Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 1 of 28
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`July 19, 2021
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`SENT VIA ECF
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`The Honorable Philip M. Halpern
`United States District Court
`Southern District of New York
`500 Pearl Street, Room 1950
`New York, NY 10007
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`CASE STYLE:
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`STEVEN BUFFINGTON v. PROGRESSIVE CORPORATION and
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`PROGRESSIVE ADVANCED INSURANCE CO.,
`7:20-CV-07408 (PMH)
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`CASE NO.:
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`Dear Judge Halpern:
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`Pre-Motion Conference Letter regarding Motion for Amend Complaint
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`Pursuant to Your Honor’s Individual Practices R. 2(c), Plaintiff respectfully submits this
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`letter request regarding an anticipated motion to amend the complaint. Plaintiff has conferred
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`with Defendants on the substance of the proposed Amended Complaint, and Defendants
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`represent that they do not oppose the amendment.
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`Pursuant to the Court’s Civil Case Discovery Plan and Scheduling Order, the deadline to
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`amend the complaint expired on March 1, 2021. However, at the initial case management and
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`scheduling conference on February 9, 2021, the parties represented that discovery was needed to
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`determine whether Progressive Corporation should be a party to the suit. At that conference, the
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`Mailing Address: P.O. Box 140036, Orlando, FL 32814-0036
`Physical Address: 3165 McCrory Place Suite 175, Orlando, FL 32803
`T (407) 603-6031 F (888) 974-2175
`NORMANDPLLC.COM
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`1
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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 2 of 28
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`Court stated that it would entertain a request for leave to amend the complaint after the deadline
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`based on the outcome of further discovery.
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`Through discovery and continued investigations, Plaintiff has decided not to pursue his
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`claims against Defendant Progressive Corporation at this time. Plaintiff has also decided not to
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`pursue any claims against either Defendant for failure to pay title and transfer fees. Accordingly,
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`Plaintiff intends to assert claims against Defendant Progressive Advanced Insurance Company
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`only for failure to pay sales tax. No other changes are proposed on the amended complaint. A
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`copy of Plaintiff’s First Amended Complaint is attached hereto as Exhibit A .
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`Leave to amend is governed under Federal Rule of Civil Procedure 15(a), which grants
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`plaintiffs the right to amend their complaint once, within twenty-one days of serving it or of
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`receiving a responsive pleading or motion to dismiss. Fed. R. Civ. P. 15(a)(1). After twenty-one
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`days, “a party may amend its pleading only with the opposing party’s written consent or the
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`court’s leave.” Fed. R. Civ. P. 15(a)(2). Because the Court’s deadline for amended pleadings has
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`passed, leave to amend is also governed by Rule 16, which requires Plaintiff to demonstrate good
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`cause for the amendment. Good cause is demonstrated by showing that “despite [] having
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`exercised diligence, the applicable deadline could not have been reasonably met” by the plaintiff.
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`Oscar v. BMW of N. Am ., No. 09 Civ. 11, 2011 U.S. Dist. LEXIS 146395, 2011 WL 6399505, at
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`*2 (S.D.N.Y. Dec. 20, 2011).
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`Here, Plaintiff seeks to amend the complaint solely to drop one Defendant (Progressive
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`Corporation) and all allegations related to the failure to pay title and transfer fees. Plaintiff does
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`not propose any new allegations against the remaining Defendant, and seeks only to streamline
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`the allegations that remain at issue. The purpose of the amendment is to provide the parties and
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`this Court with an operative pleading that focuses only on the issues and parties that remain
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`Mailing Address: P.O. Box 140036, Orlando, FL 32814-0036
`Physical Address: 3165 McCrory Place Suite 175, Orlando, FL 32803
`T (407) 603-6031 F (888) 974-2175
`NORMANDPLLC.COM
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`2
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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 3 of 28
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`pending in this lawsuit. Plaintiff submits that the proposed amended complaint will provide
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`clarity to the parties on the scope of and breath of discovery moving forward with the case, and
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`will assist in the orderly resolution of the remaining disputes between the parties. This is
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`sufficient good-cause for an amended complaint.
