Louisiana AG: Lawsuit Against State Farm to Be Heard in State Court

A federal judge has ruled that Louisiana Attorney General James D. “Buddy” Caldwell’s lawsuit against State Farm Auto Insurance over vehicle repair tactics will be heard in Louisiana state court, where it was originally filed one year ago, the AG’s office announced.

The suit, filed Aug. 19, 2014, in Louisiana’s 19th Judicial District Court, alleges State Farm violated Louisiana’s Unfair Trade Practices Act and Monopolies Law by using scare tactics to steer Louisiana consumers to State Farm’s preferred repair shops and forcing shops to perform vehicle repairs cheaply and quickly, rather than in accordance with consumer safety and vehicle manufacturer performance standards.

At the time of the filing, State Farm Public Affairs Director Phil Supple told Insurance Journal that the “description in this lawsuit is not in line with State Farm’s mission to serve the needs of its customers, and our long, proud history of achievements in advancing vehicle safety.”

He pointed to State Farm’s long-term involvement with the Insurance Institute for Highway Safety and the insurer’s role in helping facilitate auto safety improvements.

Through a procedural mechanism State Farm had the case removed to federal court and then transferred to multi-district litigation pending in Florida, the AG’s office said.

Caldwell filed motions in December 2014 to have the case transferred back to state court in Louisiana. U.S. District Court Judge Gregory A. Presnell granted Caldwell’s motion.

State Farm currently holds the largest share of auto insurance policies in Louisiana. In 2012, State Farm wrote one third of all auto insurance policies in the state, totaling over $1 billion in premiums.

Source: Louisiana Attorney General’s Office

Related:

• Louisiana AG Files Suit Against State Farm Over Auto Repair Practices

Topics Lawsuits Auto Louisiana