MICHAEL E. WEINSTEN (SBN 155680) ANDREW B. BRETTLER (SBN 262928) DAVID B. JONELIS (SBN 265235) LAVELY & SINGER PROFESSIONAL CORPORATION 2049 Century Park East, Suite 2400 Los Angeles, California 90067-2906 ‘Telephone: (310) 556-3501 Facsimile: (310) 556-3615 |: mweinsten@lavelysinger.com abreitler@lavelysinger.com djonelis@lavelysinger.com Attorneys for Plaintifis SCOTT GURNEY, DEIRDRE GURNEY and LITTLE WIN, LLC CONFQRMED COPY ORBEA, PEAD JAN 1.0 2017 or, Exoeutve Oxo /Cxk ea Gaba, Depay shox SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF LOS ANG! SCOTT GURNEY, an individual; DEIRDRE GURNEY, an individual; and LITTLE WIN, LLC, a California limited liability company, Plaintiffs, v. ITV GURNEY HOLDING INC., a Delaware corporation; BRENT MONTGOMERY, an individual; ANDREW GARARD, an individual; DAVID McGRAYNOR, an individual; and DOES 1-100, inclusive, Defendants. CASE NO. BC6 46298 COMPLAINT FOR (1) BREACH OF FIDUCIARY DUTY @) | BREACH OF CONTRACT @) CIVIL EXTORTION (4) INVASION OF PRIVACY (3) VIOLATION OF CAL. PENAL CODE SEC. 502 (©) CONVERSION (7) DECLARATORY INJUNCTIVE RELIEF DEMAND FOR JURY TRIAL, Plaintiffs Scott Gumey, Deirdre Gurney and Little Win, LLC (collectively “Plaintiffs”) by and through their attorneys, Lavely & Singer Professional Corporation, respectfully allege as follows: COMPLAINT10 WW 12 B 14 15 16 18. 19 21 22 23 24 25 27 28 (TRODUCTION 1. This case arises from an outrageous campaign of intimidation and extortion employed by defendant ITV Gurney Holding Inc. (“ITV”) to illegally acquire a near 40% stake in Gurney Productions ata grossly deflated price from founders Scott and Deirdre Gurney, the creators of the wildly successful reality series Duck Dynasty. 2. In 2012, the Gumeys sold a 61.5% stake in their company, Gumey Productions, to ITV, an affiliate of British television behemoth ITV ple. ITV paid roughly $40 million up-front, with an option to acquire the Gurneys’ remaining share in the next three to five years for a price determined by the company’s profitability. As an inducement to the sale, ITV contractually agreed that the Gumeys ‘would stay on as Co-CEO’s and would also be permanent managing members of the company’s Board of Directors. ITV also agreed that the Gurneys, as managing members of the Board, would have exclusive authority to run the company’s day-to-day operations consistent with their prior practice ~ a right which could not be revoked as long as the Gurneys retained their minority stake. 3. ITV’s gamble to buy a majority interest in Gumey Productions and to allow the Gumeys to run the company paid off brilliantly. The Gurneys performed their end of the bargain in exemplary fashion and, in just three short years, increased profits of Gurney Productions by over 65%. The same, however, cannot be said for ITV’s performance of its obligations. 4, In 2015, arift developed between the Gumeys and ITV following the departure of Paul Buccieri and Kevin Lygo, two of the original ITV-appointed Board members. ITV replaced Lygo with defendant Brent Montgomery, a competitor of the Gumeys, whose personal ambitions and conflicts were directly at odds with his new role on the Gurney Productions’ Board. Montgomery was effectively poison to Gumey Productions and wanted complete control ~ something he could not obtain until ITV bought the Gumeys out. However, given the success of Gumey Productions, I'V would have to pay a steep price to purchase the Gumeys’ stake, something ITV apparently was unwilling to do. Accordingly, without disclosing their intentions to the Gumeys, ITV and the individual Defendants concocted a scheme by which they would squeeze out the Gurneys, tarnish their reputation in the industry, and acquire the Gumeys’ interest in Gurney Productions for a massively discounted price. a COMPLAINT5. By December 2016, ITV’s true intentions were revealed. On December 5, 2016, ITV lured the Gumeys to a Board meeting in Sherman Oaks (far from the Gutney Productions offices, where meetings were typically held) with a fake “agenda” signaling business as usual. Once there, ITV’s appointed Board members ambushed the Gumeys with false accusations of impropriety (not previously disclosed), threats of termination and outright extortion —all targeted to the unlawful end of forcing the Gueys to sell at an outrageously low price. Specifically, Defendants Montgomery, Garard and McGraynor presented the Gurney with an agreement for ITV to purchase their minority share af well below the contracted-for price, and then threatened to go “public” with bogus allegations of fraud and “embezzlement” if the Gumeys did not sign the deal that very day. Montgomery went so far as to threaten: “The minute you guys tell us this is not going to resolve today {i.e., that the Gumeys’ would not sign the deal] . . all the networks are getting alerted, the agencies, the talent, everyone gets alerted ” The Board’s threat falls squarely within the definition of “extortion” under California Penal Code Sec, 519 (“[fJear, such as will constitute extortion, may be induced by a threat... . to accuse the individual threatened . . . of any crime . . . or [] [t]o expose, or to impute to him or them any deformity, disgrace or crime.”) 6. With full confidence that they had done nothing wrong, the Gumeys refused to suecumb to Defendants’ strong-arm tactics and left the meeting. Less than two hours later, Defendants made good on their threats as multiple media outlets began reporting the alleged “fraud” by the Gumeys. In fact, there was no fraud, and Defendants knew this. 7. Indeed, as just one egregious example of their complete lack of good faith, Defendants accused the Gurneys of secretly setting up a competing company, Snake River Productions, in violation of the non-compete provisions in their employment agreements, Snake River (which was not even fully operational), however, was not a competing company. It was created for scripted television, game shows and documentary films — none of which is prohibited by the agreements between the Gumeys andl ITV. On its face, the Gumeys’ non-compete provision applied only to “reality based” program: 2. Despite this, and when presented with concrete evidence of Snake River's true purpose, ITV took the absurd position that “game shows” are reality based TV. They are not—a fact known to just about everyone in the industry, except apparently ITV. COMPLAINT8. Under their agreements, the Gumeys were entitled to a fair hearing before the Board, with counsel present, to address the allegations raised. They were also entitled to a 30-day “cure” periog| to resolve any alleged breaches. Given ITV’s aggressive tactics and leaks to the media, it was clear from the outset that Defendants had no intention of fulfilling either obligation. In the face of ‘overwhelming evidence demolishing their accusations, Defendants voted to terminate the Gurneys” employment as co-CEO’s “for cause” at a Board meeting held on December 8 ~ a direct breach of contract and fiduciary duties. = Lest there be any doubt as to Defendants’ unlawful motives, within minutes following the Gurneys’ wrongful termination, the Board handed the Gumeys a letter titled “Membership Interest Call Notice,” In that letter, ITV purported to exercise its right to “call” (i., purchase) the Gurneys” minority interest under a “termination with cause” provision that, if properly and timely exercised, would have resulted in a 25% reduction in the call price. ITV’s purported “call,” however, was neither timely nor proper. It was a gross miscalculation, as the provision on which ITV was relying, on its face, | only applies to terminations “before the end of fiscal year 2015.” Defendants’ attempt to exercise non- existent rights is itself a direct breach of contract and fiduciary duties 10, Instark contrast with ITV's improper and untimely exercise of its “call” rights, on December 22, 2016, the Gumeys properly and timely exercised their “put” rights, which accelerated based on ITV’s multiple breaches of contract and wrongful termination of the Gurneys. Moreover, because the Gurneys exercised their put rights under the acceleration provision of their contract, ITV is now compelled to purchase the Gurneys’ minority stake at a 25% premium above the regular call price. ‘At the time of exercise, the Gumeys expressly reserved their rights to sue ITV and its appointed Board members for the many millions in damages caused by their outrageous conduct, breaches of contract and| fiduciary duties, all of which are ongoing. 