Preview
FILED
8/16/2022 1 :34 PM
1 CIT-ESERVE FELICIA PITRE
DISTRICT CLERK
DALLAS CO., TEXAS
Christi Underwood DEPUTY
DC-22-10234
CASE NO.
USI SOUTHWEST INC. ) IN THE DISTRICT COURT
)
Plaintiff, )
)
V. )
)
HUB INTERNATIONAL INSURANCE )
SERVICES, INC. )
3390 University Avenue, Suite 300 ) DALLAS COUNTY, TEXAS
Riverside, California 92501—3315 )
)
(SERVE: Corporation Service Corp. )
dba CSC-Lawyers Inc. )
211 East 7th Street ) 193rd
Suite 620 )
Austin, Texas 78701) )
)
Defendant. ) _TH JUDICIAL DISTRICT
PLAINTIFF’S VERIFIED ORIGINAL PETITION
For its Original Petition, Plaintiff USI Southwest, Inc. [“USI”] states:
1. Rule 47 Disclosure.
1. Pursuant to Rule 47(c)(3), TEX. R. CIV. P., USI states that it seeks
monetary relief over $250,000 but less than $1,000,000 in this action.
2. Discovery plan.
2. Plaintiff requests that discovery be conducted at Level 2, Rule 190.3,
TEX. R. CIV. P.
3. Jurisdiction and venue.
3. Plaintiff is a Texas corporation in good standing with offices located in
Houston, Harris County, Texas, and Dallas, Dallas County, Texas.
PLAINTIFF’S ORIGINAL PETITION Page 1
4. Defendant is a California corporation in good standing authorized to
conduct business in the state of Texas whose principal office is located at 3390
University Avenue, Suite 300, Riverside, California 92501. Defendant may be served
by delivering a copy of this Petition and citation to its registered agent, Corporation
Service Corp. dba CSC-Lawyers Inc., 211 East 7th Street, Suite 620, Austin, Texas
78701. Plaintiff requests that citation be issued.
5. This Court may exercise personal jurisdiction over Defendant pursuant
to § 17.042(1) and (2), TEx. CIV. PRAC. & REM. CODE, because as described below, this
matter involves a contract with a Texas resident to be performed in whole or part
in Texas and because Defendant committed a tort in whole or part in the state of
Texas. In addition, in paragraph 10(c) of the Brokerage Agreement discussed in this
Original Petition, Defendant has consented to personal jurisdiction of federal and
state courts in Dallas County, Texas.
6. Venue is properly laid in this Court because the parties agreed in
paragraph 10(c) of the Brokerage Agreement discussed in this Original Petition that
disputes between them concerning the contract described below would be heard in
Dallas County, Texas, and independently a substantial part of the events or
omissions giving rise to the claim occurred.
4. Facts common to all counts.
7. In August 2020, USI entered into a Brokerage Agreement under which
HUB received authority to submit accounts or risks to USI for the purpose of
procuring insurance coverage on behalf of certain insureds. Under the Brokerage
PLAINTIFF’S ORIGINAL PETITION Page 2
Agreement, once USI placed insurance for insureds submitted by HUB, USI became
the owner of the business, the expirations, and all gross premiums generated by the
business, whether or not those premiums were collected.
8. In addition, the Brokerage Agreement between also contained the
following term:
The Broker shall timely pay to the Company, and hereby guarantees payment
to the Company of, all premiums and taxes, if any, due with respect to policies
of insurance placed by the Company on behalf of an Insured, whether or not
the Broker collects such premiums or taxes from such Insured, including but
not limited to any adjustable premiums or additional premiums developed by
audit. Any credit extended to any Insured shall be the sole risk and
responsibility of the Broker. The Company may, at its sole option and in its
sole discretion, satisfy any such amount owed to it by reducing the
commissions otherwise owed by the Company to the Broker hereunder.
9. After execution of the Brokerage Agreement, HUB submitted two
applications for insurance for MNM Lilac Investments or affiliated entities, both of
which were placed by USI resulting in the issuance of policy YACL9L454426030 and
Liberty Mutual Insurance Co. policyYACL9L454426041.
