boykin et al v. illinois union insurance company et al complaint

8/7/2019 BOYKIN et al v. ILLINOIS UNION INSURANCE COMPANY et al Complaint

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Case 2:11-cv-00326-SRC -MAS Document 1 Filed 01/19/11 Page 1 of 22 PageID: 1

Dughi & Hewit, P.e.340 North AvenueCranford, New Jersey 07016908.272.0200RLH-3813Attorneys for Plaintiffs,Edward P. Boykin, Phyllis A. Boykin,Azis S. Hasan, Carol A. Hasan,Ronald K. Walker and Jane e. Walker

IN THE UNITED STATES DISTRICT COURTFOR THE DISTRICT OF NEW JERSEY

EDWARD P. BOYKIN, PHYLLIS A.BOYKIN, AZIZ S. HASAN, CAROL A.HASAN, RONALD K. WALKER, andJANE C. WALKER, as assignees ofDAVID M. CONNOLLY,

Plaintiffs,v.ILLINIOS UNION INSURANCECOMPANY, MONTY L. DAVIS, MARYR. DAVIS, RICHARD L. BERGMARK,TONI L. BERGMARK,

Defendant

Civil No.:

COMPLAINT

COMPLAINT

Plaintiffs, Edward P. Boykin and Phyllis A. Boykin (the "Boykins"), Azis S. Hasan andCarol A. Hasan (the "Hasans"), and Ronald K. Walker and Jane C. Walker (the "Walkers")(collectively, the "Plaintiffs"), by and through their attorneys, Dughi & Hewit, P.C., by way ofComplaint, state as follows:


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THE PARTIES

1. At all times material hereto, the Boykins were citizens of the State of Florida,residing at 14 Via Marino, in the City of Palm Coast.

2. At all times material hereto, the Hasans were citizens of the State of Florida,residing at 2 Laguna Court, in the City of Palm Coast.

3. At all times material hereto, the Walkers were citizens of the State of Florida,residing at 10 Via Marino, in the City of Palm Coast.

4. Upon information and belief, David M. Connolly ("Connolly") is a citizen of NewJersey, residing at 106 Stanie Brae Drive, in the Borough of Watchung, and the president ofConnolly Properties, Inc. ("Connolly Properties").

5. Upon information and belief, Defendant lllinois Union Insurance Company("lllinois Union") is a corporation organized and existing under the laws of the State of lllinoiswith its principal place of business in the State of lllinois.

6. Upon information and belief, Defendants, Monty L. Davis and Mary R. Davis (the"Davises") are citizens of the State of Texas, residing at 19827 Cypress Church Road, Cypress,Texas.

7. Upon information and belief, Defendants Richard L. Bergmark and Toni M.Bergmark (the "Bergmarks") are citizens of the State of Texas, residing at 60 Tiel Way,Houston, Texas.

JURISDICTION AND VENUE8. Jurisdiction is conferred on this Court pursuant to 28 U.S.C. 1332 in that this is

an action between citizens of different states and the amount in controversy exceeds $75,000,exclusive of interest and costs. The Plaintiffs are all residents of the State of Florida. Upon

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information and belief, Connolly is a resident of the State of New Jersey. Upon information andbelief, the Davises and the Bergmarks are all residents of the State of Texas. Upon information

and belief, lllinois Union is a corporation organized and existing under the laws of the State oflllinois with its principal place of business in the State of lllinois.

9. Venue is proper in this District pursuant to 28 U.S.C. 1391(a)(I) and (2), inthat Connolly resides in this District and a substantial part of the events or omissions giving riseto the claims asserted herein occurred in this District.

GENERAL ALLEGATIONS10. lllinois Union Insurance Company ("lllinois Union") issued a Business and

Management Indemnity Policy, bearing policy number BMI20062163 (the "lllinois UnionPolicy"), for the benefit of Connolly Properties and Connolly.

11. The lllinois Union Policy covers Connolly for claims made under the lllinoisUnion Policy during the policy period of December 12, 2008 to December 12, 2009 (the "PolicyPeriod").

