According to State Farm’s former out-tasking agreement with LYNX Services, the insurer would have been able to terminate its relationship with LYNX if the third-party administrator (TPA) owned or operated an auto glass retail company.
“If LYNX starts up, acquires or obtains an equity interest in any entity that engages in … retail automotive glass repair or replacement in the United States, and such entity’s business operation is or can be controlled by LYNX, [the TPA must notify State Farm] immediately,” the out-tasking agreement says. “Upon receipt of such notice, State Farm shall have the right to terminate this agreement within 90 days.”
The Background
State Farm and LYNX signed this glass claims services out-tasking agreement in 2017 and renewed it in 2022. State Farm made headlines in early 2025 by announcing it would not renew the deal again and would instead begin using Safelite Solutions as its TPA. The Safelite Group operates both Safelite Solutions and the retailer Safelite Auto Glass.
That transition prompted LYNX to file suit against State Farm and Safelite Solutions for allegedly misappropriating its trade secrets. The out-tasking agreement became a crucial piece of evidence that both LYNX and State Farm used to support their claims in the ensuing litigation.
Throughout the lawsuit, State Farm has claimed that it, not LYNX, actually owns the information that was allegedly misappropriated. The insurer alleges the “trade secrets” fall under the out-tasking agreement’s definition of “State Farm information.” LYNX claims it owns the information in question and says it was compiled in its METRYX registry using special processes and logic developed by LYNX.
What Does the Agreement Call ‘Confidential’?
The confidentiality section of the out-tasking agreement states that State Farm and LYNX would likely “learn or have access to certain confidential, patent, copyright, business, trade secret, proprietary or other like information or products of the other party.”
Despite listing those information categories, the confidentiality segment of the out-tasking agreement doesn’t help determine to which company any given piece of information belongs.
“‘State Farm information’ means information of State Farm and its third parties,” the document says. “LYNX information shall include information of LYNX, its affiliates and its third parties.”
Mediation Requirements
Another segment of the out-tasking agreement now plays a significant role in the lawsuit. The contract includes conflict resolution instructions. According to the agreement, “the parties shall attempt in good faith to resolve any dispute arising out of or relating to this agreement promptly by negotiation between leadership who have the authority to settle the controversy.”
Judge Jonathan Hawley of the U.S. District Court for the Central District of Illinois, Peoria Division, determined that LYNX and State Farm had failed to follow this agreed-upon procedure and has paused all litigation until the parties attempt negotiations.
State Farm, bails on Lynx and goes with the largest third-party network that also owns their own glass shops in competition with independent glass shops, while at the same time price fixing reimbursement rates. There is no hint of conflict of interest in any of this?
A sad situation for everyone … and especially so for the true independent operators. Ever heard of steering, anyone???
So having been mostly on the Collision side these days, we are dealing with the same thing with State Farm of issues with payments and price fixing so after some extensive research, unfortunately insurance companies are exempt from most federal antitrust guidelines due to the McCarran Ferguson act of 1945. Basically due to some antiquated law that is on the books that has not been revisited. They are allowed to run a muck and do what they want to do.
Big money taking care of big money plain and simple. They’re trying to squeeze out all of the independent shops by cutting our payouts at the same time raising insurance rates across the country. I still can’t believe that someone in the senate or congress isn’t looking into this by now. Anyone with a brain can see how detrimental this is for small independent shops across this country.