State Farm Granted Stay in Class Action Suit

An Illinois judge has granted State Farm a stay in the class action lawsuit brought against it by more than 5 million customers.

newgavelNoting the plaintiffs “ … do not oppose State Farm’s request to vacate and continue the October 15, 2016 deadline for submission of the notice status report and class notice plans,” Judge David R. Herndon ruled in favor of State Farm October 14 and granted a stay in the case.

Herndon, however, also noted the Seventh Circuit Court of Appeals could disagree with the lower court’s decision to grant class certification to the suit.

“Further, the Seventh Circuit’s decision regarding class certification will have a significant effect on the ultimate disposition of this case,” Herndon wrote in his decision. “Thus, the Court finds that it would be imprudent at this stage to proceed further in this matter until the resolution of the class certification appeal.”

The suit was certified as a class-action suit following a federal judge’s ruling September 16. The class-action suit accuses State Farm of defrauding the plaintiffs by secretly bankrolling Lloyd Karmeier’s 2004 campaign. Further, the case alleges, State Farm “ … created and conducted [a] RICO enterprise … to enable State Farm to evade payment of a $1.05 billion judgment affirmed in favor of approximately 4.7 million State Farm policyholders by the Illinois Appellate Court.”

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