Emily Myers, NAAG Antitrust and Powers and Duties Chief Counsel
District of Columbia
Attorney General Has Common Law Authority to Bring Parens Patriae Action
The D.C. attorney general’s parens patriae authority was affirmed in an important recent decision. The attorney general brought an action against an oil company and several petroleum distributors, alleging violations of the city’s Retail Service Station Act (RSSA). The defendants moved to dismiss the complaint. They argued that the statute contemplates only private enforcement of its provisions and that the District failed to assert a quasi-sovereign interest (as required by Alfred L. Snapp & Son, Inc. v. Puerto Rico1) to support assertions of parens patriae standing. The lower court agreed and dismissed the claims and the attorney general appealed.
The appellate court first addressed the question of standing. The court noted that the U.S. Supreme Court’s decision in Alfred L. Snapp addressed the requirements for parens patriae standing in federal court, but did not establish requirements for parens standing when a state brings suit in its own courts to enforce its own laws. In addition, the court found that the District’s interest, in this case, is not quasi-sovereign, but sovereign — the District’s power to create and enforce its own legal code. (The court noted that its conclusion that the District’s interest here was sovereign did not mean that the District’s interest in “fostering a competitive gasoline market for the benefit of consumers” is not an appropriate quasi-sovereign interest.) The court therefore reversed the trial court and held that the attorney general had standing to bring these claims.
With regard to the question of statutory authority to bring these claims, the defendants argued, and the trial court agreed, that only the affected retail service stations had a right to enforce the relevant provisions of the RSSA. The appellate court rejected this argument on several grounds. First, the court analyzed the statutory basis for the attorney general’s powers and determined that the statutory intent was that the attorney general “have broad power to exercise all such authority as the public interest requires and wide discretion in determining what litigation to pursue to uphold the public interest” unless those powers were explicitly limited by statute. The trial court thus erred in finding no authority for the attorney general simply because the RSSA did not give the attorney general explicit enforcement authority. The attorney general’s ability to act “pursuant to his statutory authority and duty to uphold the public interest” is not dependent on the inclusion in a statute of an explicit right of action. Second, the RSSA itself
[D]oes not contain the clear expression of a legislative intent to curtail the Attorney General‘s enforcement powers. Such a clear expression would be necessary for us to conclude that the independent Attorney General is foreclosed by the RSSA from exercising his statutorily recognized common-law power to sue, in pursuit of what he believes the public interest requires, to enforce the RSSA marketing-agreement provisions that the Council determined were both necessary to foster a competitive gasoline market for the benefit of consumers and “in the interests of the public health, safety, and welfare.” District of Columbia v. ExxonMobil Oil Corp. No. 14-CV-633 (D.C. Ct. App. Nov. 2, 2017).
Eleventh Amendment Bars Inclusion of State in Private Antitrust Settlement
Private purchasers of the prescription drug Flonase filed an antitrust suit against GSK, the manufacturer. The parties reached a settlement in 2013, and notice of the settlement was sent to class members. Although the state of Louisiana was a class member, it received instead the required notice under the Class Action Fairness Act (CAFA). The settlement prohibited class members from bringing released claims against GSK in any court. The Louisiana attorney general filed suit against GSK in state court on similar antitrust claims and GSK sought to enjoin the suit on the grounds that Louisiana did not opt-out of the settlement class and is bound by the settlement. The federal district court dismissed GSK’s claims, holding that, under the Eleventh Amendment, “a State retains the autonomy to choose ‘not merely whether it may be sued, but where it may be sued.’” The court determined that it could not enjoin the state unless it had waived its sovereign immunity and held that receipt of the CAFA notice was not sufficient to show such a waiver. GSK appealed.
The Third Circuit affirmed the district court’s dismissal of GSK’s claims. The court held that the key question was whether the district court exercised jurisdiction over Louisiana in the original, settled suit. Since Louisiana had not waived its sovereign immunity, the district court lacked jurisdiction.
The court first explained that Supreme Court precedent holds that the Eleventh Amendment applies to a motion to enjoin a state from suing in its own court. The settlement in this case asked the court to order that all members of the settlement class be permanently enjoined from bringing any of the released claims in any state or federal court. Louisiana was ostensibly part of that class, so the settlement sought to enjoin Louisiana from suing in its own court. Thus, the Eleventh Amendment applies. That this occurred in the form of a court-approved settlement, rather than in a motion for injunction, is immaterial to the Eleventh Amendment question.
