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1HomePageMap small mw 0816Local news stories affecting the auto body industry in Illinois, Indiana, Iowa, Kansas, Kentucky, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin

Three-C Body Shops is seeking recovery of short-pays, fees, and court costs from State Farm Insurance for the insurer’s repeated underpayments for services generally rendered and charged to their customers when their vehicles have been deemed to be total losses.

Currently, there are approximately 89 active lawsuits between Three-C’s and State Farm that began in November 2012. Generally the suits stem from total-loss billings, whereas Three-C Body Shop is seeking an estimated $296,807.93, of which State Farm has agreed to pay only $31,565.03, leaving an unpaid and contested amount to date of $265,242.90. Similar lawsuits will likely be filed.

Bob Juniper, second generation owner and president of the 58-year-old, family-owned company is no stranger to controversy or to taking on the challenges the collision industry presents. He was one of the first shop owners in the nation to ‘put his money where his mouth is’ by his hard-charging and often controversial local television and radio consumer awareness ads and commercials regarding direct repair programs (DRPs).

Juniper said, “When a vehicle becomes a total loss, we cease normal repair-related activities and change to another mode of operation, and, as such, charges for such activities are assessed that may or may not be consistent with a repair.

Such charges may be processes including but not limited to clean-up from fluid leaks, relocating a disabled vehicle, storage, protection, research, documentation, administrative activities, parts handling, and others. We have closely studied the high cost of handling and processing total loss vehicles.

In the Columbus, OH, area, insurers understand and pay for such charges—all but one, that is. State Farm continues to be ‘the odd-man-out’ in settling such claims fairly.

We must be paid for our efforts and liabilities associated with the handling involved in total losses as such activities are not ‘the cost of doing business.’  We have decided to let the courts decide who is right and who is wrong. Our efforts to work things out with State Farm directly were unsuccessful. I believe the facts will show that the money is owed. We look forward to sharing the results of these cases with the collision repair industry.”

Todd A. Fichtenberg, one of Three-C’s attorneys of the law firm Skinner & Associates, LLC of Columbus, OH, stated: “Ohio lacks the statutory provisions that have made those like Ray Gunder in Florida so successful in the recovery of fees and costs. Without that statutory framework, we are using Ohio’s existing laws and good faith arguments for the extension of those laws in an effort to recover Three-C’s fees and costs”.

Three-C Body shops was founded in 1956 and currently has six locations including two satellite locations (inspection-estimating, drop-off, and delivery), which help feed their four repair production locations in and around the Columbus market area. The company does $10 million-plus in annual sales.

The Iowa Collision Repair Association (ICRA) held the fourth annual Midwest Auto Body Show on March 20, 2014, in Altoona, IA. The 2014 theme was “The Future Is Now” and was free to Midwest collision industry members.

Paul Massie, Ford Motor Company's powertrain and collision product marketing manager, offered a video presentation webinar about the high-strength, military-grade aluminum alloy included in the 2015 Ford F-150 pickup and conducted a Q&A session.

Iowa senator Brad Zaun and ICRA lobbyist Scott Weiser brought the collision industry up to date on 2014 legislative activities.

Pete Tagliapietra of NuGen IT moderated an “Insurer Mandate– Parts Procurement” panel discussion.

A presentation titled “Information Technology and the Future of Collision Repair” was given during lunch.

After lunch, free “Training in the Round” education sessions were held on the trade show floor, which featured more than 65 vendor display booths.

Michigan House Bill 5339, introduced on February 19, 2014, seeks to amend the Michigan Insurance Code of 1956 to restrict insurance companies from numerous actions that irk collision repair facility operators. The broadly-worded bill has not yet been scheduled for hearings.

A proposed bill in Minnesota, House File 2690 (HF 2690), seeks to amend Minnesota Statutes 2012, section 72B.092, subdivision 1 to include more stringent prohibitions against insurance company requirements placed upon repair facilities. Introduced by representatives Joe Atkins, Greg Davids, Joe Hoppe, Debra Hilstrom, Jim Davnie, and Melissa Hortman on March 3, 2014, HF 2690 changes two subsections of the existing law, including provisions the repair industry supported and were added into the law in 2007.

The first amendment adds a prohibition against insurance companies and their representatives from requiring that a vehicle be presented “… at a particular motor vehicle repair shop designated by the insurer” in addition to the existing ban against drive-in claim centers.

