Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.

Monday, November 8, 2021

Antitrust

  • A bipartisan coalition of 26 attorneys general led by Pennsylvania Attorney General Shapiro and California Attorney General Bonta submitted a brief to the Third Circuit asking it to uphold a lower court decision that stopped a New Jersey hospital merger. The coalition is concerned about the anticompetitive effects of the merger.

Consumer Protection

  • Massachusetts Attorney General Healey announced an assurance of discontinuance against the Mildred Elley School, including a payment of more than $1 million in consumer relief. Among other things, the school allegedly failed to make required disclosures at least 72 hours before making enrollment agreements, advertised higher placement rates than were accurate, and engaged in high-pressure sales tactics when it contacted prospective students more than twice a week.

Data Privacy

  • Colorado Attorney General Weiser announced that SEMA Construction must pay over $63,000 and update its data security practices after a 2018 data breach. The settlement resolves allegations that the company failed to protect employees’ and consumers’ personal information and that it failed to notify consumers of the data breach in a timely manner.

Environmental

  • Washington D.C. Attorney General Racine announced the successful resolution of two environmental enforcement matters, including a judgment against Miss Dallas Trucking, LLC in a water pollution lawsuit and a settlement against local contractor Universal Flooring and Remodeling, LLC after a lead paint investigation. Miss Dallas Trucking must pay $30,000 in costs and a $50,000 civil penalty, and Universal Flooring must pay $25,000 in civil penalties and agree to injunctive relief. Attorney General Racine also announced a lawsuit against South Capitol Improvement, LLC over illegal water discharge.

Housing

  • A multistate coalition of 18 attorneys general led by New York Attorney General James submitted a comment letter to the U.S. Department of Housing and Urban Development (“HUD”) in support of expanding eviction protection rules. Specifically, the coalition is asking HUD to halt evictions when there is a pending Emergency Rental Assistance Program application, require landlords supervised by HUD to seek money rather than possessory judgments against those who file federal emergency rent assistance applications, and remove late-payment fees during national emergencies.

Tuesday, November 9, 2021

Antitrust and Competition

  • New York Attorney General James announced an agreement with the owners of supermarket chains Price Chopper and Tops Friendly Market, securing the divestment of 11 stores in connection with their proposed merger. The agreement will help maintain competition and protect employee rights in the relevant areas.

Bankruptcy

  • A bipartisan coalition of attorneys general sent a letter to Congress in support of the Bankruptcy Venue Reform Act, which would amend the Bankruptcy Code to limit where corporations may file bankruptcy to only the jurisdiction in which their principal place of business or their assets are located. The coalition believes this amendment will prevent corporations from forum shopping.

Consumer Protection

  • Kentucky Attorney General Cameron announced a proposed settlement with Delta Natural Gas which is intended to save consumers more than $3.4 million in rate increases for natural gas.

Cybersecurity

  • Connecticut Attorney General Tong issued a press release urging caution after a data breach against online stock trading platform Robinhood. According to the press release, a hacker has obtained access to five million people’s email addresses and two million people’s full names.

Environmental

  • Iowa Attorney General Miller announced that District Judge McPartland of the District Court for Linn County entered a consent decree against Abatement Specialties, approving a civil penalty of $40,000 and injunctive relief to resolve allegations of asbestos removal violations during a high school renovation.

Wednesday, November 10, 2021

Consumer Protection

  • Pennsylvania Attorney General Shapiro announced that his office won two lawsuits against car title lenders. Attorney General Shapiro’s office obtained a judgment against Dominion Management of Delaware, Inc. and Dominion Management Services, Inc., d/b/a CashPoint, and a company principal, requiring the company to pay over $8.5 million for charging illegally high interest rates on its car title loans. His office also won a court ruling against Auto Equity Loans of Delaware, LLC, which had tried to stop a consumer protection investigation against it. The U.S. District Court for the Middle District of Pennsylvania held that the Attorney General may investigate Auto Equity’s claims that none of its loan transactions occurred in Pennsylvania.

Deceptive Claims

  • Oregon Attorney General Rosenblum announced a lawsuit against opioid manufacturer Endo Health Solutions and Endo Pharmaceuticals, Inc. for allegedly deceptively marketing Opana for more than 10 years. The lawsuit alleges that the company misrepresented Opana’s risks and benefits.

Health Insurance Portability and Accountability Act (HIPAA)

  • New Jersey Acting Attorney General Bruck announced that printing companies Command Marketing Innovations, LLC and Strategic Content Imaging, LLC, which provide services to a managed healthcare organization, agreed to pay $130,000  in penalties and implement new security policies after allegations that they improperly handled medical and client information and when they failed to detect a printing error. $65,000 of the payment is suspended if the companies comply with the order.

Price Gouging

  • North Carolina Attorney General Stein announced that his office reached a $20,000 settlement with gas station Mansa Travel Center Charlotte LLC, d/b/a Queen’s Market, for allegedly violating the state price gouging law during the state of emergency in place over the Colonial Pipeline shutdown. The lawsuit alleged that the company increased gas prices by as much as 256%. The settlement also requires the company to implement software permanently that records gas prices and the number of gallons sold.

Thursday, November 11, 2021

Criminal Medicaid Fraud

  • West Virginia Attorney General Morrisey announced two criminal convictions by his office’s Medicaid Fraud Unit, one for Medicaid fraud through the submission of forged claims for non-emergency medical transportation services and the other for financial exploitation of an elderly person by a nursing home employee. Both convictions also resulted in the payment of full restitution.

Friday, November 12, 2021

Consumer Protection

  • The Consumer Financial Protection Bureau filed a lawsuit against pawn lenders FirstCash, Inc. and Cash America West, Inc. alleging that they violated the Military Lending Act by charging over 36% on loans to active duty servicemembers and their dependents. The lawsuit, which seeks injunctive relief, consumer redress, and civil penalties, also alleges that FirstCash violated a 2013 order against its predecessor.

Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.

Monday, November 1, 2021

Consumer Protection

  • Kansas Attorney General Schmidt announced that Shawnee County District Court Judge Watson approved consent judgments against company SearchTec, Inc., which manages business documents, for illegally disposing of documents that contained personal information using public trash receptacles in violation of the Kansas Consumer Protection Act. Under the consent judgments, three corporate entities associated with SearchTec must pay almost $500,000 and change their business practices, for example by properly disposing of documents and conducting employee training.
  • Massachusetts Attorney General Healey announced a settlement with insurance agency Health Plan Intermediaries Holdings, LLC d/b/a Health Insurance Innovations, resolving allegations that the company sold health insurance plans that were not authorized for sale, claimed that its health insurance covered services it actually excluded, described health insurance as comprehensive when it was limited, and deceptively passed off limitations as positive elements rather than negative. The settlement includes a $625,000 payment and bans the company from selling health plans that are not Medicare-related in the state for a year.

Financial Exploitation Prevention Act (FEPA)

  • Michigan Attorney General Nessel announced that the Financial Exploitation Prevention Act’s rule requiring financial institutions to report financial exploitation of vulnerable adults to law enforcement and adult protective services is now in effect.

Tuesday, November 2, 2021

Consumer Protection

  • Washington D.C. Attorney General Racine asked six funeral homes in the District to comply with an emergency COVID-19 law requiring funeral homes to clearly and transparently display pricing information about funeral services and goods on the businesses’ websites. The businesses must also post the Funeral Bill of Rights online.

