Over 100 auto repair shops, including at least six body shops, have been sued as a group in Orange County for violations of the State's Business & Professions Code (which includes violations of B.A.R. regulations). The suit, Consumer Enforcement Watch Corp. v 7 Day Tire, Muffler & Auto, et al. was filed April 11 in Orange County Superior Court, Santa Ana. It alleges that the various defendant repair shops harmed consumers when they violated B.A.R. regulations including failure to renew their registrations on time, writing improper estimates, failing to secure proper approval for estimates, and failing to return parts removed from vehicles.
The California State Assembly Insurance Committee has passed by a bipartisan vote of 12-4 the Senate Bill that would make it illegal for an insurance company to have a financial interest in a body shop. Having earlier passed the full Senate (29-16), the bill will be read and likely voted upon by the full Assembly between August 6 and the end of the month. If passed by the Assembly, it will go to the Governor's desk and could become law on January 1.
The California State Assembly on August 29 turned down State Senate 1648, a bill that would have prohibited insurance companies from owning bodyshops and forced the Automobile Club to divest its interest in Caliber Collision Centers. This opens the door for more insurance companies to buy or take a financial position in collision repair facilities. Allstate has already announced that it intends to open 17 - 20 Sterling shops in California beginning next year.
Five major paint manufacturers and seven paint jobbers are named in a class action lawsuit for price-fixing in violation of State antitrust laws filed on August 15 in Los Angeles Superior Court. The action alleges that the paint companies and jobbers engaged in "horizontal price fixing and minimum resale price maintenance." The lawsuit covers the period from 1993 to the present and asks for class action status on behalf of 7,000 California body shops. It alleges that defendants "conspired to fix, raise, maintain or stabilize prices for automotive refinishing paint." The defendants include paint manufacturers PPG, DuPont, Sherwin-Williams and Akzo Nobel, together with jobbers D'ANgelo & Sons, Tri-City Paint Corporation, Finishmaster, Inc., Auto Color Specialists, Inc., National Oak Distributors, Inc., and Hayward Color, Inc.
The California salvage industry won what the collision repair industry couldn't; a partial victory in Sacramento with the passage of two bills - and the defeat of a third - that begin to level the playing field between licensed salvage yards and the gray market of automotive rebuilders that bids against them for wrecked vehicles.
The International Autobody Congress & Exposition (NACE) Town Hall will provide a forum for discussion and debate about some of the collision repair industry's hottest topics, including state and federal legislation regarding insurer-owned shops and right to repair, diminished value (DV) and post repair inspections, fraudulent practices, steering and what it means to repairers and consumers, the future of the industry -- image, technician shortage and the aging workforce -- and repair information availability.
Ten body shops were closed down and 35 people arrested, 29 of them body shop employees, in a Santa Clara County insurance fraud sting operation. The operation used an undercover agent who approached body shops in the Bay area and asked them to write inflated estimates so that minor body damage, often intentionally inflicted by the vehicle owner, could be increased to cover total repaint jobs and upgrades like spoilers or new seats. The Santa Clara District Attorney's office has issued additional felony arrest warrants. The sting operation was the largest of its kind in the nation, according to the National Insurance Crime Bureau.
California Gov. Gray Davis signed on Sept. 23 the nation's first family leave bill, providing benefits for up to six weeks a year payable from the state disability insurance program to workers who must care for sick family members - children, spouses, parents and, in the case of gay couples, domestic partners. The family leave can also be taken to "bond" with newborn children, newly adopted children and new foster children.