Diamond Claims & Investigation Services, Inc. - Page 6

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          plaint (initial complaint), an amended complaint (amended com-              
          plaint), and a second amended complaint (second amended com-                
          plaint), and the plaintiffs and FIG submitted a pretrial order              
          (pretrial order).  In those submissions, the plaintiffs raised              
          claims against FIG for breaches of contract, indemnity, and                 
          fraudulent misrepresentations and sought damages from FIG with              
          respect to those claims.5  The District Court ruled that the                
          pretrial order (1) superseded the various complaints that the               
          plaintiffs had filed in the Farmers lawsuit and (2) controlled              
          the determination of any damages to be awarded to the plaintiffs.           
               In the pretrial order, the plaintiffs alleged, inter alia:             
               VI.       Contentions of Fact                                          
                        *     *     *     *     *     *     *                         
                    2.   In December, 1980, Michael Conn, acting as                   
               Director of CID and on behalf of all defendants, and                   
               plaintiffs, agreed as follows (these promises are                      
               hereinafter jointly referred to as "the agreement"):                   
                         a)   That CID would assign to plaintiffs all                 
               investigations which were assigned to outside investi-                 

          5  In the initial complaint and in the amended complaint, the               
          plaintiffs alleged that the parties to the agreement at issue in            
          the Farmers lawsuit were FIG and "Diamond Claims" and that, as a            
          result of FIG's breaches of contract and fraudulent misrepresen-            
          tations, "plaintiff Diamond Claims has suffered lost revenue from           
          investigation, consultation and clerical services; lost profits *           
          * * all to plaintiff Diamond Claims' damage in the amount of                
          $5,000,000", and requested, inter alia, that the District Court             
          enter a judgment against FIG and in favor of "Diamond Claims" in            
          the amount of $5 million on account of its claims against FIG for           
          breaches of contract and fraudulent misrepresentations.  In the             
          second amended complaint and in the pretrial order, references to           
          "Diamond Claims" in the foregoing allegations were changed to               
          references to "plaintiffs".                                                 

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Last modified: May 25, 2011