State Farm has agreed to pay $250 million to settle a class action alleging it secretly worked to help elect an Illinois high court justice in order to overturn a billion-dollar judgment against State Farm. The class members are millions of State Farm policy holders.
The complaint alleged that State Farm collaborated with advocacy groups to handpick Lloyd Karmeier to run for an Illinois Supreme Court seat because of his sympathy to tort reform. State Farm allegedly funneled money through interest groups like the U.S. Chamber of Commerce to assist Mr. Karmeier in his successful 2004 campaign.
The complaint alleged that after Justice Karmeier was seated, he was involved in overturning a $1.06 billion award in favor of millions of State Farm customers who said the insurer let them down by having body shops fix their crashed cars with lower-quality aftermarket parts instead of automaker-branded parts.The award had been affirmed by a state appellate court in 2001, and was overturned by the state Supreme Court in 2005.
The case is Hale et al. v. State Farm Mutual Automobile Insurance Co. et al., case number 3:12-cv-00660, in the U.S. District Court for the Southern District of Illinois.
This blog is intended to provide information to the general public and to practitioners about developments that may impact Oregon class actions.