The Alliance of Automotive Service Professionals of New Jersey (AASP/NJ) has issued a call to action to defend the 1963 Consent Decree, which is currently being reviewed for termination by the U.S. Department of Justice (DOJ).
The Consent Decree was enacted in 1963 and legally instructed 265 insurers and various other entities not to conspire to unreasonably restrain trade and commerce in the collision repair market.
“The 1963 Consent Decree is a critical document that adds teeth to the collision industry’s side when it deals with insurers,” said Jerry McNee, president of AASP/NJ. “The Department of Justice should be endorsing and promoting it on behalf of consumers – not considering erasing it from history. AASP/NJ stands behind the Consent Decree and all efforts to keep it in place.”
Per the Consent Decree, insurers and co-conspirators 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; or
- 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.
Although the Consent Decree has never been fully enforced, AASP/NJ says it has been useful in numerous lawsuits to support the fact that the practices referenced above are illegal. The Consent Decree essentially states that three insurance trade associations and their members (more than 250 at the time) agreed to forever refrain from several practices, including setting prices and steering. AASP/NJ believes the termination or elimination of the Consent Decree could have a devastating effect on the collision industry.
“The collision repair industry benefits greatly from anything that protects its customers and sets limits to what insurers can and can’t do during the vehicle repair process,” said Charles Bryant, executive director of AASP/NJ. “Our industry can’t afford to lose something as vital as the 1963 Consent Decree.”
The DOJ has set a deadline of Sept. 2 for interested parties to provide public comment on the proposal. AASP/NJ states that the collision industry needs to act fast to tell the DOJ why the 1963 Consent Decree should not be terminated. AASP/NJ has created a special web link to an online petition to assist members in quickly submitting their comments to the DOJ. Click here to view the petition.
