Antitrust

California Attorney General Settles with Television and Computer Monitor Manufacturers for Alleged Price Fixing

• California AG Kamala Harris announced that a court preliminarily approved the AG’s settlements with LG, Hitachi, Panasonic, Toshiba, and Samsung (the “Companies”) to resolve allegations that they violated the state’s antitrust and consumer protection laws by fixing prices on certain electronics components.
• According to the complaint, which was filed in 2011, the Companies allegedly fixed prices on cathode ray tubes (“CRTs”), which were key components of televisions and computer monitors manufactured between 1995 and 2007. Specifically, the complaint alleged that the companies exchanged competitively sensitive information regarding CRTs and regularly met to fix prices of CRTs, causing consumers to pay inflated prices for products containing CRTs.
• Under the terms of the settlements, the Companies will pay a total of $4.95 million in damages, as well as civil penalties. California consumers and sole proprietorships that purchased televisions or monitors between 1995 and 2007 also are eligible for reimbursement for the alleged overcharges.

Consumer Financial Protection Bureau

CFPB Shuts Down Student Debt Relief Services Company for Allegedly Operating a Scam

• The Consumer Financial Protection Bureau (“CFPB”) filed an enforcement action against student debt relief services company Student Aid Institute, Inc. (“SAI”) and its chief executive officer over alleged violations of federal consumer protection laws and regulations.
• According to the consent order, SAI allegedly charged illegal upfront fees, misrepresented to borrowers how much they would save through the company’s services and whether they were eligible for loan forgiveness, failed to provide required privacy notices, and misrepresented to consumers that the company was affiliated or endorsed by the federal government.
• Under the terms of the consent order, SAI and its chief executive officer must permanently cease operations as a debt relief service, cancel all contracts, stop charging customers any fees for its services, and pay a penalty of $50,000.

Consumer Protection

California Attorney General Sues Investment Bank for Alleged Violations of State False Claims Act and Securities Law

• California AG Kamala Harris filed a complaint against Morgan Stanley alleging the company violated the state False Claims Act, the California Securities Law, and other state laws by misrepresenting the risks associated with certain investments.
• According to the complaint, Morgan Stanley packaged and sold residential and other types of mortgage-backed securities from subprime lenders without properly disclosing the risks associated with the loans. In addition, Morgan Stanley’s offering documents allegedly misrepresented the quality of the loans in the investment packages and used inflated appraisal values for the properties that secured the loans.
• AG Harris seeks, among other things, three times the damages suffered by California government pension funds as a result of the acts, as well as injunctive relief, restitution, and the costs of the investigation.
• Earlier this year, the U.S. Department of Justice and the AGs from New York and Illinois reached separate settlements with Morgan Stanley over similar allegations; Morgan Stanley also participated in an 11-bank settlement with Virginia AG Mark Herring which resolved allegations that the company misrepresented the quality of residential mortgage-backed securities sold to state entities.

Florida Attorney General Settles with Legal Publishing Company Over Negative Option Marketing

• Florida AG Pam Bondi reached a settlement with Juris Publishing, Inc. and Jurisnet, LLC (collectively “Juris”) to resolve allegations that the companies used “negative option marketing” in violation of the Florida Deceptive and Unfair Trade Practices Act.
• According to the AG’s office, Juris allegedly placed consumers in automatic shipment and subscription renewal plans without their consent or without clearly and conspicuously disclosing the terms of these plans.
• Under the terms of the Assurance of Voluntary Compliance, Juris must offer a refund to certain Florida consumers and must make changes to how it discloses negative option plans to consumers, as well as obtain consumers’ express informed consent to the terms and conditions of such plans.

Illinois Attorney General and FTC Obtain Injunction Against Payday Loan Debt Operation

• Illinois AG Lisa Madigan and the Federal Trade Commission (“FTC”) obtained a preliminary injunction and filed a complaint seeking permanent relief against a debt collection operation doing business as, among other names, Stark Law, Stark Recovery, and Capital Harris Miller & Associates (collectively “Stark”), for alleged violations of state and federal consumer protection and debt collection laws.
• According to the complaint, Stark allegedly called, harassed, and threatened consumers demanding immediate payment for payday or other short-term loans that the consumers either did not owe or that Stark was not authorized to collect. The operation also allegedly sold fake payday loan debt portfolios to other debt buyers who then tried to collect on the alleged fake debts.
• The action against Stark is part of “Operation Collection Protection,” a coordinated initiative among federal, state, and local authorities announced late last year to stop deceptive and abusive debt collection practices nationwide.

For-Profit Colleges

Massachusetts Attorney General Sues For-Profit School for Allegedly Deceiving Students

• Massachusetts AG Maura Healey filed a complaint against ITT Educational Services, Inc. (“ITT”), for alleged violations of state consumer protection laws by utilizing unfair and deceptive acts and practices in order to enroll students in its educational programs.
• According to AG Healey, ITT allegedly gave prospective students inflated statistics on the percentage of graduates who obtained jobs in or related to their fields of study and used high pressure tactics to enroll students.
• According to the AG’s press release, AG Healey seeks, among other things, civil penalties, injunctive relief, and restitution for students.

State v. Federal

Georgia and Wisconsin Attorneys General Lead Panel Discussion to Reduce Opioid Abuse at National Summit

• Georgia AG Sam Olens and Wisconsin AG Brad Schimel led a panel discussion at the National Rx Drug Abuse and Heroin Summit on the importance of collaboration between state leaders and the medical community to reduce opioid trafficking and addiction. The summit is the largest national collaboration of business, academia, and health professionals, state and national leaders, and advocates to address prescription drug abuse and heroin use.
• According to the National Association of Attorneys General (“NAAG”), the panel focused on innovative policies and strategies, prescriber education initiatives, the expansion of drug monitoring programs, and the need to reduce the stigma associated with addiction.
• AG Olens and AG Schimel are both members of the NAAG Substance Abuse Committee, which works with law enforcement, prosecutors, community leaders and other stakeholders to identify developing trends and combat substance abuse through coordinated efforts.

Seven Attorneys General Urge the EPA to Retract Proposed Regulation of Competitive Racing Vehicles

• Seven AGs wrote a letter to the U.S. Environmental Protection Agency (“EPA”), urging the EPA to remove language in a Clean Air Act proposed rule that would expand the EPA’s jurisdiction under the Clean Air Act to cover vehicles modified solely for racing or competition.
• The proposed rule would prohibit the modification of certified motor vehicles and motor vehicle engines and their emission control devices even if they are used solely for competition.
• In the letter, the AGs write that statutory language and the EPA’s historic practices with respect to vehicles modified solely for racing or competition make it clear that such vehicles, which are not used on public roads, are not regulated under the Clean Air Act. The letter further states that the proposed rule would be harmful to the economy because it would allegedly render many products made, sold, and installed by businesses in the automotive industry illegal.
• This letter follows a similar letter sent to the EPA by Ohio AG Mike DeWine last month.