1o. During the effective period of each policy, HUB requested various
changes to each policy, sometimes to add locations or increase valuation of covered
property, and other times to remove locations. In response to HUB’s requests, USI
obtained insurance coverage and billed the following via invoices:
Date Invoice Number Amount
7/27/2021 3805865 $142,404.00
12/1/2021 3956659 $87,636.02
12/13/2021 3819394 $75,928.00
12/14/2021 3969370 $113,358.00
12/14/2021 3969425 $878.00
PLAINTIFF’S ORIGINAL PETITION Page 3
12/16/2021 3972933 $163,802.00
3/10/2022 4080641 $6,649.00
4/12/22 4119109 $2,171.00
TOTAL $592,826.02
After all adjustments and return premiums, HUB owes USI $479,505.88.
11. USI made multiple formal written demands on HUB for payment of all
sums due and owing under the Brokerage Agreement on April 14, 2022.
12. In response, HUB has declined to honor its obligation under the
Brokerage Agreement to remit the premiums due. In fact, HUB represented that it
transferred the policies to Kris Hamburger on or about November 1, 2021. In the
same notification received in May 2022, HUB again declined to pay any portion of
the net premiums described above or honor its guarantee obligation. And contrary
to the express terms of Section 7(a)(1) in the Brokerage Agreement, HUB even
wrongly contended that transfer of the book of business terminated the Brokerage
Agreement.
5. COUNT I —
VERIFIED PETITION ON SWORN ACCOUNT
13. USI incorporates paragraphs 1 through 12 of this Original Petition as
though fully set forth.
14. USI’s claim is founded on a written contract, the Brokerage Agreement,
and business dealings between the parties to this action as set forth above.
15. USI has maintained a systemic record of transactions relating to the
Brokerage Agreement.
PLAINTIFF’S ORIGINAL PETITION Page 4
16. USI’s claim, supported by the declaration of Mike Nielsen attached
hereto, is just and true and all just and lawful offsets, payments and credits have
been allowed.
17. USI is entitled to recover $479,505.88.
6. COUNT II - BREACH OF THE BROKERAGE AGREEMENT
18. USI incorporates paragraphs 1 through 17 of this Original Petition as
though fully set forth.
19. HUB breached the Brokerage Agreement by failing to timely pay to USI
and by refusing to honor its guarantee of payment to USI of all premiums and due
with respect to the policies of insurance and modifications to them referred to
above, as the direct and proximate result of which USI has sustained damages in
excess of the minimum jurisdictional limit of this Court.
7. COUNT III —
CONVERSION
20. USI incorporates paragraphs 1 through 19 of this Original Petition as
though fully set forth.
21. The payments for premiums and policy modifications listed above were
entirely owned by USI and were to be held separately and in trust for USI’s benefit
and prompt payment to USI. HUB had no right to take any action with respect to
these funds except to pay them to USI.
22. By diverting the payments for premiums and policy modifications
listed above to Hamburger in November 2021, HUB exercised dominion and control
of USI’s personal property to the exclusion of USI’s rights, as the direct and
PLAINTIFF’S ORIGINAL PETITION Page 5
proximate USI has sustained damages in excess of the minimum jurisdictional limit
of this Court.
8. COUNT IV — ATTORNEY’S FEES
23. USI has been compelled to retain counsel to vindicate its rights due to
HUB’s breach of the Brokerage Agreement.
24. USI presented the claim described in this Original Petition to HUB
beginning on April 14, 2022. HUB has not paid any part of the claim to date.
25. USI has incurred and is continuing to incur attorney’s fees to vindicate
its rights in this matter and is entitled to recover those fees from HUB pursuant to
Chapter 38, TEX. CIv. PRAC. & REM. CODE.
9. JURY DEMAND
26. Plaintiff demands trial by jury on all causes of action and has paid the
jury fee.