11. __Inrespective of the millions they are now due from ITV from the exercise of their “put” rights, the Gumeys have suffered severe and irreparable damages (financial, emotional and to their reputations) as a result of Defendants’ unlawful conduct. By this lawsuit, Plaintiffs seek to hold ITV, and each of the individual Defendants personally, accountable for the substantial damages they have caused and which are estimated to significantly exceed $100,000,000. Plaintiffs further seek 4 COMPLAINTdeclaratory and injunctive relief from the Court to, among other things, confirm the Gurneys” rights to be paid by ITV in accordance with the “put” provision of their agreement, and to enjoin Defendants from unlawfully interfering with their ongoing right to exch ely run Gurney Productions for so long as ITV fails to pay the monies now due. THE PARTIES 12. Plaintiff Scott Gurney is, and at all times relevant herein was, an individual residing in Los Angeles County, State of California. Scott Gumey is a founding member and manager of Gurney Productions, LLC (“Gurney Productions”), a California limited liability company, and currently holds a minority interest in Gumey Productions. 13. Plaintiff Deirdre Gurney is, and at all times relevant herein was, an individual residing in Los Angeles County, State of California, Deirdre Gumey is married to Scott Gumey. She is also a founding member and manager of Gurney Productions and currently holds a minority interest therein. 14, Plaintiff Little Win, LLC (“Little Win") is, and at all times relevant herein was, a California limited liability corporation with its principal place of business located in Los Angeles, California. Little Win is a “loan-out” company owned and controlled 100% by Scott and Deirdre Gurmey. Little Win, Deirdre Gumey and Scott Gurney collectively own a 38.5% minority interest in Gumey Productions. 15. Plaintiffs are informed and believe, and on that basis allege, that defendant ITV Gurney Holding, Inc. (‘ITV") is, and at all times relevant herein was, a Delaware corporation with its principal place of business located in Los Angeles County, California. 16. Plaintiff's are informed and believe, and on that bas allege, that Defendant Brent Montgomery (“Montgomery”) is an in dual residing in Old Greenwich, State of Connecticut. Montgomery is a current board member of Gumey Productions appointed by ITV, 17. Plaintiffs are informed and believe, and on that basis allege, that Defendant Andrew Garard (*Garard”) is an individual residing in London, England. Garard is a board member of Gumey Productions appointed by ITV. 18, Plaintiffs are informed and believe, and on that basis allege, that Defendant David MeGraynor (“McGraynor”) is an individual residing in London, England, McGraynor is a board 5 COMPLAINTRen 10 ul 12 14 15 16 17 19 20 21 22 24 25 26 27 28 member of Gumey Productions appointed by ITV. 19. Plaintiff’ are presently unaware of the true names and capacities of the Defendants sued herein as Does 1 through 100, inclusive, and therefore suc said Defendants by fictitious names. Plaintiffs will amend this Complaint to allege the true names and capacities of such fictitiously named Defendants when their names and capacities have been ascertained. Plaintiffs are informed and believe, and based thereon allege, that each of the fictitiously named Defendants responsible in some manner for the occurrences, acts and omissions alleged herein and that Plaintiffs’ damages were proximately caused by their conduct, Hereinafter, all Defendants (including Doe Defendants) will sometimes be referred to collectively as “Defendants.” 20. Plaintiffs are informed and believe, and based thereon allege, that at all times material hereto, Defendants, and each of them, were the agents, employees, partners, joint venturers, co- conspirators, owners, principals and employers of the rem ing Defendants, and each of them, and at all times herein mentioned were acting within the course and scope of that agency, employment, partnership, conspiracy, ownership or joint venture. Plaintiffs further allege on the basis of information and belief that Defendants, and each of them, authorized, directed and/or ratified the wrongful acts alleged herein and, consequently, all Defendants are jointly and severally liable to Plaintifis, FACTS COMMON TO ALL CAUSES OF ACTION AL ITV’s Acquisition Of Gurney Productions 21.. Scott and Deirdre Gurney are television producers known for such popular “reality” television shows as Duck Dynasty, Auction Hunters, Haunted Collector, Speed of Life, American Guns and Leah Remini: It's All Relative. Their company, Gurney Productions, is also the producing force behind many of the specials featured on the Discovery Channel’s annual Shark Week programming block. Since 2005, the Gurneys and their company have produced hundreds of hours of quality programming for top cable channels such as A&E, Spike, National Geographic, Discovery, Animal Planet, Weather Channel, Syfy, VH1, ESPN and NBC Sports, among others. Their signature series Duc Dynasty was the number one rated show on the A&E network for four years running, breaking multiple records and holding the honor of being the highest rated reality cable TV show of all time. 6 COMPLAINT22. In 2012, the Gumeys were approached by British television behemoth ITV ple. which ‘was seeking to expand its foothold in the U.S. television market and saw Gumey Produetions, then in its second season of Duck Dynasty, as an attractive target. At the “courting” stage, ITV won the Gumeys” confidence with promises that the Gurneys would be able to stay on and run the company, and that they would be granted complete autonomy to operate Gurney Productions as they always had. Indeed, years later, ITV general counsel Andrew Garard boasted that ITV's successful U.S. acquisition spree was attributable in large part to promising U.S. producers full autonomy. As explained in a 2016 article in which Garard was interviewed for the legal publication Law360 ( How ITV's GC Used Emotional IQ To Win Over M&A Targets): “ITV's goal has always been to run the back offices for the ators so they're free to focus on making good TV, not swoop in and take the reins, according to Garard. And clari ing that those were ITV's intentions was one of his central responsibilities throughout the transaction.” 23. With the explicit understanding that they would continue to run their company as they always had, and that they would maintain day-to-day control of Gurney Productions as members and managers, the Gurneys agreed to sell a 61.5% share of Gurney Productions with an option for ITV to purchase the remaining interest within the next three to five years through certain “call” and/or “put” provisions. B. The Gurney Productions Amended And Restated Operating Agreement 24. Inconnection with the sale, the Gumey Productions’ Operating Agreement was amended and restated, as of December 31, 2012, to reflect the parties” respective rights and obligations. The Gumeys also agreed to act as co-Chief Executive Officers pursuant to separate five-year employment agreements. 