U.S. District Judge Gregory Presnell has dismissed the antitrust lawsuit filed by group of Florida collision repair shops against State Farm and dozens of other insurers, which alleged the insurers use their direct repair programs to “illegally control and depress” repair rates and if the shops don’t comply, customers are steered away. “The complaint is more than 30 pages long and suffers from a host of problems,” the judge for the U.S. Middle U.S. District of Florida, Orlando division, writes in his decision to dismiss.
Independent automotive glass repair shops allege similar issues with third-party administrators (TPAs), which handle automotive glass claims for insurers, so this case has potential implications for the AGRR industry.
“The complaint is a prohibited ‘shotgun pleading,’ with each count incorporating irrelevant allegations … Dismissal is required,” the judge writes.
“[T]he complaint fails to identify which plaintiffs have direct-repair program agreements with which (if any) defendants. If the plaintiffs choose to re-plead, this must be corrected,” he adds.
“With limited exceptions, the allegations of wrongdoing are attributed, collectively, to every defendant and alleged to have been perpetrated upon every plaintiff,” the judge continues. “While there may be situations in which such collective descriptions are sufficient, at least some of the claims asserted here require individualized allegations. For example, if plaintiffs’ counsel were able to establish that defendant A was unjustly enriched by shortchanging plaintiff B, it would not entitle any other plaintiff to a judgment against defendant A (or any other defendant). However, that is the way this action has been pleaded. If the plaintiffs choose to re-plead, this must be corrected.”
The case is dismissed without prejudice and all pending motions have been denied by the judge as moot.
“Should the plaintiffs choose to re-plead, they must do so on or before June 27, 2014,” the judge writes.
To view a copy of the judge’s decision, click here.