10. RULE 193.7 NOTIFICATION
27. Defendant is hereby notified pursuant to Rule 193.7, TEX. R. CIV. P.,
that its production of a document in response to written discovery authenticates
that document for use against Defendant in any pre-trial proceedings or trial unless
within ten days or such other time as may be ordered by the Court, Defendant
objects to the authenticity of all or part of a document stating the specific basis for
objection.
WHEREFORE, USI prays for judgment in its favor and against Defendant for
damage in excess of the minimum jurisdictional limit of this Court, for pre— and
PLAINTIFF’S ORIGINAL PETITION Page 6
post-judgment interest, attorney’s fees and all other relief to which it may be
entitled.
Respectfully submitted,
/s/ Thomas B. Alleman
Thomas B. Alleman
State Bar No. 01017485
DYKEMA GOSSETT PLLC
1717 Main, Suite 4200
Dallas, Texas 75201
214 698 7830 phone
855 216 6218 fax
talleman@dvkema.com
ATTORNEYS FOR PLAINTIFF
PLAINTIFF’S ORIGINAL PETITION Page 7
VERIFICATION
My name is Mike Nielsen, my date of birth is June 10, 1968, and my address
is 14241 Dallas Parkway, Suite 700, Dallas, Texas 75254, USA. I declare under
penalty of perjury that the statements contained in this Verified Original Petition
true and correct.
Executed in Dallas County, State of Texas, on the day of August, 2022.
Mflgflv Declarant
PLAINTIFF’S ORIGINAL PETITION Page 8
Automated Certificate of eService
This automated certificate of service was created by the efiling system. The filer served this
document via email generated by the efiling system on the date and to the persons listed below.
The rules governing certificates of service have not changed. Filers must still provide a certificate
of service that complies with all applicable rules.
Lina Bryant on behalf of Thomas Alleman
Bar No. 1017485
LBryant@dykema.com
Envelope ID: 67341174
Status as of 8/23/2022 7:47 AM CST
Associated Case Party: USI SOUTHWEST INC.
Name BarNumber Email TimestampSubmitted Status
Marilyn Guichard mguichard@dykema.com 8/16/2022 1:34:25 PM SENT
Thomas B.Alleman talleman@dykema.com 8/16/2022 1:34:25 PM SENT
Lina Bryant lbryant@dykema.com 8/16/2022 1:34:25 PM SENT
Preview
FILED 8/16/2022 1 :34 PM 1 CIT-ESERVE FELICIA PITRE DISTRICT CLERK DALLAS CO., TEXAS Christi Underwood DEPUTY DC-22-10234 CASE NO. USI SOUTHWEST INC. ) IN THE DISTRICT COURT ) Plaintiff, ) ) V. ) ) HUB INTERNATIONAL INSURANCE ) SERVICES, INC. ) 3390 University Avenue, Suite 300 ) DALLAS COUNTY, TEXAS Riverside, California 92501—3315 ) ) (SERVE: Corporation Service Corp. ) dba CSC-Lawyers Inc. ) 211 East 7th Street ) 193rd Suite 620 ) Austin, Texas 78701) ) ) Defendant. ) _TH JUDICIAL DISTRICT PLAINTIFF’S VERIFIED ORIGINAL PETITION For its Original Petition, Plaintiff USI Southwest, Inc. [“USI”] states: 1. Rule 47 Disclosure. 1. Pursuant to Rule 47(c)(3), TEX. R. CIV. P., USI states that it seeks monetary relief over $250,000 but less than $1,000,000 in this action. 2. Discovery plan. 2. Plaintiff requests that discovery be conducted at Level 2, Rule 190.3, TEX. R. CIV. P. 3. Jurisdiction and venue. 3. Plaintiff is a Texas corporation in good standing with offices located in Houston, Harris County, Texas, and Dallas, Dallas County, Texas. PLAINTIFF’S ORIGINAL PETITION Page 1 4. Defendant is a California corporation in good standing authorized to conduct business in the state of Texas whose principal office is located at 3390 University Avenue, Suite 300, Riverside, California 92501. Defendant may be served by delivering a copy of this Petition and citation to its registered agent, Corporation Service Corp. dba CSC-Lawyers Inc., 211 East 7th Street, Suite 620, Austin, Texas 78701. Plaintiff requests that citation be issued. 5. This Court may exercise personal jurisdiction over Defendant pursuant to § 17.042(1) and (2), TEx. CIV. PRAC. & REM. CODE, because as described below, this matter involves a contract with a Texas resident to be performed in whole or part in Texas and because Defendant committed a tort in whole or part in the state of Texas. In addition, in paragraph 10(c) of the Brokerage Agreement discussed in this Original Petition, Defendant has consented to personal jurisdiction of federal and state courts in Dallas County, Texas. 