By Eric Stock
EAST ST. LOUIS – A federal judge has conferred class-action status for a lawsuit against State Farm that accuses the insurance giant of violating federal racketeering laws.
A lawsuit that dates back to 1997 accuses State Farm of channeling money to boost the campaign of a state Supreme Court Justice to potentially influence a ruling. Justice Lloyd Karmeier who ended up holding on to his seat, helped to overturn a $1 billion verdict in a case that contended State Farm authorized non-factory parts for vehicles that were involved in crashes – and did not inform policyholders.
Karmeier was named this week to replace Rita Garman as Chief Justice.
A Chicago-based law firm that’s representing the plaintiffs says 4.7 million policyholders could share in an estimated $7.6 billion payout.
State Farm spokesman Phil Supple said in a statement the company was “disappointed in the court’s decision on the class certification question, and respectfully disagree with it.”
“We intend to ask the appellate court to review this ruling in the very near future. Plaintiffs have unsuccessfully asserted and reasserted these allegations for many years and should not be permitted to do so any longer.”
Eric Stock can be reached at eric.stock@cumulus.com.
