Considering the litigation described

ON**

Pending Litigation

Sunoco (R&M), LLC and Sunoco, LLC vs. Pennsylvania National Mutual Casualty Insurance Company, Greyhound Aramingo Petroleum Co., Inc., and Sergey Gorlov

Originally filed in Court of Common Pleas of Philadelphia County, First Judicial District of Pennsylvania, Civil Trial Division, Commerce Program, No. 00271; now at the Superior Court of Pennsylvania, No. 1532 EDA 2023, No. 1404 EDA 2023, and No. 1403 EDA 2023

In June of 2020, Plaintiffs Sunoco (R&M), LLC and Sunoco, LLC (collectively "Sunoco") filed an action for breach of contract and indemnification against Pennsylvania National Mutual Casualty Insurance Company ("Penn National"), franchisee Greyhound Aramingo Petroleum Co., Inc. ("Greyhound") and Sergey Gorlov arising out of defendants' failure to perform their respective contractual duties to Sunoco with respect to litigation arising out of an accident occurring on September 25, 2014, at a Sunoco-branded gas station located at 2750 Aramingo Avenue in the City of Philadelphia. In its complaint, Sunoco alleges that Defendant Greyhound and non-party SG II, LLC (both of which are owned or controlled by Defendant Gorlov) entered into a dealer franchise agreement with Sunoco and undertook indemnity and insurance obligations as it pertains to the above-

referenced accident. For the Greyhound agreement, Defendant Gorlov also executed a personal guaranty that he too would be personally responsible for any monetary liabilities or obligations that Defendant Greyhound owed Sunoco. In accordance with their obligations under the dealer franchise agreements, both SGII and Defendant Greyhound purchased insurance policies that named Sunoco as an additional insured; SG II purchased its policy through Defendant Penn National. Sunoco alleges that Penn National, Greyhound, and Mr. Gorlov have all breached their contractual obligations to Sunoco with respect to a settlement of the personal injury litigation surrounding the above-referenced accident. Sunoco further brought a claim against Defendant Penn National for bad faith in unreasonably refusing to pay for Sunoco's loss incurred as a result of the personal injury litigation and settlement. Sunoco brought this suit to recover actual damages sustained, plus consequential damages, attorneys' fees, and pre and post-judgment interest to the extent permitted by law. After discovery and motion practice at the trial court level, the judge granted Sunoco's motion for summary judgment for breach of contract against Greyhound. At the same time, the judge granted Penn National and Sergey Gorlov's motions for summary judgment against Sunoco, which negated Sunoco's claims against Penn National and Gorlov as a matter of law. A damages trial was set on Sunoco's damages as a result of Greyhound's breach of contract. At the trial, the judge awarded Sunoco all of the damages it sought in its breach of contract case against Greyhound for failure to defend/indemnify Sunoco in the underlying personal injury case. Specifically, the judge awarded $1.5MM for the underlying settlement amount that Sunoco had to pay, $409,344.07 for unreimbursed defense costs for the underlying litigation, and $379,458.69 for attorney's fees to prosecute this breach of contract claim. The total verdict was $2,288,802.76. Greyhound appealed the verdict to the Superior Court of Pennsylvania. Sunoco also appealed the order granting Penn National's and Gorlov's motions for summary judgment to the same court. The ap