Two more state AGs are withdrawing membership from what once was an independent association of state attorneys general, according to media reports.
In April, Montana Attorney General Austin Knudsen announced his intent to resign from the National Association of Attorneys General (NAAG) while the Attorney General of Missouri, Eric Schmitt, and Texas, Ken Paxton, announced their withdrawal last week.
“Our point on all of this is just the broader role that litigation is playing in these major public policy questions, whether it's opioids today or we're climate change going forward and in
many respects these lawsuits and the process is being driven by these outside counsels when they retain them on a contingency fee basis,” said Tiger Joyce, American Tort Reform Association (ATRA)’s president.
The National Association of Attorneys General (NAAG) previously managed multistate investigations and lawsuits in an unbiased manner however, in recent years, the historic organization is accused of benefiting from settlements with major corporations.
“The National Association of Attorneys General has, at least by public accounts that we've seen, $200 million in assets,” Joyce told Legal Newsline. “That's a lot of capital to be deployed in litigation and to grow litigation efforts.”
A March 30 ATRA report entitled, A Nonprofit that Acts Like a Plaintiffs Law Firm, found that NAAG provides grants to states to help litigation get off the ground and to fund research and other expenses needed to determine participation in multistate lawsuits. States are subsequently required to repay the grant if there is a settlement among litigants.
Among the highlights of the report are that NAAG received $15 million as part of a settlement in 2021 involving McKinsey and Company and $140 million from a tobacco settlement, which gave private lawyers billions of dollars and requires tobacco companies to make yearly payments to states in order to do business.
“It’s a perfect example of the organization being an active player in these lawsuits as opposed to just being a forum where these individual attorneys general and their staffs have meetings, discussions and coordination efforts,” Joyce said.
Alabama was one of the first states to withdraw from NAAG last year.
“Attorneys general don't just bring lawsuits driven by plaintiff's lawyers,” Joyce added. “They have important law enforcement responsibilities. So, from a law enforcement standpoint, it's significant because there may be criminal-type activities that they need to focus on as well as on the civil side.”