12. The lllinois Union Policy has a $1,000,000 limit of liability under the"Management Insureds and Company Coverage Section."

13. Upon information and belief, the remaining limits on the lllinois Union Policy are$746,453.68 (the "Remaining Policy Limits").

14. Under the "Insuring Clauses" of the lllinois Union Policy, lllinois Union shall"pay the Loss of the Management Insureds for which the Management Insureds are notindemnified. by the Company and which the Management Insureds have become legallyobligated to pay by reason of a Claim first made against the Management Insureds during the

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Policy Period, . . . and reported to the Insurer pursuaut to subsection El herein, for auyWrongful Act taking place prior to the end of the Policy Period." (Emphasis in original).

15. Connolly is au "Insured" under the illinois Union Policy, due to his role as a"Mauagement Insured" (defined in the illinois Union Policy to include all General Partners,Directors, Officers, Mauagers, aud employees of Connolly Properties).

16. The Plaintiffs fust made a claim covered by the illinois Union Policy againstConnolly during the Policy Period and filed a Complaint in the United States District Court,District of New Jersey, entitled, Edward P. Boykin, et ai. v. Connolly Properties, Inc., et ai.,Civil Action No. 09-5267 (DRD) (the "Underlying Litigation") against Connolly and ConnollyProperties, seeking monetary relief for wrongful acts committed during the Policy Period.

17. The Complaint in the Underlying Litigation qualifies as a "Claim" under theillinois Union Policy: "a civil proceeding against any Insured seeking monetary damages or nonmonetary or injunctive relief, commenced by the service of a complaint or similar proceeding."

18. Pursuaut to Judge Debevoise's October 25, 2010 Order (the "UnderlyingJudgment") in the Underlying Litigation, judgment was entered in the amount of $1,368,502 plusinterest against Connolly, aud in favor of the Plaintiffs as follows: (1) in favor of the Boykinsaud against Connolly in the amount of $487,500 plus interest; (2) in favor of the Hasans andagainst Connolly in the amount of $496,002 plus interest; and (3) in favor of the Walkers audagainst Connolly in the amount of $385,000 plus interest.

19. The Underlying Judgment is based on conduct that is covered by the illinoisUnion Policy aud Connolly is legally obligated to pay the Underlying Judgment. TheUnderlying Judgment qualifies as a covered "Loss" under the illinois Union Policy: "Loss meausdamages, judgments, . . . awarded by a court."

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20. Connolly's actions that precipitated the finding of liability qualify as "WrongfulActs" covered under the illinois Union Policy: "Wrongful Act means any actual or alleged error,omission, misleading statement, misstatement, neglect, breach of duty or act allegedly committedor attempted by: a) any of the Management Insureds, while acting in their capacity as such."

21. In connection with the Underlying Litigation, Connolly and the Plaintiffs enteredinto an Assignment Agreement (the "Assignment Agreement"), pursuant to which Connollyassigned to the Plaintiffs all of Connolly's rights and claims against illinois Union for, among

other things, coverage for the Underlying Judgment as well as for extra-contractual damages.22. A true copy of the Assignment Agreement is attached as Exhibit A.23. On or about September 8, 2009, the Davises and the Bergmarks filed an action

against Connolly in the United States District Court, District of New Jersey, alleging thatConnolly misappropriated the Plaintiffs' funds.

24. On or about February 11, 2010, the United States District Court, District of NewJersey entered partial summary judgment against Connolly, finding Connolly liable to theDavises and the Bergmarks for breach of fiduciary duty and conversion. In a second Opinionand Order entered on September 2, 2010, United States District Court, District of New Jerseyentered a Final Judgment against Connolly and in favor of the Davises and the Bergmarks in thetotal amount of $1,045,000.

FIRST COUNTBREACH OF CONTRACT

25. The Plaintiffs repeat and reallege the allegations set forth in the precedingParagraphs of this Complaint with the same force and effect as if each were fully set forth atlength herein.