Turning to the question of waiver, the court held that receiving a CAFA notice and failing to oppose the settlement based on that notice was not a waiver. Louisiana did not clearly indicate its intent to waive its sovereign immunity — it did not act at all. The court upheld the district court’s refusal to enjoin the state’s action. In re: Flonase Antitrust Litigation, Nos. 16-1124, 16-3019 (3d. Cir. Dec. 22, 2017).
Attorney General Not Required to Pay for Governor’s Counsel in Amicus Effort
President Trump issued two Executive Orders concerning immigration, each of which was challenged in court. The Maine attorney general filed an amicus brief supporting the challenge. Wanting to file an amicus brief in support of the orders, the Maine governor requested that the attorney general represent him in that effort or authorize him to retain outside counsel at the attorney general’s expense. The attorney general declined to represent the governor, but authorized him to retain outside counsel at his own expense, provided that counsel was licensed to practice in Maine. The governor sued, seeking an order that the attorney general may not place any limitations on the scope of the counsel’s representation of the governor and that the costs of the outside counsel must be paid from the attorney general’s budget. The attorney general moved to dismiss the complaint.
The court dismissed the governor’s suit on two grounds. First, the attorney general argued, and the court agreed, that the attorney general’s refusal to represent the governor, conveyed in a letter dated March 15, 2017, was an administrative decision and should have been appealed through the administrative appeals process under Maine rules of civil procedure. Because the governor did not file an appeal within 30 days of receiving the attorney general’s decision, the appeal is time-barred under state law.
Second, the court agreed with the attorney general that the case should be dismissed on grounds of mootness. The cases in which the governor sought to file amicus briefs had been decided, certiorari had been granted in the consolidated cases by the Supreme Court, and the cases had been dismissed on grounds of mootness. The governor argued that the issue is capable of repetition but evading review. The court agreed with the attorney general that, if the situation arises again, the governor will have sufficient time to challenge the attorney general’s decision, so the case will not “evade review” and the exception to the mootness doctrine does not apply.
Finally, the court held that the separation of powers doctrine prohibits the court from granting the governor’s requested relief. The Maine constitution includes a separation of powers clause. The court concluded that:
Appropriation and budgeting are powers given exclusively to the legislative branch by the Maine Constitution. If the Court were to put requirements on the legislatively appropriated budget of the Office of the Attorney General, the Court would essentially be appropriating funds from the Office of the Attorney General and redistributing them to the Executive Branch. Had the Legislature intended to provide funds for the Governor to conduct the litigation he is clearly permitted to conduct in these cases, given the Attorney General’s position, it could have done so. Going forward, it is well within the Legislature’s power to do just that. LePage v. Mills, No. CV-17-95 (Me. Super. Ct. Oct. 16, 2017).
Appeal Not Perfected When Notice of Appeal Filed on Attorney General, Not State Agency
A Medicaid provider was found by the North Dakota Department of Human Services to have overbilled the program. The provider filed a notice of appeal with the district court and served its notice on an assistant attorney general in the Attorney General’s Office. The Department moved to dismiss, arguing that service had been improper, but the district court denied the motion. The Department appealed.
North Dakota law provides that “An appeal shall be taken by serving a notice of appeal and specifications of error specifying the grounds on which the appeal is taken, upon the administrative agency concerned, upon the attorney general or an assistant attorney general, and upon all the parties to the proceeding before the administrative agency . . . .” The provider argued that its service was proper because it served an assistant attorney general and the Attorney General’s Office represents administrative agencies in appeals before the district court. In a prior case, the court had held that service on the attorney general was proper because service was made on an assistant attorney general who had represented the agency in an administrative proceeding. In this case, however, the Department was not represented by an attorney in the proceedings below, so service of process on the assistant attorney general was not effective. The court concluded, “Furthermore, the statutory requirement to serve both the agency and the attorney general would be rendered inoperative or superfluous if [North Dakota procedural rules] permit service of a notice of appeal on an agency by serving the attorney general or any assistant attorney general in all appeals from agency orders.” Altru Specialty Servs. v. N.D. Dep’t of Human Servs., 2017 N.D. 270 (2017).
- 458 U.S. 592 (1982).