State Farm Reaches Preliminary Deal in Conspiracy Lawsuit

Sep 5, 2018

Credit State Farm

EAST ST. LOUIS, Ill. - Insurance giant State Farm has reached a $250 million preliminary settlement of a federal class-action lawsuit claiming the company funneled money to the campaign of a candidate for the Illinois Supreme Court.

The lawsuit alleged Bloomington-based State Farm secretly funneled money to the campaign of Supreme Court Chief Justice Lloyd A. Karmeier while he was a candidate for the high court in 2004.

In 2005, the case of Avery v. State Farm, Karmeier cast the deciding vote to reverse a $1.06 billion judgment against State Farm for its use of aftermarket car parts in repairs. The court ruled the nationwide plaintiff class was improperly certified by a Williamson County trial judge. It also contended using aftermarket parts was not a breach of State Farm policyholders' contracts.

The class-action lawsuit sought nearly $10 billion from State Farm in a trial that was scheduled to begin Tuesday. The plaintiffs alleged State Farm covertly supported Karmeier's campaign in order to secure his win and reversal of the Avery lawsuit decision.