United States: State AGs In The News - February 19th, 2015

Last Updated: February 25 2015
Article by Bernard Nash and JB Kelly


Hospital Backs Away From Acquisition After New Massachusetts Attorney General Voices Concern

  • Partners HealthCare System, Inc. decided not to move forward with its proposed acquisition of South Shore Health and Educational Corporation. The parties filed a stipulation of voluntary dismissal with the Suffolk County Superior Court, where a consent judgment detailing the terms and conditions of the merger was pending approval.
  • Partners had reached a preliminary agreement to acquire South Shore with former Massachusetts AG Martha Coakley. After taking office, AG Maura Healey expressed her concerns about the merger and indicated that if the court declined to approve the consent judgment, she would seek to enjoin the merger.
  • AG Healey stated that she "appreciate[d] the thoughtful process that Partners engaged in while making this important decision, and believe[d] it is the right choice for Partners and the Commonwealth..." Partners' planned acquisition of Hallmark Health Corporation remains under consideration.


Judge Grants Preliminary Injunction to Prevent Disclosure of Nonprofit's Donors

  • A federal judge for the Central District of California granted a preliminary injunction preventing California AG Kamala Harris from obtaining a list of donors to the Americans for Prosperity Foundation (AFP), a nonprofit group founded by Charles and David Koch. AFP's lawsuit against AG Harris will now proceed on the merits, and AG Harris has 21 days to file her response to AFP's complaint.
  • The dispute originated when AG Harris informed AFP that in order to comply with the California Supervision of Trustees for Charitable Purposes Act, AFP was required to submit the names and addresses of all individuals who had donated more than $5,000 to the group for tax years 2011 and 2012. AFP resisted and brought this lawsuit seeking permanent injunctive relief, claiming that such information would "hinder citizens' ability to freely and anonymously associate with AFP in violation of the First Amendment" and subject donors to potentially harmful actions by individuals opposed to AFP.
  • AG Harris asserted that acquiring donor information is necessary to ensure that the charity or nonprofit is not being used to evade taxes, or for other fraudulent purposes. AG Harris also indicated that the information would only be used within the AG's office and would remain confidential.

Consumer Financial Protection Bureau

CFPB Takes Action Against Mortgage Companies for Allegedly Deceptive Ads

  • The Consumer Financial Protection Bureau (CFPB) filed suit against All Financial Services, LLC, and settled with Flagship Financial Group, LLC and American Preferred Lending, Inc., over alleged violations of the 2011 Mortgage Acts and Practices Advertising Rule. The Rule prohibits the use of misleading claims in mortgage advertising, including among other things, creating the implication of government affiliation or endorsement of a mortgage product.
  • The CFPB alleged that the mortgage companies mislead consumers through the use of terms like "FHA-insured" or "HUD-approved," or otherwise misrepresented that they were selling mortgage products affiliated with a government entity in the course of conducting direct mail promotion activities.
  • The CFPB's lawsuit against All Financial is pending in U.S. District Court for the District of Maryland. The CFPB entered into administrative consent orders with the other two lenders, requiring Flagship Financial to pay $225,000 in civil penalties, and American Preferred to pay $85,000. In addition, both settling companies must implement compliance monitoring and reporting programs.

Consumer Protection

Ohio Sues Debt-Recovery Company Said to be "Spoofing" as Government

  • Ohio AG Mike DeWine filed a lawsuit against debt collector Nationwide Recovery Group, LLC and its owner Michael McCarthy (Nationwide) for violating the Ohio Consumer Sales Practices Act and the Fair Debt Collection Practices Act.
  • The AG's complaint alleges that Nationwide impersonated local government and law enforcement—including various court clerks, sheriffs, and investigators—in its attempts to collect debts from Ohio consumers. In some cases, Nationwide is alleged to have "spoofed" consumers' caller IDs to display a government phone number and threatened consumers with arrest or legal action if they did not repay the alleged debt immediately.
  • The lawsuit is pending in the Montgomery County Court of Common Pleas, and seeks restitution as well as civil penalties.

Data Privacy

President Obama Issues Executive Order on Private Sector Information Sharing

  • President Obama signed an executive order designed to increase information sharing among private companies, nonprofit organizations and government agencies regarding threats, vulnerabilities, and attacks occurring over the internet.
  • The Order specifically directs the Department of Homeland Security to foster the creation of Information Sharing and Analysis Organizations (ISAOs). It also seeks to establish mechanisms that maintain and improve the functions of ISAOs and facilitate information dissemination and private sector partnership with the federal government—specifically through the National Cybersecurity and Communications Integration Center.