Education – Title IX

  • A coalition of 19 state attorneys general and the District of Columbia, led by Oregon Attorney General Rosenblum, filed an amicus brief with the District of Oregon in Hunter v. U.S. Department of Education, in support of Title IX laws which prohibit sex-based discrimination. The coalition is arguing that the religious exemption to Title IX was unjustly expanded and should again be narrowed.

Healthcare – Pharmacy Benefit Managers

  • Insurance Commissioner Navarro announced that the Delaware Department of Insurance will begin creating and enforcing regulations over Pharmacy Benefit Managers (“PBMs”) as HB 219 goes into effect. Among other things, the newly enacted law bars unequal payments to unaffiliated pharmacies and gives the Department of Insurance the power to investigate and regulate PBMs.

State AG Election News

  • Jason Miyares (R) won Virginia’s attorney general election, defeating incumbent Mark Herring (D). AG Elect Miyares, who has been a member of Virginia’s House of Delegates since 2016 and is a former prosecutor, has become the state’s first Latino attorney general. Some of his priorities in office include combatting human trafficking and improving law and order in Virginia.

Wednesday, November 3, 2021

Antitrust

  • Colorado Attorney General Weiser sent a letter to the U.S. Department of Transportation asking it to help increase competition among airlines to improve consumer protection. Specifically, Attorney General Weiser relayed his concerns that the industry is too concentrated and provides unnecessarily limited competition. Weiser also offers suggestions for a new model for the industry, including changes in slot management and code-sharing practices.

Thursday, November 4, 2021

Consumer Protection

  • Florida Attorney General Moody announced a lawsuit against online travel company BookIt Operating, LLC seeking more than $7 million for consumers. The lawsuit alleges that the company acted as an online third-party intermediary for car rentals, hotels, and airlines, and that it failed to disclose it did not have funds for current bookings without new incoming bookings, leaving consumers without a reservation or an initial refund.

Environmental – Toxic Chemicals

  • North Carolina Attorney General Stein announced four lawsuits against 14 manufacturers of fire suppressant Aqueous Film Forming Foam, which contains PFAS. The lawsuit alleges that the manufacturers created a public nuisance and a design defect, failed to warn consumers, and fraudulently transferred assets to shield profits. The lawsuit is seeking an investigation into the nature of the damage, a cleanup, replacement of water treatment systems and wells, restoration of resources, and future monitoring.

Social Media

  • Pennsylvania Attorney General Shapiro announced a lawsuit against Pennsylvania companies owned and operated by influencer Dana Chanel, alleging that Chanel failed to deliver promised goods and services and misled consumers.

Friday, November 5, 2021

Bank Secrecy Act

  • California Attorney General Bonta announced an administrative accusation filed with the California Gambling Control Commission against The Bicycle Hotel & Casino, following the resolution of a federal investigation into whether the company violated the Bank Secrecy Act’s anti-money laundering provisions. The action will seek to hold the business owner responsible for violations of state law.

Consumer Protection

  • Illinois Attorney General Raoul announced a settlement with online payday lending lead generators MoneyMutual LLC, PartnerWeekly LLC, and Selling Source LLC. The settlement resolves allegations that these businesses violated state lending laws by generating payday loan leads without a license and by arranging payday loans for out-of-state lenders which were also unlicensed, all while representing that their loan network was trustworthy. The settlement requires the companies to immediately stop offering loans to consumers in the state without a license.
  • Colorado Attorney General Weiser announced that the Colorado Department of Law’s consumer protection section responded to complaints that online educational platform com displayed e-cigarette ads. The press release states that the consumer protection section is satisfied with the company’s steps to block these advertisements using content moderating software but that it will continue to monitor online advertising to protect children.

Cybersecurity

  • Washington Attorney General Ferguson released his sixth annual Data Breach Report, revealing that the last year has far surpassed the record of data breach and ransomware attacks reported since Attorney General Ferguson’s office began tracking this data. 2021 saw 6.3 million notices, while the previous record was 3.5 million in 2018.

Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.

Monday, October 25, 2021

Charities

  • New York Attorney General James announced the launch of a new online filing portal charities may use to report their annual financial disclosures. The system is intended to increase the efficiency of filing for charities that are required to register with the Office of the Attorney General’s Charities Bureau.

Consumer Protection

  • Washington D.C. Attorney General Racine announced a lawsuit against event venue the Loft at 600 F and its owner, who allegedly refused to provide refunds or reschedule events, including weddings, which were canceled during the space’s closure due to the pandemic. The lawsuit is seeking restitution, damages, refunds, and civil penalties.

Price Gouging

  • Minnesota Attorney General Ellison announced a consent judgment against egg producer Sparboe Farms, resolving allegations that it excessively priced eggs in March and April 2020. The consent judgment requires the company to donate 90,000 dozen eggs to nonprofit organizations within 18 months. The company must use eggs that are the same quality as those it sells at retail and assume all costs.

Tuesday, October 26, 2021

American Rescue Plan Act (ARPA)

  • A coalition of 20 states led by Arizona Attorney General Brnovich filed a brief in support of Ohio’s lawsuit against the Biden administration’s American Rescue Plan Act Tax Mandate, which requires states not to lower taxes in order to receive COVID-19 relief funding. The coalition is asking the Sixth Circuit to uphold an injunction against the mandate.

Antitrust

  • Washington Attorney General Ferguson announced a lawsuit against 19 chicken producers and an industry data reporting service, alleging a conspiracy to inflate and manipulate prices, coordinate industry supply reductions to maximize profits, and rig contract bids. The lawsuit seeks injunctive relief, restitution, and civil penalties.

Energy

  • A coalition of 22 states, six cities, and the District of Columbia, led by California Attorney General Bonta, sent a letter of support to the National Highway Transportation Safety Administration’s proposal to strengthen requirements for corporate average fuel economy standards for model year 2024-2026 vehicles. The coalition is arguing that improved fuel economy saves money for consumers, improves national security, improves air quality, combats climate change, and allows for public health benefits.

Environmental

  • A multistate coalition led by California Attorney General Bonta sent a letter to the U.S. Environmental Protection Agency asking it to quickly adopt regulations limiting oxides of nitrogen emissions from model year 2027 on-road heavy-duty trucks. The coalition is arguing that these regulations are needed to protect vulnerable communities and to improve air quality

Wednesday, October 27, 2021

Consumer Protection

  • Kentucky Attorney General Cameron announced that his Office of Rate Intervention reached a proposed settlement with Columbia Gas of Kentucky, Inc. The agreement will save consumers more than $8 million in natural gas rate increases and includes a provision requiring the company not to seek a further base rate increase for at least three years.

COVID-19

  • Arkansas Attorney General Rutledge announced a lawsuit against Med-Care Health Link, LLC and others for failing to provide over $10 million worth of personal protective equipment and 560 ventilators to University of Arkansas for Medical Sciences. The lawsuit seeks a refund and civil penalties for each violation of the Arkansas Deceptive Trade Practices Act.

Fraud Schemes

  • New Jersey Acting Attorney General Bruck announced that the Bureau of Securities issued orders to five companies that were offering fraudulent investment opportunities for cryptocurrencies. The orders require the companies to stop violating New Jersey law.

