GEICO faces renewed class actions following court reversal

The United States Court of Appeals for the Sixth Circuit ruled in favor of captive insurance representatives seeking to pursue GEICO in a class action.

The appeals court stated in its opinion: “GEICO characterized James Moyer and other captive insurance agents as independent contractors and did not allow them to have full control over the benefits it provided to its corporate employees.” The agents charged him. They claim GEICO was violating the Employee Retirement Income Security Act of 1974 (ERISA) by unfairly discriminating against them and denying them benefits.

“The documents of the benefit programs are in line with the plaintiffs' requests, but they were not attached to the complaint. The district court therefore ordered the parties to provide the relevant plan documents. GEICO has submitted documents that, according to one of its executives, have brought the dispute under control.

“The attorneys objected and argued that the district court could not rely on them in deciding GEICO's motion to dismiss. The court did not agree, relied on the documents, and dismissed the appeal. Because there are legitimate questions about whether the documents provided by GEICO are a complete set of documents for the proper, regulatory process, we reverse and remand.”

It was pointed out that the district court relied on a summary of the plan instead of referring to GEICO's actual profit sharing plan.

“The district court erred in relying on the summary of the plan because there was a genuine question as to its validity and, in any event, the district court should have looked to the plan itself,” the appeals court said. “GEICO did not provide complete records of the program itself.”

The opinion also pointed out: “And GEICO has not submitted all documents related to its integrated welfare plan… Finally, we are not sure that the current record accurately reflects how profit sharing and integrated welfare plans have changed between 2017 and 2023.”

“There is a question of fact as to whether the record covers each of the profit-sharing amendments and consolidated welfare programs since that time. Thus the district court could not rely on the contents of the plans (or plan summaries) to dismiss the amended complaint.”

The amended complaint, which added four plaintiffs by name in 2023 (originally, only Moyer was named), sought relief and damages.

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