights 

under the Policies and, therefore, there is a justiciable controversy that is ripe for determination 

by declaratory judgment pursuant to 28 U.S.C. § 2201. 

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159. Therefore, a declaratory judgment is both necessary and proper in order to set 

forth and determine the rights, obligations and liability that exist between the parties under the 

Policies in connection with the Massey Lawsuit. 

WHEREFORE, Counterclaim Plaintiff Austin Mutual Insurance Company prays that 

this Court enter judgment in its favor and declare the following: 

1. Austin Mutual does not have a duty to defend the Insureds against the 

Massey Lawsuit because any alleged “bodily injury” was known to the 

Insureds prior to the commencement of the policy period; 

2. Any other and further relief this Court may deem just and proper.

COUNT IV – DECLARATORY JUDGMENT –

NO DUTY TO DEFEND BECAUSE COVERAGE FOR THE MASSEY COMPLAINT 

IS PRECLUDED BY THE EMPLOYERS’ LIABILITY EXCLUSION

(AGAINST DAK4, LLC, MCDONALD’S CORPORATION, AND 

MCDONALD’S USA, LLC)

In support of Count IV – Declaratory Judgment, Austin Mutual states as follows: 

160. Austin Mutual incorporates the allegations set forth in paragraphs 1 through 159

as if fully set forth herein. 

161. The Insureds have called upon Austin Mutual to provide a defense for the Massey

Lawsuit under the Policies. 

162. Austin Mutual does not have a duty to defend the Insureds against the Massey

Lawsuit because the Policies include an exclusion labeled “Employer’s Liability,” which 

excludes from coverage “bodily injury” to “[a]n ‘employee’ of the insured arising out of and in 

the course of” ... “[e]mployment by the insured” or “[p]erforming duties related to the conduct 

of the insured’s business.”

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163. The “Employer’s Liability” exclusion also excludes coverage for “bodily injury”

to “[t]he spouse, child, parent, brother or sister of that ‘employee’ as a consequence of” any 

“bodily injury” to an “employee” covered by the exclusion.

164. The Massey Complaint alleges that plaintiffs Taynarvis Massey and Ryan 

Freeman are employees at McDonald’s restaurants that were owned and operated by Lexi.

165. The Massey Complaint alleges that plaintiffs Maria Villasenor and Sujey Figueroa 

are employees at McDonald’s restaurants operated by McDonald’s Restaurants of Illinois, Inc., a 

wholly-owned subsidiary of McDonald’s USA and, therefore, an insured under the Policies.

166. The Massey Complaint alleges that plaintiff Truvon Turner is an employee at a 

McDonald’s restaurant owned and operated by DAK4. 

167. The alleged increased risk of exposure to COVID-19 alleged in the Massey

Complaint is allegedly caused by the Insureds’ failure “to take proper precautions to protect 

employees, including the worker plaintiffs, and the public, from the spread of COVID-19” and 

their failure “to implement government guidance and expert recommendations at the stores 

where the worker plaintiffs are employed.” Ex. 1, Massey Comp. ¶ 59.

168. The Massey Complaint makes clear that “Plaintiffs are vulnerable to severe bodily 

injury or death from infection caused by the unsafe environment in which they work.” Ex. 1, 

Massey Comp. ¶ 123 (emphasis added).

169. Because any injuries alleged in the Massey Complaint to the worker plaintiffs are 

injuries to employees of the Insureds “arising out of and in the course of” their “[e]mployment 

by the insured,” any such alleged “bodily injury” is excluded from coverage by the Employers’

Liability exclusion.

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170. Because any injuries alleged in the Massey Complaint to the worker plaintiffs are 

injuries to employees of the Insureds in the course of “[p]erforming duties related to the conduct 

of the insured’s business,” any such alleged “bodily injury” is excluded from coverage by the 

Employers’ Liability exclusion.

171. Because the claims in the Massey Complaint are based entirely on the working 

conditions of the plaintiffs, the Employers’ Liability exclusion precludes any potential for 

coverage and Austin Mutual has no duty to defend the Massey Lawsuit.

172. An actual controversy exists between the parties concerning their respective rights 

under the Policies and, therefore, there is a justiciable controversy that is ripe for determination 

by declaratory judgment pursuant to 28 U.S.C. § 2201. 