25. Among its key provisions related to govemance, the revised Operating Agreement provides that: «Deirdre and Scott Gumey, together with Little Win, LLC, hold a 38.5% interest in Gurney Productions, with a majority 61.5% interest held by ITV Gumey Holding Inc., a company affiliated with ITV ple and its international arm ITV Studios; 7 COMPLAINTSe oa) cy ul 13, 4 15 16 7 18 19 20 21 22 23 24 25 26 27 28 ‘* The company is to be managed by a Board of five managers, including Deirdre and Scott Gumey; * Neither ITV nor the Board may for any reason remove the Gumeys from the Board, ie., they are to remain on the Board unless they replace themselves and/or they sell their minority interest in the company; ‘Notwithstanding any other provision of the Operating Agreement, the Gurneys have exelusive authority to “manage the day-to-day business and affairs of the Company consistent with past practice of the Gurneys,” to “hire and fire employees other than the chief financial officer,” and to “decide which productions are sold, to whom and upon what terms;” and + That the Gumeys’ express approval is required for any company actions outside “the ordinary course of business consistent with the past practice of the Gurneys,"| and “[hJiring any senior executive” other than the CFO. 26. As to the distributions of the company’s profits, the Operating Agreement provides that the Gumeys/Little Win are entitled to receive their 38.5% share of “Distributable Cash” every six months following the effective date of the agreement, 27. Finally, with respect to the purchase of the Gumeys/Little Win’s 38.5% interest in the company, the Operating Agreement provides that for a 90 day period following delivery of the company’s audited financial statements for fiscal year 2015, ITV may elect to purchase all of their retained membership interest at a “Call Purchase Price” based on eight times average EBITDA (Earnings Before Interest, Tax, Depreciation and Amortization) of the company for the prior three years. Pursuant to Section 6.8(b) of the Operating Agreement, the “Call Purchase Price” is reducible by 25% in the event the Gurneys’ employment is terminated “for cause,” but only ifthe termination occurs “before the end of fiscal year 2015.” 28. However, under Section 6.9(b) of the agreement, if the Gumneys’ employment i terminated without good cause, and/or if ITV or the company materially breaches the Operating Agreement (and fails to cure such breach on thirty days’ notice), then the Gumeys’ “put” rights accelerate and ITV may be required to purchase the Gurneys/Little Win’s interest at a 25% premium 8 COMPLAINT10 u 2 13, 4 15 16 7 18 19 20 21 2 above the regular call pric C. Defendants Conspire To Mlegally Oust The Gurneys From The Company They Founded, And Attempt To Usurp Plaintiffs" Remaining Interest At A Grossly Deflated Price Through Threats of Extortion And Other Improper Means. 1, The Gurneys Increase Company Profits By Over 65% In Just Three Years. 29. Over the four years following ITV’s acquisition of a majority stake in Gurney Productions, the Gurneys worked tirelessly (up to 18 hour days) and successfully to increase company earnings and produce top rated shows. Through their efforts, Gurney Productions proved to be among the most profitable, and possibly the most profitable, of ITV’s U.S. acquisitions, with profit margins upwards of 30%. In 2012, ITV publicly projected EBITDA for Gumey Productions around $10,000,000. Within three years, the company’s annual EBITDA had increased by over 65% and was projected to rise even more by the end of 2017, when the Gurneys would have been entitled to exercise their “put” rights. 2. A Rift Develops Following ITV’s Replacement Of Board Chairman Kevin Lygo With A Gurney Competitor, Brent Montgomery; Montgomery Poisons the Board And Undertakes To Undermine Gurney For His Personal Interests. 30. Although the Gueys performed their end of the bargain in every way, well exceeding expectations, in the latter part of 2015, a rift began to develop between the Gumeys and ITV following the departure of two key ITV-appointed Board members, one of whom left to become president of A&E Studios (the network distributing Duck Dynasty and other Gurney shows). These Board members were replaced with Defendants Montgomery and Garard, neither of whom appeared to have any genuine interest in the success of Gurney Productions. Montgomery was in fact a competitor of the Gurneys who had recently sold his own company, Leftfield Entertainment Group, to ITV. Plaintiffs are informed| and believe, and on that basis allege, that Montgomery retained an interest in the profits of Leftfield, thus creating a clear conflict of interest between his position on the Board and Gurney Productions. Plaintiffs are further informed and believe, and on that basis allege, that Montgomery (through his deal a COMPLAINTSeowrxaunea i 12 13 14 15 16 7 18 19 20 21 22 23 24 25 26 27 28 structure) had additional personal financial interests in secing the Gurneys ousted before the end of their term. 31. From the outset, Montgomery appeared antagonistic to and resentful of the Gumeys and engaged in questionable behavior including, among other things, threatening that Gurney Productions would not share in ITV leads distributed across ITV’s U.S. platform, passing confidential Gurney Productions information to Leftfield, and inviting Leftfield personnel to Gumey Produetions Board meetings. 32. It soon became clear that this “new” Board, poisoned by the additions of Montgomery and Garard and controlled entirely by ITV, had no intention of fulfilling the promises ITV made to the Gumeys just three years earlier. It also became clear that the ITV-appointed Board members had no intention of fulfilling their fiduciary obligations to Gumey Productions. In one astonis ing example, Montgomery proclaimed at a Board meeting that it would be better for ITV if the Gumey/A&E Duck Dynasty deal fell through (which would have severely impacted company profits), as ITV would avoid having to pay the Gumeys more money at the end of the Gurneys” earn out period. As another egregious example, in late 2015, the ITV-appointed Board members threatened to reduce the Gumeys’ bonus compensation if they did not accept a deal that would have been devastating to Gurney Productions’ profits, but would have helped ITV and Lefifield in other ways. Fortunately for the company, the Gumeys, who had the contractual right to run the company without interference from the Board, disregarded the threat (by accepting the lower pay) and negotiated a far better deal for the benefit of Gumey Productions. Unfortunately for the Gurneys, however, Montgomery’s threat was a harbinger of ITV’s true intentions- intentions which became abundantly clear on December 5, 2016. 