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26. The illinois Union Policy is a valid and enforceable contract, pursuant to whichillinois Union, among other things, is obligated to indemnify Connolly for any Loss incurred

during the Policy Period.27. By reason of illinois Union's failure to indemnify Connolly for a Loss incurred

during the Policy Period, illinois Union has materially breached the illinois Union Policy and hasdirectly and proximately caused Connolly significant damages and loss in an amount to bedetermined at trial, which claims Connolly has assigned and transferred to the Plaintiffs.

28. Connolly assigned any and all claims for coverage under the illinois Union Policyto the Plaintiffs.

WHEREFORE, the Plaintiffs demand judgment against illinois Union as follows:a. Declaring that the illinois Union Policy covers the Underlying Judgment;b. Declaring that Connolly's interest in the Remaining Policy Limits, which has

been assigned to the Plaintiffs, is superior to that of the Davises and theBergmarks;

c. Ordering specific performance of the illinois Union Policy;d. Ordering illinois Union to indemnify Connolly pursuant to the illinois Union

Policy;e. Awarding compensatory damages;f. Awarding pre- and post-judgment interest;g. Awarding the Plaintiffs their attorneys' fees, costs, and disbursements; andh. Granting other such relief as this Court deems just and proper.

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SECOND COUNTBREACH OF FIDUCIARY DUTY - COMPENSATORY DAMAGES


30. lllinois Union owed a fiduciary duty to Connolly with regard to the lllinois UnionPolicy.

31. lllinois Union breached its fiduciary duty to Connolly by, among other things,failing and refusing to indemnify Connolly for covered Loss under the lllinois Union Policy.

32. As a direct and proximate result of this breach by lllinois Union, the Plaintiffs, asassignees of Connolly's rights and claims against lllinois Union, have been and continue to bedamaged in an amount to be determined at trial.

33. Connolly assigned any and all claims for breach of fiduciary duty to the Plaintiffs.WHEREFORE, the Plaintiffs demand judgment against lllinois Union as follows:a. Awarding compensatory damages;b. Awarding pre- and post-judgment interest;c. Declaring that Connolly 's interest in the Remaining Policy Limits, which has

been assigned to the Plaintiffs, is superior to that of Davises and Bergmarks;d. Awarding the Plaintiffs their attorneys' fees, costs, and disbursements; ande. Granting other such relief as this Court deems just and proper.

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TIDRDCOUNT

BAD FAITH, BREACH OF FIDUCIARY DUTY AND BREACH OF IMPLIEDCOVENANT OF GOOD FAITH AND FAIR DEALING - PUNITIVE DAMAGES


35. The lllinois Union Policy included an implied covenant of good faith and fairdealing.

36. Connolly and/or Connolly Properties at all times relevant hereto performed anyand all duties and obligations under the lllinois Union Policy.

37. At all times relevant hereto, lllinois Union, by its acts and omissions, acted in badfaith and breached its fiduciary duties and the covenant of good faith and fair dealing, includingbut not limited to the following:

a. Prior to entry of the Underlying Judgment, the Plaintiffs offered to Connolly tosettle and resolve the claims asserted in the Underlying Litigation for an amount within theremaining limits of the lllinois Union Policy, which offer Connolly promptly forwarded tolllinois Union and demanded that lllinois Union resolve and settle the Plaintiffs' claims withinthe limits of the lllinois Union Policy;

b. With knowledge of a strong likelihood that a judgment would be entered againstits insured Connolly for an amount in excess of the remaining limits on the lllinois Union Policybased on conduct covered by the lllinois Union Policy, lllinois Union did not settle or resolve theclaim but instead placed its interests ahead of its insured's interests and continued to wrongfullydeny coverage and wrongfully and unreasonably refuse to settle; and

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c. With knowledge of a strong likelihood that a judgment would be entered againstits insured Connolly for an amount in excess of the remaining limits on the lllinois Union Policybased on conduct covered by the lllinois Union Policy and with knowledge of multiple claimantsmaking claims against Connolly, which claims were also covered by the lllinois Union Policy,who would also make claim to the remaining limits of the lllinois Union Policy, lllinois Uniondid not even make any attempt to enter into settlement discussions with the Plaintiffs or otherclaimants to explore if the case could be settled or resolved with all claimants for any amountless than the remaining limits on the policy. Instead, lllinois Union placed its interests ahead ofits insured's interests and continued to wrongfully deny coverage and wrongfully andunreasonably refuse to settle or even to explore settlement opportunities, all to the detriment ofits insured Connolly.