6. Venue is properly laid in this Court because the parties agreed in paragraph 10(c) of the Brokerage Agreement discussed in this Original Petition that disputes between them concerning the contract described below would be heard in Dallas County, Texas, and independently a substantial part of the events or omissions giving rise to the claim occurred. 4. Facts common to all counts. 7. In August 2020, USI entered into a Brokerage Agreement under which HUB received authority to submit accounts or risks to USI for the purpose of procuring insurance coverage on behalf of certain insureds. Under the Brokerage PLAINTIFF’S ORIGINAL PETITION Page 2 Agreement, once USI placed insurance for insureds submitted by HUB, USI became the owner of the business, the expirations, and all gross premiums generated by the business, whether or not those premiums were collected. 8. In addition, the Brokerage Agreement between also contained the following term: The Broker shall timely pay to the Company, and hereby guarantees payment to the Company of, all premiums and taxes, if any, due with respect to policies of insurance placed by the Company on behalf of an Insured, whether or not the Broker collects such premiums or taxes from such Insured, including but not limited to any adjustable premiums or additional premiums developed by audit. Any credit extended to any Insured shall be the sole risk and responsibility of the Broker. The Company may, at its sole option and in its sole discretion, satisfy any such amount owed to it by reducing the commissions otherwise owed by the Company to the Broker hereunder. 9. After execution of the Brokerage Agreement, HUB submitted two applications for insurance for MNM Lilac Investments or affiliated entities, both of which were placed by USI resulting in the issuance of policy YACL9L454426030 and Liberty Mutual Insurance Co. policyYACL9L454426041. 1o. During the effective period of each policy, HUB requested various changes to each policy, sometimes to add locations or increase valuation of covered property, and other times to remove locations. In response to HUB’s requests, USI obtained insurance coverage and billed the following via invoices: Date Invoice Number Amount 7/27/2021 3805865 $142,404.00 12/1/2021 3956659 $87,636.02 12/13/2021 3819394 $75,928.00 12/14/2021 3969370 $113,358.00 12/14/2021 3969425 $878.00 PLAINTIFF’S ORIGINAL PETITION Page 3 12/16/2021 3972933 $163,802.00 3/10/2022 4080641 $6,649.00 4/12/22 4119109 $2,171.00 TOTAL $592,826.02 After all adjustments and return premiums, HUB owes USI $479,505.88. 11. USI made multiple formal written demands on HUB for payment of all sums due and owing under the Brokerage Agreement on April 14, 2022. 12. In response, HUB has declined to honor its obligation under the Brokerage Agreement to remit the premiums due. In fact, HUB represented that it transferred the policies to Kris Hamburger on or about November 1, 2021. In the same notification received in May 2022, HUB again declined to pay any portion of the net premiums described above or honor its guarantee obligation. And contrary to the express terms of Section 7(a)(1) in the Brokerage Agreement, HUB even wrongly contended that transfer of the book of business terminated the Brokerage Agreement. 5. COUNT I — VERIFIED PETITION ON SWORN ACCOUNT 13. USI incorporates paragraphs 1 through 12 of this Original Petition as though fully set forth. 14. USI’s claim is founded on a written contract, the Brokerage Agreement, and business dealings between the parties to this action as set forth above. 15. USI has maintained a systemic record of transactions relating to the Brokerage Agreement. PLAINTIFF’S ORIGINAL PETITION Page 4 16. USI’s claim, supported by the declaration of Mike Nielsen attached hereto, is just and true and all just and lawful offsets, payments and credits have been allowed. 