A Superior Court judge awarded $20 million in punitive damages — in addition to nearly $15 million previously awarded by a jury in compensatory damages — to Connecticut auto repair shop owners in their 10-year legal battle against The Hartford.
The Auto Body Association of Connecticut, which comprises more than 1,000 auto body shops, filed a lawsuit in 2003 against Hartford Fire Insurance Co., which is part of The Hartford Financial Services Group.
The association alleged that The Hartford engaged in a pattern of unfair and deceptive acts and practices, violating state law, by steering customers who had been in a crash to certain preferred auto body shops. The lawsuit also alleged that The Hartford provided incentives to its appraisers to establish artificially low hourly rates for auto body repair work.
On Nov. 17, 2009, a jury hearing the case awarded $14.77 million to the auto body association, saying that the insurer engaged in a practice that resulted in a loss to the repair shops. Superior Court Judge Alfred J. Jennings Jr. added $20 million in punitive damages in a ruling on June 5.
The Hartford's spokesman, Thomas Hambrick, said: "We are disappointed in the ruling and plan to appeal."
None of the money has been paid to auto body repair shops yet. At the end of the legal process, there will be a fund of money that includes the $14.7 million in compensatory damages and the $20 million in punitive damages, said the auto body association's attorney, David A. Slossberg of the firm Hurwitz, Sagarin, Slossberg & Knuff in Milford.
"In most class actions, when you have a common fund like that, you then allow each member of the class to apply and there will be a process that will be set up to distribute the money to members of the class," Slossberg said.
Ultimately, payment will depend on whether The Hartford wins an appeal.