A notable Venable alum stopped by the NAD conference last Tuesday morning to give the room an insider’s view into the Office of Attorney General in the District of Columbia. After a moving moment of silence for the victims of hurricanes, the recent mass shooting in Las Vegas, and his mother who had recently had a stroke, Attorney General Racine gave the room an overview of the goings-on and priorities of his office as well as his thoughts on the priorities of AG offices around the country.
With respect to investigations, General Racine confirmed what the crowd had long suspected. With speculation that the new administration may be less active when it comes to enforcement actions related to consumer protection, General Racine said that “the states are not going to back down.” General Racine has been and continues to be in regular communication with his counterparts in other states (on both sides of the aisle) working to bring about enforcement actions to protect consumers. At least one example where states are taking a leading role is a major investigation into resort fees and drip pricing where the federal government was once an active participant but has since taken more of a background role. The 50 states involved have stepped up and are actively pursuing the investigation.
General Racine said that this increased activity from the states should be expected over the next few years—especially from AG’s with a “D” next to their name. One strategy attorneys general on both sides of the aisle are using to keep up with the increase in enforcement is to utilize outside plaintiff’s counsel on a contingency basis to pursue consumer protection matters. General Racine said that his office recently obtained approval from the D.C. government to retain plaintiff’s counsel in enforcement actions and regularly receives solicitations from the plaintiff’s bar regarding potential cases. Sensing unease from the crowd at this strategy, Amy Mudge asked the tough question, “how will the AG’s office manage these plaintiff’s law firms” (especially when it comes to non-monetary settlements)? General Racine responded that, for this model to work, the AG’s office cannot simply outsource legal work to plaintiff’s counsel, rather the AG staff must be actively engaged in the litigation and there should be no doubt that the AG is in charge of all facets and retains full control of the representative matter. In the case of D.C., General Racine recruited a senior lawyer from another AG office with prior experience in this area to lead the management of outside counsel. General Racine also said outside plaintiff’s counsel should be hired through a competitive process, and it needs to be made clear at the outset that the objective of the investigation is not necessarily about a monetary settlement.
A clear theme of General Racine’s discussion was one of communication between business and the AG’s office. General Racine readily admitted that regulators may not have all of the facts nor have a sufficient understanding of the industry or business in question. For this reason, General Racine encouraged all companies that are faced with a CID to come in and talk with the AG to make sure all sides of the story are heard. General Racine said that many times a frank conversation results in his office being better informed about potential matters.
General Racine’s message of communication was also clear in his discussion of his office’s other roles. He said there is not enough communication between industry and the AG’s office outside of investigations. He suggested that companies would much rather meet their respective AGs outside of the investigatory process. Moreover, the AG’s offices prefer to work with industry, especially as it relates to the AG’s legislative function. General Racine said that one of his office’s busiest functions is to comment on existing legislation and draft new legislation for the District. General Racine said he welcomes the opinions and insight of inside and outside counsel from all industries especially as it relates to consumer protection.
Finally, General Racine made clear his fondness for organizations that implement and promote self-regulation, especially self-regulation with teeth. General Racine praised NAD for its work and encouraged those in the audience to continue to participate in self-regulation, and with their respective attorneys general, to ensure a fair marketplace for consumers.