I respectfully disagree with the majoritys decision to affirm the trial courts grant of Plaintiffs’ motion for partial summary judgment on the issue of statutory compliance. The reasons below correspond to Farm Bureaus first assignment of error: Farm Bureau initially asserts that the trial court erred in granting Plaintiffs’ motion because genuine issues of material fact exist as to whether the WCTL system complies with La.R.S. 22:1892(B)(5). In my view, Farm Bureau is correct.
The issue is whether the WCTL violates subsections (B)(5)(a) and (B)(5)(b). And because Plaintiffs have the burden of proving this at trial, the first step of de novo review is to determine whether Plaintiffs have supported their motion with prima facie evidence of noncompliance.
Plaintiffs’ motion describes the WCTL system as a “proprietary, database valuation tool” offered by Mitchell International Inc. (Mitchell) to subscribing clients such as Farm Bureau. According to Plaintiffs, the WCTL database system determines vehicle values by locating comparable vehicles within a given geographic area, selecting a handful of those comparables, discarding the rest, and then applying various algorithms based on national data to adjust those comparables.
Thus, Plaintiffs initially contend that the WCTL is not a “fair market value survey” as required by La.R.S. 22:1892(B)(5)(a). Plaintiffs suggest that the term “survey” contemplates a broad treatment of a subject whereas the WCTL only considers a small, rather than broad, number of comparable vehicles. In support, Plaintiffs attached to their motion WCTL proprietary documents which explain that the number of comparable vehicles used by the system is capped at twenty. Plaintiffs maintain that viewing only twenty comparable vehicles cannot be considered a fair market value survey.
Plaintiffs next assert that even if the WCTL is a fair market value survey, the survey is not conducted using “qualified retail automobile dealers in the local market area as resources” as required by subsection (B)(5)(a). In support, Plaintiffs filed with their motion the WCTL valuation report for class member Yvette Beauchamp. The report shows that the base value was calculated by using four comparable vehicles ranging from 52 to 149 miles away from Beauchamp. This distance, according to Plaintiffs, far exceeds what would qualify as a “local market area” under the statute. Plaintiffs claim that the WCTL failed to use the car dealers located within 25 miles of Beauchamp. And according to Plaintiffs, these are the dealers that are within the local market area as contemplated by the statute.
Finally, Plaintiffs turn their attention to subsection (B)(5)(b), arguing that the WCTL is an insurance industry source rather than “a generally recognized used motor vehicle industry source[.]” In support, Plaintiffs point to the deposition transcript of Mitchell representative Donn Keatley, who states that the WCTL is only marketed to insurance companies and a few rental car companies. Thus, according to Plaintiffs, Mitchell does not license or sell the WCTL to new or used motor-vehicle dealers or individuals shopping for these vehicles.
Plaintiffs also filed numerous other documents with their motion for summary judgment, including WCTL proprietary documents regarding data compilation and the deposition transcript of NADA representative Mike Stanton. Because Plaintiffs carried their burden of producing prima facie evidence of Farm Bureaus statutory noncompliance, the burden shifted to Farm Bureau to produce evidence of the existence of a material factual dispute or demonstrate that Plaintiffs are not entitled to judgment as a matter of law.
Farm Bureau first addresses the WCTLs compliance with La.R.S. 22:1892(B)(5)(a), which contemplates a “fair market value survey conducted using qualified retail automobile dealers in the local market area as resources.” In support, Farm Bureau attached to its memorandum in opposition of summary judgment the affidavit and report of Rene Befurt, Ph.D., an expert in designing, conducting, and analyzing market surveys. Dr. Befurt concluded that the WCTL conducts a fair market value survey because it has all the essential elements of a fair market value survey: “it (1) clearly defines the target population, (2) uses a clear sampling frame to identify and screen for members of the target population, and (3) precisely queries information regarding the characteristics of the relevant vehicles.” He also observed that the WCTL looks for the most comparable vehicles in the local market. Contrary to Plaintiffs’ suggestions, Dr. Befurt believed that the adjustments made to comparable vehicles did not detract from the WCTLs status as a fair market value survey using local dealerships as resources.
Farm Bureau also filed with its opposition memorandum the deposition transcript and report of Arnold Barnett, Ph.D., a professor at the Massachusetts Institute of Technology. Dr. Barnett explained that the algorithms used by the WCTL are “eminently reasonable and carefully constructed.” According to Dr. Barnett, the WCTL is “utterly similar in structure and purpose to any other existing methods for processing market survey results, all of which use algorithms.”
In addition, Farm Bureau submitted countervailing evidence to Plaintiffs’ assertion that the WCTL does not derive its values using “qualified retail automobile dealers in the local market area as resources.” Id. For example, Mitchell representative Donn Keatley explained in his deposition that the WCTL surveys local market dealerships by searching for comparable vehicles within a geographic radius. It does so by searching for the best comparable vehicles in the local market. Only when it cannot find three comparable vehicles of dealerships within an initial 75-mile search does it expand the search beyond 75 miles. According to Farm Bureau, this is consistent with subsection (B)(5)(a). And the process of selecting the best comparables from the local market—or the nearest market when insufficient comparables are available—is reflected on the face of the WCTL valuation report for each class member. Each report identifies the comparable vehicles and the distance from the insureds vehicle.
