State Farm Agrees to Settle Suit Alleging Improper Influence Over Judicial Election for $250M

A federal district court judge in Illinois has granted preliminary approval to a settlement between State Farm and a class of plaintiffs claiming that the insurance giant created a RICO enterprise to bankroll the election of a judge to the state’s high court. Illinois Supreme Court Justice Lloyd Karmeier was elected in 2004, and in 2005 voted to overturn a $1.05 billion verdict against the insurer stemming from breach of contract claims regarding its alleged use of non-original parts in vehicles damaged in accidents. State Farm will not admit liability through the recently-proposed settlement, but will pay $250 million to class members. 

Plaintiffs in the class action regarding the judicial election claimed that State Farm used non-profit entities to secretly support Justice Karmeier’s election, allegedly funneling millions of dollars into his campaign. After he was elected, plaintiffs in the earlier State Farm lawsuit unsuccessfully attempted to have the judge recused from their case due to State Farm’s alleged influence in the judicial campaign.

Additional Reading

State Farm to Pay $250M to Settle Suit Claiming It Orchestrated Win of Justice Who Voted Its Way, ABA Journal, September 10, 2018

Second Amended Complaint, filed September 4, 2018 in Hale et al v. State Farm Mutual Automobile Insurance Company, via Justia Dockets