MADISON - ST. CLAIR RECORD

On the day Chicago lawyer Robert Clifford’s firm spent $150,000 opposing the retention of Illinois Supreme Court Justice Lloyd Karmeier, Clifford appeared in federal court on behalf of clients who claim campaign money corrupted the Supreme Court.

The Illinois election board posted Clifford’s contribution to “Campaign for 2016” on Oct. 21, during a hearing in an $8 billion suit he leads against State Farm.

Clifford and others allege that in 2004, State Farm secretly provided $4 million to Karmeier through third parties in order to overturn a $1 billion judgment against the insurer.

At the hearing, he told Magistrate Judge Stephen Williams that he plans to depose Karmeier after the Nov. 4 election.

Clifford’s contribution to Campaign for 2016 serves as a vivid reminder that plaintiff lawyers raised millions for Karmeier’s opponent, Gordon Maag.

Campaign for 2016 spent $571,000 last weekend, for television spots that accuse Karmeier of selling justice. The committee spent another $169,056 for a brochure.

Most of the money came from associates of St. Louis lawyer Stephen Tillery, whose $10 billion judgment against Philip Morris awaits review at the Illinois Supreme Court.

The group’s name fits because if voters don’t retain Karmeier, they will choose a replacement in two years.

In the State Farm case, Mark Hale of New York state and Todd Shadle of Texas claim the insurer and two other defendants conspired to violate racketeering law.

Fifteen years ago, Hale and Shadle belonged to a class of policy holders who won a jury verdict at Williamson County courthouse in Marion.

Jurors found State Farm supplied inferior parts for millions of crash repairs.

Fifth District appellate judges - Maag being one of them - upheld the verdict in 2001, and State Farm appealed to the Supreme Court.

While the case remained under review, Karmeier defeated Maag.

In 2005, the Supreme Court reversed the judgment.

Lead plaintiff Michael Avery moved to vacate the Supreme Court decision in 2011, claiming he found new evidence of State Farm’s secret support for Karmeier.

The Supreme Court denied his motion.

His lawyers sued State Farm in federal court in 2012, on behalf of Hale and Shadle, claiming the insurer concealed and misrepresented facts at the Supreme Court in 2005 and 2011.

Hale and Shadle also sued State Farm employee William Shepherd and Illinois Civil Justice League director Ed Murnane.

Each side has asked the other to produce documents of communications among attorneys, and each side has asserted privilege to withhold those documents.

State Farm, Shepherd and Murnane argue that privilege doesn’t apply because they need to determine when plaintiffs obtained the evidence they identified as new in 2012.

Hale and Shadle argue that privilege doesn’t apply because State Farm engaged in fraud.

At the Oct. 21 hearing, plaintiff counsel Steven Blonder of Chicago said plaintiffs are entitled to find the basis of fraudulent statements in State Farm’s Supreme Court briefs.

“Did State Farm mislead its lawyers or did its lawyers perpetrate the fraud?” Blonder said.

“Had State Farm come clean on its involvement, Karmeier would have recused himself and the Illinois Supreme Court would have done something different.”

For State Farm, Ronald Safer of Chicago said an assertion of fraud can’t overcome privilege.

“They can’t stand here on assertions,” Safer said. “They have to prove it.”

He said their allegations of misrepresentation were flawed.

Safer said plaintiffs count $1 million in dues that State Farm paid to the U.S. Chamber of Commerce as a contribution to Karmeier.

“There are a number of different things that this money was going to be used for.”

He said the Chamber approved $1.8 million to $2 million, to improve the litigation climate in Illinois, Mississippi, West Virginia and California.

He said plaintiffs allege that State Farm chief executive Ed Rust, as a Chamber board member, voted in 2003 to send money to Karmeier.

“That was false, patently and demonstrably false,” Safer said.

Williams said, “Did he have a proxy?”

Safer said, “There is no evidence that they took any kind of proxy, your honor. Everything State Farm said was true. Now they say State Farm contributed to an organization that contributed to an organization that contributed to an organization that contributed to Justice Karmeier’s campaign.”

State Farm counsel Joseph Cancila of Chicago said he recognized the names on the Chamber vote and Rust did not have a proxy.

Safer produced the Chamber’s bylaws and said they didn’t allow proxy votes.

Williams said he would take privilege issues under advisement. He set another hearing Nov. 3.

Michael Nester of Belleville attended the hearing on behalf of the Illinois State Bar Association.

Plaintiffs alleged in September that State Farm corrupted the Bar’s process for evaluating judicial candidates.

(Editor’s note: The Madison-St. Clair Record is owned by the U.S. Chamber Institute for Legal Reform).