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`Plaintiff also notes that because Defendants do not oppose the dismissal of Progressive
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`Corporation, Plaintiff can dismiss Progressive Corporation voluntarily pursuant to Federal Rule
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`of Civil Procedure 41(a)(1) without leave of court. However, given that Plaintiff has also decided
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`not to pursue his claims for title and transfer fees at this time, Plaintiff proposes that an amended
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`complaint would be a more appropriate mechanism for amending the allegations and parties.
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`Accordingly, Plaintiff has attached a stipulation and order granting leave to file a First
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`Amended Complaint, Exhibit B . Alternatively, if the Court prefers to proceed with a pre-motion
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`conference, the parties can be available for a conference to further discuss the proposed
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`amendment.
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`Thank you for your attention to this matter.
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` If the Court has any questions, we are
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`available at your convenience.
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`Cc: All Counsel of Record (VIA ECF)
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`Respectfully submitted,
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`/s/ Amy Judkins
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`Amy L. Judkins
`NORMAND PLLC
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`Mailing Address: P.O. Box 140036, Orlando, FL 32814-0036
`Physical Address: 3165 McCrory Place Suite 175, Orlando, FL 32803
`T (407) 603-6031 F (888) 974-2175
`NORMANDPLLC.COM
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`3
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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 4 of 28
`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 4 of 28
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`EXHIBIT A
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`EXHIBIT A
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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 5 of 28
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE SOUTHERN DISTRICT OF NEW YORK
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`STEVEN BUFFINGTON, on behalf of
`himself and all others similarly situated,
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` Plaintiff,
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`Civil Action No.: 7:20-cv-07408-PMH
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`AMENDED CLASS-ACTION
`COMPLAINT
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`v.
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`THE PROGRESSIVE CORPORATION
`and PROGRESSIVE ADVANCED
`INSURANCE CO.,
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` Defendant.
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`Plaintiff, Steven Buffington, on behalf of himself and all other similarly situated, files this
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`Amended
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` Class
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` Complaint
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` against
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` Progressive
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` Advanced
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` Company
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`(“Progressive Advanced or Defendant”), and in support thereof states the following:
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`NATURE OF THE ACTION
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`1.
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`This is a class action lawsuit by Plaintiff, Steven Buffington, who was a named
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`insured under a Progressive automobile policy issued for private passenger auto physical damage
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`including comprehensive and collision coverage, which requires payment of “Actual Cash Value”
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`or “ACV.” ACV is the cash amount to replace the vehicle, including mandatory taxes.
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`2.
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`Defendant Progressive Advanced issues automobile policies in the State of New
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`York. One of the coverages Progressive Advanced offers is comprehensive and collision
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`coverage.
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`3.
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`Upon information and belief, Progressive Advanced systematically underpaid not
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`just Plaintiff but thousands of other putative Class Members, as defined herein. Defendant owes
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`1
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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 6 of 28
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`its insureds for ACV losses for total-loss vehicles insured with comprehensive and collision
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`coverage.
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`4.
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`This lawsuit is brought by Plaintiff on behalf of himself and all other similarly
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`situated insureds of Defendant’s automobile policies issued in the State of New York that have
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`suffered damages due to Defendant’s practice of refusing to pay full mandatory sales tax to
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`first-party total-loss insureds on physical-damage policies containing comprehensive and
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`collision coverages. Such payments are required by applicable New York law and Defendant’s
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`insurance policies issued to Plaintiff and members of the Class, defined herein.
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`The failure to pay full sales tax for first-party total losses owed to the insureds
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`5.
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`6.
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`pursuant to the policy language is a breach of the policy and violates New York law.
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`JURISDICTION AND VENUE
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`This Court has jurisdiction over this action pursuant to 28 U.S.C. § 1332(d)(2),
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`because (a) the Plaintiff is a member of the putative class defined herein, each of which consists
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`of at least 100 members, and he and the Defendant are citizens of different states; (b) the
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`amount-in-controversy exceeds $5 million dollars exclusive of interest and costs; and (c) none of
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`the §1332 exceptions apply to this claim.
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`7.
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`Venue is proper in this Court because a substantial portion of the acts and course
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`of conduct giving rise to the claims alleged occurred within the district and the Defendant is
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`subject to personal jurisdiction in this district.
