If you received the Notice, State Farm’s records reflect that you submitted a claim to State Farm for a covered loss to a dwelling or other structure in Alabama under a State Farm structural damage insurance policy, based on a loss occurring between March 8, 2011 and August 3, 2017, for which you either (i) received an actual cash value ("ACV") payment on which depreciation may have been applied to estimated labor and other non-material costs, or (ii) did not receive a payment but did receive a State Farm estimate for the costs of the damage repair on which depreciation may have been applied to estimated labor and other non-material costs. The Court allowed, or “certified,” a class action lawsuit that may affect your rights. The parties have now reached a proposed settlement of that lawsuit.

The Court authorized the notice because you have a right to know of a proposed settlement of this class action, including the right to submit a claim for payment as part of the settlement, and about all your options regarding this settlement before the Court decides whether to give “Final Approval” to the settlement. If the Court approves the parties’ Stipulation of Settlement (“Settlement Agreement”), and if any appeals are resolved in favor of the settlement, then payments will be made to those who qualify and timely submit a valid claim. The notice explains the lawsuit, the settlement, your legal rights, what benefits are available, who may be eligible for benefits, and how to get them.

The Honorable Judge Terry F. Moorer of the U.S. District Court for the Southern District of Alabama is overseeing this class action. The lawsuit is known as Arnold v. State Farm Fire and Cas. Co., Case No. 17-CV-148-TFM-C.

This lawsuit is about whether State Farm breached its Alabama insurance policies by applying depreciation to the estimated costs of labor and other non-material costs in calculating ACV payments. Plaintiff contends that such depreciation resulted in Plaintiff and the Class being underpaid and was a breach of the insurance contracts.

State Farm denies that its conduct breached the insurance contracts. State Farm contends that many policyholders received everything they were entitled to under their policy, including through payments for replacement cost benefits.

In a class action, one or more people called “Class Representatives” sue on behalf of other people who have similar claims. The people together are a “Class” or “Class Members.” The Plaintiff who sued originally, along with three additional class representatives who were appointed by the Court in this case, are the Class Representatives. The person or entity they sue (in this case, State Farm) is called the Defendant. One court resolves the issues for all Class Members. The Court has appointed the lawyers for the Class Representatives (referred to as “Class Counsel,” whose names and contact information are provided in response to FAQ 18) to represent the Class and has appointed the Plaintiff and the three additional class representatives to serve as Class Representatives.

The Court has not decided the merits of this case in favor of either the Plaintiff or State Farm and has not found that State Farm did anything wrong. Instead, both sides agreed to settle. That way, the parties avoid the cost of a trial and potentially an appeal, and the people who qualify will get compensation. The Class Representatives and their attorneys think the settlement is best for all Class members. The settlement does not mean that State Farm did anything wrong. No trial has occurred, and the Court has not yet ruled on Plaintiff’s claims or State Farm’s defenses.

This settlement covers a Class of State Farm insureds who, according to Plaintiff’s allegations, were underpaid because State Farm calculated ACV payments by applying depreciation to estimated labor and other non-material costs.

You are receiving the notice because you are a potential member of the settlement “Class,” consisting of:

All persons and entities insured under a State Farm structural damage policy who made: (1) a structural damage claim for property located in the State of Alabama with a date of loss on or after March 8, 2011, but before August 3, 2017; and (2) which resulted in an actual cash value payment during the class period from which “non-material depreciation” was withheld from the policyholder; or which would have resulted in an actual cash value payment but for the withholding of “non-material depreciation” causing the loss to drop below the applicable deductible.

If you are a member of the Class, you will automatically be included unless you took affirmative steps to exclude yourself. Both current and former State Farm insureds can be part of this lawsuit.

The following people are excluded from the Class: (1) all persons and entities with claims arising under policies with State Farm coverage form WH-2101 or endorsement form FE-3650, or any other policy form expressly permitting the “depreciation” of “labor” within the text of the policy form; (2) all persons and entities that received actual cash value payments from State Farm that exhausted the applicable limits of insurance as shown on the declarations page; (3) State Farm and its affiliates, officers, and directors; (4) members of the judiciary and their staff to whom this Action is assigned; and (5) Class Counsel.

The Notice has been mailed to all people who are potentially eligible to receive money under the settlement, but it may also reach some people who are not in the Class. This series of questions may help you determine if you are a Class Member. Please consider all of the questions in order:

There is no document in your possession that will easily disclose whether you are a class member. However, if you are unsure whether you are potentially eligible to receive monies from the settlement, you may timely submit a claim form to have State Farm determine if you are eligible to receive payment. There is no penalty to submitting a claim form and submitting a claim form is the only way to have your claim reviewed, and if eligible, receive money from this settlement.

If you have further questions, you may call the following toll-free number 1-877-540-0864.

Please do not call State Farm or your State Farm agent to discuss this lawsuit. You may, however, continue to call State Farm or your State Farm agent regarding any other insurance matters.