3. ‘The “Ambush” Board Meeting, 33. OnDei mber 5, 2016, the Gumeys were called to a meeting of the Board with a fake agenda, suggesting that the Board would be addressing usual company business. The Gumeys received no advanced warning as to the real purpose of the meeting, and they appeared without counsel. At this, ‘meeting, the ITV-appointed Board members effectively ambushed the Gumeys with allegations of impropriety, none of which were true and all of which were asserted in bad faith, and the assertion thal ‘the Gumeys’ employment agreements were being terminated. As just one egregious example of their 10 COMPLAINTu 12 13 14 15 16 7 18 19 20 an 23 24 25 26 27 28 bad fa th, Garard, Montgomery and McGraynor accused the Gumeys of engaging in a competing business called Snake River Productions, which they claimed violated the “non-compete” provision of the Gumeys’ employment agreements. In fact, however, Snake River (which at this point was not even fully functional) was not a competing venture at all. It was a company created for the purpose of producing scripted television, documentaries and game shows. Of course, the Board had no evidence otherwise because none exists. 34. Further, contrary to the Board members’ allegations, the “non-compete” provision of the Gumeys’ employment agreements on its face is expressly limited to the development and production. of | “reality-based programs.” It does not prohibit the types of activities that Snake River Productions was contemplating. Indeed, just months lier, in a September 2016 Board meeting, the Gumneys specifically informed the Board that they were working on “scripted” projects in the event their contract was not renewed at the end of its term in December 2017. Nobody on the Board suggested that this would in any way be a violation of the Gumeys’ agreements- it was not. 35, When later confronted with incontrovertible evidence destroying their non-compete claim, the Defendants, through counsel, made the ridiculous and unsubstantiated claim that “reality- based” programming includes game shows. It is common knowledge and universally accepted in the industry that games shows are an entirely different genre of television than “reality-based” television. 36. As yet another example of Defendants’ utter bad faith and breach of fiduciary duties, Montgomery, Garard and McGraynor attempted to claim that the Gurneys had engaged in improper self dealing by purchasing from Gurney Productions the rights to a failed show called Northern Territories which the Gumeys had hoped to tum into a documentary. Again, the claim was unsupported by fact and, more importantly, directly contradicted by the plain language of the Operating Agreement signed by ITV. Section 4.9 of the Operating Agreement explicitly states that the Gumeys “may engage in any transaction with the Company so long as such transaction is not expressly prohibited by this Agreement and so long as the terms and conditions of such transaction, on an overall basis, are on arms’ length terms and are fair and reasonable to the Company . ..” In fact, although the deal was disclosed to and approved by the Board, the Gumneys had no obligation at all to disclose or get approval for their involvement, ‘The transaction was not prohibited by the Operating Agreement and was on terms deemed Mt ‘COMPLAINTRowen 10 ul 12 13 14 15 16 17 18, 19 20 21 23 24 25 26 27 28 fair and reasonable to Gumey Productions, as demonstrated by the Board’s review and approval of the deal, Moreover, as set forth previously, the Gumeys had exclusive authority to run the day-to-day of Gurney Productions without Board approval, and that includes licensing deals and programming sales. 37. Not only did the Board deem the terms fair and reasonable (the Gumeys paid the company over $3 million for the rights) by originally approving the deal, the Board confirmed that the deal was fair and reasonable to Gurney Productions following the assertion of this bogus self-dealing claim. Almost immediately after ITV complained (albeit disingenuously) of the allegedly self-dealing nature of the Northern Territories deal, as a measure of their good faith, the Gurneys offered to unwind the transaction. Defendants, however, quickly backtracked and refused the offer to rescind the deal - opting instead to keep the money. In doing so, TV and it’s appointed Board members not only acknowledged the reasonableness of the terms - they ratified the deal. 38. Given the outrageous nature of these and other allegations asserted at the December 5 meeting, there is no question of the Defendants’ malevolent intent and misguided motivations for this meeting, The Gumeys had been successfully running Gumey Productions for 11 years. If their new partners had genuine concerns or questions about these issues, those issues could and should have been resolved by simply approaching the Gumeys in a professional manner, months earlier, when these Board members knew the facts about which they were now complaining. Instead, in breach of their fiduciary duties and agreements, the Defendants actively conspired to build a case to oust the Gumeys in| order to acquire their minority interest at a bargain basement price. 4. Defendants Engage In Attempted Extortion. 39. As demonstrated above, Defendants employed the element of surprise as a tact to achieve their unlawful ends. Another tactic employed by these Defendants at the December 5 Board meeting was nothing short of attempted extortion. 40. After falsely accusing the Gurneys of unlawful conduct, including the alleged “embezzlement” of $850,000 (another claim that was demonstrably false), the Defendants presented the Gurneys with an agreement for the purchase of the Gumeys” and Little Win’s minority interest in Gurey Productions. The price offered was substantially less than what the Gumeys would have received had their shares been purchased through the timely exercise of ITV's “call” rights and/or the R COMPLAINTGumeys’ “put” rights. Although the Defendants knew full well that the Gumeys’ counsel was not present at the mecting, they demanded that the agreement be signed then and there. The Defendants further threatened that, if the agreement was not signed on the spot, the bogus allegations (which included allegations of professional and criminal misconduct) would be made “public.” Montgomery ‘went so far as to threaten: “The minute you guys tell us this is not going to resolve today [i.e., the Gurneys’ refuse to sign] .. . all the networks are geiting alerted, the agencies, the talent, everyone gets alerted...” 41. California Penal Code Sec. 518 defines extortion as “the obtaining of property from another, with his consent induced by a wrongful use of force or fear, or under color of official right.”| Cal. Penal Code Sec. 519 further provides that “[fJear, such as will constitute extortion, may be induced by a threat, either... 2. To accuse the individual threatened, or any relative of his, or member of his family, of any crime; or, 3. To expose, or to impute to him or them any deformity, disgrace or crime; or, 4, To expose any secret affecting him or them.” 42. Despite Defendants’ high pressure and unlawful tactics, the Gurneys, with full confidence that they had done nothing wrong, did not sign the buy-out agreement at the meeting as demanded. In a last-ditch effort to force their hand, Montgomery followed the Gurneys out of the Board| meeting and confronted Scott Gurney. At first feigning sympathy for the Gurneys, Montgomery again ‘threatened “after this moment right now it’s gonna be out there and you know that f-ing sh-t with Schotz”— a not-so-subtle reference to LMNO Entertainment CEO Eric Schotz who was very publicly lambasted in the media for alleged fraud. Again, the Gurneys refused to submit to extortion, despite the irreparable harm these false allegations would cause (and have caused) to their reputations. 