Each week, Crowell & Moring’s State Attorneys General team highlights significant actions that State AGs have taken. Here are this week’s updates.
- A coalition of 22 state Attorneys General, led by Iowa Attorney General Bird, sent a letter to International Shareholder Services (ISS) and Glass Lewis, two major Wall Street advising companies, urging them to “follow the law and quit recommending woke investment strategies that jeopardize millions of Americans’ retirement security.” The letter criticizes the two companies’ position that banks should not have to disclose their reasoning when they close a bank account.
- A coalition of 26 state Attorneys General submitted a comment letter to the Bureau of Alcohol, Tobacco, and Firearms opposing a recently-proposed rule which would make any individual who sells a firearm ‘predominantly for profit’ liable to civil, administrative, or even criminal penalties unless the seller acquires a federal license. The letter expresses concern that the rule sweeps too broadly, capturing as many firearms transfers, sales, and purchases as possible.
- A coalition of 19 state attorneys general led by Montana Attorney General Knudsen sent a comment letter opposing the Biden administration’s “Business Diversity Principles” proposal. The attorneys general object to the proposed measures to increase diversity, equity, inclusion, and accessibility because they “advocate for explicitly race-based employment quotas and decision making.”
- A coalition of 19 state Attorneys General, led by New Jersey Attorney General Platkin announced their support for a proposed federal rule that would expand SEC supervisory authority over certain nonbank companies that offer digital consumer payment and wallet services, such as Venmo, CashApp, Paypal, and Zelle. The rule would subject these companies to the same regulatory oversight as banks, credit unions, and other traditional financial institutions.
- Arizona Attorney General Mayes announced a settlement for more than $13 million with Cox Communications. The settlement resolves an investigation and lawsuit alleging the telecommunications company failed to adequately disclose additional fees to customers.
- California Attorney General Bonta announced a settlement with Invitation Homes to resolve allegations that the company violated the California Tenant Protection Act (TPA) and California’s price-gouging law by unlawfully increasing rents on approximately 1,900 homes. As part of the settlement, Invitation Homes will pay $2.04 million in civil penalties and is required to take specific actions to ensure compliance with California law.
- Colorado Attorney General Weiser announced a settlement with Colorado property management company Four Star Realty, in light of numerous instances of the company illegally charging tenants for routine repairs and other services. Four Star agreed to pay the state just under $1 million, nearly all of which will be earmarked for consumer restitution.
- Connecticut Attorney General Tong announced a joint enforcement action against auto dealer Manchester City Nissan, along with its owner and several employees, for systematically deceiving customers about the price of certified used cars, add-ons, and government fees. The complaint alleges that the dealership regularly charged junk fees for certification, add-on products, and government charges without consumers’ consent.
- Connecticut Attorney General Tong issued a cease and desist letter to HighBazaar, warning organizers that the unlicensed cannabis market appears to violate multiple state statutes. To date, the Office of the Attorney General has three pending enforcement actions, and has secured judgments against four additional Connecticut retailers for alleged violations of the Connecticut Unfair Trade Practices Act over the sale of illegal delta-8 THC.
- Connecticut Attorney General Tong filed seven new enforcement actions against wholesalers and retailers engaging in the distribution and sale of potent, illicit cannabis products in Connecticut. The actions allege that the products have not been subject to Connecticut’s testing standards, do not contain appropriate warnings, and in some cases are sold in misleading packaging designed to appeal to children.
- Florida Attorney General Moody announced the activation of the state price gouging hotline due to a state of emergency declaration for severe weather. Florida’s price gouging law only applies to items and services essential to getting ready for, or recovering from, a storm within the areas of a declared state of emergency.
- Michigan Attorney General Nessel announced a lawsuit against Michigan’s Choice Tree Service, Storm Support Emergency Tree Removal, and business owner David Foster, alleging illegal business practices. The Department of the Attorney General presented evidence that Foster’s businesses were confusing and misleading consumers about their legal rights.
- Minnesota Attorney General Ellison announced a lawsuit against a group of dairy farms and their owners seeking at least $3 million in damages for wage theft. The suit alleges that the farms deducted hours from workers’ paychecks, failed to pay wages at the beginning and end of workers’ employment, and unlawfully deducted rent to pay for substandard onsite housing.
- Minnesota Attorney General Ellison announced that the U.S. Supreme Court had remanded the state’s lawsuit against major actors in the fossil-fuel industry, allowing the case to proceed in state court. The suit alleges that the companies deceived and defrauded Minnesotans about the climate change-related danger associated with their products.
- New York Attorney General James announced an agreement with Hudson Valley-area health care provider Refuah Health Center, Inc to invest $1.2 million to strengthen its cybersecurity and pay $450,000 in penalties and costs. The Office of the Attorney General found that Refuah failed to maintain appropriate controls to protect and limit access to sensitive data.
- North Carolina Attorney General Stein announced that the state’s price gouging law is in effect after Governor Roy Cooper declared a statewide state of emergency due to severe weather. Since 2018, Attorney General Stein has brought 12 lawsuits against 29 defendants under North Carolina’s price gouging statute and obtained 14 judgments or settlements totaling $1,080,000 against 25 defendants.
- Oklahoma Attorney General Drummond announced that he is exploring legal action against insulin manufacturers and pharmacy benefit managers for wrongful conduct that resulted in artificially increased prices for insulin. Drummond has issued a Request for Proposal for outside counsel to investigate conduct and potentially pursue litigation.
- Pennsylvania Attorney General Henry announced an agreement with Pittsburgh Career Institute that relieves dozens of students of $218,000 in debt balances that were outstanding when the school closed in November 2023. This is the latest in a series of actions through which the Pennsylvania Office of the Attorney General has obtained more than $205 million in private and federal student loan debt cancellation.
- Utah Attorney General Reyes announced the Utah Consumer Privacy Act (UCPA), effective December 31, 2023. The UCPA requires businesses to protect personal data and provide consumers with information about how to exercise their rights.
- Washington Attorney General Ferguson announced a $460,000 settlement with House of Raeford Farms to resolve claims of price-fixing. The lawsuit alleges that House of Raeford Farms engaged in a widespread illegal conspiracy with 18 other chicken producers to inflate and manipulate prices, rig contract bids, illegally exchange information, and coordinate industry supply reductions to maximize profits.
- Washington Attorney General Ferguson proposed legislation to increase the maximum penalty for antitrust violations like price-fixing and collusion. The legislation increases the maximum penalty for price-fixing, illegal collusion, and other antitrust violations to three times the illegal gains or loss avoided.
- Washington Attorney General Ferguson announced a lawsuit against Labor Law Poster Service and its owners, alleging over 300,000 violations of the Washington Consumer Protection Act through the sending of deceptive solicitations giving the false impression that they are mandatory bills from a government agency.