State Farm Automobile Insurance Co. v. Newburg Chiropractic, P.S.C.
United States Court of Appeals for the Sixth Circuit
741 F.3d 661 (2013)
Plambeck owned chiropractic clinics in Kentucky but, mistakenly believing he didn't need a Kentucky license since he personally never treated patients (employing only Kentucky-licensed chiropractors instead), operated without the state-required owner's license, a violation carrying criminal but not civil penalties; over four years, State Farm (plaintiff) paid the clinics over $500,000 directly for treating its policyholders in car-accident cases, all without complaint about service quality, before suing to recover those payments upon discovering Plambeck's licensing violation. The district court granted State Farm summary judgment based on its mistake of fact, and the clinics appealed.
Whether a party may recover money paid to satisfy obligations under a contract that is void as against public policy if the party received what it bargained for under the contract.