April 6, 2026
$15.6M Settlement Follows Jury Verdict in Total Loss Class Action Where Econ One Expert, Phillip Johnson Testified
A federal court in Arkansas has preliminarily approved a $15.6 million class action settlement in Chadwick v. State Farm, resolving claims that State Farm systematically underpaid Arkansas policyholders on total loss vehicle claims by applying a so-called “Typical Negotiation Adjustment” — a deduction that uniformly reduced actual cash value payments to insureds.
Econ One Managing Director Dr. Phillip Johnson testified at the June 2025 jury trial on behalf of the plaintiff class. Dr. Johnson provided expert analysis demonstrating that the Audatex methodology underlying State Farm’s Typical Negotiation Adjustment was statistically unsound and systematically reduced State Farm’s valuations of actual cash value. He also provided the damages framework the jury was asked to apply — the difference between ACV calculated with and without the adjustment.
The jury found in favor of the class after five days of testimony. The subsequent $15.6 million settlement covers Arkansas policyholders who submitted claims between November 2016 and October 2021 and received payments based on Audatex reports applying the Typical Negotiation Adjustment, with average recoveries of approximately $489 per claim. A final approval hearing is set for July 15, 2026.
Learn more about Dr. Johnson: econone.com/staff-member/phillip-johnson
Read more about the settlement: https://econone.com/wp-content/uploads/2026/04/State-Farm-Inks-15.6M-Deal-In-Totaled-Car-Payout-Class-Action-Law360.pdf
