Tennessee Appoints New Attorney General
- The Tennessee Supreme Court appointed Republican Herbert Slatery III as the state’s next Attorney General. Tennessee is the only state where the Supreme Court appoints the Attorney General.
- For more information, please see our recent blog post on this appointment.
ACC Webcast: Post-Election Analysis of the New Attorney General Landscape
- Dickstein Shapiro and the Association of Corporate Counsel (ACC) are partnering for a webcast on Wednesday, November 5 at 2:00 PM EST for a post-election analysis of the new Attorney General landscape.
- Bernie Nash, head of Dickstein Shapiro’s AG Practice, will lead an interactive discussion about that new landscape and its implications for the business community.
- This webcast is free and open to the public. Register here.
New York Attorney General Sues to Block Pharma Manufacturer From Canceling Production of Drug
- New York AG Eric Schneiderman brought a lawsuit against Actavis plc and subsidiary Forest Laboratories to prevent them from ceasing production of an Alzheimer’s drug, Namenda, allegedly to encourage patients to transition to a newer and potentially more profitable version, Namenda XR.
- The lawsuit claims that Actavis is violating state and federal antitrust laws by pulling Namenda from the market to force patients to use Namenda XR because the patent on the former will soon expire, allowing for competition from generic drug manufacturers. The lawsuit alleges that once patients switch to Namenda XR, which has many years remaining under patent protection, it will be too burdensome for patients to switch back to generic versions of Namenda once they become available.
- The lawsuit was filed in the U.S. District Court for the Southern District of New York on September 15.
Consumer Financial Protection Bureau
CFPB Sues For-Profit Colleges Alleging Predatory Lending Practices
- The Consumer Financial Protection Bureau (CFPB) sued Corinthian Colleges, Inc. for allegedly illegal predatory lending practices. The complaint, filed in U.S. District Court for the Northern District of Illinois, alleges violations of the Consumer Financial Protection Act and the Fair Debt Collection Practices Act. It seeks injunctive and declaratory relief, damages, restitution, disgorgement, rescission, civil penalties, and costs.
- Corinthian responded in a statement that it strongly disputes the CFPB’s allegations, stating that the complaint “wrongly disparages the career services assistance that we offer our graduates and mischaracterizes both the purpose and practices of the ‘Genesis’ lending program.” Corinthian also indicated that the CFPB’s lawsuit may be disruptive to the implementation of its July 3rd agreement with the U.S. Department of Education, designed to provide an orderly transition for Corinthian students.
California Expands Attorney General’s Power to Protect Consumers’ Ability to Leave Online Reviews
- California recently signed into law a bill that will preserve consumers’ ability to leave negative reviews of vendors on websites like Yelp.com.
- The law is designed to address a growing practice whereby vendors allegedly use contractual provisions in accompanying terms of service to waive customers’ rights to post online reviews or to impose penalties for posting negative reviews of related products or services.
- Assembly Bill 2365 prohibits a contract or proposed contract for the sale or lease of consumer goods or services from including a provision waiving the consumer’s right to make any statement regarding the seller or lessor or its employees or agents, or concerning the goods or services. The bill also makes it unlawful to threaten or to seek to enforce a provision that it prohibits, or otherwise penalize a consumer for making a protected statement.
- Under the new law, the AG, the consumer, or a district or city attorney can pursue civil actions for violations, with fines of $2,500 for initial violations; $5,000 for subsequent violations; and an additional $10,000 for willful, intentional, or reckless violations.
Connecticut Attorney General Seeks Answers to Questions About Privacy and Operation of the Apple Watch
- Connecticut AG George Jepsen sent a letter to Apple Chief Executive Officer Tim Cook requesting answers to questions regarding the design and operation of the new Apple Watch.
- AG Jepsen’s letter poses several questions for Cook, including whether the watch will collect personal information and consumer data; if so, how will consumer consent to collect and share such information be obtained and how will such data be stored and safeguarded; whether Apple will review the privacy policies of application developers; and how Apple intends to monitor and enforce compliance with its guidelines regarding consumer health information.
Vermont Attorney General Settles Allegations of Consumer Protection Violations With Credit Card Processing Firm
- Vermont AG William H. Sorrell settled claims against Merchant Processing Solutions, LLC for allegedly violating the state Consumer Protection Act by using deceptive representations, failing to make required disclosures, and failing to register as a telephone solicitor.
- Among other things, the AG claims that the company used deceptive language regarding the scope of consumer savings and advertised well-known companies as clients when they were not actual clients.
- The settlement requires Merchant Processing Solutions to pay more than $169,000 in restitution to affected companies and a $100,000 civil penalty to the state. The settlement also subjects the company to injunctive relief, which includes requiring it to comply with state law and register with the secretary of state.
North Carolina Attorney General Creates Consumer Education Program for College Students
- North Carolina AG Roy Cooper initiated a program to help college students increase their consumer savviness.
- The “College Cash & Credit Tour” will bring AG Cooper and experts from his office to six different college campuses in North Carolina to give presentations that include information on how to manage student loan debt, how to use credit wisely, and how to avoid identity theft.
- As part of this initiative, the AG also will post videos of the presentations on his website, sponsor online chats to answer questions from students on these topics, and provide a checklist of steps students can take to protect themselves from consumer problems.
Vermont Attorney General Settles Privacy Case Against Furniture and Electronics Leasing Company
- Pursuant to a settlement with Vermont AG William H. Sorrell, SEI/Aaron’s Inc., a franchise of Aaron’s, Inc., has agreed to pay $45,000 to the state and $2,000 to each of the three affected consumers for allegedly placing and using remote monitoring software on leased computers in violation of the Vermont Consumer Protection Act.
- Aaron’s “Detective Mode” software was designed to assist in the recovery of the computers in the event of loss or theft. In at least three cases, the software was allegedly activated—monitoring keystrokes and transmitting screen shots to Aarons—without any evidence of loss or theft.
New Jersey Attorney General is One Step Closer to Settling Passaic River Litigation
- Acting New Jersey AG John Hoffman and the state Department of Environmental Protection announced a proposed settlement with Occidental Chemical Corp., the successor in interest to Diamond Shamrock Chemicals Company and the last remaining defendant in the almost nine-year-old litigation, over the alleged contamination of the Passaic River.
- Under the terms of the proposed settlement, Occidental will pay $190 million to the state to resolve any potential liability for cleanup and remediation costs, natural resource damages, and other damages related to the alleged decades-long discharge of hazardous chemicals into the Passaic River.
- The agreement is subject to a public comment period and approval by a state superior court judge.
Virginia Attorney General Sues Banks for Allegedly Fraudulently Selling Mortgage-Backed Securities to the Virginia Retirement System
- Virginia AG Mark R. Herring announced that he filed a lawsuit against 13 national banks seeking $1.15 billion for alleged false claims and fraudulent misrepresentations regarding the value of residential mortgage-backed securities sold to the Virginia Retirement System between 2004 and 2010.
- Because the Virginia Retirement System is funded in part by taxpayers, AG Herring sued under the Virginia Fraud Against Taxpayers Act (the Act). He also alleged actual and constructive fraud. The lawsuit is the largest financial fraud lawsuit ever brought by the state and the largest lawsuit ever brought under the Act.
- In addition to damages, Virginia will seek civil penalties of $5,500 to $11,000 for each violation, interest, costs, and fees.