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| | State Fund Sends A&J to the Mat
By Robert Warne - June 18, 2003
San Francisco Superior Court Judge, John Munter broke a bottle over the heads of a massive class of plaintiffs with his final decision, June 17, in the A&J Liquor v. State Compensation Insurance Fund case.
The suit, which threatened to drain approximately $2 billion out of State Fund, caught the close attention of the Legislature, the Department of Insurance, the workers' compensation industry, and California employers.
Represented by the law firm of Sheppard, Mullin, Richter & Hampton, State Fund’s triumph is one of the largest class action victories in California history.
Sheppard Mullin’s Fred Puglisi, who second chaired the trial, said, "Defendants rarely try large class actions, particularly when the plaintiff seeks billions of dollars. We are thrilled that our client trusted us to try this lawsuit on its behalf, and we are pleased with the Court's decision. The State Fund received justice."
The suit was filed in 1996 and eventually included over 163,000 members in the class action. After years of litigation a seven-month trial commenced July 2002.
The suit accused State Fund’s adjusters of carrying out an unfair practice of reserving claims between 1989 and 1995. The plaintiffs failed though to offer any reason why State Fund’s civil service employees who receive neither stock options nor performance based compensation would adopt or support such conduct.
It is believed that a ruling in A&J Liquors’ favor would have financially impaled State Fund beyond recovery and would have knocked the state’s workers’ compensation system out of its current orbit of issues into a realm of problems where no government has ever gone before. |
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