173. Therefore, a declaratory judgment is both necessary and proper in order to set 

forth and determine the rights, obligations and liability that exist between the parties under the 

Policies in connection with the Massey Lawsuit. 

WHEREFORE, Counterclaim Plaintiff Austin Mutual Insurance Company prays that 

this Court enter judgment in its favor and declare the following: 

1. Austin Mutual does not have a duty to defend the Insureds against the 

Massey Lawsuit because the claims in the Massey Lawsuit are excluded 

from coverage by the Employers’ Liability exclusion; 

2. Any other and further relief this Court may deem just and proper.

COUNT V – DECLARATORY JUDGMENT –

NO DUTY TO DEFEND BECAUSE COVERAGE FOR THE MASSEY COMPLAINT 

IS PRECLUDED BY THE EMPLOYMENT-RELATED PRACTICES LIABILITY 

EXCLUSION

(AGAINST DAK4, LLC, MCDONALD’S CORPORATION, AND 

MCDONALD’S USA, LLC)

In support of Count V – Declaratory Judgment, Austin Mutual states as follows: 

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174. Austin Mutual incorporates the allegations set forth in paragraphs 1 through 173

as if fully set forth herein. 

175. The Insureds have called upon Austin Mutual to provide a defense for the Massey

Lawsuit under the Policies. 

176. Austin Mutual does not have a duty to defend the Insureds against the Massey

Lawsuit because the Policies include an exclusion labeled “Employment-Related Practices 

Liability” (the “ERP Exclusion”), which excludes from coverage “bodily injury” “arising out of 

any” “Employment-related practices, policies, acts or omissions, such as coercion, demotion, 

evaluation, reassignment, discipline, defamation, harassment, humiliation or discrimination 

directed at that person.”

177. The ERP Exclusion also excludes coverage for “bodily injury” to “[t]he spouse, 

child, parent, brother or sister of that ‘employee’ as a consequence of bodily injury” to a person 

at whom the employment-related practice was directed.

178. The Massey Complaint alleges that plaintiffs Taynarvis Massey and Ryan 

Freeman are employees at McDonald’s restaurants that were owned and operated by Lexi.

179. The Massey Complaint alleges that plaintiffs Maria Villasenor and Sujey Figueroa 

are employees at McDonald’s restaurants operated by McDonald’s Restaurants of Illinois, Inc., a 

wholly-owned subsidiary of McDonald’s USA and, therefore, an insured under the Policies.

180. The Massey Complaint alleges that plaintiff Truvon Turner is an employee at a 

McDonald’s restaurant owned and operated by DAK4. 

181. The alleged increased risk of exposure to COVID-19 alleged in the Massey

Complaint is allegedly caused by the Insureds’ failure “to take proper precautions to protect 

employees, including the worker plaintiffs, and the public, from the spread of COVID-19” and 

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their failure “to implement government guidance and expert recommendations at the stores 

where the worker plaintiffs are employed.” Ex. 1, Massey Comp. ¶ 59.

182. The Massey Complaint makes clear that “Plaintiffs are vulnerable to severe bodily 

injury or death from infection caused by the unsafe environment in which they work.” Ex. 1, 

Massey Comp. ¶ 123 (emphasis added).

183. Because any injuries alleged in the Massey Complaint are injuries “arising out of” 

the employment-related practices and policies of the Insureds with respect to a response to 

COVID-19, any such alleged “bodily injury” is excluded from coverage by the ERP Exclusion.

184. Because the claims in the Massey Complaint are based entirely on the working 

conditions established by the Insureds, the ERP Exclusion precludes any potential for coverage 

and Austin Mutual has no duty to defend the Massey Lawsuit.

185. An actual controversy exists between the parties concerning their respective rights 

under the Policies and, therefore, there is a justiciable controversy that is ripe for determination 

by declaratory judgment pursuant to 28 U.S.C. § 2201. 

186. Therefore, a declaratory judgment is both necessary and proper in order to set 

forth and determine the rights, obligations and liability that exist between the parties under the 

Policies in connection with the Massey Lawsuit. 

