Lieff Cabraser Civil Justice Blog
State Farm Will Have to Face Campaign Funding Racketeering Claims

Judge Issues Two Significant Pretrial Rulings Against State Farm in “Explosive” RICO Class Action by Policyholders

On August 21st, 2018, Judge David Herndon of the U.S. District Court for the Southern District of Illinois issued orders in advance of trial that limit the expert testimony State Farm can present and at the same time block State Farm’s own efforts to limit the plaintiff policyholder class experts.

As reported by Law360 (subscription), “State Farm is fighting a class of policyholders who say the Illinois-based insurer recruited Illinois Supreme Court Justice Lloyd Karmeier to run for a seat on the court and funneled millions into his campaign coffers so he could vote in its favor in a ruling overturning the massive judgment against the company. The lawsuit’s explosive allegations stem from a $1.05 billion judgment entered against State Farm in a separate class action, Avery v. State Farm , accusing the company of using the wrong parts to repair policyholders’ cars.”

Earlier this summer, Judge Herndon denied State Farm’s motion for summary judgment, finding the class had sufficient evidence to support allegations Justice Karmeier knew about State Farm’s support of his campaign, and “that a reasonable jury could conclude the Supreme Court’s vote had been tainted.” Judge Herndon’s latest rulings reject State Farm’s motions to exclude five of the class’ experts, allowing three professors and an election lawyer to testify. The judge excluded three of the defense’s proposed experts, criticizing their underlying methodology.

Lieff Cabraser partner Robert J. Nelson, counsel for the plaintiff class, noted that he is looking forward to finally trying the case. “Our plaintiffs have been waiting a long time and we are excited that trial is now upon us,” Nelson said.

Trial in the action is set to commence on September 4th, 2018.