Safelite Group and Safelite Solutions have petitioned the Minnesota Supreme Court to review a decision by the appellate court that upholds the settlement agreement between the Minnesota Department of Commerce, Insurance Division, and Auto Club Group. The settlement requires Auto Club Group to “cease and desist from using Safelite Solutions, or any other subsidiary of Safelite Group Inc., as its administrator of automotive glass claims in Minnesota,” according to the settlement agreement.
“This case presents an important question on which this court should rule,” Safelite’s attorneys write in their petition to the Minnesota Supreme Court. “Contracts are important property rights that cannot be taken without due process. Here, the commissioner of commerce ordered an insurance company to terminate its valid, legal, contract with petitioners, and ordered it to never again do business with petitioners.
“The cease and desist order, as it pertains to petitioners, exceeds the commissioner’s statutory authority and violates petitioners’ due process rights. The court of appeals erroneously ruled that it lacked jurisdiction to review the commissioner’s unauthorized action, effectively immunizing the action from judicial review, and leaving no checks on the commissioner’s ability to issue similar orders in the future that affect the rights of petitioners and other third-party administrators that do business in Minnesota,” according to Safelite’s petition.
The company was not provided notice that the settlement was occurring, attorneys allege in the petition.
“[P]etitioners are not parties to the order, yet the order substantially affects their business in Minnesota by requiring Auto Club, one of Safelite Solutions’ important insurance company clients, to terminate its contract and never again enter into another contract with any Safelite entity,” according to the petition.
Safelite attorneys allege the court of appeals “plainly erred by dismissing the appeal for lack of jurisdiction.”
The attorneys further claim, “Here, in issuing the cease and desist order, the commissioner necessarily concluded that the statute, Minn. Stat. § 45.027, subd. 5a, authorizes him to order licensed insurance companies in Minnesota to terminate valid, enforceable and entirely legal contracts with third-party administrators who are not required to be licensed by the department. In issuing the order, the commissioner necessarily concluded that the statute authorizes him to blacklist third-party administrators, despite the fact that they are not required to be licensed, and authorizes the commissioner to, essentially, de-bar certain legitimate companies from ever doing business in Minnesota.
“The commissioner’s cease and desist order, to the extent that it affects petitioners and harms their contract rights in Minnesota, is a quasi-judicial decision that must be subject to judicial review. If not, the commissioner would be free to use cease and desist orders of this type to expand his authority to encompass third-party administrators and other parties who, by law, are not required to be licensed by the department. The cease and desist order exceeds the commissioner’s statutory authority, and raises serious due process concerns. The court of appeals erred by dismissing the writ, thereby immunizing the commissioner’s action from judicial review in this case and in future cases,” attorney write in the petition.
“Petitioners respectfully request that the court accept review, summarily reverse the court of appeals’ February 10, 2015 order, and remand the matter for review on the merits in the court of appeals,” Safelite attorneys write in the petition.
The Minnesota Supreme Court has not issued any decisions regarding the petition for review at press time.
The Minnesota Department of Commerce, Insurance Division, reviewed 125 automotive glass and accident claim files, which led to its decision, according to the settlement agreement.
After the settlement agreement was signed, Safelite Group and Safelite Solutions, as related parties to the consent order, had filed a petition for writ of certiorari with the Appellate Court of Minnesota.
To view a copy of Safelite’s petition for review, click here.
To view a copy of the consent order, click here.