Insights

The Fifth Circuit vacated the FTC’s Combatting Auto Retail Scams (CARS) Rule in January of this year, finding that the FTC failed to follow the correct administrative procedures when it promulgated the regulation.

Foreign Corrupt Practices Act (“FCPA”) enforcement has been fairly predictable for many years as the Fraud Section of the Department of Justice (“DOJ”) has maintained exclusive authority over investigating claims and bringing enforcement actions in federal courts across the country. President Trump’s recent pause on FCPA enforcement, the first of its kind since the statute was passed in 1977, has created significant uncertainty for individuals and businesses operating internationally regarding the future of FCPA enforcement. While DOJ is in the process of assessing what the future of FCPA enforcement, state attorneys general are stepping in. On April 2, California Attorney General Rob Bonta issued a Legal Advisory (the “Advisory”) to California businesses explaining that violations of the FCPA are actionable under California’s Unfair Competition Law (UCL). The announcement signals a shift in FCPA enforcement where states may take the lead and pursue FCPA enforcement through their state unfair competition laws.

On March 20, 2025, Florida Attorney General James Uthmeier announced an investigation into whether two leading proxy advisors’ advice involving the consideration of Environmental, Social, and Governance (ESG) and Diversity, Equity, and Inclusion (DEI) constitutes deceptive or unfair trade practices under Florida law or a violation of Florida antitrust law.

On February 13, 2025, a coalition of sixteen state attorneys general issued a “Multi-State Guidance Concerning Diversity, Equity, Inclusion, and Accessibility Employment Initiatives” (the Guidance). Led by Attorney General Andrea Campbell of Massachusetts and Attorney General Kwame Raoul of Illinois, and joined by the Attorneys General of Arizona, California, Connecticut, Delaware, Hawaii, Maine, Maryland, Minnesota, Nevada, New Jersey, New York, Oregon, Rhode Island, and Vermont, the Guidance is a direct response to concerns from the private sector in the aftermath of President Trump’s recent Executive Order 14173, which  directed federal agencies “to encourage the private sector to end illegal discrimination and preferences, including DEI.” The Guidance clarifies “the state of the law for businesses, nonprofits, and other organizations operating” in their respective states.

Democratic State Attorneys General took a series of actions to defend Biden Administration Rules on the environment, firearms, and immigration, in the final days before President Trump returned to the White House. While these State AGs argue that the rules at issue protect the public health and safety of their constituents and the nation, the incoming Administration has indicated that it may withdraw its support from some or all of these regulations. Notably, many of the Rules in question face legal challenges from Republican State Attorneys General. A look at the Democratic AGs’ actions is below.

With the coming of the new presidential administration, state antitrust enforcement is poised to intensify. We expect both Republican and Democratic Attorneys General (AGs) to actively pursue antitrust investigations and litigation. They will fill in where the U.S. Department of Justice and Federal Trade Commission reduce focus but are also sure to work, including on a bipartisan basis, with their federal counterparts. Below, we explore how state AGs are likely to shape the antitrust landscape in the coming four years, and the areas where we anticipate significant enforcement activity.

On December 17, 2024, the Federal Trade Commission (“FTC”) and the Illinois Attorney General (“AG”) announced a $140 million settlement with Grubhub to resolve charges involving an array of allegedly unlawful and deceptive business practices. Even though the FTC’s proposed final rule on junk fees (also announced on December 17, 2024) is limited to hotels, live events, and short-term rentals, this settlement demonstrates that the FTC will use its broad enforcement powers to pursue companies imposing junk fees online, and that both federal and state consumer protection regulators will formulate 2025 enforcement priorities with junk fees and click-to-cancel in mind. Indeed, this $140 million settlement, of which Grubhub will pay $25 million based on its demonstrated inability to pay the full amount, is the first of its kind in that it is a joint action by the FTC and state regulators to pursue both junk fees and click-to-cancel violations.

Ten states held elections for state attorney general last month. Those states include: Indiana, Missouri, Montana, North Carolina, Oregon, Pennsylvania, Utah, Vermont, Washington and West Virginia. Of the ten elections, there was only one change in political party—Pennsylvania, from Democrat to Republican. Additionally, six states elected new attorneys general—North Carolina, Oregon, Pennsylvania, Utah, Washington and West Virginia. Notably, three attorneys general were elected governor of their respective states. Those incoming governors include Josh Stein of North Carolina, Bob Ferguson of Washington, and Patrick Morrisey of West Virginia. A summary of each new attorney general and attorney general turned governor is below, listed alphabetically.

Plastic pollution is a growing concern worldwide, and State Attorneys General increasingly turn to litigation to address this issue. These lawsuits tend to focus on alleged deceptive advertising and misleading statements, but sometimes include public nuisance claims to address alleged injuries to the environment and public health. Broadly, the actions of State Attorneys General target companies directly for the products they sell and the claims they make to sell them, de-emphasizing consumer choice as a driver of these harms.

California Governor Gavin Newsom announced his plans to sign Senate Bill 1037, a bill designed in response to the “statewide housing shortage crisis” that will give Attorney General Rob Bonta new civil penalty authority to hold municipalities accountable from the moment they purportedly first violate the state’s housing laws. This marks a significant change in the law.