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`THE PARTIES
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`At all times material hereto, Plaintiff Steven Buffington was domiciled in Orange
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`8.
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`9.
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`County, New York, and was a citizen of the State of New York.
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`Defendant, Progressive Advanced Insurance Company (“Progressive Advanced”)
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`principal place of business and headquarters located at 6300 Wilson Mills Road, Mayfield, Ohio
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`2
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`

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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 7 of 28
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`44143.
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`10.
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`Plaintiff insured a leased vehicle and insured it through Defendant Progressive
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`Advanced. Plaintiff made a first-party total vehicle loss claim under his Progressive Advanced
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`policy with a loss date of March 1, 2019. Progressive Advanced procured a valuation report for
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`Plaintiff’s vehicle and prepared and sent him a document entitled “Settlement Statement”
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`purportedly approving the claim and itemizing what was owed to Plaintiff for his total vehicle
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`loss claim under his Progressive Advanced policy. The Settlement Statement itemized the
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`valuation of the lost vehicle and showed “$0.00” owed to Plaintiff for sales tax.
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`AMOUNT-IN-CONTROVERSY
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`Progressive Advanced wrote an average of approximately $363 million in
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`auto-insurance premiums for the years 2017 and 2018. 1
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`Progressive Advanced’s automobile insurance policies required the payment of
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`11.
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`12.
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`“Actual Cash Value” for first-party total vehicle loss claims. New York insurance regulations
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`define “Actual Cash Value” and require that an insurer pay all amounts, which necessarily
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`includes sales taxes, for which the claimant can reasonably be expected to pay to replace the total
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`loss vehicle with an item substantially identical to the damaged vehicle. N.Y. Comp. Codes R. &
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`Regs, tit. 11 § 216.6(b)(2) (1982) (“Regulation 64”).
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`13.
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`The payment of sales tax is required in New York in connection with the purchase
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`or lease of any vehicle, and therefore part of the replacement cost of any vehicle. The sales tax in
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`Orange County, New York, at the time of Plaintiff’s total loss accident was 8.125%.
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`14.
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`Plaintiff’s
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` further
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` herein,
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` alleges
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` Defendant’s
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`insurance-policy contract obliges it to pay full replacement costs to its insureds (including
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`Plaintiff) in the event of a total loss. Moreover, New York regulations require the inclusion of
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`1 N.Y Dep’t of Fin. Servs., 2019 complaint Ratios PP-Auto Insurance Complaints per Million Dollars of
`Premiums written in New York State,
`https://www.dfs.ny.gov/system/files/documents/2019/11/2019_auto_complaint_ranking.pdf
`(Aug. 27, 2020).
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`3
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`

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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 8 of 28
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`sales tax in any claim settlement for total-loss vehicles. Defendant nevertheless declines to
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`include such taxes when settling claims for total-loss vehicles, thereby breaching its contract with
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`every putative class member and violating New York law.
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`15.
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`For each approved total vehicle loss claim, Defendant provides its insureds
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`(including Plaintiff) with a settlement statement or materially similar document. By these
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`settlement statements, Defendant purportedly shows its insureds the amounts owed to them for
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`their total vehicle loss claims under their policies. Defendant’s settlement statements falsely stated
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`insureds were owed “$0.00” or nothing for taxes required to be paid to them for all ACV
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`total-loss claims. Defendant’s settlement statements misled its insureds as to what was owed to
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`them by New York law and under their policies.
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`16.
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`Although the precise number of class members is unknown and can only be
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`determined through appropriate discovery, Plaintiff believes that, because Defendant is among the
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`largest motor vehicle insurers in the State of New York, the class of persons of the Class defined
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`herein who are affected by Defendant’s unlawful practices consists of thousands of individuals
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`and that the amount in controversy of the Class will well exceed $5,000,000, exclusive of interest
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`and costs. Plaintiff is a member of the Class defined herein.
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`FACTUAL ALLEGATIONS
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`17.
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`Defendant utilizes a standard form policy (the “Policy”) within the State of New
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`York. The standardized Policy language related to comprehensive and collision coverage for ACV
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`of total-loss vehicles is present in every auto policy issued by Progressive Advanced in New
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`York. The Policy language is standardized in all relevant and material ways.