43. The Defendants almost immediately made good on their threat. At 4:31 p.m., Jess than two hours after the Board meeting concluded, the Hollywood Reporter posted an article titled “Duck Dynasty Producers Put on Leave at ITV Amid Fraud Investigation (Exclusive).” According to the article, ITV had already appointed a new CEO, Craig Armstrong, although the Gumeys were never consulted on, and did not approve, the appointment —a direct breach of the Operating Agreement, The article extensively quoted from an internal memorandum purportedly circulated within Gumey Productions and which contained detailed quotes from the purportedly newly-appointed CEO. Plaintifis 1B COMPLAINT10 af oF VE} 14 thy 16 EE 18 19 20 21 22 23 24 25 26 27 28 are informed and believe, and on that basis allege, that immediately after his appointment, Armstrong directed company employees to slow down delivery of shows in December 2016 (even going so far as to] shut down production for an extra week) for the sole purpose of lowering 2016 revenues- revenues that would be relevant to calculating the price of ITV’s buy out of the Gumeys’ remaining interest. 44. By engaging in attempted criminal and civil extortion, each of the Defendants breached fiduciary duties owed to the Plaintiffs as set forth in greater detail below. 5. Defendants Improperly Terminate The Gurneys’ Employment As Co-CEO’s. 45. Pursuant to their employment agreements, the Gurneys were entitled to be heard by the Board with counsel present and with no less than three days’ notice of the allegations on which the proposed termination of the Gumeys’ employment agreements was based. The fact that Defendants had already leaked the false allegations to the media (something which had to be pre-planned to have occurred so quickly) demonstrates that Defendants, in further breach of contract and their fiduciary duties, had no intention of considering any evidence put before them regardless of how damning it might be to their se 46. Nevertheless, on December 8, 2016, the Gurneys appeared at a Board meeting with counsel to present their position on the matters raised. Plaintiffs are informed and believe, and on that basis allege, that prior to the meeting, Defendants had already made their determination to terminate the Gurneys “for cause.” In fact, in advance of the meeting and without ever having heard the Gurneys? side of the story, Defendants had already prepared a 24-page lawsuit and a press statement (both of which were released to the media within hours of the meeting’s conclusion). 47. Asexpected, the Defendants failed and refused to properly consider any of the overwhelming evidence presented that destroyed their allegations. As just one example of the Defendants’ complete lack of good faith, at one point during the meeting, Defendants (through their counsel at Squire Sanders) actually accused the Gumeys of “stealing” over $3 million from Gurney Productions in connection a show called Northern Territories, when in fact the Gurneys had paid Gurney Productions over $3 mil ion for those rights. In many other instances, Defendants attempted to support their accusations with emails and other documents that, in fact, directly contradicted the position! being asserted by Defendants. 14 ~~ COMPLAINT10 u = 13 14 15 16 EE 18 19 20 21 22 23 24 25 26 27 28 48. Atthe conclusion of the meeting, and without any legitimate evi lence to support the allegations asserted, the ITV-appointed Board Members voted to terminate the Gumeys’ employment as Co-CEO’s “for cause.” 49. Pursuant to their employment agreements, in the event of an alleged breach of contract, the Gurmeys were entitled to a thirty-day “cure period” following written notice of the breach. In other words, the Gumeys could not be terminated for breach of contract, unless they were first notified of the breach and given an opportunity to fix the problem, No such notice was ever provided, and the Gumeys| were given no opportunity to exercise their cure rights prior to their termination. D. Defendants Attempt To Improperly “Call” Plaintiffs’ Membership Interest In Gurney Productions. 50. Following their termination on December 8, and at the same meeting, the Gumeys were handed a letter from Brent Montgomery with the Re: line “Membership Interest Call Notice.” The letter purports to provide notice of ITV’s intent to purchase all of Plaintiffs’ Retained Membership Interest in Gumey Productions “in connection with Section 6.8(b)” of the Operating Agreement, i, the call right triggered by a termination for cause. 51. As previously noted, Section 6.8(b) applies only to terminations which occur prior to the conclusion of Fiseal Year 2015, ITV's attempt to exercise it’s “call” right was, therefore, ineffective. Ii does, however, serve to explain (but certainly not excuse) the Defendants’ otherwise inexplicable and outrageous behavior. 52. On December 22, 2016, Plaintiffs notified Defendants of their intent to exercise their “put” rights pursuant to 6,9(b), which rights are not as limited in time. Pursuant to this provision, ITV is now required to purchase Plaintiffs’ membership interest at a price equal to eight times the average annualized EBITDA of the company for the years 2014, 2015 and 2016, multiplied by the percentage interest retained by Plaintiffs and “increased by 25%.” The “put” right was exercised without waiver of the very substantial damages sustained by Plaintiffs as a result of the breaches of fiduciary duty and other misconduct alleged herein. COMPLAINTeae 10 u 12 13, 4 15 16 7 18 19 20 ai 22 23 24 25 26 27 28 Defendants’ Additional Iegal Activities Following The Wrongful Termination Of ‘The Gurneys’ Employment. 53. Asset forth in the Operating Agreement, irrespective of the Board’s decision to terminate| the Gumeys’ employment as Co-CEO’s, unless and until their remaining interest in the company is acquired by ITV, the Gumeys remain on the Board and are entitled to continue managing the day-to-day operations of Gumey Productions. Despite the Gurneys* continuing rights, and without any legitimate explanation for their actions, since December 5, 2016, the Defendants have effectively locked the Gumeys out of their company, denied them access to information and blocked their ability to perform their functions as managing members of Gurney Productions. Plaintiffs are informed and believe, and on that basis allege, that the announcement that the Gurneys are no longer in control of the company has already resulted in a significant loss of business, including among other things, the loss of potential sales| of Shark Week episodes to the Discovery channel, 54. Plaintiffs are informed and believe, and on that basis allege, that the Board’s illegal and improper actions are part of a concerted and malicious campaign by Defendants to damage the Gumeys? reputation among the company’s employees and public at large, and to exert maximum pressure on the Gurneys to extract better terms for the buy-out of their interest, 55. Plaintiffs are informed and believe, and on that basis allege, that to further their unlawful campaign and goals, Defendants have engaged in at least the following additional material breaches of contract and fiduciary duties since the termination: © Purporting to hire Craig Armstrong as permanent CEO of Gumey Productions without the Gumeys’ approval, despite the fact that the Operating Agreement (Sec. 5.7) requires unanimous Board approval. The Gumeys were never even informed of this action at any| Board meeting or otherwise; ‘* Failing to authorize timely distributions to Plaintiffs in accordance with the Operating Agreement including, without limitation, millions of dollars in distributions currently due} for 2016; ‘* Authorizing and directing the unlawful hacking of Scott Gumeys” personal computer