The U.S. Court of Appeals for the Seventh Circuit has held that a class action—which alleges Country Mutual Insurance unjustly accumulated and retained $3.5 billion in fiduciary duties and other legal obligations—belongs in state court, and that two exceptions to the Class Action Fairness Act apply.

The appeal in Sudholt v. Country Mutual Insurance considered whether either of the two exceptions to federal jurisdiction applied under the Class Action Fairness Act (CAFA), which would then require remand to Illinois state court. The lawsuit was filed by policyholders in U.S. District Court for the Southern District of Illinois alleging that the company pocketed $3.5 billion in profits from premium revenues which exceeded the cost of claims, according to the opinion.