Social Media

  • A coalition of 25 attorneys general filed an amicus brief in Doe v. Facebook, Inc., arguing that the Supreme Court of Texas interpreted Section 230 of the Communications Decency Act overly broadly to immunize Facebook from liability for failing to warn of and benefitting from human trafficking on its platform. The coalition is arguing that the interpretation leaves victims with no avenue for recourse against platform operators.

Thursday, October 28, 2021

Consumer Protection

  • California Attorney General Bonta announced court approval of a $3.5 million stipulated judgment against Pong Game Studios Corporation for an illegal gambling operation that was set up to appear as a legal sweepstakes. The settlement also requires the business to halt its gambling operations in the state.
  • Pennsylvania Attorney General Shapiro announced settlement agreements with Arrowmistic, LLC, d/b/a Wicca Movement and Cultured Quotes, LLC for allegedly posting deceptive advertisements for “free jewelry” on Facebook without disclosing that accepting the offer meant enrollment in a membership club and paying a $19.99-$25 recurring fee unless and until the membership was cancelled. Under the settlement, the companies paid $25,000 and must not bill consumers for any membership fees from a promotional offer between January 1, 2017 and the settlement’s filing date unless they have proof of adequate consent.

Cybersecurity

  • California Attorney General Bonta issued an alert including tips for businesses and consumers to defend against cybersecurity threats. The alert reminds businesses in California that they have a legal obligation to maintain data security. Some of the business tips include training employees using data security principles, using updated software, providing firewall security, securing Wi-Fi networks, and limiting employee access to information and data.

Environmental

  • A coalition of 21 state attorneys general led by West Virginia Attorney General Morrisey filed a petition requesting that the U.S. Supreme Court clarify the definition of “waters of the United States” in the interest of protecting state sovereignty over water and land within state borders. The coalition is arguing that the U.S. Environmental Protection Agency has defined the phrase overly broadly.

Fraud Schemes

  • Florida Attorney General Moody announced the arrest of the owner of Villa Pavers and Pools for allegedly participating in a scheme to defraud homeowners of over $1 million. Specifically, the company allegedly charged at least 40% upfront fees without intent of completing the jobs for which it was paid.

Healthcare

  • New Hampshire Attorney General Formella announced that the Director of Charitable Trusts will host a public hearing over a proposed transaction between Home Health & Hospice Care and SolutionHealth. The hearing will take place on November 18.

Friday, October 29, 2021

Consumer Protection

  • New York Attorney General James announced a settlement with Ticket Fulfillment Services, L.P. and five ticket resale websites for failing to provide refunds to over 11,000 consumers who purchased tickets to events that were cancelled due to the pandemic. Under the agreement, the company must guarantee refunds to consumers in New York and out-of-state purchasers who bought tickets for New York venues if the event was cancelled, totaling about $4.4 million in refunds. The company must also discontinue affiliates’ right to sell tickets on the platform if they do not have or fail to honor a refund policy.

Data Breach

  • The Massachusetts Office of Consumer Affairs and Business Regulation reported a data breach involving health care network UMass Memorial Health between June 2020 and January 2021

Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.

Monday, October 18, 2021

Consumer Protection – Cryptocurrency

  • New York Attorney General James announced that she directed two virtual currency lending platforms to immediately stop operating in New York, and asked three others to immediately provide information about their products and operations.

Energy

  • California Attorney General Bonta announced he and other Attorneys General submitted comment letters to the U.S. Department of Energy asking it to strengthen the U.S. energy efficiency program. The letters addressed issues related to proposals to strengthen energy efficiency standards for certain types of lightbulb, washer, dryers and dishwashers and to unwind certain Trump administration process rules.

Housing

  • Virginia Attorney General Herring announced that his Office of Civil Rights filed 13 lawsuits against 29 real estate companies for alleged housing discrimination practices. Specifically, the lawsuits allege that the companies discriminated against those who planned to use Housing Choice Vouchers to pay rent. The lawsuits are seeking damages, injunctive relief, civil penalties, and costs.

Labor and Employment

  • Washington D.C. Attorney General Racine announced a lawsuit against construction company Dynamic Contracting, Inc., two of its general contractors, and four of its labor subcontractors for a scheme that involved worker misclassification on construction projects. The lawsuit, which seeks damages, penalties, and injunctive relief, alleges that the scheme resulted in the denial of worker benefits.
  • New Jersey Acting Attorney General Bruck announced that the New Jersey Division on Civil Rights adopted amendments to its New Jersey Family Leave Act rules which allow more employees to take family leave for a wider variety of reasons, including for reasons related to a public health epidemic. The rules also clarify eligibility and how to administer the leave benefit.

Tuesday, October 19, 2021

Fraud Schemes

  • A coalition of 20 attorneys general sent a comment letter to the Federal Deposit Insurance Corporation, the Federal Reserve, and the Office of the Comptroller of the Currency, urging these regulators to explicitly speak out against rent-a-bank schemes in their guidance for banks on risk management when working with third parties.
  • Connecticut Attorney General Tong issued a press release urging charities in the state to protect themselves from fraud, such as by not clicking on links in unexpected texts or emails, vetting unsolicited offers that require advance fee payments, and checking bank statements regularly for unusual activity.

Labor and Employment

  • Rhode Island Attorney General Neronha announced that two owners of asbestos remediation company Franklin Analytical Serviceswere arraigned on charges of wage theft. The charges include failure to pay overtime on a prevailing wage job, conspiracy to fail to pay overtime wages, conspiracy to file false certified payroll, and filing a false certified payroll document.

Wednesday, October 20, 2021

Consumer Protection

  • New Jersey Acting Attorney General Bruck announced that the New Jersey Division of Consumer Affairs proposed amendments to health club services regulations, which would require registered sellers of these services to post a notice at any locations where consumers sign contracts, including online, telling consumers how to cancel.
  • Washington Attorney General Ferguson filed a lawsuit against Global Grid Telecom and its owner for illegally robocalling consumers and sending deceptive recorded messages purporting to sell a robocall-blocking service. The lawsuit seeks injunctive relief, restitution, and civil penalties of up to $7,500 per violation.

Thursday, October 21, 2021

Medicaid Fraud

  • Illinois Attorney General Raoul announced that an owner and biller of medical equipment company Integrity Medical & Physician Supply were charged with defrauding Illinois out of over $600,000 in Medicaid funding. Specifically, the defendants were charged with submitting fraudulent claims to the Medicaid program for diabetic supplies that were never provided.

Consumer Financial Protection Bureau

  • The Consumer Financial Protection Bureau (“CFPB”) issued several orders seeking information on the business practices of large technology companies that operate payment systems in the United States. The CFPB is hoping to use this information to understand how the companies use payment data and manage data access, in order to ensure there are adequate consumer protections in place.

Food & Drug Administration

  • A coalition of 23 attorneys general petitioned the U.S. Food and Drug Administration (“FDA”) to accelerate the removal of toxic heavy metals from infant and toddler foods by setting limits on toxic metals in these products. The FDA has already instituted a plan to limit toxic metals in baby food, but the coalition is seeking to accelerate the timeline and is asking for stricter regulations.

State AG Election News

  • Maryland Attorney General Frosh announced that he will not be seeking re-election as Attorney General after his term ends in the next 15 months.