38. The acts and omissions of lllinois Union constitute bad faith, breach of fiduciaryduty and breach of the implied covenant of good faith and fair dealing.

39. As a direct and proximate result of lllinois Union's bad faith and the breach(es) ofits fiduciary duty and implied covenant of good faith and fair dealing, judgments were enteredagainst its insured Connolly for amounts in excess of the remaining limits on the lllinois UnionPolicy, causing Connolly significant damages.

40. lllinois Union's bad faith and the breach(es) of its fiduciary duty and impliedcovenant of good faith and fair dealing constitute sufficiently wrongful conduct to entitle itsinsured Connolly to punitive damages.

41. Connolly assigned any and all claims for bad faith, breach of fiduciary duty andbreach of implied covenant of good faith and fair dealing and for extra-contractual claims, extracontractual damages and punitive damages to the Plaintiffs.

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WHEREFORE, the Plaintiffs demand judgment against lllinois Union as follows:a. Awarding compensatory damages;b. Awarding punitive damages;c. Declaring that Connolly's interest in the Remaining Policy Limits, which has

been assigned to the Plaintiffs, is superior to that of the Davises and the Bergmarks;d. Awarding pre-and post-judgment interest;e. Awarding the Plaintiffs their attorneys' fees, costs, and disbursements; andf. Granting such other relief as this Court deems just and proper.

FOURTH COUNTDECLARATORY,lUDGMENT


43. The only current property right or other right of Connolly in the Remaining PolicyLimits is his rights and cause of action against lllinois Union for coverage and for breach ofcontract, breach of fiduciary duty, bad faith and breach of the covenant of good faith and fairdealing ("Connolly Rights").

44. A creditor can secure an interest in such Connolly Rights by, among other things,a legal proceeding to compel turn over of such rights and cause of action, which has not beendone by any party, or by Connolly assigning the Connolly Rights.

45. Connolly assigned the Connolly Rights (as well as any and all rights, claims andcauses of action for extra-contractual claims and punitive damages) to the Plaintiffs.

46. The Plaintiffs own all of the Connolly Rights.

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47. Any proceeding to attempt to enforce rights under the lllinois Policy, to turn overthe Remaining Policy Limits or to secure an interest in the Remaining Policy Limits requiresConnolly as an indispensable party. Any such proceeding in a jurisdiction which does havepersonal jurisdiction over Connolly would be and is null and avoid for purposes of declaringrights or priority to the Remaining Policy Limits.

48. The Plaintiffs' interest in the Remaining Policy Limits, by and through theassignment of the Connolly Rights, is superior to the interest, if any, of the Davises and theBergmarks to such funds.

WHEREFORE, the Plaintiffs demand judgment against the Davises and the Bergmarksas follows:

a. Declaring that the Plaintiffs have an interest in the Remaining Policy Limits;b. Declaring that the Plaintiffs' interest in the Remaining Policy Limits is superior to

the interest, if any, of the Davises and the Bergmarks to such funds;c. Awarding the Plaintiffs judgment in the amount of the Remaining Policy Limits;d. Awarding the Plaintiffs their attorneys' fees, costs, and disbursements; ande. Granting such other relief as this Court deems just and proper.

FIFTH COUNTCONSTRUCTIVE TRUST


50. The Underlying Judgment is a Loss covered under the lllinois Union Policy.

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51. As the Underlying Judgment is a Loss covered under the lllinois Union Policy,lllinois Union must hold the Remaining Policy Limits in trust for the benefit of Connolly, whomlllinois Union is obligated to indemnify.

52. lllinois Union is a constructive trustee of the Remaining Policy Limits for thebenefit of Connolly.

WHEREFORE, the Plaintiffs demand judgment against lllinois Union as follows:a. Imposing a constructive trust on the Remaining Policy Limits for the benefit of

Connolly;b. Awarding the Plaintiffs judgment in the amount of the Remaining Policy Limits;c. Awarding the Plaintiffs their attorneys' fees, costs, and disbursements; andd. Granting such other relief as this Court deems just and proper.

