USAA Prevails in MSP Recovery’s Latest Class-Action Attempt

MSP Recovery, a now-famous Miami litigation firm, has won some and lost some in federal and state appeals courts during a decade-long enterprise that has earned it millions of dollars in fees for, essentially, moving funds from auto insurers to Medicare insurance companies.

This week, MSP Recovery lost a significant one when Florida’s 3rd District Court of Appeals nixed the class of plaintiffs in a proposed class-action lawsuit against USAA Casualty Insurance Co.

“…We reverse the order granting class certification due to MSP’s putative class failing to satisfy the predominance requirement” set by Florida’s rules of civil court procedure, the judges wrote.

MSP had been shot down in two similar appeals in recent years involving IDS Property Casualty Insurance Co., part of American Family Insurance. In the USAA action, the law firm tried again to use the same reasoning to have the appeals court uphold certification of multiple, similarly injured plaintiffs.

But the 3rd District Court of Appeals judges didn’t buy the argument.

“MSP seeks to avoid reversal of its class certification by bringing a ‘declaratory action’ in lieu of direct money damages. However, this attempt is unsuccessful as MSP once again fails to satisfy the predominance requirement for the same reasons articulated by this Court in IDS II.”

The court reversed a Miami-Dade Circuit judge’s class certification and remanded the case to the trial court for further review.

John Ruiz, a Miami attorney and head of MSP Recovery, has been a thorn in the side of auto insurers nationwide for almost a decade. His ground-breaking lawsuits have argued, successfully, in many cases, that a number of auto insurance carriers failed to ensure that Medicare was the secondary payer in thousands of accidents with injuries. That left Medicare Advantage organizations and managed care plans paying more than they should have, courts have said. Florida’s no-fault/personal injury protection law also plays a role, requiring auto carriers to identify and alert when other insurance is involved.

Along the way, Ruiz has reportedly become a billionaire—while several auto insurers have had to pay damages and legal costs to Medicare insurance plans. One Florida insurance company lobbyist once quipped that the years of litigation has made Ruiz “whole-and-a-half” while leaving Medicare supplement plans with relatively little in recovery.

In the USAA appeal, Ruiz and other MSP attorneys argued, as they did in the second IDS insurance appeal (known as “IDS II”), that the firm was seeking only a declaratory judgment about IDS’s obligations to the members of the plaintiff class. That would have avoided the Florida statutory requirement that class actions must prove actual, monetary damages caused to the plaintiffs.

“However, as IDS notes, the complaint still effectively seeks money damages and intends to remedy past harms, such that highly individualized analysis of individual insureds would be required to identify any actual failures to comply with the No-Fault Act and Medicare Act,” the 3rd DCA panel noted in the second IDS appeal decision in 2024.

In the USAA case, the judges wrote: “We adopt the sound reasoning in IDS II as it is directly analogous to the facts of the present case.”

As in the IDS case, MSP sought to avoid reversal of its class certification by bringing a declaratory action in lieu of direct money damages. “However, this attempt is unsuccessful as MSP once again fails to satisfy the predominance requirement for the same reasons articulated by this Court in IDS II,” appeals court Judge Ivan Fernandez wrote in the Jan. 28 USAA opinion.

Read the opinion here.

The ruling came the same day it was announced that USAA plans to cut average auto insurance rates in Florida by about 7%.

Read More About Ruiz and MSP Recovery’s lawsuits:

Miami Court Finds IDS Property Insurance Withheld Data on PIP Cases

MSP Recovery Scores Another Appeals Court Victory Against Auto Insurers