The reinstatement of a lawsuit by five auto repair shops against insurers for violating antitrust laws has spurred more auto shops whose lawsuits have been stagnant since 2015 to follow suit.
In September, the Eleventh Circuit Court of Appeals reversed the ruling of a federal judge in the U.S. District Court for the Middle District of Florida, who had dismissed the shops’ case stating they lacked evidence that proved the insurers have a price-fixing agreement.
The repair shops, which are located in different states, allege State Farm, as well as nine other insurers, “depress the shops’ rate for automobile repair,” by setting a market rate which would only benefit the insurance provider. The shops also claim the insurers steer consumers away from non-compliant shops, violating federal antitrust and state tort laws.
The Eleventh Circuit found the shops had supplied reasonable allegations to support their claim of an agreement among insurers and reversed the judge’s ruling.
Following the reversal, several other auto shops are moving forward with their cases and may be joined with the lawsuits in the Middle District of Florida.
Professionals Auto Body, which has several locations throughout Pennsylvania and performs auto glass repairs, has filed two separate lawsuits suing 32 insurers for allegedly violating antitrust laws. The shop is seeking more than $8 million in damages.
Portland, Ore.-based Leif’s Auto Collision Centers, which was part of the multi-shop lawsuit against State Farm prior to its 2015 dismissal, filed a lawsuit against Geico in November, claiming the insurance giant has colluded with shops in its direct repair program (DRP) and steers consumers away from its business.
The insurance companies involved in the case have requested a rehearing en banc, meaning the case would be heard before the entire Eleventh Circuit as opposed to a select panel of judges. However, the request is still pending.