The Car and Truck Fleet and Leasing Management Magazine

Insurance Firm Loses Appeal in Aftermarket Parts Case

May 13, 2009

KANSAS CITY, MO --- A Missouri Court of Appeals on May 5 reinstated a $17 million jury verdict against American Family Mutual Insurance Co. in a class-action lawsuit over vehicle repairs and the use of aftermarket auto parts, the Kansas City Star reported. 

The state appeals court ruled that Jackson County Circuit Judge Edith Messina was mistaken when she ruled in June 2007 that the plaintiffs had failed to prove their theory of damages. The jury verdict had covered an estimated 315,000 Missouri residents who made claims for vehicle repairs between May 1990 and December 2004. The jury decided that American Family had used inferior, non-original equipment to repair policyholders' damaged vehicles. 

Messina's 2007 decision to throw out the verdict came about 13 weeks after the jury found in favor of the plaintiffs. Messina ruled that the plaintiffs had failed to prove American Family breached its obligation to pay for replacement parts that were similar in quality, fit and performance to the original parts, the Star reported. 

In its 30-page opinion issued May 5, a three-judge panel of the appeals court in Kansas City ruled that the plaintiffs "presented sufficient evidence for a reasonable juror to conclude that aftermarket parts are not of like kind and quality to OEM (original equipment manufacturer) parts and that American Family breached its contracts with its policyholders when it paid to return the damaged vehicle to pre-loss condition based on the nature and cost of aftermarket parts." 

Steve Witmer, a spokesman for the insurance company, told the Kansas City Star that the company was disappointed by the judges' ruling and was considering its legal options. "We still feel very strongly that our customers are well served by this practice. We fully explain the process to them and we stand behind the way that the parts fit," he said. 

The case was first filed in May 2000 and was certified as a class action in December 2001. 


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