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Allstate Insurance Co. v. Rhode Island Department of Business Regulation
Superior Court of Rhode Island
January 10, 2018
ALLSTATE INSURANCE COMPANY; AMERICAN COMMERCE INSURANCE COMPANY; AMICA MUTUAL INSURANCE COMPANY; LIBERTY MUTUAL GROUP; METROPOLITAN INSURANCE GROUP; NATIONWIDE CORPORATION GROUP; OHIO MUTUAL GROUP; MEMBERS OF THE PROGRESSIVE GROUP OF COMPANIES DOING BUSINESS IN RHODE ISLAND; PROVIDENCE MUTUAL FIRE INSURANCE COMPANY; SELECTIVE INSURANCE GROUP; THE HARTFORD FINANCIAL SERVICES GROUP; THE TRAVELERS COMPANIES, INC.; UNITED SERVICES AUTOMOBILE ASSOCIATION GROUP (USAA); MAIN STREET AMERICA GROUP, Plaintiffs,
RHODE ISLAND DEPARTMENT OF BUSINESS REGULATION, Defendant, EAST BAY AUTO, INC.; EURO MOTOR CARS, INC.; CASALE'S AUTOBODY, INC.; HILLVIEW AUTO BODY, INC.; BIGELOW AUTO BODY, INC.; RANDY'S AUTO, LTD; C.L. ENTERPRISES, INC.; SAFE-WAY AUTO SALES, INC.; MIKE'S AUTO BODY, INC.; WEST WARWICK AUTO CITY, INC.; D&H AUTO GROUP; CURRERI COLLISION CENTER, INC.; NEW CENTURY AUTO BODY, INC.; CRANSTON COLLISION CENTER SALE & SERVICE, INC.; MICHAUD AUTO BODY, INC.; CHOICE COLLISION CENTER, INC.; AUTO SERVICE AUTO BODY, INC.; TODISCO ENTERPRISES, INC.; PROVIDENCE AUTO BODY, INC.; PACHECO: AUTOMOTIVE, INC.; REGO'S AUTO BODY, INC.; ANTHONY'S AUTO BODY, INC.; DETROIT COLLISION CENTER, INC.; RICK'S AUTO BODY, INC.; BLACKSTONE AUTO SALES & BODY, INC.; AUTO BODY CONCEPTS, INC.; WARWICK AUTO BODY, INC.; Interested Parties.
County Superior Court
Plaintiff: Jeffrey S. Brenner, Esq.; Stephen D. Zubiago,
Esq.; Melissa E. Darigan, Esq.; David J. Pellegrino, Esq.;
Bruce A. Leach, Esq.; Faith A. LaSalle, Esq.; C. Russell
Bengtson, Esq.; Todd J. Romano, Esq.; R. Kelly Sheridan,
Esq.; Elizabeth A. Suever, Esq.
Defendant: Matthew M. Gendron, Esq. Sara K. Tindall-Woodman,
Interested Peter J. Petrarca, Esq.; Jina N. Petrarca, Esq.
the Court is Plaintiffs' (Plaintiffs or Insurers) motion
for a stay of the pending administrative proceeding ordered
by the Rhode Island Department of Business Regulation (DBR)
pursuant to G.L. 1956 § 42-35-15. Plaintiffs move for a
stay to allow the Court an opportunity to determine legal
issues previously presented to the appointed Hearing Officer
in a motion to dismiss, which was subsequently denied.
February 2017, several auto body repair shops (the Shops)
filed a series of Complaints (Shops' Complaints) with DBR
against Plaintiffs. Pls.' Compl. ¶ 26. In the
Shops' Complaints, the Shops allege that the Plaintiffs
failed to comply with the labor rate survey requirements set
forth in G.L. 1956 § 27-29-4.4 and promulgated by DBR
via Insurance Regulation 108. Id. at ¶ 27.
Section 27-29-4.4 and Insurance Regulation 108 require
Insurers annually to conduct an auto body labor rate survey
to determine a prevailing auto body labor rate for each
classification of auto body repair facilities. See
§ 27-29-4.4; DBR Ins. Reg. 108. The Shops'
Complaints alleged that the Insurers either failed to adhere
to the survey requirements or failed to complete the survey.
receiving the Shops' Complaints, DBR requested responses
from the Insurers. Pls.' Compl. ¶ 28. In April 2017,
Plaintiffs responded asserting that the Shops did not have
standing under the relevant statutes and regulations and that
the requested remedies were not authorized. Id. at
¶ 29. Additionally, Plaintiffs requested that DBR close
the Shops' Complaints without further action.
Id. DBR subsequently issued seventeen orders
appointing a Hearing Officer and holding that the
Complainants have the responsibility to present their case to
the Hearing Officer. Id. at 33-34. In May 2017, the
Hearing Officer conducted a hearing and established a
briefing schedule which allowed the Insurers an opportunity
to file motions to dismiss. Id. at ¶ 35.
19, 2017, Plaintiffs submitted motions to dismiss with
supporting memoranda. Id. at ¶ 36. The motions
were opposed by DBR and the Shops. Id. The Hearing
Officer heard oral arguments regarding the Plaintiffs'
motions on June 20, 2017, and she issued an order denying
Plaintiffs' motions on July 28, 2017. Id. at
¶ 41. In her decision, the Hearing Officer further
scheduled a status conference to divide Plaintiffs into two
categories, one group to analyze "setting a labor
rate" and a second to examine "a procedural issue
for the survey." Pls.' Compl., Ex. 1 at 12. The
Hearing Officer further stated that "[a] briefing
schedule will be set for the analysis issue as it is ready to
be determined as a matter of law." Pls.' Compl. at
¶ 42. The status conference has been postponed pending
the matter currently before the Court.
filed their Complaint herein on August 21, 2017, alleging
that they have been adversely affected by the Hearing
Officer's decision and requesting declaratory relief on a
number of legal questions they assert must be answered before
the administrative process may continue. See
Pls.' Compl. Plaintiffs filed a motion to stay the
administrative proceeding on August 31, 2017 pending the
Court's decision on the legal issues presented in their
Complaint. Both DBR, as the Defendant, and the Shops, as
interested parties, filed objections to Plaintiffs'
motion and supporting memoranda.