Friday, October 22, 2021

Consumer Protection

  • News sources reported that Washington D.C. Attorney General Racine added Facebook CEO Zuckerberg as a defendant in his 2018 complaint over Cambridge Analytica’s allegedly illegal collection of users’ data through a personality quiz app.

Energy

  • Michigan Attorney General Nessel announced that her office is participating in the Michigan Public Service Commission’s Technical Conference on Emergency Preparedness, Distribution Reliability, and Storm Damage, which was organized in response to prolonged power outages during the past summer. Attorney General Nessel’s participation will focus on expanding on comments the commission has received related to utility oversight.

Environmental

  • Illinois Attorney General Raoul announced a lawsuit against Metal Management Midwest Inc. d/b/a Sims Metal Management for failing to show a minimum threshold reduction in uncontrolled emissions from its metal shredding and recycling facility. The court has also entered an interim order requiring the company to create and implement a control system to reduce uncontrolled emissions by at least 81%.
  • State attorneys general applauded that the Northern District of California vacated new rules imposed by the previous administration in section 401 of the Clean Water Act. The new rules reduced states’ ability to enforce against water pollution and related environmental harm.

Labor and Employment

  • New Jersey Acting Attorney General Bruck announced that telecommunications contractor Adalex Enterprises Corp. d/b/a Adalex Communications; Advance Telecom Resources, Inc.; and Adalex’s principals must pay $175,000 to resolve allegations that the company defrauded the state by failing to pay employees prevailing wages.

Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.

Monday, October 11, 2021

Environmental

  • California Attorney General Bonta announced that the California Department of Justice is investigating the Amplify Energy oil spill that occurred off the coast of Huntington Beach. Along with state, federal, and local authorities, the California Department of Justice will determine the spill’s cause and what, if anything, could have been done to minimize or prevent it.

Tuesday, October 12, 2021

Cybersecurity

  • New Jersey Acting Attorney General Bruck announced a consent order against fertility clinic Diamond Institute for Infertility and Menopause, LLC following a data breach that compromised over 14,000 patients’ personal information. The consent order requires the company to pay $495,000, which includes civil penalties and attorneys’ fees and costs, and to implement stronger data security measures.

Wednesday, October 13, 2021

Consumer Protection

  • Indiana Attorney General Rokita announced an upcoming discussion on October 14, 2021 over his filing of a lawsuit against a company that allegedly served as a gateway for robocallers in India, the Philippines, and Singapore to make calls into the United States.
  • Florida Attorney General Moody announced a lawsuit against pool company Olympus Pools, Inc.and its owner for taking payments for pool services and then failing to completely perform them. The lawsuit seeks to permanently prohibit the defendants from engaging in certain activities related to pool construction, as well as restitution and civil penalties. Attorney General Moody’s office is also assisting with a criminal investigation.

Energy

  • Massachusetts Attorney General Healey filed comments asking the Federal Energy Regulatory Commission to amend its policies for planning and funding new electric transmission infrastructure in order to support clean energy, consumer protection, and environmental justice. These comments are in addition to separate comments Attorney General Healey earlier filed with a coalition of state attorneys general, reflecting broader concerns.

Environmental

  • California Attorney General Bonta and the California Air Resources Board filed a motion to intervene in a lawsuit to support South Coast Air Quality Management District’s rule that requires warehouses to reduce emissions from heavy sources of on-road pollution that visit them. The rule, also known as the Indirect Source Rule, has been challenged as outside the Air District’s authority.

Healthcare – Pricing Transparency

  • Washington D.C. Attorney General Racine is asking 11 hospitals to comply with new federal regulations that are geared towards making the pricing of medical services more accessible and transparent. Attorney General Racine’s requests, which follow news reports about hospitals failing to comply with the regulations, ask the hospitals to explain how they are complying and to conspicuously display their price lists for shoppable services online.

Thursday, October 14, 2021

Consumer Protection

  • Indiana Attorney General Rokita announced a lawsuit against company Startel Communication LLC, alleging that it served as a gateway for robocallers abroad, who were operating a variety of scams, to make calls into the United States. The lawsuit, which could include billions of dollars in fines, also names companies Piratel LLC and VoIP Essential LLC, which allegedly knew about the robocalls and looked the other way when they routed the calls.
  • A coalition of 19 attorneys general sent a letter to Congress asking Senate committee leadership to oppose legislation, the Methane Emissions Reduction Act and a provision of the Build Back Better Act, which would charge producers of oil and natural gas $1,500 to $1,800 per ton of methane emissions that exceed certain thresholds. The coalition is concerned about the cost increases that may result from these fines.

False Claims

  • Massachusetts Attorney General Healey announced a settlement with a private equity firm and former executives of South Bay Mental Health Center, Inc., requiring them to pay $25 million for allegedly causing the submission of fraudulent claims to Massachusetts’ Medicaid program for mental health services that were provided by improperly supervised, unlicensed, and unqualified staff members. This is the largest settlement of this kind for the Massachusetts Attorney General’s Office.

Labor and Employment

  • Massachusetts Attorney General Healey announced that White’s Bakery must pay $95,000 in restitution and penalties to resolve allegations that an employee was exposed to racial slurs at work. The settlement also includes injunctive relief terms, such as annual employee anti-bias, anti-discrimination, and anti-harassment training for the next three years.
  • Illinois Attorney General Raoul announced that his office has entered into consent decrees with meat processing company Mistica Foods and temporary staffing agency Specialized Staffing, resolving allegations that the companies engaged in discriminatory conduct against Black job applicants and workers. Specialized and Mistica must pay $180,000 and $270,000 in civil penalties respectively, and the consent decrees also include injunctive relief such as mandatory steps towards increasing the number of Black employees at Mistica and recordkeeping requirements.

Local Journalism Sustainability Act of 2021

  • A bipartisan coalition of 15 attorneys general led by Washington Attorney General Ferguson sent a letter to Congress asking it to pass legislation that supports local journalism. Specifically, the coalition is asking Congress to pass the Local Journalism Sustainability Act of 2021, which would provide tax credits and funding to support local newspapers and the hiring of local journalists.

Social Media

  • A coalition of 14 attorneys general sent a letter to Facebook CEO Mark Zuckerberg asking Facebook to disclose whether it offered protections to certain users that allowed them to spread COVID-19 and vaccine misinformation. Specifically, the coalition is asking whether the “Disinformation Dozen” received this protection, the extent to which permitted content has been anti-vaccine, and how many user complaints resulted in the removal of this anti-vaccine content.

Friday, October 15, 2021

Consumer Protection

  • Maryland Attorney General Frosh announced a settlement with Just Puppies of Maryland, Inc., Just Puppies, Inc., and their owner, resolving allegations that the companies violated the Consumer Protection Act and the No More Puppy Mills Act. The settlement includes a $500,000 partially-waived civil penalty, prevents the companies from selling dogs in Maryland, and provides restitution and other relief to consumers who purchased puppies with health disorders.
  • A coalition of 20 attorneys general opposed a potential Internal Revenue Service reporting policy that will provide the federal government with access to broad financial transaction information. The attorneys general are arguing that the policy will result in significant costs that banks will pass on to consumers and that it will increase the risk of cybercriminal exploitation of personal data.