According to Judell Anderson, executive director of Alliance of Automotive Service Providers, Minnesota (AASP-MN), whose organization supports the bill, this amendment seeks to expand the existing prohibition on requiring that vehicle owners present their cars at a drive-in because insurers have adapted to the existing prohibition by requiring vehicle owners to take their vehicles to a specific repair facility for inspection.

“We’ve heard from our members that insurance companies now tell people to go to a specific repair facility to get their vehicle inspected,” said Anderson. “In many cases, the insurer will actually have staff onsite at the body shop one or two days a week, essentially running a drive-in claim center in the repair facility. This section is really about combating insurance company steering.”

The second amendment adds a section to the existing law that expands upon the types of requirements that insurance companies may not place upon repair facilities. The added section states that insurance company representatives shall not specify or require any motor vehicle repair shop to use specific vendors, distributors, manufacturers, suppliers, business platforms, or internal processes to carry out vehicle repairs for an insured or claimant. This expands upon another subsection that was added into the existing law in 2007 that says insurance company representative shall not specify the use of a particular vendor for the procurement of parts or other materials necessary for the satisfactory repair of the vehicle. This clause does not require the insurer to pay more than a reasonable market price for parts of like kind and quality in adjusting a claim

In October 2013, AASP-MN filed a formal complaint with the Minnesota Department of Commerce requesting administrative and/or legal action to prevent State Farm from requiring that collision repair shops that participate in the State Farm direct repair program use the PartsTrader parts procurement system based upon the existing section of the law.

According to Anderson, the addition of the new section should help address numerous concerns AASP-MN members have with increasing insurance company requirements for specific vendors and business processes beyond the existing law that prohibits that activity for parts and materials.

A multi-jurisdictional task force conducted raids in Wayne and Oakland counties on the morning of February 28, 2014, on suspicion of a theft and fraud ring involving automobiles.

The investigation reportedly stemmed from a stolen automobile that lead investigators to raid the Somerset Collision Shop in Detroit, MI, according to reports in the Detroit News.

“The raids were conducted with auto theft teams from Highland Park and Hazel Park in conjunction with the Action Auto Theft squad and a number of other assisting agencies,” said the Hamtramck Police Department in a press release.

“The raids were successful with multiple arrests and the recovery of stolen property. Somerset Collision in Detroit was the primary focus of the raids.”

This isn’t the first time Somerset has been raided by authorities, according to the Detroit News writer Tom Greenwood.

In March 2007, the office of the Michigan Attorney General announced the arrests of three individuals in connection with a Detroit-based organized crime operation that allegedly stole millions of dollars in insurance fraud.

The arrests came after authorities raided three Detroit-area body shops that were all owned by the same family. Among the body shops raided in 2007 were the Somerset Auto Body Shop in Detroit.

Other businesses owned by the family were Bojax Auto Collision, Dynamic Collision, the Collision Connection, Ultimate Collision, and Foreign and Domestic Collision.

According to the Attorney General, in 2007 the businesses were owned, operated, and managed by an Orchard Lake man and his mother and brother, both of whom lived in West Bloomfield, MI.

The defendants all received probation.

The Attorney General office was unable to confirm or deny that the same family still owned the Somerset Collision Shop or were involved in the recent raid.

Heritage Collision and Frame, a 30-year-old, family-owned collision and repair shop in Ypsilanti, MI, is expanding its operations into Scio Township, just beyond the Ann Arbor, MI, border. Heritage Collision and Frame—which originated in Garden City, MI, but has called Ypsilanti its home for the last 10 years—recently purchased a specially-zoned property at 6550 Jackson Road. The facility is located about a mile west of Zeeb Road. The 6,672-square-foot building had been on the market since November 2013, but, up until that time, it was occupied simultaneously by a trucking company and a paving company.

Grant Hatchard, the late owner of Grant’s Automotive, owned the building and operated out of the facility before his wife took ownership following his death in 2011. Charlie Koenn, the selling agent, said that the building was sold to Heritage for just less than its US$240,000 listing price, but it was a sought-after property because of its unique zoning. “It’s zoned for outside storage and auto repair, and there are plenty of businesses around that would like a building like that,” Koenn said.