Price Fixing Claims Against Title Insurers Were Barred by Filed Rate Doctrine

This posting was written by Jeffrey May, Editor of CCH Trade Regulation Reporter.

Title insurance purchasers’ price fixing actions against Delaware and New Jersey title insurance companies were properly dismissed, the U.S. Court of Appeals in Philadelphia ruled June 14 in two separate opinions.

Claims for damages were barred by the filed rate doctrine, which precludes antitrust suits challenging rates filed with federal or state agencies. The appellate court also ruled that the purchasers lacked standing to seeking injunctive relief.

The New Jersey purchasers alleged that the title insurance companies fixed rates through a voluntary trade association, the New Jersey Land Title Insurance Rating Bureau. The Delaware purchasers similarly alleged that the title insurance companies utilized the Delaware Title Insurance Rating Bureau, which compiles and analyzes statistical data from its members relating to their title insurance premiums, losses and expenses, as a vehicle for setting uniform rates. In both states, the rates were approved by the appropriate regulators.

The appellate court rejected the purchasers’ arguments that the filed rate doctrine did not preclude their antitrust claims because their claims did not implicate the doctrine’s underlying policies. The court refused to “disregard a decision of the United States Supreme Court and the numerous cases that have relied on it.”

According to the appellate court, nonjusticiability and nondiscrimination policies support the doctrine. The nonjusticiability policy recognizes that federal courts are ill-equipped to engage in the rate making process. The filed-rate doctrine applies whenever rates are properly filed with a regulating agency. The doctrine also is intended to prevent carriers from engaging in price discrimination as between ratepayers.

The court rejected the purchasers’ assertion that the nonjusticiability strand was only implicated where agencies had meaningfully reviewed the challenged rate. The doctrine did not require “meaningful” agency review.

Because nonjusticiability policy alone warranted application of the filed rate doctrine to dismiss the damages claims, it was not necessary to consider the nondiscrimination policy supporting the doctrine. The filed rate doctrine applied whenever either the nondiscrimination or the nonjusticiability policy was implicated, the court explained.

The appellate court also declined to accept the purchasers arguments that the filed rate doctrine did not apply because the doctrine was limited to comprehensive regulatory regimes, such as the Interstate Commerce Act or because there was no clear repugnancy between the antitrust laws and state title insurance regulations.

Injunctive Relief

Although the filed rate doctrine is limited to damages claims and does not bar injunctive relief claims against future rates, the appellate court ruled that the purchasers lacked Article III standing to seek injunctive relief. The purchasers did not have standing because they failed to allege any impending injury. They did not allege an injury-in-fact.

The decisions are In re: New Jersey Title Insurance Litigation, 2012-1 Trade Cases ¶77,921 and McCray v. Fidelity National Title Insurance Co., 2012-1 Trade Cases ¶77,922.