A federal judge on Monday said a lawsuit accusing GEICO Corp. of overcharging more than 2 million California policyholders on car insurance early in the COVID-19 pandemic may proceed as a class action.

U.S. District Judge Beth Labson Freeman in San Jose, Calif., rejected GEICO’s contention that a group lawsuit over the alleged inadequacy of its “GEICO Giveback” program would create “insurmountable manageability problems.”

GEICO, part of Warren Buffett’s Berkshire Hathaway Inc., said a class action would not sufficiently account for differences among policyholders, including the time periods they had insurance.

The Chevy Chase, Md.-based insurer also said it would be difficult to assess damages, isolate pandemic costs and adjust rates retroactively.

But the judge said a class action was preferable to individual lawsuits, and the plaintiffs’ damages model “could present an appropriate percentage refund over a sufficiently long time” to address manageability concerns.

Lawyers for GEICO did not immediately respond to requests for comment. The plaintiffs’ lawyers did not immediately respond to similar requests.

Policyholders objected to GEICO’s decision to provide $2.5 billion of credits, including 15 percent on renewals, starting in April 2020, reflecting how people were at the time driving and getting into accidents less often.

They said GEICO reaped a “windfall” because the credit fell “well short” of adequate given the lessened risks, and accused the insurer of falsely claiming that its credits provided “substantial and full relief.”

Some insurers, including State Farm and Allstate Corp., offered pandemic-related refunds to policyholders.

The class covers California residents who bought GEICO car, motorcycle or RV insurance between March 1, 2020 and now.

GEICO is defending against a similar federal lawsuit in Chicago, and in May persuaded an appeals court in Manhattan to uphold a judge’s dismissal of a similar lawsuit there.

Berkshire Hathaway, based in Omaha, Neb., has owned all of GEICO since 1996.

The case is Day v. Geico Casualty Co et al, U.S. District Court, Northern District of California, No. 21-02103.

(Reporting by Jonathan Stempel in New York; editing by Marguerita Choy)