Digest 2.8.2018 The State AG Report Weekly Update

Cozen in the News

Cozen O’Connor’s State Attorneys General Practice Rolls Out State AG Election Tracker

  • Cozen O’Connor’s State Attorneys General Practice is offering early access to the new State AG Election Tracker, an online resource providing daily coverage of all AG primary and general elections.
  • The State AG Election Tracker is the only comprehensive resource for tracking the 2018 AG elections, which have the potential to significantly change the political landscape. There are 31 state AG elections in 2018, including 10 confirmed open seat races, and the potential for AGs appointed by governors or legislatures to change in an additional five states.
  • The State AG Election Tracker will officially roll out to wider audiences later this month. We invite you to take a sneak peek by watching this short preview video.

2018 AG Elections

North Dakota Attorney General Wayne Stenehjem Announces Bid for Reelection

  • North Dakota AG Wayne Stenehjem declared his intention to run for reelection to a sixth term in 2018.
  • Prior to taking office as AG in 2000, AG Stenehjem, a Republican, served two terms as a state Representative and twenty years as a state Senator.
  • No other candidate has filed or announced his or her intent to run for North Dakota AG in 2018.


11 Attorneys General Object to Removal of Emissions Penalty from Consent Decree

  • 11 AGs, led by Vermont AG T.J. Donovan, filed an amicus brief opposing the U.S. Department of Justice’s (“DOJ”) July 2017 decision to remove terms requiring Harley-Davidson Inc. (“Harley-Davidson”) to invest $3 million in an air pollution reduction project from a consent decree reached in 2016 with the U.S. Environmental Protection Agency and DOJ.
  • According to the AGs, the elimination of the consent decree terms requiring Harley-Davidson to fund a $3 million project retrofitting or replacing higher polluting wood-burning appliances to mitigate the pollution allegedly caused by Harley-Davidson’s manufacture and use of certain motorcycle parts is unfair, unreasonable, and against the public interest.
  • The amicus brief asks the court either to decline to amend the consent decree or to only approve a modification that would impose a substantially equivalent substitute mitigation project.

12 Attorneys General Pen Letter in Opposition to Proposed Offshore Drilling

  • 12 AGs, led by North Carolina AG Josh Stein, wrote a letter to Secretary of the Interior Ryan Zinke opposing the U.S. Department of the Interior’s 2019-2024 National Outer Continental Shelf Oil and Gas Leasing Draft Proposed Program (“Draft Proposed Program”).
  • The Draft Proposed Program expands permitted development of oil and gas extraction across 90 percent of the U.S. outer continental shelf in the Atlantic and Pacific oceans, while exempting the waters off the coast of Florida from expanded drilling programs.
  • According to the letter, the Draft Proposed Program will threaten the economic prosperity of coastal states and the unique ecologies of those states’ shores and ocean waters.

False Claims Act

New York Attorney General Settles with Home Health Care Provider Over Alleged False Medicaid Claims

  • New York AG Eric Schneiderman and the U.S. Department of Justice (“DOJ”) reached a settlement with home health care provider Home Family Care, Inc. (“Home Family”), a Licensed Home Care Services Agency (“LHCSA”), and its president to resolve a lawsuit filed by AG Schneiderman and the DOJ alleging that Home Family violated state and federal False Claims Acts by falsely billing the New York State Medicaid Program for services that were not provided or were provided by unqualified staff.
  • According AG Schneiderman, Home Family allegedly failed to meet its obligations as a LHCSA by billing Medicaid for home aide visits that never occurred as scheduled or were provided by aides not qualified to provide LHCSA services and by failing to maintain records documenting services rendered.
  • Under the terms of the settlement, Home Family and its president will pay $6.415 million to the state.
  • In a separate settlement, the former vice president of Home Family, who was responsible for overseeing aides and allegedly took no measures to stop these practices, will reportedly pay $100,000 to resolve the allegations against him.


23 Attorneys General Reach Settlement Agreement with Japanese Pharmaceutical Manufacturers Over Alleged Anticompetitive Practices

  • 23 AGs settled with Japan-based pharmaceutical patch manufacturers Teikoku Seiyako Co., Ltd. and Teikoku Pharma USA (collectively “Teikoku”) over allegations that Teikoku engaged in anticompetitive acts related to its lidocaine patch, Lidoderm.
  • According to reports, the AGs alleged that Teikoku paid or incentivized generic drug makers to delay entry into the lidocaine patch market to protect a monopoly on Lidoderm, which is widely prescribed to relieve pain associated with the shingles virus.
  • The settlement agreement, which expires in twenty years, prohibits Teikoku from entering into agreements that restrict generic drug manufacturers from researching, manufacturing, marketing, or selling products for a period of time and requires Teikoku to cooperate in an ongoing investigation into similarly anticompetitive conduct by other drug manufacturers, among other things.

New York Attorney General Sues Pharmaceutical Company for Alleged Deceptive Marketing of Opioids

  • New York AG Schneiderman filed a lawsuit against pharmaceutical manufacturer and distributor Insys Therapeutics, Inc. (“Insys”) for allegedly engaging in deceptive marketing, fraud, and commercial bribery to promote its products.
  • According to the complaint, Insys allegedly marketed Subsys—a highly addictive fentanyl drug intended for extreme cancer-related pain—for wider use by downplaying the risks of addiction to Subsys, bribing doctors to prescribe the drug, and making misrepresentations to healthcare providers.
  • The lawsuit seeks a permanent injunction against Insys engaging in the alleged practices, disgorgement of all revenues up to $75 million, civil penalties, restitution, damages, and costs.
  • As previously reported, AGs from North Carolina, New Jersey, Arizona, Illinois, and Oregon have levied similar claims against Insys in relation to the marketing tactics used to promote Subsys.

State AGs in the News

Hawaii Attorney General to Serve as Lieutenant Governor

  • Hawaii AG Doug Chin will serve as Lieutenant Governor, replacing Shan Tsutsui, who resigned earlier this week. AG Chin, the third in the line of succession, accepted the position after Senate President Ron Kouchi and House Speaker Scott Saiki declined the post.
  • As previously reported, AG Chin announced late last year that he would step down as AG on March 15 to campaign full-time for Hawaii’s 1st Congressional District seat. AG Chin will continue to campaign for U.S. Congress while he serves as Lieutenant Governor.
  • AG Chin’s successor will be appointed by Governor David Ige. Former First Deputy AG Russell Suzuki is currently Acting Attorney General.

State v. Federal

17 Attorneys General Oppose Proposed Rescission of Tip Regulations

  • 17 AGs, led by California AG Xavier Becerra, submitted comments in opposition to the U.S. Department of Labor’s proposed rule to rescind portions of a 2011 regulation issued pursuant to the Fair Labor Standards Act, which limited employers’ ability to control tips or gratuities received by employees (“tip regulations”).
  • Under the proposed rule, employers would be considered “owners” of any tips made by their staff and could retain or otherwise redistribute tips received by an employee so long as the employee was paid the federal minimum wage of $7.25 per hour.
  • According to the AGs, allowing employers to take, keep, or redistribute employee tips will harm millions of employees dependent upon tips and deceive customers as to whom will receive and benefit from their tips.