Announcements, information and updates from CWAG Members and Associates
April 19, 2018
SALES TAX COLLECTION
Jackley Leads Fight To Overturn Quill In U.S. Supreme Court
April 19, 2018

“Today we were a strong voice for Main Street America,” Jackley said, minutes after his closing argument in South Dakota v. Wayfair, the lawsuit South Dakota filed against three e-commerce companies who refused to comply with the state’s sales tax imposition on out-of-state businesses selling over the internet to in-state residents. “We believe everyone should be treated fairly.”

In  South Dakota v. Wayfair Inc. , the court is considering whether to overrule  Quill , a 1992 decision that the Constitution’s commerce clause prohibits the states from requiring out-of-state retailers that do not have a physical presence in the state to collect tax on sales to state residents.

South Dakota Attorney General Marty Jackley explained why he believed the court should reconsider the older ruling.

“There are two very significant consequences brought about by  Quill ,” said Jackley. “First, our states are losing massive sales tax revenues that we need for education, health care, and infrastructure. Second, our small businesses on Main Street are being harmed because of the unlevel playing field created by  Quill , where out-of-state remote sellers are given a price advantage.”

Deputy U.S. Solicitor General Malcolm Stewart took to the lectern on South Dakota’s side, and he pointed out that whether the court overrules  Quill  or its 1967 predecessor,  National Bellas Hess, Inc. v. Illinois Department of Revenue , leaves them in place, or does something in between, “Congress can act."

When George Isaacson, the Lewiston, Maine, lawyer representing the retailers, began his argument time, he quickly ran into a concern from Ginsburg.

“How about going back to the very basic issue?” she said. “The assertion is that asking an out-of-state seller to collect tax on goods shipped in-state discriminates against interstate commerce. But, as I see it, why isn’t it, far from discriminating, equalizing sellers. That is, anyone who wants to sell in-state, whether an in-state shop, an out-of-state shop, everybody is treated to the same tax collection obligation. All who exploit an in-state market are subject to the in-state tax. Why isn’t that equalizing rather than discriminating?”

Kennedy, who had invited the challenge to  Quill  with his concurrence in 2015’s  Direct Marketing Association v. Brohl , asked only a couple of questions, in which he appeared to be restating the arguments of Isaacson or others. He referred to a proposition, whether it was that of the parties or his own, that “this court has made a statement of constitutional law that … has now, especially in light of the cyber age, proven incorrect.”

A decision in the case is expected by late June.
CULVERTS CASE
Supreme Court Showdown: Washington’s Attorney General vs. Tribes Over Salmon Habitat
April 17, 2018

A 20-year battle over salmon-blocking road culverts lands in the U.S. Supreme Court Wednesday, in a historic showdown pitting the Washington state attorney general against the U.S. government and Washington tribes defending their treaty right to fish.

Washington Attorney General Bob Ferguson will oppose the tribes in oral argument before the court.

At issue is whether the state must replace road culverts that block salmon passage. Tribes insist, and courts have affirmed, that the tribes’ treaty right to fish also means the state must not destroy the habitat that healthy fish runs need.

Ferguson said he agrees the state must do more to repair habitat. But he disagrees with the findings by the lower court.

“Salmon are vital to our way of life here in Washington,” Ferguson said. “Regardless of the outcome of this case, the state must do more to restore salmon habitat. The Legislature should not need a court order to fix culverts that are blocking salmon runs.

“However, important issues are at stake in this appeal, as explained by the many dissenting Ninth Circuit judges,” he said, referring to nine judges of 29 on the Ninth Circuit who wanted to take the appeals-court ruling under review. In their dissent in the May 2017 ruling, the judges said the lower-court mandate to protect habitat for fish is overly broad and could be extended to block all kinds of other development, including dams.

Ferguson also said the Ninth Circuit’s decision forces the state to expend significant resources on fixing culverts that will not benefit salmon, because of other habitat problems.

“That makes no sense,” Ferguson said. “The decision also requires Washington taxpayers to shoulder the entire financial burden for problems largely created by the federal government when it specified the design for the state’s old highway culverts. That’s not fair.”
ELDER ABUSE
NAAG President Schmidt Launches National Effort to Combat Elder Abuse
April 17, 2018

The National Association of Attorneys General (NAAG) will focus on strengthening efforts nationwide to combat elder abuse, NAAG President and Kansas Attorney General Derek Schmidt announced today.

