by: Tess Nacelewicz Wednesday, October 9, 2013

ARLINGTON HEIGHTS, Ill.—An insurance company is suing Pinnacle Security in an attempt to recover its costs in a 2011 lawsuit brought against Pinnacle and a monitoring company by the children of a firefighter who died in a house fire.

First Mercury Insurance has been paying to defend the lawsuit on behalf of a client it insured, Security Associates International (SAI), which is based here and provides monitoring services. However, First Mercury contends that Pinnacle should be covering SAI’s costs. Both SAI and Utah-based Pinnacle have been sued by the children of firefighter Matt Burton, who died in the 2007 fire in California while trying to rescue house occupants.

The residents of the house subscribed to a home security/fire alarm system through Pinnacle and SAI monitored it, the lawsuit says. Burton’s children contend in their lawsuit that both companies acted negligently and that their negligence “allowed the fire to become more dangerous than it should have been when their father responded to the fire alarm.”

According to a San Francisco Chronicle report, after the fire alarm went off, an SAI dispatcher called a nonemergency line at the Contra Costa County fire department and said only that there was a fire alarm report, instead of saying that she had spoken to the homeowner and confirmed there was a working fire. As a result, the call was given low priority and there was a delay in firefighters arriving at the scene, the Chronicle said. Burton, another fire fighter, and a couple that lived in the home died in the blaze.

Both SAI and Pinnacle deny the allegations in the children’s lawsuit, as does First Mercury, according to First Mercury’s lawsuit.

The attorney for First Mercury, Michael Gregg of the Chicago-based firm of Merlo, Kanofsky & Gregg, did not respond to requests for further comment by Security Systems News’ deadline. Attempts to reach Pinnacle Security for comment were not successful.

But First Mercury contends in its lawsuit, filed Sept. 16 in Illinois in Circuit Court of Cook County, that Pinnacle agreed in its contract with SAI “to defend and indemnify SAI in connection with third-party actions pertaining to SAI’s performance of the monitoring services.” Pinnacle has refused to assume SAI’s defense and costs, which have amounted to more than $50,000 so far, First Mercury contends.

First Mercury is seeking to have Pinnacle pay SAI’s defense costs and indemnify SAI in any settlement or judgment arising from the lawsuit filed by firefighter Burton’s children.

It’s not clear how much in damages the children are seeking. However, in 2011, Pinnacle and SAI agreed to pay $4.6 million to settle a wrongful death lawsuit brought by the widow of the other firefighter who died in the blaze, Scott Desmond, according to the Chronicle. Pinnacle was responsible for $2.6 million of that settlement and SAI $2 million, the newspaper reported.

Earlier this year, Protection 1 bought key assets of Pinnacle security, including its headquarters building in Orem, Utah. But Protection 1 did not acquire Pinnacle Security itself, according to Jamie Haenggi, Pro 1’s chief marketing and customer experience officer. She said the company is still owned by Golden Gate Capital. That San Francisco-based private equity firm acquired Pinnacle in 2008.

Chris Munday, an operating partner with Golden Gate, could not be reached for comment before SSN’s deadline.

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