The Alliance of Automotive Service Providers of Massachusetts (AASP/MA) is urging its members and collision industry colleagues throughout the country to oppose the Department of Justice’s (DOJ) proposed termination of U.S. v. Association of Casualty and Surety Companies, et al., also known as the 1963 Consent Decree.
The 1963 Consent Decree forbade three insurance trade associations and their members (more than 250 at the time) from engaging in several practices, including setting prices and steering automotive repair work away from certain auto body facilities. AASP/MA believes that terminating the Decree would have a devastating effect on both the motoring public and the national collision repair industry. The association also requests that the DOJ hold a special hearing to revisit the entire issue of the Consent Decree and its effect on the collision repair and insurance industries.
“The 1963 Consent Decree is a critical document that our industry cannot afford to lose,” said Evangelos “Lucky” Papageorg, executive director of AASP/MA. “On the contrary, true enforcement and acknowledgement of the Decree is more important than ever. Steering and other common insurer practices put the consumer at great risk of an improper repair that fails in a subsequent collision. With the increasing threat of liability in our industry, professional auto body facilities cannot continue to be pressured or coerced to do things that are only designed to save the auto insurance industry money and give it control over critical steps in the repair process.”
The insurers and co-conspirators involved in the Decree were permanently barred from (among other things) placing into effect any plan, program or practice that has the purpose or effect of:
- Sponsoring, endorsing or otherwise recommending any appraiser of damage to automotive vehicles
- Directing, advising or otherwise suggesting that any person or firm do business or refuse to do business with (a) any appraiser of damage to automotive vehicles with respect to the appraisal of such damage, or (b) any independent or dealer franchised automotive repair shop with respect to the repair of damage to automotive vehicles
- Exercising any control over the activities of any appraiser of damage to automotive vehicles
- Allocating or dividing customers, territories, markets or business among any appraisers of damage to automotive vehicles
- Fixing, establishing, maintaining or otherwise controlling the prices to be paid for the appraisal of damage to automotive vehicles, or to be charged by independent or dealer franchised automotive repair shops for the repair of damage to automotive vehicles or for replacement parts or labor in connection therewith, whether by coercion, boycott or intimidation or by the use of flat rate or parts manuals or otherwise.
The DOJ has set a deadline of Oct. 2 for interested parties to provide public comment on the proposal. AASP-MA says the collision industry needs to act fast to tell the DOJ why the 1963 Consent Decree should not be terminated.