$500 Million Auto Insurance Class Action Commenced in Ontario

Following on the heels of an Illinois state jury verdict awarding over US$1 billion in compensatory and punitive damages against State Farm Mutual Insurance Company, a national class action suit has been commenced in Ontario against State Farm Mutual Insurance Company, Liberty Mutual Insurance Company, Gan Canada Insurance Company, and Royal Sun Alliance. As in the US class action suit, which is presently under appeal, the Ontario suit alleges that the defendant auto insurers breached their motor vehicle insurance policies across Canada by their alleged practices of specifying non-original equipment manufactured parts in their repair estimates. The issue in the case is whether these so-called “non-OEM parts” are of “like kind and quality” to the original equipment manufacturer or “OEM” parts such as to restore damaged vehicles to their pre-loss condition. The Ontario class action claims in excess of $500 million in compensatory and punitive damages.

The class plaintiffs are represented by Harvin Pitch and Colin P. Stevenson of Teplitsky, Colson, as well as Arie Gaertner and Alexander Torgov of Gaertner Tobin. State Farm Mutual Insurance Company is being represented by Mark A. Gelowitz and Mahmud Jamal of Osler, Hoskin & Harcourt LLP; Gan Canada Insurance Company is being represented by Eleanore A. Cronk of Lax O’Sullivan Cronk; Liberty Mutual Insurance Company is being represented by Allan S.W. D’Silva and Paul Martin of Fasken Martineau DuMoulin LLP; and Royal Sun Alliance is being represented by Bruce Thomas, Q.C., of Cassels, Brock & Blackwell LLP.