Court OKs letting lawyers see Allstate analysis

CHARLESTON – Three lawyers in Wheeling can see a 10-year statewide analysis of Allstate Insurance property damage claims, the West Virginia Supreme Court of Appeals decided Nov. 30.

The Justices unanimously directed Allstate to obey a discovery order that Ohio Circuit Judge Martin Gaughan signed last year for plaintiff Douglas Arensburg.

Gaughan found the discovery burdensome but not unduly burdensome.

The Justices backed him up. In an unsigned opinion, they wrote that Arensburg's need for the information sufficiently outweighed the burden on the insurer.

Allstate paid about 3,500 property damage claims in West Virginia in the years that Gaughan's order covered. Allstate has estimated the cost of the analysis at $553,500.

Allstate must turn the analysis over to Arensburg's attorneys, Robert Fitzsimmons, Michael McGuane and Thomas McIntire.

Arensburg owned rental property that a fire damaged in 2002. A contractor estimated the repairs at $21,330.48.

Arensburg told Allstate he would repair the property himself.

Allstate sent him a check for $14,357.74.

Arensburg complained that the check should have included a $3,000 contractor payment.

When he hired an attorney to press the claim, Allstate sent a check for $993.46.

Arensburg sued in 2003, alleging unfair trade practices.

His attorneys requested class action relief for policyholders in partial loss claims with payouts that did not include overhead and profit for contractors.

They did not take the next step and move to certify Arensburg as class representative.

Arensburg's complaint sought punitive damages, attorney's fees, and damages for aggravation and inconvenience.

He then claimed total loss on his property. Allstate approved it and sent him the balance of his $66,000 policy limit.

Allstate sought an order declaring that Arensburg, as a total loss claimant, could not represent a partial loss class. Gaughan denied it.

In 2005, Arensburg asked for a claim survey from 1993 through 2002.

When Gaughan ordered it, Allstate attorneys Nathan Bowles and Charles Love of Charleston asked the Justices to block the order.

Bowles argued that Arensburg's claim was moot and the circuit court should not allow him to proceed with a class action.

He wrote, "... an individual is not allowed to bring a class action on behalf of others just because he wants to. He must have suffered the same injury."

Fitzsimmons responded that the claim was not moot because Arensburg sought punitive damages.

The Justices found that Gaughan committed no clear error in finding that the analysis was not unduly burdensome.

They wrote that the analysis was clearly relevant and material in determining whether Allstate violated the Unfair Trade Practices Act as a general business practice and whether bad faith and malice required punitive damages.