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`Under the Policy, Progressive is authorized to elect to pay ACV in the event of a
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`total loss. This election allows Defendant to avoid paying for loss when the cost to repair or
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`18.
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`replace exceeds the value of the vehicle. In New York, if Defendant elects to pay ACV, Defendant
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`is required to include the cost of mandatory sales tax.
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`4
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`

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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 9 of 28
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`At all times material hereto, Plaintiff insured a 2016 Toyota Sienna XLE, VIN #
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`5TDDK3DC6GS131202 (“Insured Vehicle”).
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`At all times material hereto, Plaintiff insured the Insured Vehicle under an
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`insurance policy issued by Defendant Progressive Advanced. ( Ex. A) .
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`On or about March 1, 2019, Plaintiff was involved in an accident while operating
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`19.
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`21.
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`the Insured Vehicle. As a result of the accident, Plaintiff filed a claim for property damage with
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`Defendant, claim number 19-4813179-01, and the Insured Vehicle was determined to be a total
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`loss.
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`22.
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`Progressive’s uniform procedure is to use a third-party vendor to determine the
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`base and adjusted vehicle value (what it calls market value) of total loss vehicles by using the
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`price to purchase comparable vehicles at the time of the loss.
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`Plaintiff’s total loss vehicle is identified in the policy declarations and it was
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`23.
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`legally titled and registered in compliance with New York laws at the time of loss.
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`24.
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`ACV generally and for policies issued in New York specifically combines the
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`market value of the vehicle plus sales taxes required to replace the total loss vehicle with an item
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`substantially identical to the damaged vehicle. Plaintiff challenges Progressive Advances’s failure
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`to include sales tax with ACV payments.
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`25.
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`Following the filing of the claim, Defendant determined and provided Plaintiff
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`with a document entitled “Settlement Statement” stating that the Insured Vehicle was a total loss
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`with a base value of $20,718.78, that $17,816.60 was the “Total Settlement” owed to Plaintiff for
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`his claim, and that “$0.00” were owed to him on his claim for sales tax. (Ex. B). Defendant also
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`obtained and provided Plaintiff with a market valuation report for his total loss vehicle. (Ex. C).
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`Defendant paid Plaintiff’s leasing company $17,816.60 as the ACV payment on
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`26.
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`his claim.
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`Defendant’s payment of $17,816.60 did not include sales tax mandated by New
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`5
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`

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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 10 of 28
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`York laws.
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`28.
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`After Defendant’s payment to the leasing company, Plaintiff still owed money
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`under the lease, which debt would have been satisfied or diminished had Defendant included the
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`29.
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`sales tax in the ACV payment.
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`Plaintiff replaced his total loss vehicle and incurred sales tax in doing so.
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`Sales tax is a mandatory cost that must be paid to replace any vehicle in the State
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`of New York.
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`31. Mandatory sales tax to lease a vehicle is due at the inception of the lease on the
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`total amount of the lease payments for the entire term of the lease. N.Y. Tax Law § 1111(i).
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`32.
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`The sales tax in Middletown New York Zip Code of 10940 for a replacement
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`vehicle is 8.125% (State tax rate of 4%, County tax rate of 3.75% and Metropolitan Commuter
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`Transportation District tax rate of 0.375%).
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`New York insurance regulations require that an insurer with policy provisions
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`requiring the payment of Actual Cash Value pay all amounts for which the claimant can
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`reasonably be expected to pay to replace the total loss vehicle with an item substantially identical
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`to the damaged vehicle. N.Y. Comp. Codes R. & Regs, tit. 11 § 216.6(b)(2) (1982) (“Regulation
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`64”). A violation of Regulation 64 is also a violation of N.Y. Ins. §2601 (the Unfair Claim
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`Settlement Practices Statute). Replacement Costs include sales taxes that an insured must pay to
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`replace a total loss vehicle.
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`By purporting to pay Actual Cash Value after a total loss, Defendant, through its
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`Policy, promised to pay sales tax as part of its Collision and Comprehensive coverages.
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`Defendant, however, by its conduct alleged herein, breached the Policy contract
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`34.
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`35.
