Sixth Circuit Nixes Class Status in State Farm Total Loss Lawsuit
The Sixth Circuit rejected class certification in a major auto insurance total loss case against State Farm.
Why it matters: This decision cements a growing body of federal precedent making it harder for policyholders to pursue auto insurance total loss claims as class actions. The ruling will guide litigation tactics for insurers and plaintiffs in future disputes.
- On April 24, 2026, the en banc Sixth Circuit reversed class certification in Clippinger v. State Farm.
- The case involved about 90,000 Tennessee policyholders challenging how State Farm calculated actual cash value for totaled cars.
- The court found individual questions about each vehicle’s value outweighed any common legal issues.
- The 10-7 decision aligns the Sixth Circuit with five other federal appeals courts denying class certification in similar cases.
In a significant ruling for the insurance industry, the Sixth Circuit Court of Appeals, sitting en banc, overturned the district court’s certification of a class action against State Farm on April 24, 2026. The case, Clippinger v. State Farm Auto. Ins. Co., centered on claims from approximately 90,000 Tennessee policyholders who alleged that State Farm’s use of a 'typical negotiation' adjustment unfairly undervalued their total loss auto claims.
- The court found that determining the actual cash value (ACV) of each vehicle would require individualized assessments, making class treatment improper.
- This mirrors prior outcomes in the Third, Fourth, Fifth, Seventh, and Ninth Circuits, each of which had previously denied class certification in similar total loss cases. As noted by Carleen Bongat, the decision adds a formidable barrier to class actions on this issue.
- Gibson Dunn, counsel for State Farm, called the published opinion "useful to defendants across the country in auto insurance class actions and beyond." (More)
The 10-7 split underscores ongoing debate, but with this latest ruling, the judicial consensus is clear: individualized questions about ACV preclude broad class actions in total loss disputes. For legal teams representing insurers or policyholders, this framing will likely drive future case strategy and settlement dynamics.
By the numbers:
- 90,000 — Tennessee policyholders in the failed class action
- 10-7 — Split in the Sixth Circuit's en banc decision
- 6 — Number of federal circuits now denying class certification in similar cases