Dated: January 19, 2011

DEMAND FOR JURY TRIALThe Plaintiffs demand a trial by jury.

Respectfully submitted,DUGHI & HEWIT, P.C.,Attorneysfor Plaintiffs,Edward P. Boykin, Phyllis A. Boykin,Aziz S. Hasan, Carol A. Hasan,RonaldK. Walker, and Jane C. Walker

By: Russell L. Hewit (RLH -- 3813)Dughi & Hewit, P.c.340 North AvenueCranford, New Jersey 07016908.272.0200

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Exhibit AAssignment Agreement

fromConnolly to the Boykin Parties

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ASSIGNMENT AGREEIHENTThis Assignment Agreement ("Assignment Agreement" or "Agreement") made this__

of December 2010, by and among David M. Connolly ("Connolly" or "Assignor"), on the onehand, and Edwal'd Boykin, Phyllis Boykin, Aziz Ha.all, Carol Hasan, Ronald Walker and JaneWalker (jointly "Boykin Plaintiffs" or "Assignee"), on the other hand,

WITNESSETH:WHEREAS Connolly andlor Connolly P!'Operties, Inc. ("Connolly Properties")

purchased certain policies of insurance known as Business and Management Indemnity Policiesf!'Om Illinois Union Insurance Company ("Illinois Union"), including but not limited to policynumber BM120062 J63 (all policies of insurance issued by JIIinois Union to Connolly, includingboth known andlor identified policies and policy number BMJ2OQ62163 as well as unidentifiedandlor unknown policies are referred to jointly as "Illinois Union Policies"); and

WHEREAS the BoyJdn Plaintiffs asserted claims for damages a ~ d loss against Connolly,including but nol.limited to claims asserted in a lawsuit entitled Edward P. Boykin el al. v.Connolly Properties, Tnc" ct al. Civil Action No. 09-5267 (ORD), in the United States DistrictCourt for the District of New Jersey ("Lawsuit"). which claims were and are covered underDlinojs Union Policies; and

WHEREAS Connolly timely tendered the claims to Illinois Union and demanded defenseand indemnity of the claims under the Illinois Union Policies, and Illinois Union provideddefense but not indemnity ot' the claims and reserved its rights to deny and wrongfully deniedcoverage for indemnity and damages arising from these claims under the IIlinoi. [Jninn Policiesin breach of its contractual obligations; and

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Assignmenl AgreementConnolly and the Boykin PlaintiffsPage I of9

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g g

WHEREAS notwithstanding that the Boykin Plaint iffs' claims exceeded the limits of theIllinois Union PCllicies, the Boykin Plaintiffs offered to Connolly to compromise. settle andresolve the cl aims against Connolly for an amount within what Were the remaining limits of theIllinois Union Policies, which offer would have avoided Connolly being exposed to damages inexcess of the Jimits of the Dlinois Union Poticies; and

WHEREAS Connolly communicated to flIinoi. Union the of fer by the Boykin Plaintiffsto seWe within the limits of the Illinois Union Policies and avoid damages in excess of the limitsof the Illinoi s Union Policies "nd consented [0 and requested that Illinois Union settle the claimsof the Boykin Plaintiffs for an amount within the remaining limits of the lIiinois Union Policies;and

WHEREAS Illinois Union knew or should have known that there was an overwhelminglikelihood lhallhe Boykin Plaintiffs would obtain a judgment aga inst Connolly for an amount inexcess of the limits of [he Diinois Policies' limits based Oil claims covered by the Illinois UnionPolicies, yet refused to settle the claims of the Boykin Plaintiffs within the limits of its policiesand continued to wrongfully deny coverage for the claims for the Boykin Plaintiffs damages,exposing Connolly to a high likelihood of a jUdgment in excess of policy limits in breach ofIllinois Union's fiduciary duty to Connolly as Connolly's insurer and in breach of' its duty of fairdealing and good failh; ""d