and| theft of his personal information contained on that computer (despite direct notice to 16 ~~ COMPLAINT10 BG 12 13 4 phd 16 a 18 19 20 21 22 23 4 25 26 27 28 Defendants of the personal nature of this material); * Authorizing and directing the unlawful access of the Gumeys” personal financial information in a file cabinet maintained by the Gumeys’ personal accountant, and theft of information contained in those files (again despite direct notice of the personal and private nature of this information); * Authorizing and/or directing company personnel to unlawfully bre: into the Gumeys? personal offsite mail box and steal their personal mail, using a key left behind by the Gumeys when they were locked out; * The destruction of Plaintiffs’ personal property, including an antique safe that was in fact empty (despite having been informed it contained no company property); ‘+ The authorization of the opening of Plaintiffs’ personal mail delivered to the office, including among other things personal property tax statements, in violation of federal law; and © The purported hiring of a law firm, Hogan Lovells, to represent Gumey Productions without the Gurneys’ consent in violation of Section 5.7 of the Operating Agreement. 56. Asa result of the Defendants’ malicious and illegal conduct, Plaintiffs have suffered severe economic and emotional damage, as well as irreparable damage to their reputations ~ damages which Plaintiffs expect to exceed $100,000,000. FIRST CAUS! )F ACTION (Breach Of Fiduciary Duty Against All Defendants) 57. Plaintiffs incorporate by reference Paragraphs 1-56 hereof as though fully set forth herein, 58. As managers of Gumey Productions, Montgomery, Garard and McGraynor owed Plaintiffs fiduciary duties including, without limitation, a duty of care and loyalty as provided for in California Corporations Code Sec. 1704.09. As a member and majority interest holder, and by virtue of the fact that ITV controlled and directed the actions of three managers, ITV too owed fiduciary duties; to Plaintiffs, including without limitation, the duties of care and loyalty, the obligation of good faith and 7 COMPLAINTone © fair dealing, and the obligation not to use its power to control corporate activities to benefit itself alone in a manner detrimental to the minority. 59. Each Defendant directly breached his/its fiduciary duties owed to Plaintiffs, and/or knowingly aided and abetted, assisted and encouraged each of the other Defendants in his/its breaches of fiduciary duties, by the acts and omissions detailed in paragraphs 29 through 55 above, which acts and omissions include, among others: @ (o) © @ ® (b) @ Manufacturing knowingly false allegations against the Gumeys for the improper purpose of damaging their reputations and pressuring them into relinquishing thei membership interest at a grossly deflated price; Providing the Gumeys with a false agenda for the December 5, 2016 Board meeting for the purpose of exacting an unfair surprise; Engaging in attempted extortion at the December 5 Board meeting and thereafter; Leaking to the media the false allegations asserted against the Guneys at the December 5 Board meeting, before the Gumeys even exercised their contractual right to respond with counsel present; Appointing a new CEO without the Gumeys’ knowledge or approval; Failing and refusing to properly consider in good faith the evidence and arguments presented by the Gumeys and their counsel at the December 8 Board meeting; Terminating the Gumeys’ employment purportedly for “good cause” knowing that good cause did not in fact exist; Refusing to provide the Gumeys with notice of the alleged breaches and an opportunity to cure; Attempting to exercise “call” rights under Section 6.8(b) of the Operating Agreement, knowing that this section could not apply under any circumstances; Refusing to provide the Gumeys access to their offices and company information, | thereby interfering with their contractual rights as managers and Board members to run the day-to-day management of Gumey Productions; 18, COMPLAINTwk wn See raa rt 13 4 15 16 7 18 19 20 21 22 23 24 26 27 28 (&) Failing and refusing to authorize millions in distributions due Plaintiffs; () Authorizing and directing the invasion of the Gurneys” privacy rights by, among, other things, hacking into Scott Gumeys’ personal computer, unlawfully accessing and reviewing private financial data, breaking into the Gumeys? personal/private offsite mailbox and stealing mail, opening personal mail delivered to the office, and theft of personal property and private information; (m) Destroying the Gurneys’ personal property; and () The hiring of legal counsel for Gurney Productions without the knowledge and/or consent of the Gumneys. 60. Asa direct and proximate result of the aforesaid breaches of fiduciary duties, Plaintiffs have and will continue to suffer damages in an amount subject to proof at trial but which Plaintiffs believe are in excess of $100,000,000. 61. Plaintiffs are informed and believe, and based thereon allege, that Defendants, in doing the things herein alleged, acted willfully, maliciously, oppressively and despicably with the full knowledge of the adverse effect of their actions on Plaintfis, and with willful and deliberate disregard of the consequen 0 Plaintiffs, By reason thereof, Plaintiffs are entitled to recover punitive and exemplary damages from each Defendant in an amount to be determined at the time of trial SECOND CAUSE OF ACTION (Breach Of Contract Against ITV) 62. Plaintiff’ incorporate by reference Paragraphs 1-56 hereof as though fully set forth herein. 63. Asset forth above, on or about December 31, 2012, Plaintiffs entered into an Amended and Restated Operating Agreement with ITV, the relevant terms of which are set forth in paragraphs 24- through 28 above, As with every contract, the Amended and Restated Operating Agreement contains an| implied covenant of good faith and fair dealing which requires that Defendants refrain from doing anything that would injure Plaintiffs’ right to receive the benefits of the contract. 64, Plaintiffs performed all of their obligations under the Amended and Restated Operating 19 COMPLAINT10 an 12 pk 4 ub 16 18 19 20 21 22 23 24 25 26 27 28 Agreement to the extent they were not precluded and/or otherwise excused from doing so by Defendants’ conduct. 65. ITV individually, and through its appointed Board members (who, on information and belief, acted at the behest of ITV), breached the express and implied terms of the Amended and Restated] Operating Agreement by its actions and omissions, set forth in paragraphs 29 through 55 above, which include but are not limited to the following: @ (b) © @ © a) () (hy @ Manufacturing knowingly false allegations against the Gurneys for the i proper purpose of damaging their reputations and pressuring them into relinquishing theif membership interest at a grossly deflated price: Providing the Gureys with a false agenda for the December 5, 2016 Board meeting for the purpose of exacting an unfair surprise; Engaging in attempted extortion at the December 5 Board meeting and thereafter; Leaking to the media the false allegations asserted against the Gumeys at the December 5 Board meeting, before the Gurneys even exercised their contractual right to respond with counsel present; Appointing a new CEO without the Gurneys’ knowledge or approval; Failing and refusing to properly consider in good faith the evidence and arguments presented by the Gumeys and their counsel at the December 8 Board meeting; Terminating the Gurneys’ employment purportedly for “good cause” knowing