As we’ve previously reported, FTC practitioners and businesses alike have been anxiously awaiting details about the rule that will prohibit purportedly deceptive practices in connection with reviews and testimonials. Our readers likely recall the FTC’s advance notice of proposed rulemaking from November 2022, the notice of proposed rulemaking from June 2023, and the informal hearing on the proposed rule which occurred in February 2024. The wait is finally over: just yesterday, August 14, 2024, the agency announced the “Rule on the Use of Consumer Reviews and Testimonials” (the “Rule”). The final Rule, which the Commissioners unanimously approved, is a formal step to address alleged ongoing non-compliance with Section 5 of the FTC Act and the agency’s Guides Concerning the Use of Endorsements and Testimonials in Advertising (the “Endorsement Guides”), particularly in the consumer review space.

Call it the summer of junk fees and drip pricing. In July, California’s new drip pricing law went into effect and in August the federal government announced further proposed rules into junk fees and subscription services. Regulators say these proposed price transparency laws and regulations are consumer protection tools that will save consumers money, help them avoid hidden fees and enable them to cancel recurring charges and subscriptions.

With the increase in state-federal collaboration, now is the time to ensure that your company is in the best position to engage with and address potential regulatory enforcement actions. In light of the uptick in intergovernmental investigative and enforcement collaboration, namely among federal agencies such as the Department of Justice (DOJ), and individual state authorities like state attorneys general offices (AGs), AGs are growing their enforcement capacity and increasing their activity in areas that have historically been left to federal agencies.

In a recent development that underscores the ongoing debate over diversity, equity, and inclusion (DEI) initiatives in the United States, a group of 21 Republican State Attorneys General spearheaded by Tennessee Attorney General Jonathan Skrmetti has challenged the American Bar Association's (ABA) Standard 206 on Diversity and Inclusion. In a letter sent to the ABA in early June, the Republican AG group argues that the ABA Standard and its proposed revisions are unlawful due to the Supreme Court's ruling in Students for Fair Admissions, Inc. v. President & Fellows of Harvard College (SFFA).

On August 1, 2024, Nondiscrimination on the Basis of Sex in Education Programs or Activities Receiving Federal Financial Assistance, one of the final Title IX regulations of the U.S. Department of Education released on April 19, 2024, will go into effect. The new regulations address the previous administration’s rollback of Title IX protections, and include, among other things, an expanded definition of sex discrimination that provides new protections for LGBTQ+ individuals against discrimination on the basis of sexual orientation and gender identity. For example, the new rules prohibit schools that receive federal funding from barring transgender students’ use of pronouns that correspond to their gender identities, or denying transgender students access to facilities, like locker rooms and restrooms, that match their gender identities. Other notable changes in the new regulations include the following: (1) protection from all sex-based harassment and discrimination, including that based on sex stereotypes, sexual orientation, gender identity, or pregnancy or related conditions; (2) broadening the definition of “hostile environment” harassment to include conduct that is so severe or pervasive that it limits or denies a person’s ability to participate in the education program or activity; (3) increased accountability by requiring schools to take prompt and effective action to end any sex discrimination in their education programs or activities, prevent reoccurrence, and remedy its effects; and (4) protection against retaliation for students, employees, and others who exercise their Title IX rights.

Last week the New Jersey State Attorney General (AG) Matthew J. Platkin announced the creation of a new division: the Antitrust Litigation and Competition Enforcement Section (ALCES) within the Division of Law (DOL). The permanent and stand-alone section is based out of the DOL’s Newark office and is intended to reinforce the state’s capacity for robust antitrust protection. This marks yet another effort by a state AG to increase antitrust resources and focus on both large and small antitrust issues to promote fair and competitive markets.

There are very few issues that can unite Republican and Democratic State Attorneys General in today’s polarized political environment. Aviation is one of those issues.

Crowell & Moring previously reported that new paid leave laws would be in effect at the start of 2024 in Chicago and Illinois. (For more information, see Crowell & Moring’s December 1, 2023 Alert, “New Year Will Bring Changes to Paid Leave in Illinois and Chicago”). The Chicago City Council has now amended its Paid Leave and Paid Sick and Safe Leave Substitute Ordinance (“Amended Chicago Ordinance”), making a number of changes, including delaying the effective date to July 1, 2024. Cook County also followed suit, acting to bring its laws in line with the new Illinois and Chicago paid leave requirements, with the passage of the Cook County Paid Leave Ordinance (“Cook County Ordinance”) at the end of last year.  

On Friday, January 12, 2024, the District of Columbia enacted a new pay transparency law, joining states like California, Colorado, Illinois, and New York, which have already enacted such legislation.  The legislation must first clear a 30-day congressional review period and, absent a Congressional vote to overrule the legislation, it will take effect June 30, 2024.

Governor Hochul vetoed a bill passed by the New York State legislature that would have effectively banned all non-compete agreements.  In her December 26, 2023 veto message, Governor Hochul cited New York’s “highly competitive economic climate” and the “legitimate interests” of companies to “retain highly compensated talent,” while stating that she has “long supported limits on non-compete agreements for middle-class and low-wage workers.” The Governor observed as well that she had “proposed banning non-compete agreements for anyone making below the median wage in New York” in her first Executive Budget. Governor Hochul stated that she remains open to “future legislation that achieves the right balance.”