United States District Court, D. Maine
DECISION AND ORDER
E. WALKER UNITED STATES DISTRICT JUDGE.
Plaintiff, National Fire Adjustment Company, Inc., seeks a
declaratory judgment stating that the Defendant, Eric Cioppa,
cannot enforce 24-A M.R.S. § 1476, which requires that
public adjusters adhere to a 36-hour waiting period before
soliciting business from Maine citizens or offering a
contract for public adjustment services. According to
Plaintiff, the statute violates Plaintiff's first
amendment speech rights. The parties request a judgment on a
Fire Adjustment Company, Inc. (“Plaintiff” or
“NFA”) provides licensed public insurance
adjustment services for clients who have suffered property
damage in the State of Maine. Stip. Facts ¶ 14.
NFA holds an active resident adjuster license from the State
of Maine's Department of Professional and Financial
Regulation, Bureau of Insurance. Id. ¶ 15.
the nature of NFA's business to enter into contracts with
property owners after the property owners suffer a loss
insured by an insurance company. When a property owner
retains NFA's services, NFA's employees provide
loss-adjustments services to the property owner, which
services, ideally, will provide the property owner with a
method for adjusting (placing a value on) the insured loss
that is more favorable to the property owner than the method
used by adjusters employed or contracted by the property
owner's insurance company. By providing this service,
NFA's adjusters (sometimes called “public
adjusters”) help ensure that property owners settle
coverage claims with their insurance companies for fair
value. Id. ¶ 6. In return for their services,
public adjusters charge a fee to the policyholder. The fee is
usually a percentage of the overall damage recovery paid by
the insurance company. Id.
1997, through the Maine Insurance Code, the State of Maine
has restricted the ability of public adjusters to solicit
business within a 36-hour window following a loss. In its
current form,  the so-called “36-Hour Rule”
reads as follows:
1. Solicitation. An adjuster seeking to
provide adjusting services to an insured for a fee to be paid
by the insured may not solicit or offer an adjustment
services contract to any person for at least 36 hours after
an accident or occurrence as a result of which the person
might have a potential claim.
24-A M.R.S. § 1476(1).
reviewed the merits of the proposed legislation, and in the
course of deliberations that resulted in amendments to the
36-Hour Rule, the Legislature did not consider or rely on any
factual findings of fraudulent, misleading, intrusive, or
otherwise concerning communications by public adjusters.
Stip. R. ¶ 43.
Eric Cioppa is the Superintendent of the Maine Bureau of
Insurance. Id. ¶ 24. The Maine Bureau of
Insurance is one of five agencies within the State of
Maine's Department of Professional and Financial
Regulation. Id. ¶ 25. The Maine Bureau of
Insurance regulates the State's insurance industry,
including by licensing insurance adjusters and imposing
discipline for violations of the State's insurance laws.
Id. ¶ 26. In addition to other duties,
Superintendent Cioppa is charged with protecting consumers
from misleading or fraudulent business activities.
Id. ¶ 27.
in Maine must be licensed and are governed by a comprehensive
state regulatory scheme to protect the public from misleading
or fraudulent business activities. Id. ¶¶
28-29. Among other tools in his enforcement arsenal,
Superintendent Cioppa is authorized to revoke, suspend, place
on probation, or otherwise limit the licensure of adjusters,
and to impose civil penalties and restitution orders, for
violations of any law enforced or rule adopted by the
Superintendent. Id. ¶¶ 29-33.
Cioppa has imposed discipline on public adjusters, including
suspensions from practice and civil penalties, for violations
of the 36-Hour Rule. Id. ¶ 46. For example, in
October 2012, Superintendent Cioppa suspended a public
adjuster's license for 30 days and ordered him to pay a
$500 civil penalty because he had violated the 36-Hour Rule.
The adjuster left two telephone messages concerning his
services for property owners who experienced a fire-related
loss. Id. ¶ 47.
two employees who work as adjusters in Maine, both of whom
are duly-licensed. Id. ¶ 17. Superintendent
Cioppa is not aware of any evidence that NRA's
Maine-based adjusters have engaged in any false or misleading
statements in their communications with clients regarding
NFA's public insurance adjustment services. Id.
¶ 23. NFA has instructed its adjusters in Maine to
adhere to the 36-Hour Rule. Id. ¶ 48. NFA's
public adjusters in Maine are presently adhering to the
36-Hour Rule to avoid discipline by the Superintendent.
Id. ¶ 49. NFA's public adjusters in Maine
have created time-keeping and alert systems to ensure that
they wait the full 36 hours after a fire before contacting a
property owner. Id. ¶ 50.
addition to the foregoing stipulated facts, the parties have
stipulated to the following facts concerning the impact of
the 36-Hour Rule on public insurance adjustment services.
Accordingly, the Court accepts it as established that the
first 36 hours after a fire are a critical time for public
adjusters to communicate with potential clients about their
services; that the first 36 hours after a fire can be
stressful, hectic, and traumatic for property owners who have
suffered damage; that property owners may relocate to
temporary housing immediately after a fire loss, so that
there may be a very short period of time for a public
adjuster to locate and communicate with the policyholder;
that property owners may agree to cleaning or tear-down
services immediately after suffering a property loss,
impeding the ability of public adjuster to assess the value
of the loss; and that, by logical extension, NFA public
adjusters' adherence to the 36-Hour Rule is causing
NFA's public adjusters to lose business on an ongoing
basis. Id. ¶¶ 7-12, 51.
public insurance adjusting services for policyholders in
accordance with Maine law is a lawful business activity and
is not inherently misleading. Id. ¶ 13.
argues the 36-Hour Rule violates the First Amendment because
it is a “content- and speaker-based restriction on
speech [that] is presumptively unconstitutional viewpoint
discrimination.” Pl.'s Mot. for Disposition of
Liability Issues by Judgment on a Stip. R. at 2, ECF No. 21
(“Pl.'s Mot.”); see also Complaint
¶¶ 4-5. In the alternative, Plaintiff argues the
Rule imposes burdens that either do not advance the
State's interest or sweep more broadly than necessary to
achieve the stated interest. Pl.'s Mot. at 2; Complaint
¶ 44. Defendant argues the 36-Hour Rule directly
advances a substantial governmental interest and is no more
burdensome than is necessary to serve that interest.
Defendant's Mem. of Law for Disposition on a Stip. R. at
7 (“Def.'s Mem.”).
First Amendment, made applicable to the States by the
Fourteenth Amendment, prohibits the States from, among other
things, abridging the freedom of speech. Janus v. Am.
Fed'n of State, Cnty, and Mum. Emp., 138 S.Ct. 2448,
2463 (2018). Persons subjected to a deprivation of their
speech rights may, pursuant to 42 U.S.C. § 1983, bring
an action in federal court to obtain declaratory or