Lloyd’s Files Suit to Rescind $17 Million Michael Jackson Policy

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June 08, 2011Lloyd’s Files Suit to Rescind $17 Million Michael Jackson Policy At the time of Michael Jackson’s death on June 25, 2009 he was days away from beginning a slate of 30 concerts at the 02 Arena in London. In fact, the first show was scheduled for July 8, 2009.

AEG Live, LLC the company that contracted with Jackson to perform the show obtained a Contingency Non-Appearance and Cancellation policy from Lloyd’s providing coverage in the amount of $17,500,000. The policy listed AEG Live and the “Mark Jones Company, LLC” as insureds. It is alleged that the “Mark Jones Company, LLC” is in fact the “Michael Jackson Company, LLC.”

The policy provided coverage for losses that resulted from any of the planned concerts being “cancelled, abandoned, postponed or interrupted.” Included within the insured perils was the illness or death of Michael Jackson. After his death, AEG Live tendered to Lloyd’s seeking payment under the policy. Lloyd’s, in turn, filed the instant action.

Initially, the complaint alleges that AEG Live has failed to properly cooperate in Lloyd’s investigation of the claim. The complaint, states in part:

Underwriters' ability to thoroughly and properly investigate and evaluate the claim remains impaired because the documents and other information requested have to date not been provided by AEG or its counsel as obligated under California law

Lloyd’s is seeking, in part, to rescind the policy based upon various “misrepresentations or concealments.” In particular, Lloyd’s contends that AEG Live should have communicated Michael Jackson’s prescription drug use/drug addiction.

In addition, Lloyd’s also seeks a declaration that it is not required to indemnify AEG Live as Michael Jackson’s death was not an “Accident” as contemplated by the policy. The policy required that Lloyd’s receive a medical report and a Lloyd’s representative attend the rehearsals taking place in London, as neither occurred, Lloyd’s contends it is not required to provide coverage.

For a copy of the complaint, click here

Brian Biggie and Dan Gerber

Posted at 05:42 PM in Emerging Issues | Permalink

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