Price Gouging

  • Michigan Attorney General Nessel issued a warning to Benton Harbor residents and those living in surrounding areas advising them to watch out for price gouging, especially of bottled water, after concerns of lead contamination in drinking water.

Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.

Monday, October 4, 2021

Consumer Protection

  • New Jersey Acting Attorney General Bruck announced that the Division of Consumer Affairs reached a settlement agreement for over $138,000 with five gas stations that were overcharging consumers, including by selling regular gas as premium. In addition to the monetary payment, the settlement includes injunctive relief.

Social Media

  • Connecticut Attorney General Tong is requesting that TikTok’s leadership meet with educators and parents in Connecticut to explain its policies to prevent platform misuse and to commit to reforms that stop dangerous and harmful content.

Tuesday, October 5, 2021

Healthcare Rights and Access

  • California Attorney General Bonta announced his conditional approval of the sale of acute psychiatric inpatient hospital Adventist Health Vallejo to Acadia Healthcare Company Inc. The sale is contingent on conditions that address the risk of price increases in a limited market and ensure the availability of high-quality services. Some of the conditions include a price freeze, a monitor, and an evaluation team.

Social Media

  • A bipartisan coalition of 52 attorneys general expressed their support for hearings the U.S. Senate Committee on Commerce, Science, and Transportation’s Subcommittee on Consumer Protection, Product Safety, and Data Security is conducting about mental health harm to children from social media. The coalition is hoping the hearings uncover more about the business practices social media companies are employing to gain the attention of young people on their platforms and argues that the government should hold these companies accountable.

Wednesday, October 6, 2021

Consumer Protection

  • Pennsylvania Attorney General Shapiro announced a lawsuit against Great Conventions LLC and its owner for allegedly violating state consumer protection law by canceling the Great Philadelphia Comic Con without issuing refunds. The lawsuit seeks restitution, civil penalties, and a permanent injunction from selling tickets to or operating public events in the state.
  • Florida Attorney General Moody issued a press release warning consumers about a 16% increase in robocalls in 2021, as compared to last year. The press release states that Attorney General Moody is working with attorneys general nationwide to combat call-related scams.

Criminal Fraud Schemes

  • Virginia Attorney General Herring announced the first worker misclassification charges his Worker Protection Unit has brought. The charges were brought against GTO Drywall, LLC and Richmond Drywall Installers Constructors, Inc., which were indicted on counts of felony embezzlement related to misclassifying employees as independent contractors.

Thursday, October 7, 2021

Cybersecurity

  • Oregon Attorney General Rosenblum announced an increase in data breaches reported to the Attorney General’s Office. There have been 131 reported breaches so far in 2021, compared with 110 last year. The press release also includes Oregon’s $50,000 September settlement with public accounting firm Gustafson & Company LLC over a 2020 data breach.

Environmental

  • Massachusetts Attorney General Healey announced a lawsuit against the owner and former managers of MRM Project Managementfor allegedly conducting illegal asbestos work, illegally disposing of waste, and demolishing buildings and bridges without filing the proper notifications. The lawsuit alleges that this conduct violated several state environmental laws and regulations.

Online Charitable Fundraising

  • California Attorney General Bonta applauded that Governor Newsom signed into law his sponsored legislation that will provide oversight of internet-based charitable fundraising. Among other things, the new law, which goes into effect on January 1, 2023, authorizes attorney general regulations beginning on January 1, 2022, creates clear definitions of conduct subject to regulation, and requires meaningful disclosures and prompt distribution of donations.

U.S. Postal Service

  • A coalition of 20 attorneys general led by Pennsylvania Attorney General Shapiro and New York Attorney General James submitted a formal complaint asking the Postal Regulatory Commission to order the U.S. Postal Service to request an advisory opinion on the Postmaster General’s plan to change the Service. The coalition is arguing that the plan does not have meaningful oversight and thus undermines public accountability, particularly after 2020 operational changes resulted in widespread mail delays.

Friday, October 8, 2021

Consumer Protection

  • Michigan Attorney General Nessel issued a notice of intended action to King Crawford Enterprises, LLC, which is conducting business as Nano Hearing Aids, in response to a large quantity of Better Business Bureau complaints alleging unlawful business practices related to hearing aid sales. Among other things, the business is being accused of failing to make proper disclosures and causing misunderstanding over goods or services’ source, approval, sponsorship, or certification.
  • The Consumer Financial Protection Bureau (“CFPB”) filed a complaint and proposed consent order against reverse mortgage lender American Advisors Group, alleging that it used deceptive and inflated home estimates to induce consumers to take out reverse mortgages. The CFPB is also alleging that the company violated a 2016 consent order with this conduct. The consent order includes a $1.1 million civil penalty, $173,400 in restitution, and injunctive relief.

Environmental

  • New Jersey Acting Attorney General Bruck announced seven new environmental enforcement actions. Five of these focus on harmful contamination in overburdened communities, one focuses on underground fuel storage tanks, and the last concerns an abandoned gasoline filling station with unregistered and unmonitored fuel storage tanks.

Labor and Employment

  • New York Attorney General James issued a statement in support of Catholic Health System employees who are currently on strike, saying she supports their demands for a fair wage and safe work environment.

Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.

Monday, September 27, 2021

Energy

  • New York Attorney General James announced a $6 million agreement with National Grid, resolving allegations that it knowingly provided false reports to the Long Island Power Authority on the amount of electricity delivered but not billed for. The $6 million payment will be used to subsidize heat pump modernization and replacement for low- and moderate-income individuals.

Environmental – “Defeat Devices”

  • New Hampshire Attorney General Formella announced a settlement agreement with Volkswagen Group of Americaand related companies for using “defeat devices,” which resulted in excess Nitrogen Oxide emissions of up to more than 30 times the legal limit. The settlement includes a $1.15 million payment and the installation of a fast charging station in New Hampshire.

Social Media

  • Vermont Attorney General Donovan applauded Facebook’s announcement that it will pause its “Instagram Kids” app designed for children. Attorney General Donovan stated that he is still concerned about social media companies’ actions to protect children.

U.S. Environmental Protection Agency

  • A coalition of 22 state attorneys general and several cities and counties, led by California Attorney General Bonta, sent a letter to the U.S. Environmental Protection Agency, asking it to adopt stricter greenhouse gas emissions standards for passenger cars and light trucks. The coalition believes automakers are well-positioned to meet these standards and that the stricter standards better advance the Clean Air Act’s objectives.

Tuesday, September 28, 2021

Consumer Protection

  • Washington Attorney General Ferguson announced a consent decree against timeshare exit company Reed Hein & Associates LLC, which includes a guaranteed $2.61 million payment and a potential additional $19 million if it violates the consent decree’s terms. The consent decree resolves a lawsuit over a deceptive 100% money-back guarantee offer. In addition to the monetary payment, the consent decree includes injunctive relief and requires the company to retract statements it made in response to the Attorney General’s lawsuit.
  • Massachusetts Attorney General Healey issued an advisory to automobile dealers and consumers about auto dealers’ obligations surrounding vehicle advertising and pricing. For example, the advisory reminds auto dealers that they are required to accurately advertise prices, honor the prices advertised, and comply with provisions in consumer lease contracts.
  • It was reported that Colorado Attorney General Weiser announced that Compass Bank and Air Academy Federal Credit Union must refund borrowers after they failed to return guaranteed automobile protection fees that they improperly retained. In total, Compass Bank must refund about $1.68 million, and the Credit Union is still determining the amount it owes.

