State Farm denies North Carolina actual cash value suit allegations, says relief sought not justified

State Farm has denied all allegations against it in a North Carolina lawsuit regarding actual cash values (ACVs) on total loss claims, aside from confirming the nature of the collision the lead plaintiff was involved in, and is again seeking dismissal.

The suit alleges State Farm is systematically lowering the ACVs it pays on total loss claims.

The suit alleges that State Farm reduced the retail cost of vehicles comparable to total losses to reduce payouts by 4–9%. It alleges violations of North Carolina’s Unfair and Deceptive Trade Practices Act (UDTPA) and Unfair Claims Settlement Practices Act (UCSPA), as well as breach of contract specific to plaintiff Craig Brewer.

State Farm denies all of those alleged violations and, specifically regarding Brewer, denies breach of contract.

Brewer contends that State Farm’s alleged reduction decreased his payout by 5.5%.

In its March 11 answer to the complaint, State Farm confirms Brewer as one of its policyholders at the time of the collision and that his 2021 Genesis GV80 was declared a total loss, valued at $56,772, pre-accident base.

The insurance company states, however, that class certification of the case is inappropriate. State Farm asked the court to stay the case pending an appraisal of the plaintiff’s vehicle. In February, U.S. Chief District Judge Catherine C. Eagles ordered the appraisal and denied a stay of the case pending the results. She also denied State Farm’s motion to dismiss the case.

Among the allegations State Farm denies is that, through CCC Intelligent Systems’ CCC One, it is allowed to choose the methodology and total loss vehicle valuation parameters.

It also denies a portion of the lawsuit that states, “Unbeknownst to Mr. Brewer, in calculating the amount it was required to pay, in violation of North Carolina’s total loss regulation, State Farm wrongfully reduced the retail cost of comparable vehicles used in the calculation in violation of regulations in the State of North Carolina, which resulted in an impermissible reduction of the total loss claim payment in the amount of $3,328.”

State Farm denies that Brewer and the proposed class are entitled to any relief as a result of the lawsuit.

State Farm denies the allegation that it used an “average private condition” setting when valuing Brewer’s vehicle rather than basing it on the retail costs of comparable vehicles.

It also denies allegations that it should be required to pay the amount of an alleged illegal retail price reduction of comparable vehicles stated in CCC One reports provided to Brewer and the class members. State Farm argues that the proposed class isn’t properly defined, doesn’t meet a federal class action procedural mechanism, and that Brewer’s action can’t be properly certified as a class action.

State Farm argues that Brewer’s claims, as well as those of the class members, may be barred, in whole or in part, by:

• • Fraud;
  • Terms, provisions, conditions, definitions, limitations, and exclusions in their insurance policies;
  • Their failure to comply with other conditions precedent or prerequisites for bringing suit or recovering benefits under their insurance policies;
  • Doctrines of accord and satisfaction, recoupment, set-off, and/or election of remedies, including an offer and acceptance of complete relief, reached with State Farm;
  • Their conduct, actions, and inactions under the doctrine of ratification;
  • Their own actions, negligence, or legal fault; and
  • The doctrines of res judicata, collateral estoppel, waiver, or settlement.

State Farm argues that Brewer and the class members may lack standing to pursue their claims for failure to appraise or follow the required appraisal.

According to State Farm, Brewer’s claims should be barred, in whole or in part, by the doctrine of unclean hands and/or estoppel because he “received the entire benefit of the bargain and cannot now pursue a claim for breach;” his failure to mitigate damages, if any; the doctrine of laches; and by payment or the voluntary payment doctrine.

“State Farm pleads independent, intervening, or superseding acts and omissions of plaintiff and others as a complete bar to this action,” states the company’s answer to the complaint.

“The insurance contract forms at issue in this litigation were approved by and/or filed with North Carolina’s insurance regulatory authorities if such approval or filing was required, and State Farm has complied with all relevant insurance regulations with regard to the approval and maintenance of those contracts.”

State Farm also argues that Brewer and the class “have adequate remedies at law.”

“The complaint fails to state a claim upon which any relief can be granted and should be dismissed,” State Farm wrote in its answer. “State Farm acted at all times alleged in the complaint in compliance with the insurance policies and with North Carolina law, and in good faith.”

State Farm demands a jury trial.

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