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NEWARK, N.J.--A federal judge has dismissed antitrust charges filed against dozens of brokers and insurers by policyholders who alleged that the defendants conspired to allocate business and fix insurance prices.
U.S. District Judge Garrett E. Brown Jr. in Newark, N.J., on Thursday threw out racketeering and Sherman Act claims in two consolidated lawsuits brought by property/casualty and employee benefit policyholders against most of the largest brokers and insurers in the United States. The suits followed settlements by numerous brokers and insurers of bid-rigging and client-steering charges brought by attorneys general in several states.
In his ruling, Judge Brown said that case statements filed by the plaintiffs failed to demonstrate that the defendants agreed to take illegal steps to restrain market competition.
"While there was an exchange of information about these contingent commission agreements, which plaintiffs allege were a method by which the market or customers were allocated among the insurers, plaintiffs have not shown that the insurers colluded to allocate business," Judge Brown wrote.
The court found last year that the policyholder complaints failed to provide enough particulars to support the antitrust charges, and ordered the plaintiffs to file supplementary case statements laying out additional facts. The brokers and insurers then filed motions to dismiss.
In granting those motions Thursday, though, Judge Brown also gave the plaintiffs one more opportunity to improve their case. He allowed policyholders to amend their complaints or revise their case statements once more within the next 30 days to address the shortcomings the court identified.