WHEREFORE, Counterclaim Plaintiff Austin Mutual Insurance Company prays that 

this Court enter judgment in its favor and declare the following: 

1. Austin Mutual does not have a duty to defend the Insureds against the 

Massey Lawsuit because the claims in the Massey Lawsuit are excluded 

from coverage by the ERP Exclusion; 

2. Any other and further relief this Court may deem just and proper.

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COUNT VI – DECLARATORY JUDGMENT –

NO DUTY TO DEFEND BECAUSE THE POLICIES EXCLUDE COVERAGE FOR 

“BODILY INJURY” THAT WAS EXPECTED OR INTENDED

(AGAINST DAK4, LLC, MCDONALD’S CORPORATION, AND 

MCDONALD’S USA, LLC)

In support of Count V – Declaratory Judgment, Austin Mutual states as follows: 

187. Austin Mutual incorporates the allegations set forth in paragraphs 1 through 186

as if fully set forth herein. 

188. The Insureds have called upon Austin Mutual to provide a defense for the Massey

Lawsuit under the Policies. 

189. Austin Mutual does not have a duty to defend the Insureds against the Massey

Lawsuit because the business liability coverage under the Policies excludes coverage for “‘bodily 

injury’ ... expected or intended from the standpoint of the insured.”

190. The Massey Complaint alleges that the plaintiff workers at McDonald’s 

restaurants are allegedly injured because, as a result of the Insureds’ failure to adopt or 

implement the safety measures recommended by the CDC and identified in McDonald’s own 

corporate policies, they face an increased risk of exposure to the Virus and an increased 

likelihood that they might contract COVID-19 in the future. 

191. As alleged above, prior to the filing of the Massey Complaint, the CDC, numerous 

government agencies, and health experts had already provided guidance to the public and, in 

particular, to food retailers like the Insureds, regarding steps that are necessary to reduce the 

risks associated with operating businesses during the pandemic. Indeed, before the Massey

Complaint was filed, COVID-19, its risks and its spread among the population dominated the 

news and business in the United States. the Insureds were well aware of the risks related to 

COVID-19 and the risks of failing to implement the recommended safety precautions.

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192. The alleged increased risk of exposure to COVID-19 or increased risks of 

contracting COVID-19 are the expected result of the alleged failure by the Insureds to implement 

and enforce safety measures that were designed and recommended for the purpose of reducing 

the risk of the spread of COVID-19. 

193. Because the increased risk of exposure to the Virus asserted in the Massey

Complaint was “expected and intended” as used in the Policies, coverage for the Massey

Complaint is excluded by the plain language of the Policies, and Austin Mutual has no duty to 

defend the Massey Lawsuit.

194. Any actual controversy exists between the parties concerning their respective 

rights under the Policies and, therefore, there is a justiciable controversy that is ripe for 

determination by declaratory judgment pursuant to 28 U.S.C. § 2201. 

195. Therefore, a declaratory judgment is both necessary and proper in order to set 

forth and determine the rights, obligations and liability that exist between the parties under the 

Policies in connection with the Massey Lawsuit. 

WHEREFORE, Counterclaim Plaintiff Austin Mutual Insurance Company prays that 

this Court enter judgment in its favor and declare the following: 

1. Austin Mutual does not have a duty to defend the Insureds against the 

Massey Lawsuit because any alleged “bodily injury” is excluded from 

coverage under the Policies because such alleged injury was “expected 

and intended”; 

2. Any other and further relief this Court may deem just and proper.

Dated: September 24, 2021

By /s/ Michael L. Rice

Holly A. Harrison

Michael L. Rice

HARRISON LAW LLC

141 W. Jackson Blvd.

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44

Suite 2055

Chicago, IL 60604

(t) (312) 638-8776

(f) (312) 638-8793

hollyharrison@hlawllc.com

mikerice@hlawllc.com

ATTORNEYS FOR 

DEFENDANT/COUNTER-PLAINTIFF 

AUSTIN MUTUAL INSURANCE COMPANY

CERTIFICATE OF SERVICE

The undersigned attorney hereby certifies that on September 24, 2021, the foregoing 

AUSTIN MUTUAL INSURANCE COMPANY’S FIRST AMENDED COUNTERCLAIMS 

FOR DECLARATORY JUDGMENT was electronically filed with the Clerk of the U.S. 

District Court prior to midnight Central time, using the CM/ECF system, which will provide 

notice to all counsel of record. 

s/ Michael L. Rice

Michael L. Rice

Attorney for Defendant and Counter-Plaintiff

Austin Mutual Insurance Company

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