The State AG Report Weekly Update July 20, 2017

Consumer Protection

14 AGs Oppose Rollback of FCC Net Neutrality Protections

  • 14 Democratic AGs, led by Illinois AG Lisa Madigan, submitted comments urging the Federal Communications Commission (“FCC”) to ensure open access to the Internet and to continue to require equal access to all content providers, a concept commonly known as “net neutrality.”
  • In the comments, the AGs voiced their opposition to the FCC’s proposal to roll back the classification of fixed and mobile broadband Internet access service as a common carrier telecommunications service, as well as the rollback of the FCC’s Open Internet rules, which protect consumers’ ability to access content without interference from their service providers.
  • The AGs argue that without net neutrality, Internet service providers could charge content providers more for priority treatment or favor their own content over content offered by third-party web sites.

California Attorney General Files Lawsuit Against Cigarette Manufacturer for Allegedly Violating Tobacco Regulations and Selling Illegal Cigarettes

  • California AG Xavier Becerra filed a lawsuit against Canadian cigarette manufacturer Grand River Enterprises Six Nations (“GRE”) over allegations that it violated provisions of the California Health and Safety Code that require cigarette manufacturers that are not a part of the state’s tobacco 1998 Master Settlement Agreement to make escrow payments before selling cigarettes in the state.
  • According to the complaint, GRE, which did not participate in the Master Settlement Agreement, allegedly sold hundreds of millions of dollars of cigarettes in the state without making over $13 million in required payments to the escrow fund.
  • The lawsuit seeks to prohibit GRE from selling cigarettes until it makes the escrow payments, and would require it to pay civil penalties and legal fees, among other things.

Massachusetts Attorney General Files Lawsuit Against Debt Collection Law Firm for Allegedly Threatening Consumers

  • Massachusetts AG Maura Healey filed a lawsuit and obtained a preliminary injunction against attorney Robert R. White and his law firm Levy & White (collectively “Levy & White”) for allegedly threatening consumers with arrest or imprisonment for nonpayment of small debts in violation of the state’s debt collection regulations.
  • According to the AG’s office, Levy & White allegedly routinely intimidated consumers when seeking to collect debts, coerced consumers into repayment plans, and in some instances, threatened consumers with imprisonment.
  • The lawsuit seeks to permanently bar Levy & White from filing or litigating collection actions in the Lowell District Court, restitution to affected consumers, civil penalties, and attorney’s fees.

Minnesota Attorney General Files Lawsuit Against Internet Company Over Allegedly Misquoting Internet and Cable Prices to Consumers

  • Minnesota AG Lori Swanson filed a lawsuit against phone, cable, and Internet companies CenturyTel Broadband Services LLC, d/b/a CenturyLink Broadband; Qwest Broadband Services, Inc., d/b/a CenturyLink; and Qwest Corporation, d/b/a CenturyLink QC (collectively “CenturyLink”) for allegedly charging customers Internet and cable rates inconsistent with price quotes in violation of the state’s consumer fraud and deceptive trade practices acts.
  • According to the complaint, CenturyLink allegedly charged some consumers more than the price quoted for cable and Internet service and refused to honor quoted rates after consumers brought the price misrepresentations to the company’s attention.
  • The lawsuit seeks restitution to affected consumers, civil penalties, attorney’s fees, litigation costs, and to enjoin CenturyLink from further violations of state law.

Health Care

Department of Justice, DHHS Office of Inspector General, and 30 States Charge Over 400 Defendants for Alleged Health Care Fraud

  • The U.S. Department of Justice (“DOJ”), the U.S. Department of Health and Human Services’ Office of Inspector General (“HHS”), and 30 state Medicaid Fraud Control Units brought charges against over 400 defendants, including physicians, nurses, and other healthcare providers, for allegedly submitting $1.3 billion in false billings, in violation of federal and state law.
  • According to the DOJ, the defendants allegedly falsely billed Medicare, Medicaid, and TRICARE for unnecessary prescription drugs that often were never purchased or distributed to consumers, as well as allegedly unlawfully distributed opioids.
  • In addition to the charges, HHS initiated suspension actions against nearly 300 providers, including doctors, nurses and pharmacists.

Labor and Employment

Massachusetts Attorney General Reaches Settlement with Healthcare Services Company Over Alleged Failure to Properly Pay Employees

  • Massachusetts AG Healey reached a settlement with healthcare services company Healthcare Services Group, Inc. (“HSG”) to resolve allegations that it violated state minimum wage and overtime laws by underpaying employees.
  • According to the AG’s office, HSG’s timekeeping and payroll systems inaccurately recorded the full amount of hours employees worked, resulting in clerical errors and HSG’s failure to pay employees correct wages.
  • Under the terms of the agreement, HSG will pay more than $250,000 in restitution and penalties, and also pay for the cost of locating former employees who are restitution recipients.


5 AGs File Lawsuit Against Generic Drug Manufacturers Over Price Fixing Allegations

  • The AGs of Arkansas, the District of Columbia, Missouri, New Mexico, and West Virginia filed a lawsuit against generic drug manufacturers Heritage Pharmaceuticals, Inc., Aurobindo Pharma USA, Inc., Citron Pharma, LLC, Mayne Pharma (USA), Inc., Mylan Pharmaceuticals, Inc. and Teva Pharmaceuticals USA, Inc. for allegedly violating state antitrust laws. This suit mirrors an ongoing action initiated by the Connecticut AG in which 40 other AGs alleged that the same six generic drug manufacturers violated state antitrust and consumer protection laws by suspiciously raising prices of certain generic drugs.
  • According to the complaint, the pharmaceutical companies allegedly conspired to control prices and allocate markets for antibiotic medication doxycycline hyclate and oral diabetes medication glyburide.
  • The lawsuit seeks civil penalties, costs and attorney fees, and monetary relief, among other things.

State AGs in the News

South Carolina Attorney General Appoints New Chief Deputy Attorney General

  • South Carolina AG Alan Wilson named former Circuit Court Judge Jeff Young as Chief Deputy AG.
  • Prior to being appointed Chief Deputy AG, Judge Young served as Sumter Circuit Court Judge and in the South Carolina House of Representatives.