On June 3, the U.S. Treasury Department filed a reply in its 11th Circuit litigation[1] against the National Small Business Association regarding the constitutionality of the Corporate Transparency Act (CTA). Of late, the Treasury Department has faced additional pressure and scrutiny, with 22 states filing a joint amicus brief last month, asserting that the CTA displaces state authority and would economically harm residents.
Tennessee and Mississippi attorney generals (AG), joined by 13 other states, filed a multistate lawsuit in the Southern District of Mississippi. The lawsuit challenges the U.S. Department of Health and Human Services’ (HHS) attempt to expand the breadth of the Affordable Care Act’s (ACA) antidiscrimination provision, known as Section 1557. This section prohibits discrimination on the basis of sex. HHS’ new rule, which is scheduled to take effect on July 5, extends the definition of sex to encompass gender identity. The AGs argue that HHS’ expansion of the ACA provision will have undesirable effects on the medical industry. They claim that the promulgation of this new rule is also unconstitutional and interferes with states’ reserved powers.
On Tuesday, Texas Attorney General (AG) Ken Paxton announced the creation of a team dedicated solely to the prosecution and enforcement of Texas’ privacy laws. The team will focus on handling cases under at least seven different laws, including the state’s relatively new comprehensive consumer privacy law, and will be part of the office’s Consumer Protection Division. In his announcement, the AG touts the team as the largest such unit in the U.S., and one that will aggressively enforce the state’s privacy laws.
California Attorney General (AG) Rob Bonta is leading a coalition of Democratic AGs from 22 states and the District of Columbia to defend the Environmental Protection Agency’s (EPA) rule that sets stringent greenhouse gas emissions standards for heavy-duty vehicles. The coalition filed a motion to intervene in the U.S. Court of Appeals for the D.C. Circuit, where the EPA’s rule is facing a legal challenge from Republican AGs.
Continued focus on antitrust enforcement has led the New Jersey and California attorneys general (AG) offices to go on a hiring spree. New Jersey AG Matthew Platkin recently announced the establishment of a permanent, stand-alone Antitrust Litigation and Competition Enforcement Section to enforce the New Jersey Antitrust Act. Meanwhile, the California AG’s office intends to hire eight new antitrust attorneys in June 2024, with more expected throughout the year. The announcement out of the California AG’s office aligns with the state’s aggressive antitrust enforcement practices, and comes just two months after the California Department of Justice announced its plan to invigorate criminal antitrust prosecutions.
Private equity firms can breathe a sigh of relief after a federal judge dismissed claims that threatened to establish a precedent for holding private equity firms liable for certain actions by their portfolio companies.
On May 17, 2024, Colorado Governor Jared Polis signed into law Senate Bill 24-205, the Colorado Artificial Intelligence (AI) Act, making Colorado the first U.S. state to enact comprehensive legislation regulating the use and development of AI systems. The act is designed to regulate the private-sector use of AI systems, particularly addressing the risk of algorithmic discrimination arising from the use of so-called “high-risk AI systems.” The law will take effect on February 1, 2026, and the Colorado attorney general (AG) has exclusive enforcement authority.
North Carolina Attorney General Josh Stein and the U.S. Attorney’s Office for the Middle District of North Carolina have reached a $500,000 settlement with Sharon Raynes Halliday and RAPHA Healthcare Services LLC, resolving a false claims lawsuit filed in July 2022 related to requests for payment submitted to the North Carolina Medicaid program.
Published in Law360 on May 23, 2024. © Copyright 2024, Portfolio Media, Inc., publisher of Law360. Reprinted here with permission.
On April 23, the FTC promulgated its final rule[1] banning noncompetes nationwide.[2]
While most commentary has focused on the scrutiny noncompetes would now garner at the federal level, few discussed the waterfall enforcement effect at the state level that would follow as state attorneys general could deploy their broad authority under state unfair or deceptive acts or practices, or UDAP, laws to treat noncompetes as separate and independent violations.[3]
Last week the office of the Attorney General of Connecticut announced that the state had reached a settlement with HighBazaar over allegations that the organization allowed the unlicensed sale of cannabis, and the presence of minors, at their outdoor social cannabis events in Connecticut. The settlement represents one of many enforcement actions aimed at eliminating the state’s gray market and protecting licensed businesses and consumers.