United States: State AGs In The News - May 7th, 2015

Hot News

James Martin Receives Honor for Legal Writing

Charities

California Attorney General Wins at Ninth Circuit in Dispute Over Donor Disclosures

  • The Ninth Circuit issued its decision in Center for Competitive Politics v. Kamala Harris, affirming the District Court's denial of a preliminary injunction, and finding that a California law which requires nonprofit groups to provide to the California AG a list of donors who have contributed more than $5,000, was not likely to be a violation of CCP's, or its members', First Amendment Rights.
  • The California law in question—the Supervision of Trustees and Fundraisers for Charitable Purposes Act—requires organizations that solicit funds from California residents to register with the Registry of Charitable Trusts, which in turn requires the list of donors to be disclosed to the AG.
  • CCP had argued that mandatory donor disclosure infringed on its members' right to freely and anonymously associate with CCP in violation of the First Amendment, and would have a chilling effect on members' future participation. AG Harris argued that the information provided would remain confidential, and was necessary to ensure that the putative charity is engaged in a charitable purpose and not engaging in improper business practices.
  • CCP President David Keating indicated that CCP would seek review of the decision, framing the outcome as requiring "an impossible choice" between "disclos[ing] donors to the attorney general or [not] asking Californians to support our work to defend free speech."

Consumer Protection

FTC Issues Complaint Against Weight-Loss Companies Profiting From "Fraud Trifecta"

  • The Federal Trade Commission (FTC) secured a temporary restraining order enjoining Sales Slash LLC, Purists Choice LLC, Artur Babayan, and Vahe Haroutounian d/b/a Prisma Profits (defendants) from violating the FTC Act and the CAN-SPAM Act in connection with marketing, promoting, and selling various weight loss products online.
  • The complaint alleges three types of illegal behavior:
    1. defendants made multiple unsubstantiated claims regarding the efficacy of the weight-loss products
    2. defendants paid marketers to post banner ads on third-party websites that led consumers to false news reports designed to appear as if coming from an independent consumer, or in some cases, from a celebrity or a doctor who has endorsed the product
    3. defendants hired marketers to send spam emails to the contacts of hacked email accounts, making it appear that the email came from a friend or family member
  • The commissioners voted 5-0 in favor of the complaint, which seeks permanent injunctive relief, as well as restitution for injured consumers. The lawsuit is pending in federal court for the Central District of California.

Data Privacy

Los Angeles Sues Bank Over Alleged Deceptive Practices

  • The City of Los Angeles is suing Wells Fargo Bank, N.A., for unfair business practices and failure to report a data breach. The City alleges that Wells Fargo permitted, and even encouraged, bank employees to engage in unfair, unlawful, and fraudulent conduct resulting in higher customer fees.
  • The City alleges that Wells Fargo employees opened unauthorized customer accounts, refused to close those accounts when the customers demanded it, and, in some instances, moved funds from authorized client accounts to pay the fees associated with the newly opened accounts (a practice known as "gaming").
  • Wells Fargo responded by stating that it is "focused on the best interests of its customers and creating a supportive, caring and ethical environment for our team members." The bank further averred that it provides its employees with "training, audits and processes" to ensure that its customers "receiv[e] only the products and services they need and will benefit from."
  • Under a law that permits larger California municipalities to seek redress for consumers statewide, the City is seeking restitution and injunctive relief, as well as civil penalties of up to $2500 for each violation.

U.S. DOJ Unveils Guidelines for Best Practices in Cybersecurity

  • The U.S. Department of Justice (DOJ) released guidelines for businesses to prevent, address, and mitigate damages from potential cybersecurity threats.
  • The Guidelines provide specific suggestions for companies to implement before a cyberattack or intrusion, including:
    • identify the data, assets or services most important to the company's existence and create tiered security measures to protect such data, assets, or services;
    • create and test an actionable incident response plan comprised of concrete procedures to follow in the event of a cyberattack;
    • implement network monitoring; and
    • acquaint legal counsel with laws regarding cyber incidents and responses.
  • Finally, the Guidelines provide a list of information that a company should retain after a cyber incident, and instructions for notifying relevant law enforcement bodies.

Environment

California Teams With EPA and DOJ to Enforce Clean Water Act

  • California AG Kamala Harris together with the California Water Resources Control Board, the U.S. Department of Justice, and the U.S. Environmental Protection Agency, settled claims against Lehigh Southwest Cement Company and Hanson Permanente Cement, Inc., (Lehigh) for alleged violations of the U.S. Clean Water Act and the California Water Code.
  • The Plaintiffs alleged that, over a five-year period, Lehigh discharged millions of gallons daily of process water from cement manufacturing and other industrial activity, polluted with selenium and other toxic metals, into the local ecosystem.
  • In addition to $2.5 million in civil penalties, the Consent Decree requires Lehigh to spend more than $5 million to construct and operate a system to treat all process storm water so that it does not exceed stipulated maximum levels of pollutants, and to develop and implement procedures to minimize future pollution from storm water surges. Lehigh must also submit semiannual progress reports to the EPA and the Water Resources Control Board.

False Claims

Telecom Carriers Pay $10.9 Million in Penalties to FCC

  • The Federal Communications Commission (FCC) agreed to resolve claims with AT&T and Southern New England Telephone (SNET) alleging that the telecom carriers overbilled the government for services provided to the FCC's Lifeline program.
  • Through the Lifeline program, the FCC provides financial support to telecom carriers based on the number of qualified low-income subscribers to which the carrier reports that it provided discounted service. AT&T and SNET allegedly failed to remove customers in 2012 and 2013 from their records when those customers did not recertify their qualifying status under the program.
  • AT&T responded in a statement that it "discovered this issue in the course of an internal review, voluntarily reported it, and reimbursed the Universal Service Fund." AT&T also indicated that it had "implemented process enhancements so this does not happen again."
  • In addition to reimbursing the government for payments received for allegedly ineligible customers, AT&T and SNET will pay a combined $10.9 million in civil penalties to the U.S. Treasury.

Intellectual Property

House Committee Passes "TROL Act"

  • The U.S House of Representatives Committee on Energy and Commerce approved the Targeting Rogue and Opaque Letters (TROL) Act, legislation designed to address the problem of patent assertion entities misusing overly-broad patents.
  • The TROL Act declares certain forms of patent misuse—for example, sending large numbers of deceptive demand letters that threaten litigation and order businesses to pay license or settlement fees in exchange for the recipient's use of the alleged patent—to be unfair or deceptive practices under the FTC Act. It also gives authority to the FTC and State AGs to levy fines on entities engaging in patent misuse.
  • The House Judiciary Committee is considering a different bill to address patent misuse, the Innovation Act, which creates more specific pleading standards and directs courts to award attorneys' fees if the position and conduct of the non-prevailing party was not reasonably justified in law and fact.

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.

Authors
 
In association with
Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
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
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

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 or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq 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 of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

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