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Dallas partners Roger Higgins and Elizabeth Lee Thompson won a significant victory in the United States Fifth Circuit Court of Appeals for Allstate Fire and Casualty Insurance Company.


Allstate sought affirmance of the district court’s dismissal of policyholders’ putative class action complaint alleging that Allstate was liable for breach of contract and violating provisions of the Texas Insurance Code that requires prompt payment of claims. The policyholders asserted two alternative breach of contract claims: one alleging that Allstate failed pay them sales tax and fees on their total loss vehicles (Cost Approach), and the other breach of contract claim alleging that Allstate failed to determine the actual cash value of their total loss vehicles through using a purportedly required comparable sales valuation method (Comparable Sales Approach). The policyholders also sought a declaratory judgment by the district court as to whether the policy and Texas law required Allstate to employ the Cost Approach or the Comparable Sales Approach.


The Court of Appeals agreed with the district court that neither the policy nor Texas law requires that Allstate use either the Cost Approach or the Comparable Sales Approach to determine the actual cash value of the policyholders’ total loss vehicles.  As a result, the Court concluded that the district court correctly dismissed both breach of contract claims.  Because the policyholders had no contract claim, the Court also affirmed that they failed to state a claim under the Texas Insurance Code or a claim for declaratory relief.

The Fifth Circuit precedent upon which the Court based its dismissal of the Cost Approach breach of contract claim—Singleton v. Elephant Insurance Co.—was another Thompson Coe Fifth Circuit victory obtained by Roger Higgins and Elizabeth Lee Thompson.

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Roger D. Higgins

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