Some Find Issues With Fees In Safelite Case

The messy dispute between the Minnesota Insurance Commissioner, Mike Rothman and Safelite have resulted in some hefty fees for Safelite’s attorneys. Last week the Eighth Circuit Court ruled the legal team for the auto glass repair company deserved close to $1 million in attorney’s fees from its lawsuit against Rothman.

Originally, Safelite claimed the First Amendment was violated when the Auto Club Group Inc., also known as AAA, entered a consent order with the Minnesota Department of Commerce. The order prohibited AAA from working with Safelite.

Minnesota law contains an anti-coercion provision that bans claims processors from pressuring customers into using a specific vendor. According to a court claim, the state’s Department of Commerce opened an investigation into Safelite’s practices five years ago. The investigation resulted in a violation being issued to the auto glass company because of its phone scripting, which led AAA to end its relationship with Safelite in Minnesota.

After the relationship ended, Safelite filed a lawsuit that included claims that the Department of Commerce was violating First Amendment rights. In addition, Safelite also claimed the act of forcing AAA to end its relationship with the company breached a clause in the 14^th Amendment related to due process.

The Court sided with Safelite and the company settled its due process claim and did not seek damages. But Safelite did want nearly $2 million in attorneys’ fees from the lawsuit and was awarded nearly half of its asking amount. Two years ago the Department of Commerce appealed the settlement amount and is aiming for more reductions. Last week a three judge panel concluded the previously settlement amount was “trimmed enough to account for work on unsuccessful claims,” and was accurate.