Christina Spicer  |  September 20, 2016

Category: Consumer News

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Policyholders successfully certified their proposed Class in a lawsuit alleging State Farm bribed a judge to avoid paying a $1 billion judgment.

Lead plaintiffs alleged in their class action lawsuit that after State Farm was slapped with a $1 billion judgment in a consumer fraud class action lawsuit, the insurance provider funded an Illinois state Supreme Court judge’s re-election campaign in order to escape paying the penalty.

According to the complaint, the judge won the election and several months later overturned the judgment against State Farm.

“Of course, there was no guarantee for State Farm that the appeal would not be decided before the November 2004 election, but the risk — a $2 to $4 million investment for a possible $1.05 billion return — was sufficiently minimal to make it a worthwhile gamble,” alleged the plaintiffs in their complaint.

“Trying these claims individually would result in a substantial amount of repetition and wasted resources,” said U.S. District Judge David R. Herndon.

Judge Herndon found that the plaintiffs showed that the prongs of numerosity, commonality, typicality and adequate representation were established by their proposed Class. He also appointed the plaintiffs in the complaint as leads in the class action.

State Farm argued that the class counsel proposed by the plaintiffs were inappropriate because of donations they made to the state judge’s rival. However, Judge Herndon agreed with the plaintiffs’ proposal for class counsel. Judge Herndon found that the donations were irrelevant to the class action.

“Those campaign contributions were transparent and fully disclosed and do not create a conflict of interest with the proposed class,” wrote Judge Herndon in his order. “Likewise, the court does not see a conflict with the investigators and their findings regarding the contributions.”

The class action stemmed from litigation that resulted in a $1.05 billion judgment against State Farm in Avery v. State Farm.

The case was litigated in Illinois state court and alleged that State Farm violated the terms of their contracts when they used parts not made by the original manufacturers for repairs. Avery brought claims for breach of contract and violation of the Illinois Consumer Fraud Act.

The $1.05 billion judgment was upheld by an appellate court; however, it was reversed by the Illinois Supreme Court in the following years.

The plaintiffs in the current class action against State Farm allege that the company used money to “recruit, finance, direct and elect a candidate to the Illinois Supreme Court who, once elected, would vote to overturn the $1.05 billion judgment,” in 2003.

The plaintiffs are represented by Lieff Cabraser Heimann & Bernstein LLP, Barrett Law Group PA, Hausfeld LLP, Clifford Law Offices, Much Shelist PC, Thrash Law Firm, Gordon Ball PLLC, Pendley, Baudin & Coffin LLP and Erwin Chemerinsky.

The State Farm Racketeering Class Action Lawsuit is Mark Hale, et al. v. State Farm Mutual Automobile Insurance Company, et al., Case No. 3:12-cv-0660, in the U.S. District Court for the Southern District of Illinois.

UPDATE: October 2018, the State Farm non-OEM crash parts class action settlement is now open. Click here to file a claim.

UPDATE 2: On Dec. 13, 2018, insurance policyholders represented in a State Farm racketeering class action lawsuit managed to secure final approval of a $250 million settlement, despite objections to the deal.

UPDATE 3: On Oct. 26, 2019, Top Class Actions viewers started receiving checks from a State Farm non-OEM crash parts class action settlement worth as much as $104. Congratulations to everyone who filed a claim and got PAID!

We tell you about cash you can claim EVERY WEEK! Sign up for our free newsletter.

2 thoughts onState Farm Class Certified in $1B Racketeering Lawsuit

  1. Anthony Dennard Sr says:

    I feel like I was cheated because my insurance went up a whole lot

  2. Marcus Gunn says:

    Add me

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