Schmidt, who was elected in June to a one-year term as NAAG president, said during his presidency he will focus on working with attorneys general around the country to help all states gather expertise and build capacity to fight elder abuse, neglect and exploitation. The members of the association are the 56 state, territorial and District of Columbia attorneys general.

“Elder abuse has been called the silent epidemic of our time,” Attorney General Schmidt said. “It is a crime that too often operates in the shadows. But the numbers are staggering, and as the population age 65 and older continues to grow, it is clear that we all need to do more to combat this serious problem.”
HUMAN TRAFFICKING
Attorney General Becerra Announces Guilty Plea by Backpage.com CEO Carl Ferrer and Permanent Shutdown of the Online Sex Trafficking Website 
Ferrer pleads guilty to conspiracy and money laundering
April 12, 2018

California Attorney General Xavier Becerra announced that defendant Carl Ferrer, Chief Executive Officer of online sex advertising website Backpage.com, has pled guilty to one charge of conspiracy and three counts of money laundering. The defendant entered the guilty plea in Sacramento County Superior Court, resolving charges against him in the criminal case People of the State of California v. Carl Ferrer, Michael Lacey, and James Larkin. This plea follows the permanent shutdown of Backpage.com announced on April 9. The website has been described as the world’s largest online brothel, facilitating human trafficking throughout the world.

Under the terms of the plea agreement, Carl Ferrer agrees to:
  • Plead guilty to one count of conspiracy and three counts of money laundering;
  • Cooperate in the prosecution of Lacey and Larkin;
  • Shut down Backpage.com throughout the world;
  • Surrender operating rights to all internet domains used to operate Backpage.com;
  • Make Backpage.com data available to law enforcement; and
  • Face a five-year maximum sentence.
2018 CWAG Chair's Initiative
May 3-4, 2018
Scottsdale, Arizona
 
Chair’s Initiative Registration is Now Closed
Due to overwhelming response to this year’s Chair’s Initiative, CWAG has closed registration for the event. We look forward to seeing you at an upcoming CWAG meeting!

Thank you for your continued support of CWAG and CWAG Chair, Arizona Attorney General Mark Brnovich. We look forward to seeing you all in May!
CRYPTOCURRENCY
A.G. Schneiderman Launches Inquiry Into Cryptocurrency “Exchanges”
Virtual Markets Integrity Initiative Seeks to Improve Transparency and Accountability of Major Cryptocurrency Trading Platforms to Protect Virtual Currency Investors
April 17, 2018

New York Attorney General Eric T. Schneiderman launched the Virtual Markets Integrity Initiative, a fact-finding inquiry into the policies and practices of platforms used by consumers to trade virtual or “crypto” currencies like bitcoin and ether. As part of a broader effort to protect cryptocurrency investors and consumers, the Attorney General’s office sent letters to thirteen major virtual currency trading platforms requesting key information on their operations, internal controls, and safeguards to protect customer assets. As the letters explain, the Initiative seeks to increase transparency and accountability as it relates to the platforms retail investors rely on to trade virtual currency, and better inform enforcement agencies, investors, and consumers.
CYBERSECURITY
Arizona Attorney General Mark Brnovich Announces New Law to Protect Data Breach Victims
April 13, 2018

Attorney General Mark Brnovich is proud to announce Governor Ducey signed HB2154 into law, updating and strengthening Arizona’s data breach consumer protection statute. The bill, sponsored by Representative T.J. Shope and authored by the Arizona Attorney General’s Office, bolsters protections and adds notification requirements for victims of a data breach.

“I applaud Representative Shope and members of the legislature for adopting these common sense improvements to our data breach laws,” said Attorney General Brnovich. “Consumers have a right to know when their sensitive information has been breached so they can protect themselves from financial loss. A key component of the legislation was notification to the Attorney General’s Office of a breach. My office will be better positioned to investigate massive breaches in the future and assist consumers to protect their assets from theft.”

