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GEICO Wins Sanctions Against Law Firm, Auto Repair Shop

GEICO won a sanctions request in Florida federal court against a Mississippi auto repair shop and its law firm. U.S. Senior District Judge Gregory A. Presnell ruled that GEICO’s Motion for Attorney Fees was “meritorious” and ordered the insurance company to prepare a specific fees request.

Clinton Body Shop and its law firm, John Arthur Eaves Attorneys, lost a summary judgment in a related suit charging GEICO with unjust enrichment and tortious interference with business relations. GEICO said that the summary judgment victory in that previous case barred the body shop from reasserting those same claims. The federal judge in the Middle District of Florida agreed.

“Any reasonable attorney or claimant would have known what is one of the most fundamental principles of our legal system: that a claim or issue, once litigated to a final adjudication, cannot be relitigated,” GEICO said in its motion. “(R)efiling of the same claims they lost to GEICO three months earlier in another case is automatically bad faith, warranting sanctions.”

Clinton’s argument was that the two suits involved separate entities: the first against GEICO Insurance Co., the latter against GEICO General Insurance.

The case is part of multidistrict litigation in which repair shops in 10 states are accusing several insurance companies of violating the Sherman Antitrust Act by colluding to keep reimbursement rates low for auto body repair work.

Presnell had dismissed Clinton’s claims against GEICO in May before granting sanctions on July 19.

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Filed under Florida, Insurance, Insurance Defense, Middle District of Florida