A state’s effort to enforce its law on behalf of its residents in state court was upheld by the court.
The attorney general for the state of Mississippi (AG) sued manufacturers of liquid crystal displays, alleging anti-competitive and price-fixing schemes that increased consumer prices. The AG filed the suit in state court as parens patriae, that is, on behalf of the state and its residents.
Manufacturers moved to have the lawsuit heard in federal court pursuant to the federal Class Action Fairness Act (CAFA). They argued that the suit is actually a mass action -- claims of at least 100 people seeking to recover damages based on common facts and law -- and that the state’s residents are the real parties in interest. The AG countered that CAFA does not apply because a parens patriae action filed in state court asserts the sovereign interests of the state in protecting its residents. The residents are not actually plaintiffs even if they receive restitution and all residents benefit from the state enforcing the state law.
AARP Foundation Litigation attorneys filed AARP’s friend-of-the-court brief in the U.S. Supreme Court, pointing out that parens patriae actions are fundamentally distinct from private actions and benefit the public by enforcing the law as much as by obtaining restitution to injured residents. Treating them as mass actions creates untenable logistical problems, delays, and increases costs that could be spent on other enforcement actions. The Mississippi legislature (like most state legislatures) has authorized the AG to protect the public by enforcing state laws on behalf of the state and residents: residents should not be forced to join as individuals to gain the protection of the law.
A unanimous Supreme Court agreed. Parsing the statutory language and the intent of Congress in enacting CAFA, the Court rejected the manufacturers’ argument. The Court also discussed at length the administrative nightmare that would ensue if states were required to abandon parens patriae actions in favor of mass actions – an argument emphasized by AARP in its brief.
What’s at Stake
Attorneys general are often the first and most important defenders of their residents. Older people in particular rely on states to ensure they have access to safe nursing facilities and home health care, and to protect their homes and assets. State AGs have been instrumental in protecting older people in nursing facilities by increasing staffing levels and training and ending the deceptive marketing of powerful, and dangerous, antipsychotic medications. AARP’s brief also showed how the AGs have saved homes from foreclosure and stopped abusive lending practices. They have stopped the sale of unsuitable annuities to older people, and protected against price gouging by undisclosed fees in credit cards for medical bills. Defendants accused of violating state law should not be permitted to make it more difficult and costly for states to enforce those laws. Indeed, 46 state attorneys general also filed an amicus brief in opposition to being forced into federal court when they are enforcing state laws.
State of Mississippi v. AU Optronics was decided by the U.S. Supreme Court.