WHEREAS in the Lawsuit, the district court entered an order granting the BoykinPlaintiffs summary judgment against Connolly for $1,368,000 (the "Boykin Judgment" or"Order'), un amount in excess of the rcnul.lniug limits of [he IlHnojs Union 'POliCies,unnecessarily exposing Connolly to damages in eXcess oflhe limits of the rIlinois UnionPolicies; and

4768010006 nsn77Sv2

Assignment AgreementConnolly and [he Boykin PI.intiffsPage2of9



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WHEREA S the Boykm Judgment also divested the Boykin Plaintiffs of their interests inthe Hillside Valley Investment Trust (the ''Trust'') and those interests reverted to Connolly; and

WHEREAS Connolly tendered the Boykin Judgment to Illinois Union for payment, andlllinois Union has refused to pay the Boykin Judgment or the remaining limits of the IllinoisUnion Policy in breach ofDlinois Union's fiduciary duty to Connolly as Connolly's insurer andin breach of its duty of fair dealing and good faith, and Illinois Union continues to wrongfullydeny coverage for the claims of the Boykin Plaintiffs under the IllinoiS Union Policies; and

WHEREAS Connolly and the Boykin Plaintiffs have rCllched agreement on the terms ofConnolly' agreement to assign and transfer to the Boykin Plaintiffs any and aJl rights and claimsagainst BIinois Union (a) in any way related to, under or arising ftom breach of the Jilinois UnionPolicies, (b) for coverage under the IllinOis Union Policies, (e) to any and all proceeds due underthe fIlinois Union Policies, (d) for extra-contractual damages, punitive damages and any and allother available remedies and relief arising from or in breach of Illinois Union' s fiduciary duty toConnolly as Connolly's insurer and in breach of irs duty of fair dealing and good faith; and

WHEREAS, in addition to the assignments and transfers related If) the Illinois UnionPolicies, Connolly also agrees to assign and transfer to the Boykin Plaintiffs the interests that theBoykin Plaintiffs were divested of in the Trust under the terms of the Order; and

NOW, THEREFORF.. Connolly and the Boykin Plaintiffs agree to the following tonnsand conditions.

1. Recitations. The recitations in the WHEREAS clauses are incorporated into thebody of this Agreement"" rcpl'Cscntntions ortl.e parties.

2. Assignment of Insurance Hights. Connolly irrevocably assigns, transfers anddelivers to the Boykin Plaintiffs to the maximum extent permitted by law, outright and free of

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any and all liens, clnims and encumbrances, any and all rights, claims, causes of action andentitlements (u) to any and all proceeds due, payable or [0 be paid under the lIIinois UnionPolicies, (b) to any and all claims for insurance coverage under the lIIinois Union Policies, (c) toany and all claims arising from breach of the lllinois Union Policies, (d) to any and all claims forextra-contractual damages. punitive damages lind any and all other available remedies and reliefarising from Illinois Union's breach of its fiduciary duty co Connolly us Connolly'S insurerand/or arising froOl its breach of its duty of fair dealing and good faith (jointly. the "AssignedClaims"). The Assigned Claims include any and all rights. claims, causes of accion andentitlements arising from o r relaled in any way to any claims Connolly had. has or may haveagainst Illinois Union for any reason.

3. Assignment of Interests in and to HUis/de. Connolly irrevocably assigns.transfers and delivers to lhe Boykin Plaintiffs to the maximum extent permitted by law. outrightand free of any and all liens, any and all shares, membership interests. partnership interests.ownership interests and any and ull claims. encumbrances. rights, causes of action andentitlements previously owned or held by the Boykin Plaintiffs, which he received pursuant tothe (erms of the Order divesting Che Boykin Plaintiffs of their interests in the Trust ("BoykinHillside Interests").

