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North Carolina Shop Added to Suit Against Insurers

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Sept. 5, 2014—K and M Collision LLC in Hickory, N.C., has been included as a plaintiff in a lawsuit filed against several major insurance carriers and their affiliates, according to an announcement made Thursday.

The suit was orgininally filed in Illinois district court on April 30 under the Racketeer Influenced and Corrupt Organizations Act (RICO), and accuses State Farm, Allstate, Geico, Progressive, Farmers, Liberty Mutual, Nationwide and others of short pays and conspiracy to establish “an artificial market value for collision repairs.”

K and M joins Crawford's Auto Center in Pennsylvania in the suit.

“I think the lawsuit will uncover and prove what many shops throughout the country have known for years: that the insurance companies are refusing to pay for proper repairs, and are using illegal methods to suppress the market rate,” K and M vice president of operations Kevin Michael Bradshaw said in a statement.

This is the latest in a flurry of lawsuits filed on behalf of repair facilities against insurers.

The Louisiana Attorney General filed a lawsuit in August on behalf of consumers against State Farm.

And, since filing a suit in Mississippi on behalf of three collision facilities last year, attorney John Eaves Jr. has worked to file similar suits across the U.S. In August, a U.S. Judicial Panel on Multidistrict Litigation granted Eaves’ request to have the separate suits consolidated to one court (the panel chose Florida). 

The consolidation of the case also allows repairers to utilize each individual state’s laws collectively for each suit, Eaves told FenderBender. According to Eaves, repariers in 41 states have already filed or begun the process of filing suits to join the effort. He expects all 50 states to be included by the time the case reaches its trial stage.

On Sept. 11, a judge will set a schedule for the case, Eaves said.

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