ORLANDO – A lawsuit alleging that insurance companies, including State Farm, are
pressuring auto body and repair shops to use substandard parts hit
the skids in the 11th Circuit Court.
In Parker Auto Body et al v. State Farm et al, the
plaintiff is suing State Farm Insurance and more than 50 other
automotive-insurance providers, alleging that the defendants have
joined together to leverage their collective market power and exert
control over a wide range of the collision-repair industry.
This includes, but is not limited to, fixing the cost of labor
rates, controlling the cost of replacement parts, forcing auto body
and repair shops to use substandard or even dangerous replacement
parts, compulsory use of a parts-procurement program that directly
financially benefits State Farm and indirectly benefits the remaining
In addition, the claim alleges the defendants are guilty of
boycotting shops that are unwilling to comply with either their
decision to control prices or their demands to use substandard and
improper parts, and interfering with the plaintiff’s current and
prospective business relations by intentionally misrepresenting and
making knowingly false statements regarding the quality, efficiency
and ethical reputation of his business.
The claim goes on to contend the defendants exerted economic
duress and coercion upon both the plaintiff to and upon consumers to
bow to their demands.
This includes making direct threats to consumers to refuse to
cover portions of their repairs if they continue to patronize the
plaintiff’s business to the point where the defendants' behavior
has done serious harm to the competitive environment in the body-shop
“It's an unfair practice and we think vehicles should be
repaired the way the manufacture says they should be,” Matt Parker,
owner of Parker Auto Body, told the Louisiana Record. “Every
time you want to represent the consumer, the insurance company wants
you to do things the cheapest way possible and the end result is not
He alleges that State Farm Insurance and the other defendants have
unfairly pressured him to use substandard and after-market parts, to
reduce costs, under the threat of losing favored status.
Parker said insurance companies have been applying pressure to
auto body and repair shops to fix vehicles at the lowest cost
possible for the last 20 years.
“We have to deal with this kind of pressure all of time and the
response is typically to try to make the body shops look like the bad
guys,” he said. “But the person really getting hurt is the
Parker contends that these policies have been driving up insurance
rates across Louisiana for decades.
“The insurance companies use these delay, deny and defend
tactics to make consumers choose between accepting their policies or
fighting it out in court,” he said. “It's become a real
Right now, Parker's lawsuit remains in stasis. His legal team
missed a deadline to file an appendix with the court and the 11th
District Court dismissed the case on Oct. 4, according to an article
Parker said there still is a plan to continue pursuing the claim.
“But it is progressing at a snail's pace,” he said.