2022 AG Elections

Republican Candidate Seeks 2022 Rematch Against Minnesota’s Incumbent Attorney General

• Doug Wardlow, general counsel for My Pillow, Inc. and a former state representative, has announced he will again seek the Republican nomination for Minnesota AG.
• If he were to receive the nomination, Wardlow’s challenge to incumbent Democratic AG Keith Ellison would be a rematch of the 2018 election, which Ellison won by a margin of 49% to 45%.
• For more AG election news, insights, and polls, visit Cozen O’Connor’s State AG Election Tracker.

Consumer Protection

Timeshare Exit Company to Pay Over $220,000 for Deceiving Consumers

• Missouri AG Eric Schmitt obtained a default judgment against timeshare exit company Martin Management Group LLC and its owner (collectively “Martin Management”) over allegations that it charged upfront fees and failed to provide promised services in violation of Missouri’s Merchandising Practices Act.
• The complaint alleged that Martin Management solicited large sums of money from customers by falsely guaranteeing to refund their payment if it could not obtain a release from their timeshare commitments within 180 days and instructed clients to redirect timeshare maintenance fees to itself, putting several customers in arrears with their timeshare holding companies.
• According to the AG’s office, the judgment awards over $222,000 to the state, including approximately $170,000 for restitution and $52,000 in civil penalties and attorneys’ costs. The judgment also permanently enjoins Martin Management from offering or selling timeshare-exit services in the state.
• As previously reported, AG Schmitt separately sued Brian Scroggs and four timeshare-exit companies under his control over similar allegations.

Bipartisan Group of Attorneys General Urge FCC to Help Increase Access to Remote Learning

• A bipartisan group of 30 AGs, led by Colorado AG Phil Weiser and Nebraska AG Doug Peterson, submitted a comment letter to the Federal Communications Commission (“FCC”) urging the FCC to expand its E-Rate program, which provides funding for expanding school and library broadband connectivity to support remote learning during the COVID-19 pandemic.
• The letter was sent in support of several states’ petitions, including Colorado, seeking the temporary waiver of certain restrictions on the E-Rate program to allow the use of E-Rate funds for Wi-Fi hotspots and other broadband Internet solutions for students who lack adequate connectivity to participate in remote schooling.
• The letter argues that the FCC has the authority to amend or waive E-Rate program rules to allow it to support a range of technological solutions to the extraordinary need for remote learning during the COVID-19 pandemic. The letter also asserts that expanding Internet access through the E-Rate program can help ensure educational equity.

Democratic Attorneys General Urge Universal Federal Student Loan Relief

• A group of 17 Democratic AGs, led by Massachusetts AG Maura Healey and New York AG Letitia James, sent a letter to the U.S. Congress urging the adoption of the House and Senate resolutions calling on the Biden administration to cancel up to $50,000 in federal student debt for every federal student loan borrower.
• The letter argues that broad cancellation of federal student loan debt will provide economic relief to millions of borrowers and a boost to the economy.
• The letter further notes that many federal student loan borrowers were struggling to repay their loans even before the COVID-19 pandemic, that the current repayment programs in place do not provide sufficient opportunities for borrowers facing financial hardship to manage their debts during the current economic crisis, and that failure to manage federal student loan payments can have catastrophic consequences for borrowers, including wage garnishment, loss of income tax credits, and seizure of social security payments.

Utilities

Texas Power Companies Investigated over Winter Storm Power Outages

• Texas AG Ken Paxton issued Civil Investigative Demands (“CIDs”) under the Texas Deceptive Trade Practices – Consumer Protection Act to 12 power companies, including the Electric Reliability Council of Texas, Inc. (“ERCOT”) related to the statewide power outages in the wake of the recent winter storm that battered the state and left millions of residents without power and heat.
• The CIDs seek information, documents, and communications regarding the companies’ emergency plans, pricing policies, and the storm-related power outages, among other things.
• The CIDs set a deadline of March 15, 2021 for the power companies to comply with the production demands.

Financial Industry

Cryptocurrency Platforms and Backers Targeted over Allegedly Deceptive Conduct

• New York AG Letitia James sued cryptocurrency trading platform Coinseed, Inc. and its two top executives (collectively “Coinseed”) over allegations that it operated illegally and defrauded investors in violation of New York’s Martin Act.
• The complaint alleges that Coinseed raised funds in an unregistered securities offering and deceived investors with false claims about its staff’s expertise and experience. The complaint seeks restitution, disgorgement, and injunctive relief.
• AG James also reached a settlement with iFinex Inc., the operator of cryptocurrency platform Bitfinex, and related companies (collectively “Bitfinex”) and with the issuer of a cryptocurrency called “tether,” Tether Holdings Limited, and related companies (collectively “Tether”) to resolve allegations that Bitfinex and Tether made false statements to investors in violation of New York’s Martin Act.
• According to the settlement agreement with Bitfinex and Tether, the AG’s office’s investigation found that the companies allegedly promoted “tether” as a stablecoin – a cryptocurrency backed by real-dollar reserves – even though Tether had no access to banking and at times held no reserves to back “tethers” in circulation. In addition, Bitfinex allegedly hid massive losses and misled its clients and the market regarding its liquidity problems.
• Under the terms of the settlement agreement, among other things, Bitfinex and Tether will pay $18.5 million in penalties to the state. Bitfinex and Tether are also banned from any trading activities with New Yorkers and are required to report their efforts to exclude New Yorkers from their trading activities.