Allstate Case May End Use of Special Judges in La.

The use of administrative law judges to settle some legal disputes involving state agencies could be threatened by a lawsuit now before the Louisiana Supreme Court.

According to Associated Press reports, the suit started in a flap over whether Allstate Insurance can sell a particular type of policy in Louisiana. In March, a judge in Baton Rouge ruled that the entire system of administrative law judges is unconstitutional, sending the suit directly to the high court.

The Supreme Court has given attorneys until June 20 to file written arguments.

Ann Wise, director of the Louisiana Division of Administrative Law, says the ruling by District Judge Janice Clark is the first of its kind in the nation. She says if administrative judges are eliminated, an estimated 40,000 lawsuits will be pushed into state courts.

But Jill Craft, an attorney for the Department of Insurance, which challenged the system, says the ruling is all about separation of powers in government.

In this case, Allstate won a ruling from an administrative judge allowing the company to sell a line of insurance to condominium owners. The department tried to appeal, but was told that state agencies have no right to challenge such rulings.

Clark says that by creating administrative law judges as an executive branch agency, the Legislature usurped the authority of the judiciary.

Several other state agencies have administrative law systems. Wise says those agencies also could lose their administrative law functions if Clark’s ruling stands.

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