Emmis Sues Insurer For Not Covering Costs Of Defending Shareholder Suit
January 15, 2016 at 3:57 AM (PT)
EMMIS has sued its insurer for refusing to cover its legal fees in the recently-settled case brought by dissident preferred shareholders.
The company sued ILLINOIS NATIONAL INSURANCE COMPANY for breach of contract in the Southern District of INDIANA on MONDAY (1/11), complaining that the insurer denied coverage under the sole explanation that the suit arose from the separate 2010 attempt by CEO JEFF SMULYAN to take the company private and should therefore be covered by CHUBB INSURANCE COMPANIES, which covered that incident.
ILLINOIS NATIONAL pointed to allegations by the shareholders (the "Lockup Group") that the preferred share buyback plan was motivated by the failure of the 2010 case, but EMMIS termed those allegations "superfluous and irrelevant to the actual claims asserted against EMMIS, its officers and directors."