State Attorneys General

For the past twenty years, state attorneys general have played an increasingly prominent role in enforcing laws and regulations affecting the business community.  While often appropriate, state AG enforcement can also lead to inconsistent, duplicative and politically motivated enforcement of key laws and regulations. In addition, many state AGs hire outside plaintiffs’ lawyers for these cases, raising questions about conflicts of interest and political favoritism. read more...

Modern state AG litigation began with the lawsuits filed against tobacco companies in the 1990s. These generated billions in state revenue, favorable publicity for state AGs and huge profits for certain plaintiffs’ firms hired by state AGs to conduct the litigation. 

The success of the tobacco litigation has led many AGs to target additional business sectors, particularly in the pharmaceutical and financial services areas. While some cases may be legally appropriate, other state AG actions appear more about enhancing a state AG’s political standing. In addition, businesses face the danger of inconsistent and duplicative enforcement by each of the fifty state AGs as well as numerous federal regulators. This is particularly true in the financial services context, where the Dodd-Frank law grants state AGs the power to enforce regulations issued by the new Consumer Financial Protection Bureau.

Also problematic is the use of outside contingency fee counsel by many state AGs. This involves state AGs awarding secret, no-bid contingency fee contracts to outside plaintiffs’ lawyers to represent their states in litigation.  As plaintiffs’ lawyers are awarded large contingency fees from successful lawsuits, money may be funneled back into campaign contributions to the AGs.  These alliances raise significant concerns about conflict of interest, favoritism, the use of a public entity for personal gain, and fairness in prosecutions. 

Twenty states— Alabama, Arizona, Arkansas, Colorado, Florida, Indiana, Iowa, Kansas, Louisiana, Minnesota, Mississippi, Missouri, Nevada, North Carolina, North Dakota, Ohio, Texas, Utah, Virginia, and Wisconsin —have passed "sunshine" legislation to create an open process of hiring outside contingency fee counsel. These measures vary, but more recent laws require state attorneys general to disclose their contingency fee contracts, ensure that they maintain control of the litigation and impose reasonable limitations on fee awards to private attorneys. Other attorneys general have adopted office policies that implement many of these reforms.

 

 

Research

The ILR Research Review-Volume 2,
Issue 2

December 22, 2015 | The ILR Research Review offers valuable insights from our preeminent experts and specialists on key topics addressed in the latest of ILR's research reports.

A Perilous Patchwork: Data Privacy and Civil Liability in the Era of the Data Breach

October 27, 2015 | This paper provides an overview of the patchwork of civil liability that U.S. companies face over data breaches, including actions by federal regulators, state attorneys general and private plaintiffs.

All Results for State Attorneys General

In the News Today - February 2, 2016

February 02, 2016 | Insights

McGraw's Entry into WV Supreme Court Race a 'Bombshell': WV MetroNews reporter Hoppy Kercheval today calls former Attorney General Darrel McGraw's entry into the state Supreme Court race "the biggest bombshell of the last minute election filings." Noting McGraw would be 92 years old by the end of his term, Kercheval says the filing "is a curious, unexpected move, but then again, the McGraws have always marched to their own beat." (WV MetroNews) Read More »

In the News Today - January 21, 2016

January 21, 2016 | Insights

New Mexico AG Latest to File Suit Against Volkswagen: Volkswagen already faces more than 500 lawsuits from individuals and car dealers, as well as suits brought by the U.S. Justice Department and attorneys general in Texas and West Virginia, over the alleged emissions scandal. That, however, didn't stop New Mexico Attorney General Hector Balderas from also filing suit against the automaker yesterday. (Wall Street Journal) Read More »

In the News Today - January 7, 2016

January 07, 2016 | Insights

ACE Seeks Contempt Proceedings Against Litigation Financier: Irish developer Garrett Kelleher invested "$2.85 million in 2006 in the efforts of Liberian group Abi Jaoudi and Azar Trading (AJA) to enforce a $66.5 million judgment against US insurer Cigna Worldwide, in return for a share of the lawsuit's proceeds. The litigation ultimately failed, but ACE Group, which took over Cigna, will ask a U.S. court "to find Mr Kelleher along with two others, Martin Kenney and Samuel Lohman, in contempt of court for their role in the AJA case." (Irish Times) Read More »

The ILR Research Review-Volume 2,
Issue 2

December 22, 2015 | Research

The ILR Research Review offers valuable insights from our preeminent experts and specialists on key topics addressed in the latest of ILR's research reports. Read More »

Outgoing Louisiana AG's 'Buddy System' Highlighted

December 02, 2015 | Insights

The Louisiana Watchdog highlights outgoing Louisiana Attorney General Buddy Caldwell's questionable use of outside private contingency counsel to sue companies on behalf of the state. Specifically, the report highlights Caldwell's use of private law firms in the Gulf oil spill litigation. Read More »

Outgoing Louisiana AG Violating State Law with Outside Counsel Contracts?

November 25, 2015 | Insights

Loyola Law School professor Dan Ciolino says outgoing Louisiana Attorney General Buddy Caldwell's practice of forcing "defendant" companies to pay legal fees to private lawyers working for the state" is "a blatant violation of state ethics laws." Read More »

USA Today Editorial Raises 'First Amendment Concerns' About New York AG's Exxon Probe

November 24, 2015 | Insights

New York Attorney General Eric Schneiderman's probe into Exxon Mobil's past statements and research about climate change "raise serious First Amendment concerns," writes the USA Today editorial board. Read More »

In the News Today - November 23, 2015

November 23, 2015 | Insights

SEC In-House Judge's Comments Further Fuel Criticisms of Bias in the System: According to a recent court filing, Judge Brenda Murray, the chief in-house judge for the Securities and Exchange Commission, last year "told eight stockbrokers to give up on the idea that she would toss the case against them without first holding a hearing." She reportedly "explained to the brokers that the commissioners who run the SEC and approve all the civil charges filed by the agency don't want its judges second-guessing them." (Wall Street Journal) Read More »

In the News Today - November 17, 2015

November 17, 2015 | Insights

New DoJ Rules Encourage More Charges Against Individuals in Corporate Investigations: The Justice Department released changes to its guidelines for prosecutors in corporate enforcement cases. These guidelines now instruct prosecutors to "focus on wrongdoing by individuals from the very beginning of any investigation of corporate misconduct." (Wall Street Journal) Read More »

In the News Today - November 12, 2015

November 12, 2015 | Insights

Business or Personal? Sheldon Silver's defense attorneys face an uphill battle in proving that the relationship between the indicted former New York Assembly Speaker and Dr. Robert Taub was that of true friendship, rather than a quid pro quo. Taub is accused of referring patients from his cancer center to Silver's law firm in exchange for receiving state grants with the help of Silver. (New York Times) Read More »

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