4. k..,.rfion and Filing of Claims/Costs of Pursuing ASSigned Claims. TheBoykin Plaintiffs are authorized by ConnoUy to assen and prosecute. and shall assen andprosecute, che Assigned Claims us assignee as though ConnoUy was asserting and prosecutingthe Assigned Claims in it, own righ' and name, and the Boykin Plamuf!s shall be solely entitledto any recovery on the ASSigned Claims. In the event that formal litigation is filed, the BoykinPlaintiffs shalI caption the case in the name of the Boykin Plaintiffs, individually and as assignee

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of Connolly and shall also recite In tile pleadings that the Assigned Claims have been assignedby Connolly to the Boykin Plaintiffs,

The Boykin Plaintiffs shall be solely responsible for the costs, including but not limitedto attorneys fees and expenses and costs, incun'ed in asserting and prosecuting the AssignedClaims,

5. Representations of Connolly. Connolly represents and warrants that (1) he ownsthe Assigned Claims, he bas not released tile Assigned Claims lind he has the right and authorityto assign and transfer the Assigned Claims and the Boykin Hillside Interests to the BoykinPlaintiffs, and (2) he has not assigned, pledged, transferred or otherwise encumbered any of theAssigned Claims and the Boykin Hillside Interests and he assigns them to the Boykin Plaintiffsfree and cleur of any and all liens, claims and encumbmnces of any third partiers, Connolly shallnot assign or transfer to any other persons or entities the Assigned Claims or the Boykin HillsideInterests and shall not assign to any other persons or entities any other rights or claims (a) to anyproceeds due, payable or to be paid under the Illinois Union Policies, (b) for any other claims forinsur-dnce coverage under the Illinois Union Policies, (c) for any other c l a i m ~ ",ising from breachof the Illinois Union Policies, Cd) for any other claims for extra-contractual damages, punitivedamages or any other available remedies or relief against Illinois Union for any reason or (e) tothe Boykin Hillside Interests,

Connol ly represents and wan'ants that he has no assets or income, and that he has nocurrent right or entitlement to future assets or income, except as expressly listed in his AssetDisclosures he previously disclosed to the Doykin Plaintiffs, ConnOJlyrecognlzes,underslandsand agrees that if there is a misrepresentation in his Asset Disclosures that the Agreement to lookto Illinois Union and the Boykin Hillside Interests for relief and not to pursue relief from

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Connully as set forth In paragraph 7 shall be void and unenforceable and thaI the BoykinPlaintiffs shall have the right to pursue recovery from Connolly.

6, Cooperaliol L Connolly shall cooperate with the Boykin Plaintiffs in theprosecution of the ASSigned Claims, including but not Umited to (1) providing the BoykinPlaintiffs and/or their attorneys and representatives with access to and copies of books, records,documents, data, storage media, communications and other materials, whether created or storedin hard copy or electronic or computer format, relevant to the Assigned Claims, (2) authorizingand insl.nlcling his employees or employees of entities under his control, with relevantknowledge about the Assigned Claims to meet with the Boykin Plaintiffs and/or their attorneysand representatives upon reasonable notice and at reasonable times, in order to respond todiscovery requests a nd to prepare and prosecute the Assigned Claims, and (3) cooperating in thescheduling and appearance at deposition, heating, arbitration or trial and, in such event, to meetwith the Boykin Plaintiffs and/or their attorneys and representatives to prepare for suchdeposition, hearing, arbitration or trial.

In the event Connolly is contacted by Illinois Union or persons acting on it.. bebalf or iscontacted by any person concerning or related to the Assigned Claims, Connolly shall make nocomment about the Assigned Claims and shall refer any such persons to the Boykin Plaintiffs.Connolly shall not provide any docllments or wlitings concerning the Assigned Claims to anypersons, except in response to valid subpoena or COUlt order and, even then, only after firstproviding copies to the Boykin Plaintiffs and/or his attorneys and a reasonable opportunity toreview prior to production, nor shall Connolly discu"s ur ,-,ummem on the Assigned Claims, inwriting or orally, to any other person, excluding, his lawyers, tax advisors and spouse, except inthe presences of the Boykin Plaintiffs or their attorneys.