National Association of Attorneys General Conference

  • The National Association of Attorneys General announced a conference it is hosting from October 7-8, 2021 in conjunction with Vermont Attorney General Donovan on the surveillance economy. The conference will include remarks by several attorneys general and federal, state and local partners, and it will be about balancing technology advances with individuals’ rights to privacy.

Price Gouging

  • California Attorney General Bonta announced that the state price gouging law is in effect in Shasta County following a declaration of a state of emergency because of the Fawn Fire.

Wednesday, September 29, 2021

Environment

  • Michigan Attorney General Nessel announced a settlement against Concentrated Animal Feeding Operation Slater Farms for causing pollution and failing to comply with permit requirements. The settlement includes a partially waived $120,000 penalty and requires Slater Farms to accept additional oversight and permit conditions over the storage, management, and disposal of waste.

Housing

  • Washington D.C. Attorney General Racine announced a final judgment against landlord Jefferson-11th Street, LLC, including over $422,000 in rent restitution and $215,000 in penalties for housing code violations, including mold contamination, lack of heat, and vermin infestations. The judgment also requires the landlord to create policies and trainings to prevent this conduct from reoccurring and to hire a new management company.

U.S. Environmental Protection Agency

  • A coalition of 16 attorneys general sent a letter to the U.S. Environmental Protection Agency, objecting to new standards on greenhouse gas emissions from 2023 and later model light-duty vehicles. The coalition is arguing that the standards disregard individual states’ conditions and economies, as they are based on California priorities.

Thursday, September 30, 2021

Consumer Fraud

  • Minnesota Attorney General Ellison announced a bankruptcy court’s approval of a settlement including $23.6 million in debt relief and $15.8 million in restitution for former students of Minnesota School of Business and Globe University. The original lawsuit alleged that the institutions made false claims about criminal justice programs and charged illegal interest rates.

Energy

  • Michigan Attorney General Nessel announced that the Michigan Public Service Commission approved a net under-recovery of $145,023 in DTE Electric’s 2019 Reconciliation case, agreeing with Attorney General Nessel’s arguments and analysis. This creates up to $3,157,764 in savings for DTE consumers.
  • North Carolina Attorney General Stein applauded Duke Energy’s decision to voluntarily extend its moratorium on utility disconnections until March 2022 for those customers who qualify for funding assistance.

Fraud Scheme

  • Massachusetts Attorney General Healey announced that the former executive director of non-profit homeless shelter Casa Nueva Vida was indicted for allegedly stealing almost $1.5 million from the organization and lying under oath.

Healthcare – Removing Race Formulas

  • Massachusetts Attorney General Healey is urging health care providers to remove race from formulas they use to estimate kidney function. The formulas determine the health care services patients will receive and have been criticized for limiting access to care for patients of color.

Housing Discrimination

  • Virginia Attorney General Herring announced the filing of the first lawsuit under the Virginia Fair Housing Law’s systemic discrimination provision. The lawsuit, which seeks $8 million in tenant compensation, civil penalties, and attorneys’ fees, was filed against a landlord for allegedly discriminating against tenants through abusive language and conduct.

Friday, October 1, 2021

Environmental Protection Bureau

  • New York Attorney General James announced a lawsuit against Endzone Properties, Inc. and a landlord for violating lead paint laws and failing to address and disclose hazards at properties where at least 18 children were poisoned. The lawsuit seeks disgorgement, civil penalties and fines, and injunctive relief.

As the world continues to settle into its new normal, regulators have so, too. Recently, State Attorneys General (AGs) are increasingly focused on several specific enforcement priorities, including (1) price gouging; (2) privacy concerns; (3) antitrust litigation; and (4) harmful substances in products and environmental issues. Many of these priorities have gained prominence in the midst of the COVID-19 pandemic.

Price Gouging

Price gouging enforcement was triggered in large part in March 2020 from the COVID-19 pandemic. Many State AGs have been actively and aggressively investigating price gouging. Recent emergencies, outside of COVID-19, have also triggered emergency changes in costs, including from forest fires, hurricanes, and other severe weather events and natural disasters. States have broad authority in this area, and enforcement varies state-to-state. Usually State AGs look for any issues with change in cost post-emergency, not during the emergency, looking to the reasonableness of the increase. Some states have percentage limits, others cover both essential and non-essential goods. Price increases of 10% or less will generally be considered low risk. Price increases will generally be allowed where sellers can tie price increases to increased costs. It is a best practice is to have documentation supporting any decision for price increases.

Privacy Concerns

There has been an increased focus on protecting personal data and consumer privacy. Specifically, State AGs have been focused on data breaches and unlawful location tracking, and State AGs have looked into certain seller practices, such as screen scraping without notice or consent. Arizona AG Mark Brnovich has investigated companies’ tracking of consumer smartphone locations.

State specific laws require detailed compliance with data protection and privacy requirements: the first act passed in 2018 was the California Consumer Privacy Act (CCPA). Next there was the Colorado Privacy Act (CPA) then the Virginia Consumer Data Protection Act (VCPDA). These acts have similar requirements: allowing consumers to access their personal data; correct any inaccuracies with their personal data; and delete personal data. Companies must have transparency on what personal data is collected, how it is used, and the consumer’s rights. State AGs have authority to enforce these acts within their respective states.

In November 2020, California passed the California Privacy Rights Act (CPRA). The CPRA changed the CCPA, but did not replace it, expanding the rights of Californians and giving rights to consumers to rectify inaccurate personal data. The new law also created and gave authority to California’s new Privacy Protection Agency; changed the definition of a “business”; and made businesses responsible for how third parties use/share personal data that the business collects.

States also focus on protecting minors and children through the Children’s Online Privacy Protection Act (COPPA). Maintaining consumer privacy and data security remain, and will continue to be, a significant area of concern for State AGs.

Antitrust Litigation

There has been an increase in State AG antitrust litigation. Notable examples are described below:

  • Facebook: New York AG Letitia James and 48 AGs have filed complaints to end Facebook’s alleged monopoly. This was dismissed in June 2021, but there are currently efforts underway to try to bring this case back.
  • Amazon: District of Columbia AG Karl Racine is pursuing novel state-law based antitrust claims against Amazon.
  • Google: Lawsuit by 37 AGs against Google, also referred to as the “Gatekeeper of Our Digital Devices,” for allegedly maintaining a monopoly in the market for distributing apps for the Android operating system.

On September 23, 2021 the Senate Judiciary Committee approved legislation that allows State AGs to choose which court hears their antitrust cases. It is retroactive, and the intent is to prevent multi-district litigation (MDLs). Congress is also considering increases in the Department of Justice’s (DOJ) budget, specifically for the Antitrust Division, and also for the Federal Trade Commission (FTC). Although State AGs have not taken their cues from related federal actions there has been increased cooperation between the two, so an increased focus on antitrust enforcement at the federal level could lead to the same at the State AG level.

