Consumer Rights Class Action

In late 2003, Girardi | Keese filed a nationwide class action against Farmers Group Inc. alleging that Farmers Group Inc. charged excessive attorney-in-fact fees to the subscribers of the Farmers-branded insurance exchanges. Although the case was initially dismissed, the California Court of Appeal reversed the trial court's dismissal, publishing its opinion at Fogel v. Farmers Group Inc. (2008) 160 Cal.App.4th 1403 and finding that Farmers would have to answer for the allegations concerning its attorney-in-fact fees.

In the wake of the Fogel decision, Girardi | Keese added Farmers' parent, Zurich Financial Services, Ltd., to the case and the filed a motion to certify the nationwide class. Shortly before the hearing on the motion for class certification, the parties began a year's-worth of intense settlement negotiations. In October 2010, Girardi | Keese reached a settlement with Farmers and Zurich worth more than a half billion dollars. If granted final approval, the Fogel settlement will require Farmers and Zurich to refund up to $455 million in management fees to the 12.5 million class members and then pay any unclaimed funds to the insurance exchanges that are owned by those class members. Farmers and Zurich will also provide training and enhanced disclosures concerning the management fees to better educate the subscribers concerning Farmers' management fee practices. Finally, Farmers and Zurich will pay an estimated $20 million in class action administration costs and up to $90 million in attorney fees, cost reimbursement and an incentive award to the class representative.

The Court preliminarily approved the Fogel settlement in March 2011, and after more than eight years of tireless work to achieve this monumental settlement for more than 12.5 million class members, Girardi | Keese anticipates that the final approval hearing for the settlement will take place in late fall 2011.

For more information on the Fogel v. Farmers settlement, please visit https://fogelsettlement.com/.