Attorneys representing Safelite have sent a letter to the U.S. Second Circuit Court of Appeals notifying that court of “a recent decision relevant to [their] pending appeal” to halt enforcement of Connecticut’s anti-steering law. “In American Meat Institute versus U.S. Department of Agriculture, the D.C. Circuit held that the test articulated in Zauderer versus Office of Disciplinary Counsel, applies to compelled commercial disclosures that serve government interests besides preventing consumer deception. In doing so, the court adopted the approach already followed in this Circuit. Yet, the court also addressed issues related to Zauderer’s scope that are relevant to this appeal,” the company’s attorneys claim.
Safelite has sued state Attorney General George Jepsen and Thomas Leonardi, state insurance commissioner, and asked for an injunction to halt enforcement of Public Act 13-67 (an Act Concerning Automotive Glass Work). After the District Court judge decided against an immediate injunction to halt enforcement, Safelite appealed this decision to the Appellate Court. A hearing was held at the Appellate level in late May and a decision has not yet been handed down.
“First, the court held that ‘to match Zauderer logically, the disclosure mandated must relate to the good or service offered by the regulated party. … Indeed, the court emphasized that the regulation could be evaluated under Zauderer because it ‘requires the disclosures to be of purely factual and uncontroversial information about the good or service being offered’ and ‘the facts conveyed are directly informative of intrinsic characteristics of the product AMI is selling,’” Safelite’s attorney claim. “The opinion therefore supports appellants’ argument, set forth on pages 13-17 of the opening brief that compelled speech about third-party services must be subject to more than mere Zauderer review.”
Safelite’s attorney also claims the court noted “the possibility that some required factual disclosures could be so one-sided or incomplete that they would not qualify as ‘factual and uncontroversial,’ recognizing that a disclosure could ‘communicate a message that is controversial for some reason other than dispute about simple factual accuracy’ and thereby fall outside Zauderer’s scope. That ‘possibility’ appears in this case, where the compelled speech effectively communicates an endorsement of a competing business.”
Finally, Safelite’s attorneys write that the “court held that Zauderer cannot ‘sustain mandates that ‘chill protected commercial speech.’ As appellants argue on pages 21-25 of their brief, because the obligation to endorse a competitor is triggered by Safelite’s protected commercial speech, PA 13-67(c)(2) imposes a content-based burden that chills protected speech.”
Safelite’s attorneys take particular issue with a small portion of the act—PA-13-67(c)(2).
“It prohibits an insurance claims administrator (TPA) from informing policyholders about an affiliated glass repair business unless the administrator simultaneously refers policyholders to a local competitor’s glass repair business,” Safelite attorneys explain.
They argue that by requiring the company to name a competitor, “it puts appellants Safelite Group Inc. and Safelite Solutions to a Hobson’s choice: Either discontinue wholly truthful speech advising customers about Safelite-owned vehicle glass repair services, or when making such representations, also provide a referral to a competing local glass repair shop. The First Amendment protects against such attempts to commandeer speech—even commercial speech.”
On the other side of the courtroom, Connecticut’s attorney claims, “Safelite Solutions has been extraordinarily effective at steering consumers to Safelite AutoGlass.”
“[C]onnecticut has a statutory policy of protecting consumer choice in automotive insurance repair work. The Connecticut legislature enacted Public Act 13-67(c) (2) because it determined that existing statutes did not adequately prevent insurance claims administrators from undermining consumer choice by steering consumers to affiliated auto glass repair shops.”
The Appellate Court has not issued any new decision at press time.
To view a copy of Safelite’s letter, click here.
Isn’t it interesting that Safelite continues to assert they do not Steer, yet their Attorney’s do every thing possible to halt anti-steering legislation. Quite a accomplishment being able to continue to talk out of both side of your mouth for such a sustained period.
It’s the bulk of their business and they know it. If they didn’t do insurance work they wouldn’t be in business. They’ve gone bankrupt twice in 30 years and its only a matter of time again. Not to mention they hire “trainees” which can’t do installs on their own after two weeks. One of my buddies owns a business where he supplies u-hauls, and they sent out a guy to do a u-haul (national contract) said it took him 3 hours on a DW
1504…pathetic. They steer all day long. I’m in columbus,OH the headquarters, even the news won’t throw them under the bus like connecticut bc they sponser tons of things here. Horrible company.
Isn’t it also interesting at the amount of money they are throwing at this one little law in one state. It would be good if we could make the public aware of this (especially the law makers of each state). Or do we need a law that prohibits a conflict of interest between the TPA’s and the public. Safelite is not happy with most of the business, they want it all. I feel sorry for the taxpayers of Conn. with all the burden that Safelite has put on them.
Safelite signs independant shops to their TPA contracts and then uses these same shops to sell the idea to insurance companies of the vast ares that they can supply services. Now with this anti-steering bill they want to call these same independant shops “competitors”.
Why do the insurance companies allow Safelite to steer work? You would think that the insurance company would make sure that they gives out more than one name with all the complaints about steering. They should investigate the insurance companies to see if they get kickbacks from Safelite. Also, name any business where an independent company has to ask their competitor for permission to do a job, and then ask how much they can charge. We used to call that price fixing. The insurance companies can easily fix this issue but refuse. Follow the money.
Not only does Safelite need to be investigated but so does the management of the Insurances companies their doing business with. Something’s up when a Safelight sales person tells an Allstate agent they have to use them, then they call Allstate & they tell them the same thing. This is true and has happened more than once just in our town. Ask yourself, why would Allstate do that? Yes, you got it. There is only one good reason. Ever heard the term, under the table, kickbacks? I wish they would audit both companies has well as look into their private contracts. Someday they will all be brought to justice, may God have mercy on their greedy souls.
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