that good cause did not in fact exist; Refusing to provide the Gumeys with notice of the alleged breaches and an opportunity to eure; Attempting to exercise “call” rights under Section 6.8(b) of the Operating Agreement, knowing that this section could not apply under any circumstances; Refusing to provide the Gumeys access to their offices and company information, thereby interfering with their contractual rights as managers and Board members to run the day-to-day management of Gumey Productions; 20 ~~ COMPLAINTRen 10 W 12 14 15 16 17 18 19 20 21 22 23 24 25 26 2 28 (K) Failing and refusing to authorize millions in distributions due the Plaintifis; () Authorizing and directing the invasion of the Gurneys” privacy rights by, among other things, hacking into Scott Gumeys’ personal computer, unlawfully accessing and reviewing private financial data, breaking into the Gurneys’ personal/private ofisite mailbox and stealing mail, opening personal mail delivered to the office, and theft of personal property and private information; (m) Destroying the Gurneys’ personal property; and (0) The hiring of legal counsel for Gurney Productions without the knowledge and/or consent of the Gumeys. 66. As a direct and proximate result of the aforesaid breaches of contract, Plaintiffs have and will continue to suffer damages in an amount subject to proof at trial but which Plaintifis believe are in excess of $10,000,000. THIRD CAUSE OF ACTION (Civil Extortion Against All Defendants) 67. Plaintifis incorporate by reference Paragraphs 1-56 hereof as though fully set forth herein. 68. Asset forth in paragraph 41 above, California Penal Code Sections 518 & 519 define extortion. California Penal Code Sec. 524 proscribes attempted extortion. In California, the elements o! civil attempted extortion are: (1) a specific intent to commit extortion- ie., to obtain property from another, with his or her consent, induced by wrongful fear; and (2) a direct but ineffectual act done toward its commission. 69. As set forth in Paragraphs 39 through 44 above, Defendants, and each of them, have engaged in the tort of civil attempted extortion by the following acts, among others: (a) by threatening to| make “public” their false allegations of fraud and embezzlement if the Gumeys refused to sign an agreement giving up their retained interest in the company at a grossly devalued price; (b) by threatening to disclose the false allegations of fraud and embezzlement to the networks, talent and others if they did not give up their retained interest in Gumey Productions; and (c) by threatening that the Gumeys will be 21 COMPLAINT1 |] subject to public disgrace similar to another entertainment executive accused of fraud if they do not give 2 || up their interest in the company. 3 70. Asadirect and proximate result of Defendants’ actions, Plaintiffs have been damaged in 4 |] an amount to be determined at trial, but which Plaintiffs expect to exceed $1 million 5 71, Plaintiffs are informed and believe, and based thereon allege, that Defendants, in doing 6 || the things herein alleged, acted willfully, maliciously, oppressively and despicably with the full 7 || knowledge of the adverse effect of their actions on Plaintiffs, and with willful and deliberate disregard 8 || of the consequences to Plaintiff's. By reason thereof, Plaintiff's are entitled to recover punitive and 9 |] exemplary damages from each Defendant in an amount to be determined at the time of trial. 10 11 FOURTH CAUSE OF ACTION 12 (Invasion of Privacy Against All Defendants) B 72. Plaintiffs incorporate by reference Paragraphs 1-56 hereof as though fully set forth 14 |/herein. 15 73. Plaintiffs had a reasonable expectation of privacy in their private mail and personal data, 16 || including without limitation, information maintai cd by their personal accountant at their offices and 17 |} private information maintained on personal computers and drives. 18 74, Plaintiffs are informed and believe, and on that basis allege, that Defendants intentionally 19 ||and knowingly accessed and reviewed (and in some cases stole) Plaintiffs" private data by the following 20 || acts, among others: (a) authorizing and directing the opening of Plaintifis” private mail clearly 21 || designated as such; (b) authorizing and directing the opening, review and copying of personal files 22 || contained on Scott Gumeys’ personal computer and in hard drives owned by the Gurneys; (c) 23 || authorizing and directing the review and theft of Plaintiffs” private financial information contained in a 24 || private file cabinet maintained by Plaintiffs’ personal accountant; and (d) authorizing and directing 25 || company personnel to unlawfully break into the Gumeys personal offsite mailbox and stealing the mail 26 || within. 27 75. Defendants’ actions in this regard were conducted in a manner highly offensive to 28 || reasonable people. 22 COMPLAINTReN 76. Asadirect and proximate result of Defendants’ unlawful actions, Plaintiff's have been damaged in an amount to be determined at trial but which is in excess of the jurisdictional limit of the Court. 77. Plaintiffs are informed and believe, and based thereon allege, that Defendants, in doing the things herein alleged, acted willfully, maliciously, oppressively and despicably with the full knowledge of the adverse effect of their actions on Plaintiffs, and with willful and deliberate disregard of the consequences to Plaintiffs. By reason thereof, Plaintififs are entitled to recover punitive and exemplary damages from each Defendant in an amount to be determined at the time of trial EIETH CAUSE OF ACTION (Violation of California Computer Data Access and Fraud Act (Cal. Penal Code §502) - Scott Gurney Against all Defendants) 78. Plaintiffs incorporate by reference Paragraphs 1-56 hereof as though fully set forth herein. 79. Scott Gumey is the owner of a personal computer and certain hard drives containing personal information and data. 80. Scott Gumey has never authorized any Defendant, and/or any person acting under the direction or authority of Defendants, to access his personal computer, drives or other computer ‘equipment. 81. Scott Gumey is informed and believes, and on that basis alleges, that in or around December 2016, Defendants knowingly and without permission or authorization directed and/or authorized others to access Scott Gurneys’ personal computer and drives and intentionally took, copied, and/or otherwise made use of programs, data, and files from Scott Gumey’s computer and drives, 82. In taking the actions alleged above, Defendants violated California Penal Code section 502. 83. Asa direct and proximate result of Defendants’ unlawful conduct within the meaning of California Penal Code section $02, Scott Gurney has suffered damages in an amount subject to proof at trial but which Gumey believes is in excess of the jurisdictional limit of the Court, 23 COMPLAINT84, Scott Gumey is informed and believes and based thereon alleges that Defendants, in doing the things herein alleged, acted willfully, maliciously, oppressively and despicably with the full knowledge of the adverse effect of their actio s on Gumey, and with willful and deliberate disregard of the consequences to Gurney. By reason thereof, Gumey is entitled to recover punitive and exemplary damages from Defendants in an amount to be determined at the time of trial. 85. Pursuant to California Penal Code section 502, Scott Gurney is entitled to recover from Defendants his reasonable attorney's fees and costs. SIXTH CAUSE OF ACTION (Conversion Against All Defendants) 86, Plaintiffs incorporate by reference Paragraphs 1-56 hereof as though fully set forth herein, 87. Plaintififs own and have a right to possession of their personal finaneiall and other data and files, including files maintained by their accountant at the Gumey Productions offices. 