Based on the above, Farm Bureau asserts that genuine issues of material fact exist as to whether the WCTL complies with La.R.S. 22:1892(B)(5)(a). Specifically, Farm Bureau contends that genuine issues of material fact exist as to whether the WCTL is a fair market value survey; and genuine issues of material fact exist as to whether the WCTL uses local dealers as resources for each class member.
Farm Bureau next turns its attention to La.R.S. 22:1892(B)(5)(b), contending that the WCTL is “a generally recognized used motor vehicle industry source[.]” In support, Farm Bureau points to Dr. Befurts affidavit and expert report. Dr. Befurt concluded that the “WCTL derives actual cash values from generally recognized used motor vehicle sources” such as cars.com, autotrader.com, vast.com, truecar.com, and J.D. Power. He then explained that the WCTL is used by financial institutions and insurers, both of which are essential participants in the used car industry. And all of this, he opined, is evidence that the WCTL itself is a generally recognized used motor vehicle industry source. Thus, Farm Bureau contends that genuine issues of material fact exist as to whether the WCTL complies with subsection (B)(5)(b).
Finally, Farm Bureaus opposition homes in on Plaintiffs’ statement of undisputed material facts. The statement was submitted with Plaintiffs’ original motion. And therein, Plaintiffs identify forty-nine facts which they claim are both undisputed and material. Yet Farm Bureaus opposition contradicts forty-eight of these facts with countervailing summary-judgment evidence. Take, for example, the following excerpt from Plaintiffs’ statement of undisputed material facts:
STATEMENT NO. 4:
WCTL is available only to Mitchells subscribers. ․
RESPONSE TO NO. 4:
[Farm Bureau] contests Plaintiffs’ Statement of Uncontradicted Material Fact No. 4 and submits countervailing evidence as follows: The testimony of Mike Stanton as the corporate representative of J.D. Power established that anyone using the J.D. Power website is directed to the Mitchell site when the user is looking for total loss valuations for a particular vehicle.
Plaintiffs’ above statement and Farm Bureaus response are relevant to whether the WCTL is “a generally recognized used motor vehicle industry source” under La.R.S. 22:1892(B)(5)(b).
Here are two more examples:
STATEMENT NO. 14:
The projected sold adjustment is based on historic national sales data, not surveys of local dealers. ․
RESPONSE TO NO. 14:
[Farm Bureau] contests Plaintiffs’ Statement of Uncontradicted Material Fact No. 14 and submits countervailing evidence as follows: WCTL has a database of national sales data which is continuously updated. As Mitchells corporate representative Philip Kroell testified:
The projected sold, those you would need at least 30 records of where you have a—to develop a sold ratio, right, an average. They start at the—local market area, so the designated market area. And they only expand as needed.
So its—it is possible that when they have a sold projected price for a comparable in Louisiana, it will be based on sold transactional data from Louisiana.
Kroell Dep. at 117.
․
STATEMENT NO. 16:
The mileage adjustment is based on regional/national data. ․
RESPONSE TO NO. 16:
[Farm Bureau] contests Plaintiffs’ Statement of Uncontradicted Material Fact No. 16 and submits countervailing evidence as follows: The deposition testimony of Phillip Kroell, designated representative of Mitchell on August 5, 2017 ․ “WorkCenter Total Loss makes appropriate adjustments for the difference in mileage between the loss vehicle and each comparable vehicle. Adjustments are estimated based on millions of retail transactions that are captured through J.D. Power dealer relationships ․” and Affidavit of Matthew Racho, JD Power, Senior Director of the Power Information Network dated March 15, 2018 confirming that JD Power sales prices that may be shown on Mitchell reports for sales prices in Louisiana are derived from 82 franchise dealerships representing 160 franchises, all in the State of Louisiana[.]
Plaintiffs’ above statements and Farm Bureaus responses are relevant to whether the WCTL is “[a] fair market value survey conducted using qualified retail automobile dealers in the local market area as resources” under La.R.S. 22:1892(B)(5)(a). And as noted previously, Dr. Befurt stated that these types of adjustments do not detract from the WCTLs status as a fair market value survey using local dealerships as resources.
“In considering whether a genuine issue exists, courts cannot consider the merits, make credibility determinations, evaluate testimony or weigh evidence.” Pritchard v. American Freightways Corp., 37,962, pp. 3-4 (La.App. 2 Cir. 12/10/03), 862 So.2d 476, 478. And “when the party opposing the summary judgment motion submits expert opinion evidence that would be admissible and that is sufficient to allow a reasonable juror to conclude the experts opinion on a material fact more likely than not is true, the court should deny the summary judgment motion.” Willis v. Medders, 00-2507, p. 3 (La. 12/8/00), 775 So.2d 1049, 1051.
In the end, I believe that the trial court erred in making factual findings and weighing the evidence presented. Once Plaintiffs’ produced prima facie evidence of Farm Bureaus statutory noncompliance, the burden shifted to Farm Bureau to produce evidence of the existence of a material factual dispute or demonstrate that Plaintiffs are not entitled to judgment as a matter of law. In my view, the summary-judgment evidence produced by Farm Bureau clearly demonstrates the existence of genuine issues of material fact. Thus, I would reverse the trial courts grant of Plaintiffs’ motion for partial summary judgment.
I concur with the majority in all other respects.
FITZGERALD, J., dissents in part with assigned reasons and concurs in part.