Kaufman v. Allstate Ins. Co., 2008 WL 4224911 (D.N.J. Sep. 10, 2008)

Jon Bon Jovi isn’t the only one who wants to go back to New Jersey (although it might be close). In Kaufman v. Allstate Insurance Co., plaintiff vehicle owners claimed their suit against insurance companies for failure to cover the diminished value of their vehicles resulting from accidents belonged in state court, where the defendants could get a proper ass-beating (we mean “fair hearing”) by the good people of New Jersey. 

While some, but not all, of the defendant insurance companies were residents of New Jersey, the plaintiffs argued CAFA’s local controversy exception applied because the class sought “significant relief” from a local defendant, the alleged conduct of the local defendant formed a “significant basis” for the claims of the class, and the class’s “principal injuries” resulting from the conduct of each defendant occurred in the forum state.

The court agreed, finding that New Jersey Manufacturers, a New Jersey citizen, held the largest market share in personal automobile insurance policies in New Jersey – 15%, while only two other companies out of over forty issuers had shares of over 10%. While non-resident GEICO argued that a 15% market share was not “significant,” the court held the critical inquiry was the comparison between the local defendant and all other defendants. 

The court also held that New Jersey Manufacturers’ issuance of 780,000 policies, more than 100,000 more than the nearest competitor, satisfied the “significant basis” prong of the local controversy test, and further held that it is not necessary for every member of the class to have a claim against the local defendant. 

Finally, the court found that the “principal injuries” requirement was met because all of the subject policies were issued in New Jersey.

So you can go home. The only burning question the court failed to address is this —

Were those Datsuns really worth less after they wrecked them?