Kentucky Federal Court Certifies Class in Labor Depreciation Dispute
On October 15, 2018, the U.S. Court of Appeals for the Sixth Circuit held that State Farm miscalculated actual cash value by depreciating labor. The case was then sent back to the U.S. District Court for the Eastern District of Kentucky for consideration of whether the litigation may proceed as a class action.
On February 21, 2019, the District Court certified the following class: all persons and entities that received “actual cash value” payments, directly or indirectly, from State Farm Fire and Casualty Company for loss or damage to a dwelling or other structure located in the Commonwealth of Kentucky, such payments arising from events that occurred from February 28, 2013 through July 25, 2015, where the cost of labor was depreciated.
The common question to be addressed for the class is whether it was improper for State Farm to depreciate labor costs in the calculation of actual cash value payments to Kentucky insureds.
A copy of the opinion can be found here: https://law.justia.com/cases/federal/district-courts/kentucky/kyedce/0:2014cv00053/75164/191/
We will continue to follow this litigation and report on any new developments. (February 25, 2019)