J&J Settles Opioid-Related New York Suit for $230 Million
- New York AG Letitia James reached a settlement with Johnson & Johnson (“J&J”) to resolve allegations that J&J’s activities relating to its manufacture and distribution of opioids caused public nuisance, amounted to common-law fraud, and violated the New York Controlled Substance Act and New York’s consumer protection and finance laws.
- The complaint alleged that J&J, along with other manufacturers and distributors of opioids, were responsible for the opioid epidemic by knowingly misrepresenting the addictiveness of opioids and opioid products while aggressively promoting and deceptively marketing these medications to increase prescriptions and expand the market.
- Under the terms of the settlement, J&J will pay up to approximately $230 million over nine years, with the amount depending on how many of the state’s political subdivisions accept and participate in the settlement and whether a bill creating an opioid settlement fund, earmarked for opioid-addiction prevention, treatment, and education, will be signed into law. J&J will also, under the terms of the settlement, cease opioid manufacturing and distribution as well as the marketing and promotion of opioids, and J&J will provide information about opioids to the public, including sharing clinical trial data through an open-access portal, among other things.
New Jersey Attorney General Stepping Down to Join SEC
- New Jersey AG Gurbir Grewal is resigning to join the Securities and Exchange Commission (“SEC”) as Director of the Division of Enforcement on July 26, 2021.
- AG Gurbir, the first Sikh to hold a State AG’s office in the United States, has been in office since January 2018, when he was appointed by New Jersey Governor Phil Murphy and confirmed by the state senate.
- Governor Murphy named New Jersey First Assistant AG Andrew Bruck as Acting AG for the remainder of the year.
New Democratic Candidate Enters Race for Arizona Attorney General’s Office
- Sustainability scientist and former Arizona Corporation Commissioner Kris Mayes declared her candidacy for the Democratic nomination in the 2022 race for Arizona AG, competing against Democratic state Rep. Diego Rodriguez.
- As previously reported, the Republican candidates for the AG’s office include former prosecutor and Border Patrol section chief for the U.S. Attorney’s Office Lacy Cooper and private-practice attorney and cotton farmer Tiffany Shedd. Incumbent Republican AG Mark Brnovich is term-limited from seeking reelection and is running for the U.S. Senate against Democrat Mark Kelly.
- To “meet” the state AGs across the nation and read more AG election news and insights, visit The State AG Report
FTC Requires Divestiture in $21 Billion Acquisition of Retail Fuel Chain
- The Federal Trade Commission (“FTC”) reached a settlement with 7-Eleven, Inc. and Marathon Petroleum Corporation (“Marathon”) to resolve allegations that 7-Eleven’s acquisition of Marathon’s retail fuel chain subsidiary, Speedway LLC, would harm competition in hundreds of local retail gasoline and diesel fuel markets in violation of the FTC Act and the Sherman Act.
- The FTC’s complaint alleged that 7-Eleven and Speedway each own and operate thousands of retail fuel outlets across the United States and that, prior to the acquisition, these outlets competed head-to-head in 293 local markets. Without divestiture, the acquisition allegedly reduced the number of independent competitors to three or fewer in these markets, increasing the likelihood that 7-Eleven would exercise its market power unilaterally or that there would be collusive and coordinated activity among the remaining competitors in these markets.
- Under the terms of the consent order, 7-Eleven and Marathon will divest 293 retail fuel outlets to three competitors. In addition, the order bars 7-Eleven from enforcing any noncompete provisions against any franchisees or employees working at or doing business with the divested outlets. The order also requires 7-Eleven and Marathon to obtain FTC approval prior to purchasing any divested outlets, and appoints a third-party to ensure the companies’ compliance with the order. The order is subject to a 30-day public comment period commencing after the publication of the consent agreement in the Federal Register.
Nursing Home Operator Settles Charges of Resident Neglect and Insufficient Emergency Response Training
- Massachusetts AG Maura Healey reached a settlement with nursing home operator Milton HC Operating, LLC (“Milton”) to resolve allegations of resident neglect and long-term care regulatory violations.
- According to the AG’s office, an investigation found that Milton staff failed to adequately respond when a resident was found unresponsive and having difficulty breathing, including by failing to call a Code Blue on the intercom and unduly delaying calling emergency services. The resident died later that day. Milton also allegedly failed to maintain adequate emergency procedures and ensure that staff were sufficiently competent with and educated about emergency response protocols.
- Under the terms of the settlement, Milton will pay $90,000, which will be directed to the Long-Term Care Facility Quality Improvement Fund used to improve the care provided in long-term care facilities. Milton will also implement an internal compliance program and will annually certify its compliance with long-term care regulations to the AG’s Office for a period of three years.
Exxon Loses Bid to Dismiss Massachusetts Climate-Change Suit
- Massachusetts AG Maura Healey obtained two orders from the Suffolk Superior Court denying Exxon Mobil Corporation’s (“Exxon”) motions to dismiss the AG’s suit alleging that Exxon misled consumers and investors about the risks that fossil fuel-driven climate change poses to Exxon’s business, in violation of the Massachusetts Consumer Protection Act and related regulations.
- In its motion to dismiss for lack of personal jurisdiction and for failure to state a claim on which relief can be granted, Exxon argued that it is an out-of-state corporation and that the Commonwealth cannot challenge its statements and activities outside Massachusetts. In its decision, the court rejected Exxon’s arguments, finding that the complaint alleged conduct by Exxon that would give rise to specific jurisdiction under Massachusetts’s long-arm statute because it alleged that Exxon misled Massachusetts consumers and investors, and that each of the complaint counts state a sufficient claim for relief.
- In its special motion to dismiss pursuant to the Massachusetts anti-SLAPP (“Strategic Litigation against Public Participation”) statute, Exxon argued that its statements to investors and consumers were petitioning activity within the meaning of the Constitution because they were made at least in part to reach and influence regulators and governing bodies. In its decision, the court found, among other things, that the complaint is not based solely on Exxon’s petitioning activities because the mere fact that statements were made on topics that attract government interest does not make the statements petitioning activities and because Exxon is also accused of omissions, which do not qualify for constitutional protection.
