On Tuesday, July 8, Louisiana collision repairers filed a lawsuit against multiple insurers for violation of federal antitrust guidelines. Louisiana is the sixth state in which repairers have filed a suit.

Approximately 39 body shops are listed in the suit, with four to five more expected to join. Labor rate suppression, steering and failure to pay for procedures necessary for proper repairs are some of the other allegations leveled at roughly 35 insurance companies.

“Louisiana in particular has a large number of body shops that have experienced a tremendous suppression of rates and everything that will be paid to a body shop for the work they perform, including labor rates and parts and materials,” said Allison Fry, attorney and director of litigation for Eaves Law Firm. “Several shops in Louisiana have experienced truly crushing steering. I don’t know if it’s the environment in Louisiana or a certain arrogance on the part of insurers, but they’re much more blatant in their statements to shop owners about what they will or will not pay and why. For instance, one shop reported that an adjuster told them flat-out that they will not pay by the P-pages unless it’s in their financial interest to do so. And that was the corporate directive: ‘If it works for us, pay the P-pages. If it doesn’t, we’re not paying them.’

“There is an exceptionally large body of highly motivated shop owners in Louisiana who have been pushed to the point where they have to take action. They’re very vocal, very involved and they very much want to see a change in the industry.”

So far, other states besides Louisiana in which repairers have filed include Florida, Tennessee, Mississippi, Indiana and Utah. Fry said she expects repairers in 35 other states to file within the next few months, although there has been a slight delay due to a judicial panel hearing on multi-district litigation slated for July 31 in Kansas City. The panel will determine whether all the individual states’ cases can be consolidated for pretrial handling in one jurisdiction.

“We did not ask for an oral argument because we felt the matter was so straightforward and clear that it was unnecessary to impose on the panel in that way,” Fry explained. “However, several of the defendant insurers did demand oral argument, so we will be appearing in the federal courthouse in Kansas City.”