88. Defendants intentionally and substantially interfered with Plaintiffs’ ownership rights by taking possession of personal files and data owned by Plaintifi’s, including without limitation three binders located in thei .ccountant’s file cabinet that had nothing at all to do with company business and personal mail 89. Plaintiff's did not consent to the theft and conversion of their prope v. 90. Asa direct and proximate result of Defendants’ conversion of their personal property, Plaintiffs have been damaged in an amount to be determined at trial, but which Plaintiffs believe is in excess of the jurisdictional limit of this Court. 91. Plaintiffs are informed and believe, and based thereon allege, that Defendants, in doing the things herein alleged, acted willfully, maliciously, oppressively and despicably with the full knowledge of the adverse effect of their actions on Plaintiffs, and with willful and deliberate disregard of the consequences to Plaintifis. By reason thereof, Plaintiffs are entitled to recover punitive and exemplary damages from each Defendant in an amount to be determined at the time of trial. 24 COMPLAINT10 u 12 14 15 16 17 18 19. 20 21 22 23 24 25 26 27 28 ENTH CAUSE OF ACTION (Declaratory Injunctive Relief Against All Defendants) 92. Plaintiffs incorporate by reference Paragraphs 1-56 hereof as though fully set forth herein, 93. Anactual controversy and dispute has arisen between Plaintifis and Defendants as to their respective rights and duties concerning the Amended and Restated Operating Agreement, 94, Plaintiffs maintain that ITV's purported exercise of its “call” right is invalid, and that Plaintiffs are entitled to have their remaining interest in Gumey Productions purchased by ITV at a 25% premium set forth in Section 6.9(b) of the Operating Agreement. Plaintiffs further maintain that until their shares are acquired by ITV and fully paid for, the Gurneys are entitled to continue running the day- to-day operations of the company. Plaintiffs also maintain that they are entitled to distributions that have not been paid, that the appointment by Defendants of Craig Armstrong as CEO without their consent is invalid, and that that appointment of Hogan Lovells by Defendants as counsel to Gumey Productions is invalid. 95. Plaintiffs are informed and believe, and on that basis allege, that Defendants dispute each| and every position set forth by Plaintiffs in the preceding paragraph. 96. Plaintiffs therefore seek a judicial declaration that: (a) ITV’s purported exercise of its call right under Section 6.8(b) of the Amended and Restated Operating Agreement is invalid; (b) ITV is required to purchase Plaintiffs’ Retained Membership Inter in Gumey Productions in accordance with] the terms set forth in Section 6.9(b)&(d) of the Amended and Restated Operating Agreement; (c) until ITV completes the purchase of Plaintiffs’ Retained Membership Interest, the Gurneys shall be entitled to} continue running the day-to-day operations of Gurney Productions and further entitled to fully access all company data and files; (d) the Gumeys are entitled to distributions as set forth in Article 7 of the Amended and Restated Operating Agreement; (¢) the appointment of Craig Armstrong as CEO of Gumey Productions by Defendants is invalids and (f) the appointment of Hogan Lovells as counsel to Gurney Productions is invalid. 97. Plaintiffs are informed and believe, and on that basis allege, that as a result of the conduet| of Defendants described herein, Plaintiffs have and will continue to suffer great and irreparable harm 25 COMPLAINT ~Seca ra ir 12 B 14 16 7 18 19 20 21 2 23 24 25 26 27 28 and damage, in that the wrongs that have been and will in the future be caused by Defendants are ofa continuing character and will expose Plaintiffs to continuing injury. Plaintiffs are also informed and believe, and on that basis allege, that as a result of Defendants’ conduct described herein, Plaintiffs have and will continue to sustain actual damages that may be difficult to ascertain with certainty. 98. Plaintiff are informed and believe, and on that basis allege, that there is no adequate remedy at law for the injuries which they have suffered and will continue to suffer in the future unless the wrongful conduct of Defendants is restrained and enjoined, 99. Accordingly, Plaintiffs seek issuance of preliminary and permanent injunctive relief to prevent and enjoin Defendants, and each of them, from: (a) interfering with the Gumeys’ rights to continue operating and managing the day-to-day operations of Gumey Productions; (b) interfering with the Gureys’ rights to access data and information necessary to the running of the company; and (c) precluding Defendants from continuing to permit Craig Armstrong to act as CEO of Gumey Productions. PRAYER FOR RELIEF WHEREFORE, Plaintiffs pray for judgment against Defendants, and each of them jointly and severally, as follows: 1 For compensatory damages according to proof at trial, but no less than $10,000,000; 2. For exemplary and punitive damages in an amount sufficient to punish and make an example of Defendants and to deter them from engaging in such conduct in the future; 3. For declaratory relief including, without limitation, a declaration that: (a) ITV's purported exercise of its call right under Section 6.8(b) of the Amended and Restated Operating ‘Agreement is invalid; (b) ITV is required to purchase Plaintiffs” Retained Membership Interest in Gurmey Productions in accordance with Plaintiffs’ “put” rights under the terms set forth in Section 6.9(b)8(d) of the Amended and Restated Operating Agreement; (¢) until ITV completes the purchase of Plaintiffs’ Retained Membership Interest, the Gurneys shall be entitled to continue running the day- to-day operations of Gurney Productions and further entitled to fully access all company data and files; (d) the Gurneys are entitled to distributions as set forth in Article 7 of the Amended and Restated 26 "COMPLAINTOperating Agreement; (e) the appointment of Craig Armstrong as CEO of Gurney Productions by Defendants is invalid; and (f) the appointment of Hogan Lovells as counsel to Gurney Productions is invalid, 4, Injunetive relief including, but not limited to, preliminary and permanent injunctive relief to prevent and enjoin Defendants, and each of them, from: (a) interfering with the Gumneys” rights to continue operating and managing the day-to-day operations of Gurney Productions; (b) interfering with the Gume ghts to access data and information necessary to the running of the company; and (©) precluding Defendants from continuing to permit Craig Armstrong to act as CEO of Gumey Productions. 5, Forall costs of suit; 6. For pre-judgment interest at the maximum legal rate; 7. For post-judgment interest at the maximum legal rate; and 8. Forsuch other and further relief as the Court may deem just and proper. Dated: Januors8, 2017 LAVELY & SINGER PROFESSIONAL CORPORATION MICHAEL E. WEINSTEN ANDREW B. BRETTLER DAVID B. JONELIS Attomeys for PI DEIRDRE GURNEY and LITTLE WIN, intifis SCOTT GURNEY, PLC 27 COMPLAINT ~LLC demand a trial by jury. lo Dated: January 9, 2017 [AND FOR JURY TRIAL Please take notice that Plaintiffs SCOTT GURNEY, DEIRDRE GURNEY and LITTLE WIN, LAVELY & SINGER PROFESSIONAL CORPORATION MICHAEL E. WEINSTEN ANDREW B. BRETTLER we B. JONELIS DEIRDRE GURNEY and LITTLE WIN, LLC 28 COMPLAINT