Class Members who fully completed a claim form (“Claimants”) and timely mailed it to the proper address or uploaded it on this website may be eligible for payment. A copy of the claim form was attached to the Notice that was mailed to potential Class Members.  State Farm has agreed to pay Claimants the following:

1. Group A: Settlement Claimants Who Previously Received Only an ACV Payment. The Claim Settlement Payments to Claimants from whom estimated Non-Material Depreciation was initially deducted from their ACV payments and who did not receive any subsequent replacement cost benefit payments will be equal to 100% of the estimated Non-Material Depreciation that was initially deducted from the ACV payment, plus 44% of the estimated General Contractor Overhead and Profit Depreciation (if any) that was initially deducted from the ACV payment, plus simple interest at 5.55% on those additional amounts to be paid from March 8, 2017, to the Effective Date.
2. Group B: Settlement Claimants Who Previously Received Partial RCBs. The Claim Settlement Payments to Claimants from whom estimated Non-Material Depreciation was initially deducted from their ACV payments and who partially recovered the initially deducted Non-Material Depreciation through payment of replacement cost benefits will be equal to 100% of the estimated Non-Material Depreciation that was not fully recovered, plus 44% of the estimated General Contractor Overhead and Profit Depreciation (if any) that was initially deducted from the ACV payment and that was not fully recovered through payment of replacement cost benefits, plus simple interest at 5.55% on those additional amounts to be paid from March 8, 2017, to the Effective Date. 
3. Group C: Settlement Claimants Who Previously Received Full RCBs. The Claim Settlement Payments to Claimants from whom Non-Material Depreciation was initially deducted from their ACV payments and who subsequently recovered all depreciation will be equal to simple interest at 5.55% on the amount of estimated Non-Material Depreciation initially applied but subsequently recovered, plus simple interest at 5.55% on 44% of the estimated General Contractor Overhead and Profit Depreciation (if any) that was initially applied but subsequently recovered, calculated from the date of the initial ACV payment through the final replacement cost payment.

4. Group D: Settlement Claimants Who Would Have Received an ACV Payment but For Application of Non-Material Depreciation. The Claim Settlement Payments to these Claimants shall be equal to 100% of the portion of the estimated Non-Material Depreciation that the Settlement Class Member did not receive as an ACV payment solely because application of Non-Material Depreciation caused the calculated ACV figure to drop below the applicable deductible, plus simple interest at 5.55% on those amounts from March 8, 2017, to the Effective Date.

Each category of payment set forth in 1, 2, 3 and 4 above is subject to State Farm’s right to challenge or reduce the amount owed on the basis that (i) the Claimant is not a Class Member; (ii) the Non-Material Depreciation portion of the payment would exceed the applicable limit of liability under the Class Member’s Policy; or (iii) the Non-Material Depreciation portion of the payment was already recovered through replacement cost benefits payments, as explained in the Settlement Agreement.

If you have more than one loss during the Class Period of March 8, 2011 through August 3, 2017, you will need to submit a separate claim form for each loss. State Farm’s rights, and additional terms and explanation regarding how the payments are to be calculated, are set forth in the Settlement Agreement, which can be viewed at (or downloaded from) the Important Documents page.

The amount of money Class members will receive if they submit a claim form and are found eligible for payment is dependent upon the facts and circumstances of their individual claims. These amounts will be calculated for you if you timely submit a claim form, and if the Settlement is approved by the Court.

To be eligible for a payment, you needed to complete a claim form and submit it to the Settlement Administrator by mail or upload it to the Settlement Website at www.Arnold-v-StateFarm.com. Claim Forms needed to be submitted or timely postmarked by October 24, 2022. The deadline to submit a claim form has passed.

The Court granted “Final Approval” of the settlement, and any appeals were resolved in favor of the settlement. The payment will be mailed to eligible Class Members after the claims administration process is completed. If you submit a claim form but do not qualify for a payment, you will be notified of that determination. This process can take time, so please be patient.

Unless you excluded yourself, you are staying in the Class, and that means that you can’t sue or be part of any other lawsuit against State Farm over the legal claims in this case. It also means that all of the Court’s orders will apply to you and legally bind you.

If you submit a Claim Form, or simply stay in the Class and did not exclude yourself, you will agree to “release and discharge” all “Released Persons” of all “Released Claims.”  You may view a full copy of the Settlement Agreement on the Important Documents page, which provides more information.

Here is the definition of “Released Claims” and “Released Persons” in the Settlement:

“Released Claims” means and includes any and all past, present and future claims arising from or in any way related to depreciation of any kind on claims within the class period (including, but not limited to, calculation, deduction, determination, inclusion, modification, omission, and/or withholding of depreciation), whether known or unknown, and that were asserted or could have been asserted herein to the full extent of res judicata protection. This release is not intended to prevent an individual Class Member from seeking and potentially recovering any RCBs that may still remain available under the terms of his or her Policy. Additionally, Released Claims do not include any claim for enforcement of this Stipulation of Settlement and/or the Final Judgment.

