The State Ag Report - Volume 7, Issue 24 | June 2021 #3

Cozen O'Connor

Cozen O'Connor

Nevada Legislature Reforms Consumer Protection and Charitable Donation Laws

  • Three bills introduced by Nevada AG Aaron Ford were recently enacted that will amend the Nevada Deceptive Trade Practices Act (“DTPA”), the Nevada Unfair Trade Practices Act (“UTPA”), and charitable donation laws, effective October 1, 2021.
  • Assembly Bill 61 amends the DTPA by prohibiting price gouging during a declared state of emergency; enhancing civil penalties for conduct targeting minors, up to $12,500 per violation; and making robocalling and “unconscionable” conduct actionable under the DTPA, among other things.
  • Assembly Bill 47 amends the UTPA by requiring healthcare entities to report certain proposed transactions to the AG’s Office for review; prohibiting non-compete agreements for hourly employees; and imposing civil penalties for willful violations of the UTPA, among other things.
  • Senate Bill 62 strengthens charitable donation laws by, among other things, expanding the AG’s authority to bring lawsuits against scams that falsely claim to raise money for charitable causes.

Buy One, Do Not Get One Free: New Jersey Attorney General Says No More Free Marijuana Gifts with Purchase

  • New Jersey AG Gurbir Grewal issued cease and desist letters to four businesses warning that offering free “gifts” of marijuana or cannabis items with purchases of other products may violate the state Consumer Fraud Act (“CFA”).
  • In the letters to com, LLC, Sky High Munchies LLC, Slumped Kitchen LLC, and West Winds Wellness, AG Grewal warned that “gifting” marijuana or cannabis with the purchase of snacks, baked goods, or other products is deceptive and violates the CFA and the Consumer Protection Division’s Advertising Regulations because the so-called “gifts” offered are actually central to the sales transaction, and that the businesses are misrepresenting the legality of purchases that may violate the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (the “Act”).
  • The letters note that the Act—which was enacted in February 2021—legalizes and regulates cannabis use and possession and establishes the Cannabis Regulatory Commission (“CRC”), but the CRC has not yet adopted rules for licensing adult-use cannabis retailers or issued any licenses to such businesses.
  • According to the letters, each misrepresentation constitutes a separate CFA violation, which carries a $10,000 penalty for the first violation and a $20,000 penalty for each subsequent violation, and authorizes injunctive and other relief.

12 Democrat AGs Urge SEC to Require Companies Disclose Financial Risk from Climate Change

  • 12 Democrat AGs, led by California AG Rob Bonta, submitted a comment letter to the U.S. Securities and Exchange Commission (“SEC”) urging it to require U.S. companies to disclose financial risks faced by climate change, in response to the SEC’s request for public input.
  • In the letter, the AGs argue that the SEC has the authority to require detailed and accurate disclosures regarding climate-related risk from SEC-regulated companies, and such disclosures are necessary to insulate U.S. and global financial systems, investors, and Americans with invested retirement savings from associated risks.
  • Specifically, the AGs recommend the SEC require regulated companies to (i) annually disclose greenhouse gas emissions and any plans to address such emissions; (ii) analyze and disclose potential impacts of climate change and related regulation; and (iii) disclose climate change-related corporate governance and risk management strategies.

Medical Device Company Settles with Seven States Over Alleged Kickbacks and False Claims

  • Medical device company Medicrea USA, Inc. and its corporate parent Medicrea International (collectively, “Medicrea”) settled with California, Colorado, Florida, Georgia, North Carolina, New York, and Texas, and the U.S. Department of Justice (“DOJ”), over allegations that it paid kickbacks to physicians in violation of the federal Open Payment Program, Anti-Kickback Statute, and state false claims laws.
  • According to California AG Bonta’s office and the DOJ, Medicrea allegedly paid physicians through travel expenses, meals, beverages, and entertainment, to induce them to use Medicrea medical devices in surgical procedures to treat spinal disorders; received reimbursements for those expenses from state and federal healthcare programs; and failed to report those expenses to the Centers for Medicare & Medicaid Services.
  • Under the terms of the state and federal settlements, Medicrea will pay $1 million to the states, and $1 million to the United States.

No Fault, but Millions to Pay in Pharmacy Benefits Settlements with Ohio and Mississippi

  • Ohio AG Dave Yost and Mississippi AG Lynn Fitch reached no-fault agreements with healthcare company Centene Corporation and its subsidiaries (collectively, “Centene”), over allegations that two of its subsidiaries—Buckeye Health Plan Community Solutions, Inc. (“Buckeye”) and Envolve Pharmacy Solutions, Inc. (“Envolve”)—overbilled the states’ Medicaid programs for pharmacy services, in violation of provider agreements with the states.
  • According to AGs Fitch and Yost, Buckeye and Envolve allegedly misrepresented the costs of pharmacy services—including prescription drugs—to the states, and charged the states more than allowed under the price caps established in its provider agreements, among other things.
  • Under the terms of the agreements, Centene will pay $88.3 million to Ohio, and $55.5 million to Mississippi.

Arizona Attorney General Brnovich Seeks GOP Nomination for Senate Race

  • Arizona AG Mark Brnovich announced that he is seeking the Republican nomination for U.S. Senate in 2022, to challenge incumbent Senator Mark Kelly (D).
  • AG Brnovich is entering a crowded GOP primary, which already includes Retired Maj. Gen. Mick McGuire and solar-business executive Jim Lamon, among others.
  • Senator Kelly has held the seat since 2020, when he won against former Sen. Martha McSally (R) to fill the remainder of the term initially won by the late Sen. John McCain (R).

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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