Highlights from the new state law include:
  • Expanding the definition of protected “personal information” to include online account credentials, as well as an individual’s name in combination with health insurance or other medical information, passport or taxpayer identification numbers, or certain biometric data;
  • Requiring that notice to individuals affected by a breach be provided within 45 days after determining that a breach has occurred (whereas existing law provided no definitive deadline);
  • Clarifying the necessary content and available delivery methods for notifications to consumers;
  • Requiring notification to the three largest consumer reporting agencies for any breach involving more than 1,000 individuals;
  • Increasing the maximum civil penalty for a knowing or willful violation of the statute from $10,000 per breach to $500,000 per breach; and
  • Clearly explaining the Attorney General’s powers in connection with the investigation and enforcement of data-breach matters.
Law
NIST Releases Version 1.1 of its Popular Cybersecurity Framework
April 16, 2018

The U.S. Commerce Department’s National Institute of Standards and Technology (NIST) has released version 1.1 of its popular Framework for Improving Critical Infrastructure Cybersecurity, more widely known as the Cybersecurity Framework.

“Cybersecurity is critical for national and economic security,” said Secretary of Commerce Wilbur Ross. “The voluntary NIST Cybersecurity Framework should be every company’s first line of defense. Adopting version 1.1 is a must do for all CEO's.”

The framework was developed with a focus on industries vital to national and economic security, including energy, banking, communications and the defense industrial base. It has since proven flexible enough to be adopted voluntarily by large and small companies and organizations across all industry sectors, as well as by federal, state and local governments.
PRICE GOUGING
Attorney General Becerra Charges Individual for Price Gouging After North Bay Wildfires
April 16, 2018

California Attorney General Xavier Becerra today filed three misdemeanor charges against Melissa “Missy” Echeverria, a real estate agent, for allegedly raising the monthly rent on property she owns in Novato, California by more than 10 percent following the devastating fires in Northern Bay Area counties last year. Due to the blazes, Governor Jerry Brown declared a state of emergency on October 9, 2017. Price gouging during a state of emergency is illegal under Penal Code Section 396.

“In times of crisis, the overwhelming majority of Californians do what is right: we come together and help one another. Unfortunately, that’s not always the case,” said Attorney General Becerra. “There are some unscrupulous individuals who engage in price gouging, taking advantage of those who are already suffering. It’s wrong, it’s unconscionable, and it’s illegal. At the California Department of Justice, we are committed to ensuring that it’s not open season on innocent victims. I appreciate the strong partnership between my office and the Marin County District Attorney’s Office in this particular case.”

California law generally prohibits hiking the price of an item or service by more than 10 percent of what it cost before a state or local emergency was declared. This law applies to those who sell food, emergency supplies, medical supplies, building materials and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, transportation, freight and storage services, hotel accommodations and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the vendor.
TRANSPARENCY RULE
New Mexico AG Balderas Announces New Rule to Increase Uniformity and Transparency in State Rule Making Processes
April 17, 2018

Attorney General Hector Balderas announced that the Office of the Attorney General has promulgated a new rule for rule making processes for government agencies across New Mexico. With input from the public and various public bodies from across the state, the Attorney General's default procedural rule for rulemaking establishes baseline standards for rule making processes.

"Government agencies must be transparent and accountable to the public when making the rules that govern how we function as a State," said Attorney General Balderas. "This rule will create consistency in the process so that New Mexicans know that their government is working for them and is accountable."
BALANCE OF POWER
Utah Legislature Overrides Vetoes In Balance-Of-Powers Battle With Gov. Gary Herbert
April 18, 2018

Despite some close calls, the Utah Legislature on Wednesday overrode vetoes by Gov. Gary Herbert that grew out of a yearlong turf war where part-time lawmakers contend the full-time governor is seizing too much of their power.

One bill resurrected and passed is HB198, which spells out procedures to force the Utah Attorney General to provide the Legislature written legal opinions when requested, as already required by law.

Herbert blocked one such opinion last year by saying it would violate his attorney-client privilege with the A.G.’s office.

Also passing was SB171, which now will allow legislators to intervene in court to defend the laws they pass — instead of depending on the attorney general’s office to do so.

