State Attorneys General Tackle National Health Crises, One Person at a Time – Food, Medicines, Health Care, Life Sciences


United States: State Attorneys General Tackle National Health Crises, One Person at a Time

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Some might get the mistaken impression that state AGs rarely look at health-related cases, believing they are largely preempted by the FDA. However, nowadays there is little doubt that attorneys general are able to exercise their unfair and deceptive marketing practices laws with considerable weight in the health field. As the tobacco, opioid, and now vaping health crises have developed, state AGs have been at the forefront of ending marketing practices and securing redress for these damages. Over the past few weeks we have seen some interesting developments from State AG as they have continued to target individuals in their health enforcement actions.

Massachusetts Attorney General Maura Healey on December 9 settled his 2018 trialagainst e-cigarette company Eonsmoke for $ 50 million, alleging that its marketing appealed to young people, downplayed nicotine content, and that their websites had failed to implement measures to prevent sales to minors. The AG also settled with two individual defendants Gregory Grishayev and Michael Tolmach, who will pay a total of $ 750,000 for their roles. Eonsmoke was disbanded in 2020, so the regulation injunction will have the biggest impact on the pair who will now need to get FDA clearance and give AG notice before selling tobacco products in Massachusetts. in the future.

Also on the e-cigarette front, North Carolina Attorney General Josh Stein took action against JUUL co-foundersfor their personal involvement in the company’s marketing to young people. This new action against James Monsees and Adam Bowen as individuals comes just months after a lawsuit against the company was resolved in June for $ 40 million. North Carolina takes advantage of the language of settlement with JUUL, in which “released parties” are defined as “each and all principals, partners, officers, directors past and present”, but excludes persons who have been appointed by ” Other States ”in any pending action. As many states have sued a number of directors who founded and ran JUUL, this left open the possibility of seeking additional recoveries against these individuals even after their previous litigation had been settled. Attorney General Stein, in a press conference announcing the lawsuit, compared the actions of the co-founders to those of the Sackler family, the former owners of Purdue Pharma who have been sued individually by multiple AGs.

The Sacklers are not immune to individual responsibility either. Despite a resolution through the Purdue bankruptcy that would release the Sacklers from non-criminal liability in return for their $ 4.5 billion contribution to the bankruptcy estate, several states have appealed the order to court confirmation primarily on the grounds that a corporation’s bankruptcy should not be used to grant non-consensual discharges to third parties. New York Southern District Judge McMahon agreed and set aside the bankruptcy confirmation order on December 16, after determining that the bankruptcy court did not have the legal authority to grant non-consensual discharges to non-debtors. While this may reopen the state’s individual prosecution of the Sacklers, further appeals will undoubtedly follow its decision.

While public health cases can be extreme examples due to their impact on citizens, the aggressive pursuit of individuals by GAs is certainly not unique to this field. Whether a business is dissolved, bankrupt, or even settled with the state, individual owners or operators may still be in the sights of MAs and, in many cases, may be a bigger target. to ensure long-term compliance.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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