Ohio Ins. Director Files 10th Brief in Auto Parts Dispute

Ohio Insurance Director Lee Covington has become the point man for insurance commissioners nationwide, who are worried about court decisions, usually involving class actions, that they feel trespass on their regulatory territory.

Covington filed an amicus curiae brief in the Supreme Court of Missouri, supporting Wisconsin-based American Family Insurance regarding the insurer’s use of non-original equipment manufacturer (OEM) parts used in automobile repairs for its customers. The Missouri state trial court certified a multi-state class action lawsuit against the insurer last December.

In August the State’s Supreme Court, in a 7-0 decision, granted the company’s request for an appellate hearing to vacate the decision, and set oral arguments on the matter for December. Covington’s brief is the 10th he has filed in similar circumstances, citing the need to “preserve Ohio’s regulatory authority and to not impose another state’s insurance laws and increased costs on Ohio insurance consumers. ”

Covington is requesting that the state Supreme Court reverse the decision of the trial court which certified the class action or that, at a minimum, all polices of insurance entered into in Ohio be excluded from any class certification if one is entered.

“There is now a chorus of state insurance regulators who have recognized the threat that multi-state class action lawsuits pose to their ability to fulfill their mission to protect their insurance policyholders and to address their concerns,” he stated. “These cases are an attempt to execute an end-run around the established regulatory and consumer protection framework established by Congress in 1945 when it recognized that the state-based regulatory system was in the public’s best interest.”

Covington is also scheduled to address a conference today discussing the impact that multi-state class action lawsuits are having on regulated industries such as banking, telecommunications, and insurance before The Manhattan Institute at the Harvard Club, 27 W. 44th Street in New York City. The Institute will publish a transcript of the event within several weeks.

Topics Lawsuits Auto Legislation Ohio