“Released Persons” means, individually and collectively, (i) State Farm Fire and Casualty Company, and all of the past and present divisions, parent entities, associated entities, affiliates, partners, and subsidiaries; and (ii) all past and present officers, directors, shareholders, agents, attorneys, employees, stockholders, successors, assigns, independent contractors, and legal representatives of the entities set forth in (i). The Released Claims extend only to claims arising under insurance policies issued by the Defendant.

The deadline to exclude yourself from the Settlement was August 24, 2022 and has passed.

No. Unless you excluded yourself, you give up any right to sue State Farm for the claims that this settlement resolves. You needed to exclude yourself from this Class to sue State Farm over the claims resolved by this settlement. Remember, the exclusion deadline was August 24, 2022 and has now passed.

No. If you excluded yourself, you should not submit a Claim Form to ask for a payment as it will be rejected.

The deadline to object to the Settlement was August 24, 2022 and has passed.

Objecting is simply telling the Court that you don’t like something about the settlement. You can object only if you stay in the Class. Excluding yourself is telling the Court that you don’t want to be part of the Class or the settlement. If you exclude yourself, you have no basis to object because the case no longer affects you. If you object, and the Court approves the settlement anyway, you will still be legally bound by the result.

The Court appointed the lawyers for Plaintiff and the additional class representatives in this case to represent the Class (“Class Counsel”). Those lawyers are Erik D. Peterson of MEHR, FAIRBANKS & PETERSON TRIAL LAWYERS, PLLC, J. Brandon McWherter of MCWHERTER SCOTT BOBBITT, T. Joseph Snodgrass of SNODGRASS LAW LLC, and David Martin of THE MARTIN LAW GROUP, LLC:

The Court determined that these attorneys are qualified to represent the interests of the Class in this lawsuit. More information about their firm, their practices, and their lawyers’ experience is available on the firm websites.

You may if you want, but you do not need to hire your own lawyer because Class Counsel represent the Class of which you may be a member. For example, you can hire a lawyer to appear in Court for you if you want someone other than Class Counsel to speak for you. If you hire your own lawyer, you will be responsible for the charges that lawyer requires you to pay for representing you.

If you choose to remain in this lawsuit, you will not be required to pay attorneys’ fees or expenses to Class Counsel out of your own pocket. As part of the Settlement, Class Counsel will ask the Court for their attorneys’ fees and expenses to be paid in addition to the monetary benefits obtained for the Class. Class Counsel will ask the Court for up to $8,595,000 for attorneys’ fees, costs, and expenses, and will ask the Court to award the Plaintiff $20,000 and the three additional class representatives $15,000 each for their efforts in prosecuting this litigation (“Service Awards”). State Farm has agreed not to oppose Class Counsel’s request for their fees, costs and expenses, and the Service Awards to the Class Representatives up to these amounts. The Court may award Class Counsel and the Class Representatives less than the amounts they request. State Farm will separately pay Class Counsel’s fees, costs and expenses, and Class Representatives’ Service Awards that the Court orders. These payments will not reduce the amount distributed to Class Members. State Farm will also separately pay the costs to send notice and to administer the Settlement.

The Court held a scheduled Final Approval Hearing at 9:30 a.m. CST, on September 23, 2022, at the United States Courthouse in Mobile, Alabama. At this hearing, the Court considered whether the settlement was fair, reasonable, and adequate. If there were any objections, the Court considered them at that time. After the hearing, the Court decided to approve the settlement.

No. Class Counsel answered any questions that the Court may have had. If you wished to attend the hearing, or wished to present your objections to the Settlement, you had to have come at your own expense. You could have also paid your own lawyer to attend, but it was not necessary, unless you chose to have a lawyer appear on your behalf to object to the settlement.

If you submitted a proper written objection to the settlement, you or your lawyer acting on your behalf could have spoken at the Final Approval Hearing. You could not speak at the Hearing if you excluded yourself from the settlement.

If you did not submit a settlement claim, you’ll get no payment from this settlement even if you qualify for one. But, unless you excluded yourself from the settlement, you won’t be able to individually sue State Farm for the claims in this case.

The notice summarizes the proposed settlement. More details are in the Settlement Agreement, which is available on the Important Documents page, along with the Court’s Preliminary Approval Order, the Notice, the Claim Form, the Plaintiff’s Complaint, and State Farm’s Answer to the Complaint. You may also contact the Settlement Administrator at 1-877-540-0864.

Please do not call State Farm or your State Farm agent to discuss this lawsuit. You may, however, continue to call State Farm or your State Farm agent regarding any other insurance matters.

PLEASE DO NOT CALL OR WRITE THE JUDGE OR
CLERK OF THE COURT WITH QUESTIONS

PLEASE DO NOT CALL OR WRITE YOUR
STATE FARM AGENT WITH QUESTIONS

DIRECT ALL INQUIRIES TO CLASS COUNSEL
OR AN ATTORNEY OF YOUR OWN CHOOSING