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Louisiana Attorney General Files Lawsuit Against State Farm

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Aug. 20, 2014—Louisiana Attorney General Buddy Caldwell filed a lawsuit on Tuesday against State Farm Insurance for business practices aimed at “controlling the auto repair industry and forcing unsafe repairs on vehicles without the knowledge or consent of Louisiana consumers,” according to a statement by the Attorney General’s office.

The suit, filed in Louisiana’s 19th Judicial District Court, alleges State Farm violated Louisiana’s Unfair Trade Practices Act and Monopolies Law by using scare tactics to steer Louisiana consumers to State Farm’s preferred repair shops. The suit also outlines concerns about the insurance provider forcing its preferred shops to perform vehicle repairs cheaply and quickly, using sub-standard parts and methods that may not meet consumer safety and vehicle manufacturer performance standards.

“In some cases, we’ve found that these parts are nothing more than used junk yard parts. In others, we’ve found them to be foreign knock-off parts of questionable quality,” Caldwell said in a press release. “Auto repair is not an industry where you can cut corners to save a little money. It could be a matter of life and death.”

State Farm has seen several other lawsuits over the past few years. In June, a group of Florida shops filed a suit against State Farm for similar complaints.

Fenderbender also reported in March that an Ohio multiple-shop owner has filed nearly 90 suits against the insurance provider.

Caldwell says he hopes his suit will help, “change the culture of unsafe business practices led by State Farm in the auto insurance and repair industry.”

“Each month Louisiana consumers give their hard earned money to State Farm under the assumption that the insurer will take care of them if an accident occurs. This simply isn’t happening. Quite frankly, State Farm has been there for State Farm, not the Louisiana consumer,” Caldwell said.

To read the full 17-page lawsuit filed by Caldwell, click here.

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