Repair Shops Respond to State Farm’s Request for Dismissal of Antitrust Case

Attorneys for repair shops that sued State Farm recently responded to the insurer’s request for the U.S. Middle District of Florida Court, Orlando division, to dismiss their antitrust and steering lawsuit, writing, that there is “more than sufficient facts asserted to satisfy the pleading requirements.” The Florida repair shops sued State Farm and dozens of other insurers. The case has potential implications for the AGRR industry, as some automotive glass repair companies allege similar issues with third-party administrators (TPAs), which handle automotive glass claims for insurers.

“Plaintiffs allege that Defendants imposed maximum price limitations for automobile parts and services, adopted similar reimbursement policies and practices, and attempted to steer customers away from shops that refused to adhere to Defendants’ price limitations. The ‘crucial question,’ however, is ‘whether the challenged anticompetitive conduct stem[s] from independent decision or from an agreement, tacit or express,’’ State Farm’s attorneys write in their response.

“[A]s a general rule, businesses are free to choose the parties with whom they will deal, as well as the prices, terms and conditions of that dealing,” they claim. “[S]ection 1 of the Sherman Act does not preclude a party from unilaterally determining the parties with whom it will deal and the terms on which it will transact business. … At the pleading stage, ‘formulaic recitations of a conspiracy claim’ are insufficient, and ‘a conclusory allegation of agreement at some unidentified point does not supply facts adequate to show illegality.’ … The Complaint fails utterly to meet the standards set by the Supreme Court and the Eleventh Circuit for pleading conspiracy.”

In response, the repair shops’ attorneys argue that the claims in their complaint are valid.

“Defendant State Farm’s motion rests primarily upon the incorrect assertion the complaint fails to set forth sufficient facts to satisfy the pleading requirements,” attorneys write. “Repeatedly and throughout the motion, defendant State Farm misrepresents both the contents of the complaint and quite often the holdings of authority to which it cites. When the correct legal standards are applied, a straightforward reading of the complaint establishes there is more than sufficient facts asserted to satisfy the pleading requirements.

“Defendant State Farm’s numerous misrepresentation of fact and law do not alter this. The motion to dismiss is without any merit, legal or factual. The plaintiffs respectfully submit it should denied in its entirety,” attorneys claim.

The repair shops’ attorneys also responded to Geico’s request for dismissal, writing, “[Ge]ico’s motion rests primarily upon the incorrect assertion that the complaint fails to set forth sufficient facts to satisfy the pleading requirements. Repeatedly and throughout the motion, Defendant Geico misrepresents both the contents of the complaint as well as citations to authority, holdings of the cited courts and the procedural posture of those cases. When the correct legal standards are applied, a straightforward reading of the complaint establishes there is more than sufficient facts asserted to satisfy the pleading requirements.”

The judge has not issued any decisions at press time.

This entry was posted in glassBYTEs Original Story and tagged , , , , , . Bookmark the permalink.

1 Response to Repair Shops Respond to State Farm’s Request for Dismissal of Antitrust Case

  1. Roy Smalley says:

    The defendant’s claim that they have a right to “conduct business” is not precluded by Sherman is correct. It is also a very specious position that should cause them pause in that they imply they have a legal right to “conduct business” with collision repairers.

    The insurer cannot “assume” they have standing over property merely through the action of insuring, or claim it is for the common good, otherwise, contracts and property rights of owners of insured property would be meaningless. The only way an insurer can have property rights must come from an authorization that can only come from the insured property owner, either as part of the policy or a stand alone, legally binding contract.

    They do assume those rights and that is the essence of the alleged antitrust conspiracy, notwithstanding the facts alleged by the plaintiffs that insurers control price, those things that determine price, and market distribution of ‘business’ that is not theirs’ in the first place.

    An agreement or contract to ‘conduct business’ must have at its’ core, legal standing to enter into a contract and the contract must have legal intent.

    My lay opinions. Not an attorney thank goodness.

Leave a Reply

Your email address will not be published. Required fields are marked *