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7. Agreement to Look to Illinois Union and Hillside Interests Only for Relief.The Boykin Plalntiffs agree that they shall not seek relief or recovery from Connolly with regardto any and all claims against Connolly asserted in Ihe Lawsuit amI/or to which they are entitledunder the Boykin Plaintiffs' Judgment. but shall limit their recovery solely to what they receivefrom !IIinois Union and the Hillside Inrcresl,. To the extent that the Boykin Plaintiffs canrelease any and all chlims against Connolly asserted in the Lawsuit and to which they are entitledunderthe Boykin Plaintiffs' Judgment without impairing or limiting in any way Connolly'srights and claims against lIlinois Union (which have been assigned to the Boykin Plaintiffs)and/or the Boykin Plaintiffs' rights and claims against Illinois Union pursuant to the AssignedClaims. d,CY release such claims against Connolly. If, however. for any reason, such a releaseimpairs or limits in any way the rights and claims of the Boykin Plaintiffs against IllinOis Unionpursuant to the ASSigned Claims, then they do not release Connolly, but agree to look solely toIllinois Union and the Boykin flillside Interests for relief and recovery. The Boykin Plaintiffsfurther agree that they will not seek ta collcct or recover manies or payment of the judgmentfrom Connol ly but will look to Illinois Union to satisfy the judgment.. IJpon resolution of theAssigned Claims with Illinois Union, by way of verdict, court order or settlement, the BoykinPlaintiffs will execute and provide to Connolly a warrant to satisfy judgment.

A. Authority. Connolly has the full right and authOlity to assign and transfer 10 theBoykin Plaintiffs the Assigned Claims and the Boykin Hillside Interest.

B. Binding. This Assignment Agrc:ement is binding upon and shaJl inure to thebenefit of the parties and their successors and assigns.

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C. Entire Agreement. Tlus Assignment Agreement is the entire agreement betweenthe parties and there are no oral agreements. This Assignment Agreement represents thecomplete understanding between the parties and supersedes nny and all previous negotiations,represenrations or agreemenrs as to the subject matter of this Assignment Agreement. ThisAssignment Agreement may nO[ be amended except by a written instrument signed by all parties.

D. Preservation of Agreement. If a court or othe r hearing officer of competentjurisdiction holds any part of this Agreement to be invalid or unenforceable, the remainder of theAssignment Agreement shall remain in full force and effect.

E. Countcmarts. This Assignment Agreement mny be signed in counterparts, eachof which is deemed nn original, and all of which taken together constitute one and the sameagreement.

F. Additiona l Documents. The Parties agree to execute and deliver to each otherany documents reasonably necessary to effectuate the terms of this Assignment Agreement.

G. New Jersey Law. The law of the State of New Jersey shall apply in theinterpretation and enforcement of this Assignment Agreement without regard to choice of lawprinciples.

H. Signatory for Boykin Plaintiff s. Louis Modugno, attorney for the BoykinPlaintiffs. is authorized to sign t h i ~ A. . ignment Agreement on behalf of each and everyon e ofthe Boykin Plaintiffs and to bind them to the terms of this Assignment Agreement.

The NOW, THEREFORE, clause and signature pnge is the next immediate page.]

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ASSignment AgreemcluConnolly and Ihe Boykin PlointilfsPage 8 019



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NOW, THEREFORE, David M. Connolly, on the one hand, and Edward Boykin, PhyllisBoykin, Azi.2. Hasan, Carol Hasan, Ronald Walker and Jane Walker, by and through theirattorney, Louis Modugno, on the other hand, sign this Assignment Agreement intending to belegally bound by all of its terms and conditions.

ASSIGNORS;DAVID M. CONNOLLY

David M. Connolly, IndividuallyDated: December& , 2010ASSIGNEES:LOUIS MODUGNO,ATIORNEY FOR AND ON BEHALF OFEDWARD BO YKIN, PHYLLIS BOYKlN,AZIZ HASAl'l, CAROL HASAN,RONALD ~ A L K E R , ANI}1ANB WALKER/1-:/J, ' /"Louiii Modugno, AltoOley for and onbehalf of Edward Boykin, PhyllisBoykin, Aziz Hasan, Carol Hasan,Ronald Walker, and Jane Walker.p,ll- : ;C,""i ?, .)011

4768010006 72S07']S ...;l

Assignment AgreementConnolly alld the Boykin PlaintiffsPage 9 of9