Harmful Substances in Products and Environmental Issues

A significant area of focus for State AGs has been harmful substances in products, and other environmental issues, such as product emissions and discharges. State AGs have looked closely at the harmful ingredients affecting consumers. Notable examples and relevant areas of inquiries are outlined below:

  • Talc litigation against Johnson & Johnson for baby powder.
  • Coalition of 15 State AGs have submitted comments to the EPA in support of the EPA’s proposal to include per and polyfluoroalkyl substances, also known as PFAS as a class in the Contaminant Candidate List 5.
    • PFAS Litigation: District of Columbia AG Racine investigating and considering litigation against chemical manufacturer for the distribution and sale of synthetic pesticides.
  • Litigation on toxins in groundwater.
  • District of Columbia AG Racine soliciting counsel to investigate and possibly litigate claims against baby food company for allegedly misleading parents about the health and safety of its products.
  • California AG Rob Bonta secured a court decision requiring a public health agency to comply with air monitoring requirements for petroleum refineries.
  • Coalition of 20 State AGs sent a letter to Congressional leadership, asking Congress to allocate funding in its reconciliation bill to programs that promote clean energy, fight pollution, and improve air quality
  • Vermont AG T.J. Donovan filed suit against fossil fuel companies alleging that they violated Vermont’s Consumer Protection Act (VCPA) by concealing information and disseminating misleading marketing about climate change and fossil fuels. AG Donovan sought disgorgement, civil penalties, and injunctive relief.
  • Coalition of 13 State AGs sent a comment letter to the National Highway Traffic Safety Administration (NHTSA) urging higher fines for fuel economy violations.

Retailers should remain vigilant to the ingredients they put in their products and should ensure that the manufacturing and distribution processes they employ are safe.

***

State AGs have been actively engaged on several areas of importance as the world continues to navigate within a global pandemic. To take on these efforts, State AGs have increasingly sought the help of outside counsel to litigate its claims. This has been a marked shift in strategy from just five years ago. These shifts and State AG enforcement trends identified above should serve as a guide for companies as they continue to identify and employ best practices for their own policies as they adapt and settle into the new normal.

Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.

Monday, September 20, 2021

Antitrust and Competition

  • A bipartisan coalition of 30 state attorneys general, along with the attorneys general from Washington D.C. and Guam sent a letter to leaders of the U.S. House and Senate, applauding legislative proposals which would modernize federal antitrust law and urging the House and Senate to continue improving the bills being considered. The coalition is seeking changes that respond to shifts in technology, decreased competition in particular sectors, and judicial skepticism towards strong antitrust enforcement. The coalition is also asking Congress to include provisions confirming that states are sovereigns that are equal to federal enforcers, including in terms of the timing of challenging anticompetitive activity.

National Highway Transportation Safety Administration

  • A coalition of 13 attorneys general led by California Attorney General Bonta and New York Attorney General James sent a comment letter to the National Highway Transportation Safety Administration (“NHTSA”) asking the NHTSA to re-implement penalties for automobile manufacturers that failed to meet corporate average fuel economy standards for vehicles in model year 2019-2021. The coalition is seeking to restore the penalty to $14 for every tenth of a mile-per-gallon below the standards. It is currently $5.50.

Unfair and Deceptive Trade Practices Act

  • North Carolina Attorney General Stein announced a consent judgment with medical training program Stepping Stone Phlebotomy LLC, resolving allegations against the program for operating without a license. The order requires Stepping Stone to provide refunds to students who did not pass the national certification exam upon request, as well as to refrain from operating without a license in the future.

Tuesday, September 21, 2021

Antitrust and Competition

  • California Attorney General Bonta announced a consent decree that will combat potential anticompetitive effects of the Providence Group, Inc. and Plum Healthcare The two entities own dozens of skilled nursing facilities in the state. In order to fulfill the agreement’s terms, Providence must sell one of its facilities. It also must appoint a monitor to oversee the sale and ensure quality patient care.
  • New York Attorney General James sent letters to the U.S. Department of Transportation and the Federal Aviation Administration, asking the agencies to create rules that would fully use gate slots at airports, in order to increase competition.

Fraud Schemes

  • California Attorney General Bonta announced the arrest of the former owner of third-party debt relief businesses for a $6,130,000 federal student loan debt relief scam. The defendants involved in this scheme allegedly offered to reduce or eliminate federal student loan debt but instead stole money from the victims.

Wednesday, September 22, 2021

Consumer Protection

  • Ohio Attorney General Yost filed a lawsuit against the owner of Flowers by Des, who allegedly violated state consumer protection law by accepting money from consumers but failing to deliver flower services at important events. The lawsuit is seeking at least $50,000 in refunds.

Environmental Justice

  • California Attorney General Bonta announced that he secured a court decision requiring the San Joaquin Valley Unified Air Pollution Control District to comply with air monitoring requirements for petroleum refineries. The press release notes that these refineries are one of the largest non-vehicle pollution sources and are often located in low-income communities and communities of color that already suffer significant health disparities from pollution.

Labor and Employment

  • New York Attorney General James announced an agreement with industrial laundry facility FDR Services Corporation of New York, holding it accountable for illegally firing seven workers and denying paid sick leave to other workers who took sick leave for COVID-19 illness. The agreement includes a $400,000 payment and the reinstatement of employees who wish to return to the company, including the reinstatement of benefits the employees received prior to their discharge.

Thursday, September 23, 2021

Charities/Non-Profits

  • Minnesota Attorney General Ellison announced settlement agreements requiring a board member of children’s charity A Place to Call Home to pay back $66,000 in funds used for her personal benefit. The settlements also bar the board member and two former directors from operating a charity, soliciting charitable contributions, or having access to charitable assets in the state. The charity must also dissolve under the agreements.

Consumer Protection

  • West Virginia Attorney General Morrisey announced a lawsuit against collection agency Bayside Capital Services, LLC and its owner, alleging that they engaged in debt collection without proper licensing and used illegal tactics, such as threatening arrest and contacting consumers at their workplace. The lawsuit seeks civil penalties, restitution, and a court order prohibiting the company from debt collection in West Virginia.
  • Arkansas Attorney General Rutledge announced that the Arkansas Public Service Commission granted her request for a $10.4 million credit for customers of CenterPoint Energy Arkansas Gas in response to allegations of excessive charges.
  • New York Attorney General James urged customers of online plant company ShrubBucket to file a claim in the company’s bankruptcy proceedings if they are owed money for undelivered products or services. The company allegedly continued to wrongfully accept deposits up to a week before its bankruptcy filing.

Environmental – PCB Contamination

  • Delaware Attorney General Jennings announced a lawsuit against agrochemical company Monsanto and two of its spinoffs for damaging Delaware’s natural resources through their use of polychlorinated biphenyls. The lawsuit is seeking clean-up costs and damages.

Fraud Schemes

  • Florida Attorney General Moody announced a $490,000 judgment against several heating, ventilation and air conditioning companies for allegedly operating a bait-and-switch air-conditioning scheme. Under the scheme, the companies ultimately refused to provide services and claimed that ducts were damaged or contained mold, using high-pressure sales tactics in some instances.

Housing – Lead Poisoning

  • New York Attorney General James announced an agreement with property management company Chestnut Holdings of New York, Inc., resolving a lawsuit alleging that the company violated New York City’s laws preventing lead poisoning. The agreement requires the company to pay $300,000 towards lead poisoning prevention initiatives and to ensure its apartments comply with the law.