17. USI is entitled to recover $479,505.88. 6. COUNT II - BREACH OF THE BROKERAGE AGREEMENT 18. USI incorporates paragraphs 1 through 17 of this Original Petition as though fully set forth. 19. HUB breached the Brokerage Agreement by failing to timely pay to USI and by refusing to honor its guarantee of payment to USI of all premiums and due with respect to the policies of insurance and modifications to them referred to above, as the direct and proximate result of which USI has sustained damages in excess of the minimum jurisdictional limit of this Court. 7. COUNT III — CONVERSION 20. USI incorporates paragraphs 1 through 19 of this Original Petition as though fully set forth. 21. The payments for premiums and policy modifications listed above were entirely owned by USI and were to be held separately and in trust for USI’s benefit and prompt payment to USI. HUB had no right to take any action with respect to these funds except to pay them to USI. 22. By diverting the payments for premiums and policy modifications listed above to Hamburger in November 2021, HUB exercised dominion and control of USI’s personal property to the exclusion of USI’s rights, as the direct and PLAINTIFF’S ORIGINAL PETITION Page 5 proximate USI has sustained damages in excess of the minimum jurisdictional limit of this Court. 8. COUNT IV — ATTORNEY’S FEES 23. USI has been compelled to retain counsel to vindicate its rights due to HUB’s breach of the Brokerage Agreement. 24. USI presented the claim described in this Original Petition to HUB beginning on April 14, 2022. HUB has not paid any part of the claim to date. 25. USI has incurred and is continuing to incur attorney’s fees to vindicate its rights in this matter and is entitled to recover those fees from HUB pursuant to Chapter 38, TEX. CIv. PRAC. & REM. CODE. 9. JURY DEMAND 26. Plaintiff demands trial by jury on all causes of action and has paid the jury fee. 10. RULE 193.7 NOTIFICATION 27. Defendant is hereby notified pursuant to Rule 193.7, TEX. R. CIV. P., that its production of a document in response to written discovery authenticates that document for use against Defendant in any pre-trial proceedings or trial unless within ten days or such other time as may be ordered by the Court, Defendant objects to the authenticity of all or part of a document stating the specific basis for objection. WHEREFORE, USI prays for judgment in its favor and against Defendant for damage in excess of the minimum jurisdictional limit of this Court, for pre— and PLAINTIFF’S ORIGINAL PETITION Page 6 post-judgment interest, attorney’s fees and all other relief to which it may be entitled. Respectfully submitted, /s/ Thomas B. Alleman Thomas B. Alleman State Bar No. 01017485 DYKEMA GOSSETT PLLC 1717 Main, Suite 4200 Dallas, Texas 75201 214 698 7830 phone 855 216 6218 fax talleman@dvkema.com ATTORNEYS FOR PLAINTIFF PLAINTIFF’S ORIGINAL PETITION Page 7 VERIFICATION My name is Mike Nielsen, my date of birth is June 10, 1968, and my address is 14241 Dallas Parkway, Suite 700, Dallas, Texas 75254, USA. I declare under penalty of perjury that the statements contained in this Verified Original Petition true and correct. Executed in Dallas County, State of Texas, on the day of August, 2022. Mflgflv Declarant PLAINTIFF’S ORIGINAL PETITION Page 8 Automated Certificate of eService This automated certificate of service was created by the efiling system. The filer served this document via email generated by the efiling system on the date and to the persons listed below. The rules governing certificates of service have not changed. Filers must still provide a certificate of service that complies with all applicable rules. Lina Bryant on behalf of Thomas Alleman Bar No. 1017485 LBryant@dykema.com Envelope ID: 67341174 Status as of 8/23/2022 7:47 AM CST Associated Case Party: USI SOUTHWEST INC. Name BarNumber Email TimestampSubmitted Status Marilyn Guichard mguichard@dykema.com 8/16/2022 1:34:25 PM SENT Thomas B.Alleman talleman@dykema.com 8/16/2022 1:34:25 PM SENT Lina Bryant lbryant@dykema.com 8/16/2022 1:34:25 PM SENT