Lawsuit Filed Against State Farm

Discussion in 'General Insurance Agent Discussions' started by RollTodd, Jul 17, 2012.

  1. RollTodd
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    RollTodd New Member

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    A lawsuit was filed against State Farm last Friday. This one is going to be big and expansive. Finally, something is being done about the fraud and deceit that State Farm uses to get people recruited and into their agency system. So many people have lost everything they owned. Kudos to the legal team on this one.

    [FONT=Verdana, Arial, Helvetica]LAWSUITS FILED AGAINST STATE FARM MUTUAL AUTOMOBILE
    INSURANCE COMPANY


    Friday, July 13, 2012: State Farm Agent, Jack Tahanian filed a lawsuit today in Los Angeles County Superior Court against State Farm Mutual Insurance Company. The lawsuit accuses State Farm of fraud and deceit in the way the company presented its “new market” business model. In addition to the fraud claims, Tahanian’s lawsuit makes additional claims under California’s Unfair Competition Law.

    John Fisher, one of Tahanian’s attorneys says “There are an estimated 3000 “new market” or “scratch” agents suffering under the extremely adverse conditions created by State Farm’s scheme. This estimated number doesn’t reflect a larger number of agents whose contracts have been terminated by State Farm, or who had to completely walk away from their agency due to the detrimental impact of the State
    Farm agent contract.”

    "The number of adversely affected agents we have been in contact with in the last several weeks is extraordinary. Hundreds of agents from all over the United States and Canada are in desperate financial trouble and are seeking relief from State Farm’s schemes. Many of these agents have suffered severe financial ruin, and have been forced to either seek protection by filing for bankruptcy protection, or are on the verge of doing so. The similarities in each of their stories of their treatment are strikingly similar. This program is a shocking failure and State Farm continues to promote it in a positive light, knowing full well they are dooming the vast majority of these men and women to financial ruin. It is truly a disgrace to the company’s long history of commitment to its agents. It’s also a disgrace to the legacy of a company that once represented the elite in insurance agency opportunities” said Fisher.

    Fisher is working within a network of law firms who specialize in large scale, national litigation such as these cases. The key attorney in the case is Archie Lamb of Birmingham, Alabama. Lamb has spent numerous weeks meeting with agents all over the United States and Canada listening to their desperate circumstances.
    Lamb’s national practice is focused on mass torts and class-actions. Lamb previously represented the California Medical Association and numerous other medical societies against the HMO industry. Lamb and Fisher are also collaborating on the State Farm case with The Sizemore Firm out of El Segundo and the Whatley Kallas Firm out of New York City.

    All agents are encouraged to contact this group with any and all questions regarding a potential claim at 1-205-324-4644. All calls and inquiries will be kept confidential.
    [/FONT]
     
  2. Mattschmidt
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    Mattschmidt Guru

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    It will be interesting to see how all this unfolds...Surprised they didn't try to settle out of court
     
  3. ASU67
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    ASU67 New Member

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    Interesting after 35 years with this great company in agency there are people who want someone else to pay for their business failure or lack of business acumen skills. Agency is an experiment in free market capitalism where there are risks and rewards and winners and losers. The younger generation today expect to be spoon fed and want to cry when they make less than optimal decisions. All the company has to do is get successful "new market" agents to testify about their business decisions to counter the bogus claims that will be made by the plaintiffs. Of course there is one variable and that is the case may be tried in California which is the bastion of liberal judges and anti-business legislation that thwarts common sense and imposes many ridiculous penalties on it's citizens which is now contributing to bankrupting the state.
     
  4. new_agent
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    There is a line forming. If they try to settle, there will be a lot of ticas with their hands out. They are too smart for that.
     
  5. BNTRS
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    BNTRS Guru

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    Am I the only person not surprised this was filed in the state of California?

    We're not at that stage in the process, yet. The complaint has to be filed. The defendant has to be allowed a chance to respond and a court date be set.

    They'll at least go to court and have a judge review the initial complaint. SF will most likely ask for the case to be dismissed at that point.

    Depending on what SF's legal counsel can prove at that point, the dismissal may be granted. If not, SF will most likely begin to entertain settlement options.

    That's when you wish you knew the attorneys representing SF as there's a potential structured settlement sale.

    Unless it goes class action, then just the attorney's win.
     
  6. VolAgent
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    VolAgent Guru

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    Considering the intelligence level of the typical lower manager, there will be tons of evidence. You just know some of these AFOs, DAFOs and assorted acronyms either sent emails, texts or left messages that promised the sun, moon and the stars.

    The question isn't whether these new agency owners were mislead, the question is does it rise to the level of liability and can a judge and jury be convinced of it.
     
  7. sman
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    The attorney's win either way, settlement or class action.

    I know a few State Farm and Allstate agents. One Allstate agent I know ALWAYS complains about the requirements they put on the agent (who isn't an employee). One day while he was complaining, I asked, "Why don't you just go independent?" His response,

    That's the price you pay for the blue sign.
     
  8. silverpfurby
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    silverpfurby New Member

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    I've been a State Farm agent for 35 years. I trusted and was very happy with State Farm until 1999 when I agreed to take the aa97 contract in response to the Company's plea for expense assistance along with its promises of eventual compensation forthe sacrifice. Not long after it became obvious that State Farm had scammed some 5,000 of its most ardent supporters. There are few, if any, who would ever do it again or trust the company a second time. That is why it increasingly uses deception and strong arm tactics with its agents today. They simply do not trust its management.
    I will soon retire after a successful career with financial security. But there is more to a career and it is sad to leave with the bitter taste of a good meal gone rotten in the last few bites. Yet I'll be happy to shut the doors on the past 13 years of agency and never revisit State Farm from this side again.
     
  9. superfly33
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    superfly33 Super Genius

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    People love to state their opinions without actual knowledge of the case and supporting facts of the circumstances. This just goes to show their ignorance and acumen, sad really.

    Evidence may come out as to what SF said or did to get those agents to sign and and there are a lot of ways a contract can be voided. The contract may contain ambiguous language, there may be prior agreements that is not listed on the contract, fraud, undue influence, etc.
     
  10. xrac
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    I wonder where this first time poster comes from to post in support of the company. Think this is a company man posing as an agent?
     
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