Medicaid Fraud

  • Minnesota Attorney General Ellison announced a guilty plea against the leader of a network that defrauded the state Medicaid program out of over $1 million through clinic Newcomb Counseling. Among other things, the defendants billed for group therapy as if it was individual sessions and billed for services that were never actually provided.

Price Gouging

  • Virginia Attorney General Herring announced a settlement with Saly Inc. d/b/a RIR Mart Exxonfor allegedly violating the Virginia Post-Disaster Anti-Price Gouging Act by charging unconscionable prices on gasoline during the state of emergency declared for the Colonial Pipeline shutdown. The gas station increased its prices by almost 29% after the declaration of the state of emergency. The settlement includes a payment of $2,500 in civil penalties and attorneys’ fees, over $300 in disgorgement, and injunctive relief.

Friday, September 24, 2021

Education – Public Service Loan Forgiveness

  • A coalition of 22 attorneys general led by California Attorney General Bonta sent a letter to the S. Department of Education asking it to improve the Public Service Loan Forgiveness program, which has rejected the majority of applications. Specifically, the coalition is asking the Department to provide immediate relief and correct errors, improve servicer accountability and oversight, extend the pause on student loan payments, and conduct an outreach program.

Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.

Monday, September 13, 2021

Disability Discrimination Protections

  • A coalition of 18 attorneys general led by Washington D.C. Attorney General Racine filed an amicus brief in U.S. Supreme Court case CVS Pharmacy v. Doe. The brief urges the Court to uphold the existing legal standard, which allows challenges against public programs that have the effect of discriminating against those with disabilities, even without intent.

Energy

  • Michigan Attorney General Nessel announced a settlement with Michigan Gas Utilities Corporation in a rate case before the Michigan Public Service Commission. The agreement results in a rate increase about 40% lower than that requested, as well as assistance programs to benefit consumers.

 Financial Misconduct

  • New York Attorney General James announced an agreement with GTV Media Group, Inc. and its parent company, Saraca Media Group, Inc., under which the companies will pay $479.9 million to resolve allegations that they did not register as commodities brother-dealers and/or securities dealers.

 Fraud Scheme

  • New York Attorney General James announced a $3 million judgment against virtual currency trading platform Coinseed and its Chief Executive Officer. The judgment permanently bars Coinseed’s operations and creates a permanent receiver to protect investor funds.

Price Gouging

  • New Jersey Acting Attorney General Bruck issued a consumer alert warning consumers to be aware of scams following Tropical Storm Ida, including price gouging and charity scams.

Retail – Organized Retail Crime Task Force

  • Illinois Attorney General Raoul announced a public and private entity partnership aimed towards combatting the increase in organized retail crime. The partnership, called the Organized Retail Crime Task Force, is intended to increase cooperation among online marketplaces, retailers, and law enforcement agencies. Some retailers involved include CVS, Home Depot, Lowe’s, Target, Walgreens, and Walmart.

Tuesday, September 14, 2021

Consumer Protection

  • West Virginia Attorney General Morrisey announced a lawsuit against used car dealer Mr. V & Sons Pre-Owned Auto Sales, Inc. and its executives for allegedly selling unsafe vehicles, among other conduct. The lawsuit seeks civil penalties, restitution, and permanent injunctive relief.
  • A multistate coalition of attorneys general applauded the U.S. Department of Education’s decision rescinding a prior interpretation of federal law shielding student loan servicers from state oversight. The coalition’s comment letter also asks the Department to clarify when state laws that regulate student loan servicers are preempted.

Cybersecurity

  • Massachusetts Attorney General Healey announced an investigation into a T-Mobile, US, Inc. data breach that compromised over 50 million people’s personally-identifying information. Attorney General Healey’s office is investigating the breach’s circumstances, whether T-Mobile had appropriate safeguards in place, and how T-Mobile is addressing the breach.

Environmental Justice

  • A coalition of 20 attorneys general sent a letter to Congressional leadership, asking Congress to allocate funding in its reconciliation bill to programs that promote clean energy, fight pollution, and improve air and water quality. The letter notes that climate issues often disproportionately impact communities of color, low-income and immigrant communities, and Tribal and indigenous communities. The letter also asks Congress to ensure that 40% of the improvements the budget reconciliation bill funds benefit disadvantaged communities.

Wednesday, September 15, 2021

Construction Fraud Scheme

  • New York Attorney General James announced the sentencing of an individual who defrauded homebuyers, business owners, and others out of $1 million in a construction fraud scheme, which he used to his own benefit.

Consumer Protection

  • North Carolina Attorney General Stein announced that his office obtained a preliminary injunction against boat repair company Jason’s Mobile Outboard Repair and its owner, barring them from advertising or providing boat repair services or collecting consumer payments while a lawsuit related to the company’s alleged failure to perform services is occurring. The preliminary injunction also requires the defendants to provide additional information about previous financial and consumer transactions.

Thursday, September 16, 2021

Fraud Scheme

  • New York Attorney General James announced a ban against the event producer who operated African Food Festival, LLC from producing festivals and events in New York, after the producer scammed consumers who bought tickets to three food festivals by never providing food and entertainment paid for, as well as refused to pay vendors, staff, and contractors hired for the events. The court order also includes over $310,000 in restitution and penalties.

Labor and Employment

  • Massachusetts Attorney General Healey announced the issuance of three citations against recording studio Bristol Studios, Inc. and its officers for violating minimum wage laws by failing to pay its interns and failing to keep hour and wage records, as well as for failing to comply with employment laws related to providing paid sick leave. The citations total over $400,000.

OSHA – Vaccine Mandates

  • A coalition of 24 attorneys general sent a letter to President Biden threatening legal action over a proposed mandate for private sector employees to obtain a COVID-19 vaccine, submit to weekly testing, or risk termination. The attorneys general highlighted policy concerns, including the possibility of a large number of individuals leaving the workforce, particularly healthcare workers.

Friday, September 17, 2021

Cryptocurrency

  • New Jersey Acting Attorney General Bruck announced that the Bureau of Securities issued a Summary Cease and Desist Order against cryptocurrency firm Celsius Network LLC, which was selling unregistered securities to fund its operations. The press release notes that registration is important in part because it triggers certain disclosure requirements.

Environmental

  • A coalition of 15 attorneys general submitted comments to the U.S. Environmental Protect Agency (“EPA”) in support of the EPA’s proposal to include per- and polyfluoroalkyl substances, also known as PFAS, in the Contaminant Candidate List 5. Listing PFAS will be the first step in gathering data about whether these chemicals are in drinking water supplies and considering their regulation as a class in drinking water.

Fraud Scheme

  • New York Attorney General James announced a judgment against high school and post graduate basketball program AAUCONNECT and the owners of the program for defrauding consumers by selling but failing to provide training, housing, and education services; failing to provide refunds; and failing to disclose that payments were non-refundable and that significant late fees would be charged. The judgment includes a payment of almost $380,000 in restitution and penalties.

Housing

  • New York Attorney General James announced an agreement with A&E Real Estate Holdings, resolving an investigation which found that A&E failed to comply with apartment inspection, lead hazard remediation, and other requirements in New York City’s Childhood Lead Poisoning Prevention Act. The agreement includes A&E’s continued efforts to bring apartments into compliance with the Act, compliance reports, and a $510,000 payment.