A couple of things.
1. Of course everyone would take the second shot, and in his shoes, I would have thought the same thing.
2. iiNet put up the cash. For this kind of cash I.e. $5000 at every game for the season, they would have a policy to cover it. The insurers would be saying no to payment - and rightly so!
3. The club have nothing to do with it. Jarrod Walsh is contracted by the 36ers to court announce, and is not an employee of the club. He has no authority to act as an agent for the 36ers or iiNet. It was he who gave the second shot, with no authority from either the sixers or iinet. He clearly knows the rules are for one shot only, and has acted outside of these. If anyone owes hurls $5000 it's Jarrod Walsh!
4. I think hurls has a legitimate grievance here, but unfortunately, based on my limited knowledge, I don't think he has much legal standing to get it from the club or iinet.
5. To save the bad publicity, I would think iinet may like to cough up / settle for a lower amount, and then have a quiet word to Jarrod about doing some promotional work, E.g. mc a function or similar to make it up to them.