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`with Plaintiff and the other Class members by failing to pay sales tax upon the total loss of an
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`insured vehicle.
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`36.
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`Defendant also communicates to insureds in their standard claims process
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`6
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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 11 of 28
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`communications that sales tax is not included in the ACV of a total-loss vehicle which statements
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`are in direct contravention of N.Y. Comp. Codes R. & Regs., tit. 11, § 216.6(b)(2) (1982)
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`(Regulation 64). In particular, Defendant provides its insureds making total vehicle loss claims
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`with settlement statements that falsely state insureds were owed “$0.00” or nothing for sales tax
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`required to be paid to them for all ACV total-loss claims under Regulation 64 and hence by their
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`Policy as well. This standard unfair claims practice, which is a pattern of conduct perpetuated by
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`37.
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`Progressive Advanced, is deceptive and misleading.
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`THE PROGRESSIVE INSURANCE POLICY
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`The relevant insurance policy language is materially identical as to both Plaintiff
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`and all putative class members. Defendant utilizes the same or materially the same applicable
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`Policy forms and language for all class members.
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`38.
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`The insurance Policy states that “Collision” coverage means they will pay for the
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`sudden, direct and accidental loss to a covered auto, including an attached trailer; or non-owned
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`auto; and its custom parts or equipment, resulting from collision.
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`39.
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`Under a provision entitled “Limits of Liability,” the Policy states that the “limit of
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`liability for loss to a covered auto . . . is the actual cash value of the stolen or damaged property at
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`the time of the loss reduced by the applicable deductible.”
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`40.
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`Upon information and belief, Progressive Advanced invokes the limitation of
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`liability of ACV any time Defendant determines that a vehicle has sustained a total loss, because
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`the cost to repair or replace the vehicle exceeds the value of the vehicle. Electing ACV allows
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`Progressive Advanced to avoid paying the higher amount to repair or replace the damaged or
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`stolen vehicle. When Progressive Advanced elects to invoke the limitation of liability of ACV, it
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`is thereafter obligated to pay ACV.
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`41.
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`There is no difference, for purposes of the duty to pay ACV on a first-party total
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`loss claim, between a collision total-loss claim and a comprehensive total-loss claim.
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`7
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`Case 7:20-cv-07408-PMH Document 42 Filed 07/19/21 Page 12 of 28
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`42.
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`ACV is not specifically defined in the policy. The policy states that “[d]efined
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`terms are printed in bold-face type.” All references to ACV in the policy are not in bold-face
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`type. The policy has GENERAL DEFINITIONS listed which apply throughout the policy. ACV
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`is not defined in the General Definitions. The policy providing coverage for DAMAGE TO A
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`VEHICLE has a section entitled Additional Definitions. ACV is not defined in Additional
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`Definitions in the Damage to a Vehicle coverage sections of the Policy.
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`43.
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`Clearly, then, the policy language does not further define ACV as including: (1)
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`any provision excluding taxes from ACV; (2) any provision deferring payment of the ACV state
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`taxes for any purpose whatsoever; (3) any provision requiring an insured to obtain a replacement
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`vehicle; (4) any provision requiring the insured to first obtain a replacement vehicle as a
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`condition precedent to receiving ACV state taxes; or (5) any provision linking the amount of
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`ACV state taxes to a particular replacement vehicle and the corresponding state taxes on said
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`replacement vehicle.
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`44.
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`Because the Policy lacks a specific definition of ACV and uses ACV to state the
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`coverage an insured has for a total vehicle loss, the definition or meaning of ACV provided by
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`Regulation 64 becomes a term of the Progressive Policy requiring payment of all Replacement
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`Costs, including mandatory sales tax.
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`45.
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`The Policy language applies to all covered autos irrespective of ownership
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`interests—whether owned, financed or leased, insured autos are considered “owned” for purposes
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`of the Policy.
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`CLASS ALLEGATIONS
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`46.
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`Plaintiff brings this action respectively seeking representation of the Class, defined
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`below, pursuant to Fed. R. Civ. P. 23(b)(1), (b)(2), (b)(3) and/or (c)(4), as may be deemed
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`appropriate by the Court.
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`47.
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`Plaintiff bring