A Louisiana man who claims the insurer State Farm "washed" the title of his used car to conceal damage cannot sue the company in its home state of Illinois, the Illinois Supreme Court ruled this month.
The plaintiff, Christopher Gridley, sued State Farm Mutual Automobile Insurance Co. in Madison County, Ill. He alleged that the insurer violated the state Consumer Fraud Act by selling salvage vehicles with inadequately branded titles.
The Supreme Court did not address the merits of Gridley's claim in its opinion. It ruled he should have sued in Louisiana. Gridley's lawyer, John Hoffman, says his client plans to do so.
Gridley says that he bought a used 1998 Volvo S70 from a Louisiana dealer in 1999. The previous owner insured the vehicle through State Farm, Gridley's says.
Gridley says in the lawsuit that he bought the vehicle with a clean title, even though it was in an accident in Louisiana.
State Farm declared the vehicle a total loss, the court said in its ruling. The company paid the previous owner $28,841 and assumed the car's title.
The insurer fraudulently obtained a clean title for the vehicle before sending it to auction, Gridley alleges. As a result, he says, he paid too much for the car.
State Farm said Gridley should have filed suit in Louisiana because he lives there and the events he alleges in his lawsuit occurred there. An Illinois circuit court rejected State Farm's claim.
A state appeals court affirmed that decision. But on Nov. 17, the Supreme Court reversed the lower-court rulings.
State Farm declined comment on the decision.
The issue of title washing has taken on added urgency after Hurricane Katrina. Dealers and consumer groups have expressed concern that flood-damaged vehicles could reach the market without title brands that disclose that damage.