Indiana Attorney General Proposes Stronger Data Privacy Legislation

  • Data privacy legislation proposed by Indiana AG Greg Zoeller passed a key hurdle as it was approved by the Indiana Senate Committee on Homeland Security and Transportation and will now be considered by the entire Senate.
  • Indiana Senate Bill 413 would expand data breach notification obligations to breaches involving non-computerized data, and would apply to data collectors and users. The current law applies only to data owners.
  • The bill would also require companies to employ reasonable procedures to ensure that no personal information is retained "beyond what is necessary for business purposes or compliance with applicable law." It would also require online entities that collect personal or financial information from Indiana residents to conspicuously post their privacy policies, identifying the types of personal information collected from site visitors, and to whom the information is shared or sold.


Missouri Collects $43.9 Million for Environmental Remediation in National Settlement

  • Missouri AG Chris Koster announced that the state will receive $43.9 million from Anadarko Petroleum Corporation as part of a nationwide $5.15 billion settlement regarding the 2006 acquisition of Kerr-McGee Corporation.
  • The environmental claims settled by Anadarko stem from the 2009 bankruptcy of Tronox Ltd. Tronox's creditors together with the U.S. Department of Justice claimed that Kerr-McGee fraudulently saddled Tronox with most of its environmental liabilities and then divested the company to make Kerr-McGee a more attractive acquisition for Anadarko.
  • The majority of Missouri's portion of the settlement—$38.2 million—will go toward remediating two sites formerly owned by Kerr-McGee, and used for creosote wood treatment. The remaining $5.7 million will be applied to the state's Natural Resource Damages program to remediate contaminated sites for public use.

States vs Federal Government

Round One Goes to Texas in Lawsuit Challenging President's Executive Action on Immigration

  • Andrew Hanen, a federal judge for the Southern District of Texas, ruled in favor of Texas and 25 other state plaintiffs, enjoining the implementation of certain aspects of President Obama's executive action on immigration. The U.S. Department of Justice has indicated it will appeal the decision.
  • Judge Hanen's decision turned on his interpretation of the requirements of the Administrative Procedure Act (APA). Judge Hanen found that the proposed executive action, effectuated through changes in Department of Homeland Security operations, created a "substantive change to immigration policy" and thus was properly classified as a rule or regulation that must comply with the APA's requirement of being first published in the Federal Register for a period of notice and comment.
  • Texas AG Ken Paxton, who is lead plaintiff along with 25 other states, called the decision "a victory for the rule of law in America." In contrast, Washington AG Bob Ferguson, who led a group of AGs from twelve states and the District of Columbia in filing an amici brief in support of the President's actions, indicated that this ruling was only the beginning.

Eleven Attorneys General Argue Mississippi Has Authority to Investigate Google

  • Eleven AGs, led by Kentucky AG Jack Conway, filed an amici brief in federal court in support of Mississippi AG Jim Hood's attempt to investigate Google, Inc. for alleged violations of the Mississippi Consumer Protection Act through the issuance of an administrative subpoena. Kentucky AG Jack Conway was lead AG on the brief.
  • The subpoena demanded that Google produce information related to AG Hood's allegations that the company does not take appropriate measures to limit illegal activity on the internet, and derives revenue from such activities, including the exchange of pirated materials and the promotion of illegal drugs. Google objected to the subpoena and filed a lawsuit in federal court seeking an injunction to block the subpoena and the investigation.
  • Google argues that the 1996 Communications Decency Act shields online companies like Google from liability arising out of materials posted by third parties, essentially providing immunity from the AG's investigation. In their brief, the eleven amici AGs respond that even if Google is ultimately immune, that would be a defense to a lawsuit, and not to an AG investigation. Moreover, the AGs argue that the proper response when objecting to an administrative subpoena is through the state court system, not a federal lawsuit.
  • The case is Google, Inc. v. Hood, 3:14-CV-00981. The parties are scheduled to argue their positions on AG Hood's Motion to Dismiss on February 20 in front of Judge Henry T. Wingate for the Southern District of Mississippi.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement

    Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of www.mondaq.com

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at enquiries@mondaq.com.

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions