Lieff Cabraser Civil Justice Blog
Final Settlement Approved in State Farm RICO Lawsuit

Judge Grants Final Approval to $250 Million State Farm RICO Lawsuit Settlement

As reported by Law360, U.S. District Judge David Herndon has granted final approval to a $250 million settlement in the class action lawsuit brought by State Farm policyholders accusing the auto insurer of using campaign donations to buy the vote of an Illinois Supreme Court Justice.

The ruling follows twenty years of ongoing litigation between the class of plaintiffs and State Farm that began with a class action lawsuit filed against the company in 1997, accusing State Farm of deceptively using aftermarket parts to repair customer’s vehicles that were of poorer quality than those promised in the customers’ insurance policies. After a jury trial, the class of nearly five million consumers was awarded over $1 billion in damages.

The Illinois Supreme Court later threw out the judgment after a vote took place in which newly elected Justice Lloyd Karmeier sided with State Farm. Soon afterward, the class filed a separate RICO lawsuit against the company, claiming State Farm had given millions of dollars in campaign contributions to Karmeier through middlemen in hopes of getting him elected to secure his vote against the judgment.

Read the full article on Law360’s site (subscription).