Settlement Agreement Between Plaintiff States and UBS (Dec. 21, 2018)
Forty plaintiff states reached a $68 million settlement with UBS for fraudulent conduct involving interest rate manipulation that had a significant impact on consumers and financial markets around the world. UBS’ fraudulent conduct involved the manipulation of LIBOR (the London Interbank Offered Rate). LIBOR is a benchmark interest rate that affects financial instruments worth trillions…
NAAG Urges Congress to Extend CARES Act Spending Deadline
With COVID-19 cases rising daily in much of the country and many states still under a health emergency declaration, we urge Congress to amend the CRF program to allow state and local governments to spend the funding at least until December 31, 2021.
Attorneys General Urge Congress to Adopt Key Changes to the Victims of Crime Act (VOCA)
As state Attorneys General, we are often the administrators of grant funding, through our state compensation programs or otherwise, financed directly from the Fund. In order to ensure the predictability and sustainability of these critical funds, change must be enacted to support our states’ ability to effectively serve victims and survivors of crime for years to come.
NAAG Endorses Stopping Overdoses of Fentanyl Analogues (SOFA) Act
States and localities are on the front line of this crisis and are a large part of winning the battle from both a law enforcement and public health perspective.
State of Wisconsin et al. v. Indivior, No. 16-5073 (E.D. Pa. Sept. 22,2016)
Plaintiff states alleged that the makers of Suboxone, a drug used to treat opioid addiction, engaged in a scheme to block generic competitors and raise prices. Specifically, they are conspiring to wtich Suboxone from a tablet version to a flim in order to prevent or delay generic entry. The states allege that the manufacturers engaged in “product hopping” in which a company makes slight changes to its product to extend patent protections and prvent generic alternatives. The complaint was filed under seal.
New York et al. v. Cephalon, No. 2:16-cv-04234 (E.D. Pa. Aug. 4, 2016)
In May 2015, the FTC settled a “pay-for-delay” suit against Cephalon for injunctive relief and $1.2 billion, which was paid into an escrow account. The FTC settlement allowed for those escrow funds to be distributed for settlement of certain related cases and government investigations. In August 2016, forty-eight states filed suit in the Eastern District of Pennsylvania against Cephalon alleging anticompetitive conduct by Cephalon to protect the profits it earned from having a patent-protected monopoly on the sale of its landmark drug, Provigil. According to the complaint, Cephalon’s conduct delayed generic versions of Provigil from entering the market for several years. The complaint alleged that as patent and regulatory barriers that prevented generic competition to Provigil neared expiration, Cephalon intentionally defrauded the Patent and Trademark Office to secure an additional patent, which a court subsequently deemed invalid and unenforceable. Before it was declared invalid, Cephalon was able to use the patent to delay generic competition for nearly six additional years by filing patent infringement lawsuits. Cephalon settled those lawsuits by paying competitors to delay sale of their generic versions of Provigil until at least April 2012. Consumers, states, and others paid millions more for Provigil than they would have had generic versions of the drug launched by early 2006, as expected. A settlement was filed with the complaint, which includes $35 million for distribution to consumers who bought Provigil.
In re Societe Generale S.A., Agreement
Plaintiff states entered into settlement agreement with Societe Generale for fraudulent and anticompetitive conduct in municipal bond derivative transactions with state and local government entities and nonprofits across the country. Societe Generale agreed to pay $26,750,000 as part of a coordinated 22-state and private class settlement. Pursuant to the settlement, this money will mostly be applied to restitution for municipalities, counties, government agencies, school districts and nonprofits that the states allege were harmed when they entered into municipal derivatives contracts with Societe Generale. In 2008, plaintiff states, in parallel with the U.S. Department of Justice and federal regulatory agencies, began their investigation of the municipal bond derivatives market. In these markets, tax exempt entities such as municipalities, school districts, and nonprofit organizations issue municipal bonds and reinvest the proceeds until the funds are needed or enter into contracts to hedge interest rate risk. These investigations revealed anticompetitive and fraudulent conduct involving individuals at a number of large financial institutions, including Societe Generale, and certain brokers with whom they had worked. Certain Societe Generale employees and their counterparts at other institutions rigged bids, submitted noncompetitive courtesy bids and fraudulent certificates of arms-length bidding to government agencies. The misconduct led local and state governments, as well as nonprofits, to enter into municipal derivatives contracts on less advantageous terms than they would have otherwise. Societe Generale agreed to pay $25.1 million into a settlement fund to provide restitution for injured parties and $1.4 million to the attorneys general as an additional payment. Societe Generale also agreed not to submit non-competitive bids or refrain from bidding on, or coordinate the preparation of bids for municipal derivatives and to cooperate with ongoing investigations.
In re Natixis Funding Corp., Agreement, Feb. 18, 2016)
Plaintiff states entered into settlement agreement with Natixis Funding Corp. for fraudulent and anticompetitive conduct in municipal bond derivative transactions with state and local government entities and nonprofits across the country. Natixis will pay $29,950,000 as part of a coordinated 22-state and private class settlement. The funds will mostly be applied to restitution for municipalities, counties, government agencies, school districts and nonprofits that the states allege were harmed when they entered into municipal derivatives contracts with Natixis. In 2008, the plaintiff states, in parallel with the U.S. Department of Justice and federal regulatory agencies, began their investigation of the municipal bond derivatives market. In these markets, tax exempt entities such as municipalities, school districts, and nonprofit organizations issue municipal bonds and reinvest the proceeds until the funds are needed or enter into contracts to hedge interest rate risk. These investigations revealed anticompetitive and fraudulent conduct involving individuals at a number of large financial institutions, including Natixis, and certain brokers with whom they had worked. Certain Natixis employees and their counterparts at other institutions rigged bids, submitted noncompetitive courtesy bids and fraudulent certificates of arms-length bidding to government agencies. The misconduct led local and state governments, as well as nonprofits, to enter into municipal derivatives contracts on less advantageous terms than they would have otherwise. Natixis agreed to pay $23.4 million into a settlement fund and $1.5 million to the attorneys general as an additional payment. Natixis also agreed not to submit non-competitive bids or refrain from bidding on, or coordinate the preparation of bids for municipal derivatives and to cooperate with ongoing investigations.
US, Illinois, Iowa and Missouri v. Tyson Foods, No. 1:14-cv-01474, D.D.C. Aug. 27, 2014)
USDOJ and three states challenged the acquisition of Hilshire by Tyson. According to the complaint, Tyson and Hillshire compete against each other and against others to
procure sows from farmers in the United States. Tyson’s proposed acquisition of Hillshire would eliminate head-to head
competition between the companies and create a firm that would account for over a
third of all sows purchased from farmers in the United States. the merging parties agreed to divest all the assets of Heinold Hog Markets, including 8 buying stations, to a purchaser approved by USDOJ, after consultation with the states.
Florida et al. v. Service Corporation International, No. A13CV1082LY (W.D. Texas Jan. 2, 2014)
SCI, the nation’s largest funeral home chain, sought to acquire Stewart Enterprises, another large funeral home chain. Seven states and the FTC entered into consent agreements with SCI specifying which funeral homes would be divested in 59 separate markets. In a separate consent agreement, SCI agreed to provide the state plaintiffs with the same notices, requirements for approval and compliance review as to divestitures and future acquisitions included in the FTC’s consent decree and to pay the state’s costs and attorneys’ fees..