Edwards said, “Clearly the governor and the Legislature disagree about the appropriate roles and functions of their respective branches of state government. We would encourage the Legislature to intervene in a court case as soon as possible so that the Utah courts can quickly resolve these important constitutional issues.”
Utah Attorney General Sean Reyes Issued The Following Statement on the Veto Overrides

“We believe in a carefully balanced democratic system of government where the legislature enacts laws, the executive branch enforces them, and courts interpret them. When one branch upsets that equilibrium, it threatens the harmony and integrity of the whole and erodes public confidence in the institutions.

“The legislature heard several serious concerns about SB171 during the legislative session and ultimately the executive branch voiced its strongest opposition possible when the Governor exercised his veto power. In turn, a supermajority of the legislature has chosen, as is its prerogative, to go forward with this new law. If SB 171 is challenged, the courts will have their important role to play in deciding whether the law will stand or be rejected. We respect the role of all branches and have faith in the long-term results of our system of checks and balances.

“In the Office of the Utah Attorney General, we will continue to do our duty and defend state laws, unless and until there is a decision from the courts requiring us to do otherwise.”
GUN SAFETY LAWS
April 13, 2018
 
Oregon Attorney General launched a new downloadable resource for Oregonians who are concerned about a family or household member who is in possession of a gun or other weapon. Oregon’s new "Red Flag Law," also called the Extreme Risk Protection Order law, allows a judge to issue an order that permits the court to take weapons away from people who are deemed a risk to themselves or others. 

This downloadable one-pager highlights how the new law works, lists those who can request an order, and details the timelines for hearings, and how long the order is effective. 

“Oregon's ‘Red Flag Law’ is one of the few tools we have to reasonably quickly remove a gun or weapon from somebody who is at risk. When we realized that not that many Oregonians seem to realize this law is an option, we decided to create a resource for Oregonians that was simple and easy to understand,” said Attorney General Rosenblum. “This law is not complicated, but its effects could be significant. I hope that by making people aware of the law and breaking down the steps involved in the ‘Red Flag Law’ process, we are able to help save lives.”
BEST WISHES
Montana Attorney General Fox Recovering From Colon Cancer, Says Prognosis Good
April 16, 2018

Several months ago Attorney General Tim Fox was not feeling up to snuff and was having back pain and experiencing fatigue.

Fox did some of his own doctoring by scouring the internet and was taking various medications. But his doctor, Nate Buffington, did a battery of tests and suggested a colonoscopy.

As a result of that procedure, the 60-year-old Fox spent Easter Sunday at Mayo Clinic in Minnesota, recuperating from colon cancer surgery in which he had 7 inches of his colon removed 18 days ago and plans to begin chemotherapy, likely in May.

He said Monday his prognosis is good and has an 80 percent chance of being cured.
“Because of early detection and great health care services, my options and my future is very bright.

All of my options in life continue to be very viable,” Fox said, adding he is now on a mission to encourage others to get a colonoscopy.
CONGRATULATIONS
Turpen Reappointed To The Oklahoma State Regents for Higher Education
April 16, 2018

Mike C. Turpen, Oklahoma City, was recently reappointed by Gov. Mary Fallin to serve a nine-year term as a member of the Oklahoma State Regents for Higher Education. Turpen’s reappointment was confirmed by both the Senate Education Committee and the full Senate. His term will expire in May 2027.

“Mike is one of Oklahoma’s strongest voices for higher education,” said Gov. Mary Fallin. “He understands the value of an educated workforce and its importance in moving our state forward. He also is a tireless advocate for appropriate state funding for higher education as well as realizing the need to improve and modernize our state's public higher education system. He has personally raised tens of thousands of dollars for college scholarships for students throughout the state.” 
AG ELECTION TRACKER
Follow the 31 AG Races in 2018 on this Interactive Website
A significant number of states, 30 and the District of Columbia, have contests for the Office of Attorney General. Cozen O’Connor’s State Attorneys General Practice hosts an interactive map for those interested in following the races throughout the country. The State AG Election Tracker includes state-by-state AG candidate snapshots, filing deadlines and primary election dates; daily news, insights, polling and fundraising data; and the ability to sign up for real-time election-night updates via text and email. Access is free.
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