The State AG Report Weekly Update January 4, 2018

Cozen in the News

Cozen O’Connor Opens New State AG Practice Office in Richmond, Virginia

  • Cozen O’Connor has opened an office in Richmond, Virginia, where the firm’s State AG Practice will offer executive and legislative branch strategies and services for companies operating in Virginia.
  • The Virginia team will be led by Jerry Kilgore, a member of Cozen O’Connor’s State AG practice and former Virginia AG. Ashley Allen, attorney and former vice president at a Virginia-based public affairs firm, has also joined Cozen O’Connor to help develop the state government and legislative practice and will be based in the new Richmond office.

Consumer Protection

Washington Attorney General Amends Lawsuit Against Cable and Internet Provider, Alleges More Deceptive Conduct

  • Washington AG Bob Ferguson amended his lawsuit against cable and internet service provider Comcast Corporation (“Comcast”) over allegations that the company violated the Washington Consumer Protection Act by misleading consumers.
  • As previously reported, AG Ferguson in August 2016 filed a lawsuit against Comcast alleging that they offered a Service Protection Plan (“SPP”) with limited uses and applications, charged service fees when the company guaranteed service visits would be free of charge, and carried out unauthorized credit checks.
  • According to the AG’s office, new evidence has emerged allegedly revealing that Comcast may have signed up more than half of all SPP subscribers without their knowledge or consent and that, in some instances, Comcast represented to customers that the SPP plan was “free,” but later charged them after the first month.
  • The lawsuit seeks more than $100 million, including a restitution payment of $73 million, civil penalties in the amount of $2,000 per violation of the Consumer Protection Act, and the removal of improper credit checks on consumers’ credit reports.

Washington Attorney General Files Lawsuit Against Hotel Chain Over Alleged Privacy Violations

  • Washington AG Ferguson filed a lawsuit against national hotel chain Motel 6 Operating L.P. (“Motel 6”) over allegations that it violated the state’s Consumer Protection Act and Law Against Discrimination.
  • According to the complaint, Motel 6 allegedly released the personal information of guests staying at Motel 6 locations in Washington to U.S. Immigration and Customs Enforcement (“ICE”) despite its privacy policy assuring consumers their information was protected, and also allegedly knew that ICE used its guest lists to target consumers based on national origin.
  • The lawsuit seeks a permanent injunction enjoining and restraining Motel 6 from engaging in violations of the Consumer Protection Act and Law Against Discrimination, civil penalties, and other relief the Court may deem just and proper.

Pharmaceuticals

51 Attorneys General Reach Settlement with Pharmaceutical Company Over Alleged Off-Label Marketing of Prescription Drugs

  • 51 AGs reached a settlement with pharmaceutical company Boehringer Ingelheim Pharmaceuticals, Inc. (“BIPI”) for allegedly violating their states’ consumer fraud laws by engaging in deceptive and misleading representation and off-label marketing of its specialty prescription drugs.
  • According to the AGs, BIPI allegedly misrepresented that its antiplatelet drug, Aggrenox, was effective for conditions such as heart attacks and congestive heart failure, without evidence to substantiate that claim; misrepresented that its drug Micardis protected patients from early morning strokes and heart attacks and treated metabolic syndrome; misrepresented that its drug Combivent could be used as a first-line treatment for bronchospasms associated with chronic obstructive pulmonary disease (COPD); and falsely stated that its drugs Atrovent and Combivent could be used at doses that exceeded the maximum dosage recommendation in the product labeling.
  • Under the terms of the settlements, BIPI will pay a combined $13.5 million to the 50 states and the District of Columbia.

North Carolina Attorney General Files Lawsuit Against Opioid Manufacturer Over Alleged Kickbacks and Deceptive Business Practices

  • North Carolina AG Josh Stein filed a lawsuit against opioid manufacturer Insys Therapeutics, Inc. (“Insys”) for allegedly violating the state’s Unfair and Deceptive Trade Practices Act by prescribing Subsys, its opioid fentanyl drug, to patients without cancer as a part of a scheme to expand the market for an opioid intended only for terminally-ill cancer patients.
  • According to the complaint, Insys gave illegal kickbacks—often in the form of speaking fees—to doctors who prescribed Subsys to non-cancer patients, deceived and defrauded health insurance companies into paying for Susbys prescriptions, and provided financial incentives to Insys sales staff to encourage doctors to “switch” non-cancer patients to Subsys.
  • The lawsuit seeks a permanent injunction to restrain Insys from engaging in deceptive trade practices, as well as civil penalties, disgorgement of profits, attorneys’ fees, and further relief as the Court may deem just and proper.

 State AGs in the News

National Association of Attorneys General Appoints New Executive Director

  • The National Association of Attorneys General (“NAAG”) appointed Chris Toth to serve as Executive Director. This follows the U.S. Senate’s confirmation of former Executive Director Jim McPherson to serve as general counsel to the U.S. Department of the Army.
  • The 12-member NAAG executive committee, chaired by NAAG President and Kansas AG Derek Schmidt, selected the new Executive Director.
  • Toth previously served as NAAG Deputy Executive Director from February 2004 until December 2017 and as the Director of the National Attorneys General Training and Research Institute (NAGTRI) during the same time period. Toth has served as a Navy officer on both active duty and the reserves as well as an Army officer.

State v. Federal

8 Attorneys General File Lawsuit Against EPA Over Enforcement of Clean Air Act, Out-Of-State Air Pollution

  • 8 Democratic AGs, led by New York AG Eric Schneiderman, filed a lawsuit against the Environmental Protection Agency (“EPA”) for allegedly failing to control out-of-state air pollution, or “interstate smog.”
  • According to the AGs, the EPA has reason to believe that the interstate transportation of air pollution significantly contributes to exceedances of the federal standards for smog.
  • The AGs’ lawsuit seeks to add nine additional upwind states—Illinois, Indiana, Kentucky, Michigan, North Carolina, Ohio, Tennessee, Virginia, and West Virginia—to the Ozone Transport Region, a regulatory group of states established under the Clean Air Act that must act in concert to reduce smog pollution within the region. The suit challenges the EPA’s November 2017 denial of a petition, filed by the Democratic AGs in late 2013, requesting those nine states be added to the Ozone Transport Zone.

17 Attorneys General Urge Administration Against Withdrawing Rule Requiring Airlines to Disclose Baggage Fees Upfront

  • 17 Democratic AGs, led by Pennsylvania AG Josh Shapiro, sent a letter to U.S. Department of Transportation Secretary Elaine Chao asking that the Trump Administration not withdraw the Transparency of Airline Ancillary Service Fees rule, which requires airlines and third-party booking companies to disclose baggage fees and other charges.
  • According to the AGs’ letter, the Transparency of Airline Ancillary Service Fees rule, proposed in January 2017, would have made it easier for consumers to understand the “true cost” of their airline tickets by disclosing carry-on baggage fees, checked baggage fees, and seat fees that are not disclosed until booking is nearly complete.
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