Connecticut Attorney General Richard Blumenthal wants to intervene in a body shop group’s class action lawsuit against The Hartford Insurance Co. to help “prevent unfair and biased automobile body damage appraisals.”
The Auto Body Association of Connecticut (ABAC) announced that Blumenthal has asked the Stamford Superior Court for permission to file a brief in support of the ABAC motion for a permanent injunction to prevent The Hartford from exclusively using in-house representatives to perform appraisals. The injunction stems from a $15-million court decision in November in a class action suit on behalf of state body shops against The Hartford.
Blumenthal’s petition said, “The State seeks to prevent unfair and biased automobile body damage appraisals and unfair suppression of labor rates conduct which not only violates (state law), but which also has a direct and adverse effect on Connecticut’s general economy.”
Further, it said the “State has an interest in preventing the unfair suppression of labor rates that significantly harms the State’s economy and results in extreme economic hardship for independent automobile body repair shops.”
In November, a jury awarded $15 million to Connecticut auto body repair firms, saying The Hartford engaged in unfair business practices. The lawsuit filed by ABAC and three of its members alleged that the insurance company artificially suppressed body shop labor rates by eliminating the use of independent appraisers and relying exclusively on its own automobile service representatives to perform appraisals so the company could control their content, including labor rates.
Following the verdict, ABAC filed a motion for a permanent injunction to prevent the unfair business practices and asked the court for punitive damages in addition to the $15 million. Those motions are pending. The Hartford has said it would appeal the court’s decision.
“Attorney General Blumenthal has been a champion of small business and has been with us every step of the way,” said Atty. David Slossberg of Hurwitz, Sagarin, Slossberg and Knuff, of Milford, co-counsel for ABAC. “The Attorney General’s intervention in this action sends a strong message The Hartford’s unfair trade practices must stop, it must follow the law, and the hundreds of auto body shops in our state must be able to run their businesses on an even playing field, absent The Hartford’s influence and control. We are delighted with this development.”
Thomas Hambrick, spokesman for The Hartford, told the Hartford Courant that the insurer was disappointed with Blumenthal’s actions, saying body shop owners are trying to increase costs to Connecticut consumers.
"It is important to us that our customers have access to a repair program that provides great service at a fair price," Hambrick said.
ABAC President Bob Skrip said that shops in his state need to be fairly compensated for the work they perform.
“Automobiles have become increasingly sophisticated over the years. Ongoing training is necessary. Expensive, sophisticated equipment is continually required to keep up with ever-more complex vehicles,” Skrip said. “Those who work in our profession today are extremely talented craftsmen and professionals. It’s time for compensation to catch up to our expenses.”
Skrip added that ABAC plans to pursue legal action against other insurers in the state that are allegedly engaging in unfair business practices similar to those of The Hartford.
“Enough is enough,” Skrip added. “We can no longer allow huge insurance companies to force their will on businesses and consumers. It’s your car. It’s your choice where to have it repaired.”
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