From the Experts

How State AGs Use Surveys in False Advertising Suits

, Corporate Counsel


Why are states motivated to litigate against certain companies as opposed to another with questionable advertising claims?

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What's being said

  • Edward

    This article made me think of the administration that ‘edited‘ a scientific article of global warming to support the assertion that it was not proven. Is the standard that you must be selling a product to be concerned about lawsuits or does the use of surveys to support bogus claims in general open one to liability?

  • Darren McKinney

    The authors fail to note the single most important motivation behind consumer litigation brought by both state AGs and private sector personal injury lawyers: oodles and boodles of seemingly "free" money.

    State AGs, often known as "aspiring governors," want to cultivate Robin Hood reputations with gullible voters, appearing to bring millions of additional revenues into state coffers without raising taxes. And private sector hoods just want to get rich.

    But ironically enough, it‘s we consumers who are ultimately punished by these "consumer protection" lawsuits, as prices for the goods and services we buy are invariably raised to pay for all the multimillion-dollar settlements and verdicts.

    Perhaps the most perverse misuse of consumer protection laws occurs when private sector shysters approach an AG with both a scheme to fleece a deep-pocketed corporation and an implicit promise to support generously the AG‘s next election campaign if s/he hires them, effectively deputizing them with the power of the state, to prosecute the lawsuit -- on a contingency fee basis, no less.

    Unlike salaried state attorneys seeking justice in the public interest, contingency-fee attorneys seek to maximize profits in their self-interest. So whereas justice might require a settlement of X dollars, contingency-fee lawyers, with a corrupt AG‘s blessing, might nevertheless press for a settlement of 3X or 4X or 10X. Meanwhile the state develops a reputation as a "judicial hellhole" (see and business executives learn to avoid expansion or relocation there. This undermines economic growth, employment and tax revenues, of course. And as tax revenues decrease, motivations for still more lawsuit extortions increase, and a slow but steady death spiral ensues (see the once Golden State of California, the crumbling former Empire State of New York, and the hapless Food Stamp State of West Virginia as examples).

    -Darren McKinney, American Tort Reform Association, Washington, D.C.

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