The State AG Report Weekly Update April 26, 2018

Antitrust

Texas Attorney General Reaches Settlement with Dental Supply Distributor Over Alleged Anticompetitive Conduct

  • Texas Attorney General Ken Paxton settled with dental supply distributor Patterson Companies, Inc. (“Patterson”) to resolve allegations that it violated state antitrust laws by allegedly organizing a boycott designed to harm a rival distributor.
  • According to the AG’s office, Patterson and other dental supply distributors allegedly colluded to prevent the Texas Dental Association (“TDA”) from entering the dental supply market by discouraging suppliers from working with the TDA and its business partner and by agreeing not to attend the TDA’s 2014 trade show.
  • Under the terms of the final judgment and stipulated injunction, Patterson will pay the state $200,000, institute an antitrust training program, and is enjoined from further antitrust violations.

Charities

Oregon Attorney General Reaches Settlement with Former Marathon Director Over Alleged Improper Lending Practices

  • Oregon Attorney General Ellen Rosenblum announced a settlement with former board member and race director of the Portland Marathon Lester Smith to resolve allegations that he violated Oregon charities laws by obtaining illegal loans from the Marathon.
  • According to the AG’s office, Smith allegedly operated the Marathon without appropriate board oversight and obtained hundreds of thousands of dollars in illegal loans from the Marathon.
  • According to the AG’s announcement, the settlement prohibits Smith from organizing future foot races, leading charitable organizations, and seeking reinstatement in the Oregon State Bar, and requires Smith to dissolve a related business entity and pay $865,000 to the Portland Marathon and for the AG’s investigative costs.

Consumer Protection

Washington Attorney General Secures Judgment Against Technical Support Provider Over Alleged Consumer Protection Violations

  • Washington Attorney General Bob Ferguson announced that his office secured judgments against remote technical support provider iYogi, Inc. and its Indian affiliate iYogi Technical Services Private Ltd. (collectively, “iYogi”) resolving allegations that they violated the state’s Consumer Protection Act (“CPA”) by allegedly misleading consumers into purchasing unnecessary technical support products and services.
  • According to the AG’s office, iYogi representatives allegedly misrepresented that the company was affiliated with well-known software and hardware companies to gain access to consumers’ computers, ran software that led consumers to believe their computers were infected with viruses, malware, or other potentially harmful files when they were not, and pressured consumers into purchasing unnecessary antivirus programs and technical support services from iYogi.
  • Under the terms of the order granting summary judgment, iYogi is permanently enjoined from future acts or practices that might violate the CPA and must pay $4 million in restitution, $2 million in damages, $120,000 in civil penalties, and approximately $134,000 in costs and attorney’s fees.
  • Pursuant to a separate consent decree, the president of iYogi’s U.S. affiliate is subject to similar injunctive provisions and is further subject to a suspended judgment of $500,000.

Finance Industry

Illinois Attorney General Files Lawsuit Against Consumer Lender Over Alleged Illegal Lending Practices

  • Illinois Attorney General Lisa Madigan filed a lawsuit against consumer lender Future Income Payments LLC (“FIP”) based on allegations that it violated Illinois consumer lending laws and state and federal pension benefits laws by allegedly operating without state licensure and engaging in predatory lending practices.
  • According to the AG’s office, FIP allegedly offered installment loans to consumers that illegally required repayments from the proceeds of customers’ pensions and charged customers excessive fees and interest. In some cases, the AG’s office alleges that FIP continued to withdraw money from customers’ accounts even after they attempted to cancel their agreements with FIP.
  • According to the AG’s announcement, the lawsuit seeks to void the loan contracts and to obtain restitution on behalf of affected consumers, as well as civil penalties and injunctive relief against FIP.

New Mexico Attorney General Announces Settlement with Credit Card Networks Over Alleged Excessive Fees

  • New Mexico Attorney General Hector Balderas announced a final settlement resolving his office’s litigation with credit card networks Visa, Inc., Visa USA, Inc., and Visa International Service Association (collectively, “Visa”) and MasterCard Incorporated and MasterCard International Incorporated (collectively, “MasterCard”) over allegations they violated state consumer protection and antitrust laws by allegedly charging merchants excessive transaction fees in connection with credit and debit card transactions.
  • Under the terms of the settlement agreement, Visa and MasterCard will pay approximately $2.26 million and $1.13 million, respectively, to the state’s settlement fund, and must facilitate and bear the cost of distributing a consumer financial education program.
  • According to the settlement agreement, Visa and MasterCard deny all liability or wrongdoing, but have agreed to the settlement to avoid the expense and risk associated with continuing to litigate the AG’s claims.

Environmental

New York Attorney General Obtains Judgment Against Mobile Home Park Based on Alleged Sewage Discharge

  • New York Attorney General Eric Schneiderman announced that his office secured a judgment against mobile home park operator C and J Enterprises LLC and its owner (collectively, “CJE”) over allegations that they violated New York health and environmental laws and a 2008 consent order with the New York Departments of Environmental Conservation (“DEC”) and Health (“DOH”).
  • According to the AG’s office, CJE allegedly failed to adequately treat sewage and prevent raw sewage from overflowing into residential areas at its Deerfield Estates mobile home park (“Deerfield”).
  • According to the AG’s announcement, the court entered a judgment against CJE—who sold Deerfield to new ownership in 2015—for $858,000 and set a date to consider additional statutory penalties.

State AGs in the News

Coalition of Fifteen Republican Attorneys General Files Amicus Brief in Support of Dismissing California Cities’ Climate Change Lawsuit

  • A coalition of fifteen Republican Attorneys General, led by Indiana Attorney General Curtis Hill, filed an amicus brief in support of a group of energy and manufacturing companies’ motion to dismiss a federal lawsuit filed in the Northern District of California by the cities of Oakland and San Francisco over the alleged costs of remedying the companies’ proportional responsibility for the impact of climate change.
  • According to the amici states’ brief and related motion, the lawsuit should be dismissed because it seeks to litigate the essentially political question of climate change and violates recognized principles of federalism.
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