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Insurance Class Actions Insider

Update on Preferred Contractor Program Class Action Against Alacrity and Allstate

Posted in Property Insurance

Some readers have asked for an update on the status of Boynton v. Alacrity Services, LLC, a putative class action filed in July involving a preferred contractor program, which was mentioned in my July 16, 2012 blog post.  The case was removed to the U.S. District Court for the Northern District of Ohio.  In September, both Alacrity and Allstate filed motions to dismiss. 

Alacrity’s motion to dismiss brief argues that:  (1) under the terms of the insurance policy, Allstate could choose to repair the property rather than paying for damaged property, and therefore no money paid by Allstate to Alacrity could be owed to the plaintiffs; and (2) the plaintiffs’ claims are time-barred under the contractual suit limitation provision in their Allstate policy.  Alacrity further argues that the plaintiffs lack standing, and that any payment made to Alacrity could not have impaired the plaintiffs’ rights under the Allstate policy, which they can pursue to the extent they have any such contractual rights.  Alacrity cites the decision in Smith v. Alacrity Services, LLC, 778 F. Supp. 2d 606 (D. Md. 2011), in which a similar putative class action against Alacrity was dismissed.  In that case, the judge wrote that the plaintiff’s claim “that whatever Allstate paid third parties for repairs to her house was her money, rests on pure imagination.”

Allstate’s motion to dismiss brief argues that: (1) the plaintiffs’ claims are time-barred under the one-year contractual suit limitation provision in their policy; (2) there is no legal basis for plaintiffs to recover amounts paid to Alacrity; and (3) if there is a dispute over the cost of repair, it must be resolved by n appraisal under the policy’s appraisal provision.  Allstate also argues, in the alternative, that if any claim survives dismissal, the class allegations with respect to non-Ohio putative class members should be dismissed or stricken.

The plaintiffs’ opposition briefs are a bit rambling and difficult to summarize, but if you want to read through them, here is the opposition to Alacrity’s motion to dismiss and opposition to Allstate’s motion to dismiss.

At this point I don’t know when a decision might be issued on these motions.  Stay tuned.