The State AG Report Weekly Update May 18, 2017

2018 AG Elections Update

Phil Weiser Announces Bid for Colorado Attorney General

  • Phil Weiser has formally registered his candidacy to become Colorado AG. Weiser, a Democrat, is seeking to challenge Republican AG Cynthia Coffman, who is expected to run for re-election.
  • Weiser previously clerked for U.S. Supreme Court Justices Byron White and Ruth Bader Ginsburg and has served as faculty and Dean of the University of Colorado Law School.
  • Weiser also served in the U.S. Department of Justice’s Antitrust Division under both President Clinton and President Obama.

State Representative Jay Fant Declares Candidacy for Florida Attorney General

  • Republican State Representative Jay Fant has announced his candidacy for Florida AG.
  • State Representative Fant is the first candidate to officially enter the 2018 race to replace Florida AG Pam Bondi, who is term limited.
  • Representative Fant, an attorney and businessman, has represented Jacksonville in the state legislature for two terms.

Consumer Protection

FTC, AGs Partner to Launch International Initiative to Stop Tech Scams

  • Florida AG Pam Bondi and the Federal Trade Commission (“FTC”) announced the launch of “Operation Tech Trap,” a coordinated initiative among AGs and other state, federal and international law enforcement partners to stop scams that allegedly deceive consumers into believing their computers have been infected by viruses, malware, or other cyber security threats and then unlawfully charge them to fix problems that do not exist.
  • According to the FTC, the tech scams allegedly display advertisements designed to resemble pop-up security alerts from major technology companies warning that their computers are infected with viruses or being hacked, urge consumers to call a toll-free number, run a series of “diagnostic tests” that alert consumers of fake problems requiring immediate repair, and then charge consumers hundreds of dollars for the unnecessary repairs.

Kentucky Attorney General Takes Actions Against Fitness Centers for Failing to Register Businesses

  • Kentucky AG Andy Beshear has filed lawsuits, reached settlements, or obtained judgments against several fitness centers operating in the state for allegedly violating state law by failing to properly register their businesses with the AG’s office.
  • According to the AG’s office, these fitness centers allegedly failed to file an annual registration statement with the AG and post a bond if the centers charged an initiation fee or had prepaid memberships.

New York Attorney General Settles with Six Ticket Brokers for Alleged Unlawful Ticket Resales

  • New York AG Eric Schneiderman reached settlements with ticket brokers Renaissance Ventures, LLC (d/b/a Prestige Entertainment), Ebrani Corp (d/b/a Presidential Tickets), Concert Specials, Fanfetch Inc., BMC Capital Partners, Inc., and JAL Enterprises, LLC (collectively the “ticket brokers”) to resolve allegations that the companies violated state ticket laws by using illegal ticket software, known as “bots,” to purchase and resell tickets on popular ticket websites.
  • According to the AG’s office, the companies allegedly sold tickets to events in New York dating back to 2011 without obtaining required resale licenses and allegedly used bots that enabled them to purchase large numbers of tickets on ticket websites before they could be bought by consumers.
  • Under the terms of the settlement, the ticket brokers must collectively pay $4.19 million in disgorged profits and penalties to the state, maintain proper ticket reseller licenses, and abstain from using bots.
  • As previously reported, this settlement was part of a broader investigation by AG Schneiderman into the secondary ticket industry that has resulted in settlements with 15 businesses to date.

Medicaid Fraud

Tennessee Attorney General Files Suit Against Pain Management Clinic Network Over Allegations of Medicaid Fraud

  • Tennessee AG Herbert H. Slatery III filed a lawsuit against MMi Pain Clinics, its owner, and its associates (collectively “MMi”) for allegedly charging the state Medicaid system for unnecessary medical procedures.
  • According to the AG’s office, MMi, which operates 18 pain management clinics throughout the state, allegedly violated state Medicaid policy by subjecting patients to superficial back injections called ”trigger point injections” and misreporting these injections to subvert billing limitations on such injections.
  • The lawsuit seeks $7 million in damages and $14 million in civil penalties.

21 AGs and DOJ Settle with Medical Utilization Company for Alleged Medicaid Fraud

  • 21 AGs reached an agreement-in-principle to join the Department of Justice in a settlement with utilization management company CareCore National LLC (“CareCore”) over allegations that CareCore’s “Process As Directed” (“PAD”) program caused fraudulent or false claims to be submitted to and reimbursed by state Medicaid programs.
  • According to the New York AG’s office, CareCore allegedly overbilled state and federal government healthcare programs by automatically approving hundreds of radiology service requests per day without evaluating whether the procedures were medically necessary.
  • Under the terms of the agreement-in-principle, CareCore will pay the federal government $54 million, of which $18 million will go to state Medicaid programs.

State v. Federal

NAAG Pens Letter to Human Health Services Secretary in Support of Expanding Medicaid Fraud Authority

  • The National Association of Attorneys General (“NAAG”) sent a letter signed by a bi-partisan group of 38 AGs to the U.S. Department of Health and Human Services Secretary Tom Price urging Secretary Price to change federal limitations on states’ ability to use federal funds while investigating Medicaid abuse and neglect cases.
  • According to the letter, NAAG recommends lifting restrictions on Medicaid Fraud Control Units (“MFCU”) in a way that would allow federal funds to be used to investigate and prosecute abuse and neglect of Medicaid home health care beneficiaries and allow use of MFCU federal funds to freely screen any and all complaints, regardless of type or setting.