Bloomberg Law
Dec. 14, 2018, 5:52 PM

State Farm $250M Class Action Racketeering Settlement Approved

Porter Wells
Porter Wells

State Farm’s agreement to pay out $250 million to 4.7 million insured class members to settle civil racketeering allegations has been approved by an Illinois federal court.

State Farm Mutual Automobile Insurance Company and the other defendants “denied—and continue to deny—any wrong doing and opposed all of Plaintiffs’ claims,” the U.S. District Court for the Southern District of Illinois said in its Dec. 13 order granting final approval to the settlement.

The roots of the case stretch back to 1999, when State Farm was ordered to pay $1.06 billion over state consumer protection claims brought by the same class of individuals. Shortly after State Farm petitioned the Illinois Supreme Court to review the verdict, the company allegedly financially assisted in the Illinois Supreme Court campaign of Judge Lloyd Karmeier.

Claiming State Farm had funneled secret money to Karmeier’s campaign so that he would be able to participate in the appeal, the plaintiffs in the present case brought a federal class action against State Farm under the Racketeer Influenced Corrupt Organizations Act.

The parties initially agreed to the terms of the $250 million settlement on the courthouse steps in September. About 1.4 million class members are known; the remaining class members must submit claim forms to establish their membership in the class, the court said.

The legal battle up until that point “was long and extremely hard-fought,” the court said.

The discovery process included “no less than 50 discovery conferences, the production and review of hundreds of thousands of pages of documents, and 68 depositions,” the court recounted. Six years of litigation brought “approximately 100 contested motions” and saw a jury selected, according to the court’s opinion.

The Clifford Law Offices represented the plaintiff class. Riley Safer Holmes & Cancila LLP and Alston & Bird LLP represented State Farm.

The case is Hale v. State Farm Mut. Auto. Ins. Co., 2018 BL 462903, S.D. Ill., No. 12-0660-DRH, 12/13/18.

To contact the reporter on this story: Porter Wells in Washington at

To contact the editors responsible for this story: Jo-el J. Meyer at; Tom P. Taylor at