September Trial Set in Glass Emporium Case
The U.S. Attorney’s Office for the Northern District of California has
scheduled a trial for Mehrdad “Tony” Hakimian, owner of Glass Emporium
of Marin Inc., and an employee, Emma Deguzman, for September 21. Hakimian
and Deguzman, along with two other employees of the Oakland, Calif.-based
company, were charged in December 2007 with conspiracy to commit wire
fraud and commission of wire fraud by inflating prices of windshields
when billing insurance companies and billing for unused parts. Glass Emporium
also owns Glass Pro and Glass Masters, which have locations throughout
the United States.
Jack Gillund, public affairs officer for the U.S. Attorney’s Office for
the Northern District of California, would not comment on the case further
than to advise of the trial date and those involved.
“Because this is an open case, state and federal regulations do not allow
me to provide any further information,” Gillund says. “These rules are
in place to protect the rights of the defendants and preserve the integrity
of the trial.”
The criminal complaint originally was filed by Federal Bureau of Investigation
(FBI) special agent William Leoni in the U.S. District Court of Northern
William Osterhoudt, attorney for Hakimian, declined to comment on the
case since litigation is still pending.
Two others charged in the case, Aldy Antonio and Bobby Guinto, pleaded
guilty earlier this year. Both are scheduled to be sentenced in the fall.
Louisiana Auto Glass Technician Arrested
A windshield repair technician in Gonzales, La., was arrested in May by
the Louisiana State Police Insurance Fraud Unit for allegedly double-billing
insurance companies for repairs, according to information from the Louisiana
State Police. Bradley M. Businger, 26, worked for Crack Attack up until
December 2008. The police alleged that, during his time with the company,
he submitted nearly 30 invoices for repairs he never performed. Both Allstate
Insurance and AIG issued complaints to the Louisiana State Police Insurance
Fraud Unit, which led to the investigation.
According to the report, Businger is alleged to have forged policyholders’
signatures to show that they had authorized the work, and the insurers
paid approximately $1,919 for the false claims between February and December
On May 8, Insurance Fraud Unit Detectives obtained an arrest warrant for
Businger and he was arrested on May 15 and booked in East Baton Rouge
Parish Prison on 28 counts of insurance fraud pertaining to auto policies,
five counts of forgery, and two counts of felony theft.
Court Reverses $17 Million Decision Regarding American Family’s Payment
for Aftermarket Parts
The Missouri Court of Appeals for the Western District recently reversed
a court decision involving American Family’s payment for aftermarket parts.
The decision involved a class action suit with damages totaling more than
A jury had originally ruled in favor of the plaintiffs, but a trial court
later granted American Family’s motion for “judgment notwithstanding the
verdict.” A recent judge’s decision re-instates the jury’s decision to
rule in favor of the plaintiffs, who claimed that “American Family breached
its contracts with policyholders to restore their vehicles to pre-loss
condition by devising and implementing a practice that results in payment
of claims based on the (1) systematic specification of ‘inferior’ non-OEM
crash parts for repairs.”
In the case, the plaintiffs note that adjusters with American Family
“are encouraged to specify the use of non-OEM crash parts or salvage OEM
parts” when writing estimates for vehicles of an earlier model year. The
case defines OEM parts as “those parts made by the original automobile
manufacturers or suppliers.” Non-OEM parts are defined as parts “made
by outside companies without access to the design specifications of the
Plaintiffs also argued that American Family participated in the “systematic
omission of specific ‘necessary’ repairs from estimates.”
The damages for the breach of contract claims regarding aftermarket parts
totaled $13,118,325; and the omitted repairs breach damages totaled $4,274,112.
In the jury trial decision, the court notes that “the plaintiffs presented
sufficient evidence for a reasonable juror to conclude that aftermarket
parts are not of like kind and quality to OEM parts and that American
Family breached its contracts with its policyholders when it paid to return
the damaged vehicle to pre-loss condition based on the nature and cost
of aftermarket parts.”
The court adds, “ … Breach occurred at payment of an insufficient sum
to return the vehicle to pre-loss condition and damages were suffered
State Farm Issues Reminder Memo about Reports of Glass Claims
State Farm Insurance issued a memo in early May that officials called
a “reminder” to Offer & Acceptance program participants that “the
State Farm customer must be on the initial phone call to verify important
“It’s okay for the shop to call into LYNX with the customer on the line,”
says State Farm spokesperson Jeff McCollum, “but we just need to have
that conversation with them. Due diligence on our part, really.”
He adds, “It’s what any customer with any claim would need to do. You
know, a contractor can’t just call us up and say he is rebuilding a policyholder’s
house after a fire without us first talking to the homeowner.”
The memo went out on May 14 from Jason Backe, interim claim section manager.
In the memo, Backe also notes that, “if a retailer attempts to report
a glass loss to LYNX Services without the presence of the State Farm customer,
the LYNX Services representative will advise that neither the loss information
can be taken nor the dispatch completed without the presence of the State
© Copyright 2009 Key Communications Inc. All rights reserved.
No reproduction of any type without expressed written permission.