TALLAHASSEE, Fla. – A federal judge dismissed a First Amendment fight about part of a 2021 property-insurance law aimed at curbing advertising by roofers after the Florida Legislature revamped the law last month.
Chief U.S. District Judge Mark Walker dismissed the case Friday after attorneys for the plaintiffs and the state said it was moot.
In July, Walker issued a preliminary injunction that blocked the state from enforcing the law, agreeing with Gale Force Roofing & Restoration LLC that the measure violated First Amendment rights by penalizing protected speech. While the preliminary injunction put the law on hold, the underlying court case continued.
Gov. Ron DeSantis, however, called a special legislative session in May to address widespread problems in the state’s property-insurance system. As part of that session, lawmakers changed advertising restrictions on roofing contractors, “resolving the complaints” of the plaintiffs and intervenors in the case, according to a filing Friday by attorneys for both sides.
“In sum, the declaratory and injunctive relief sought in the complaints is now ‘inappropriate’ and the case is moot,” the filing said.
Roof-damage claims have been a major issue as property insurers have dropped policies and dramatically raised rates during the past two years. Insurers blame questionable, if not fraudulent, roof-damage claims for contributing to financial losses. They contend roofers have improperly advertised and solicited business from homeowners.
The 2021 law sought to prevent contractors from soliciting homeowners to file insurance claims through a “prohibited advertisement.” The law defined a prohibited advertisement as “any written or electronic communication by a contractor that encourages, instructs or induces a consumer to contact a contractor or public adjuster for the purpose of making an insurance claim for roof damage. The term includes, but is not limited to, door hangers, business cards, magnets, flyers, pamphlets and emails.”
But in issuing the preliminary injunction, Walker wrote that the law violated protected speech.
“It is also clear that the threatened injuries to plaintiff from banning plaintiff’s truthful commercial speech outweighs the state’s interest in preventing fraud, protecting consumers from exploitation and stabilizing the insurance market,” Walker wrote.
During last month’s special session, lawmakers made a series of roofing-related changes, including scaling back the definition of a “prohibited advertisement.” Under the change, the law requires advertisements to include disclaimers about issues, such as informing consumers that they’re required to pay any deductibles and that it is fraudulent to file insurance claims that include false or misleading information. Advertisements that do not include the disclaimers would be considered prohibited.
It remains unclear, however, whether the revamped prohibition will face a challenge.
The Restoration Association of Florida and Apex Roofing and Reconstruction LLC filed a separate federal lawsuit last year that raised First Amendment challenges to the 2021 law. That case remains pending, and U.S. District Judge Allen Winsor last week gave the plaintiffs until June 27 to file an amended complaint that considers the new law.
Along with revamping the definition of a prohibited advertisement, the new law also included changes such as allowing insurers to collect 2% deductibles from policyholders for roof-damage repairs.
SOURCE: Artivle written by Jim Saunders (JUNE 13, 2022)