July 1, 2005—June 30, 2007 to the People of New Hampshire, Governor John H

STATE OF NEW HAMPSHIRE DEPARTMENT OF JUSTICE

BIENNIAL REPORT July 1, 2005—June 30, 2007 To the People of New Hampshire, Governor John H. Lynch, Members of the Executive Council, and Members of the General Court:

I proudly present the biennial report for the Attorney General’s Office detailing the work and accomplishments of my Office during the 2006-2007 biennium. It is a privilege to serve as Attorney General and an honor to lead the men and women who achieved the significant successes summarized in this report.

The members of this Office have established excellence as the standard of per- formance as we carry out our mission:

To serve the people of New Hampshire with diligence, independence and integrity by performing the constitutional, statutory and common law duties of the Attorney General as the State’s chief legal officer and chief law enforcement officer; To seek to do justice in all prosecutions; To provide the State with legal representation and counsel of the highest quality; To protect the State’s environment and the rights of its consumers; and To provide supervision and leadership of New Hampshire law enforcement.

Throughout the 2006-2007 biennium I have lead initiatives focused on ensuring the children of New Hampshire remain safe. Working with Governor Lynch and the General Court, new laws have been enacted protecting the people of the State from sexually violent predators. With assistance from law enforcement, schools, and parent groups throughout the State, the office has provided education for children, parents, and educators on internet safety. The Attorney General’s Cybercrime Initiative brought training, leadership, and support for multi-agency task force efforts to detect, arrest, and prosecute those who prey on our children using the internet.

The pages of this report detail extraordinary efforts by the attorneys and staff of the Attorney General’s Office to protect the people of New Hampshire and their environment through criminal and civil prosecutions, defense of civil claims, legal advice to departments, oversight of charities, and public education on subjects ranging from consumer protection to the Right-to-Know law. This work would not be possible without the support of Governor John H. Lynch, the Members of the Executive Council, Members of the General Court, members of law enforcement from across the state, and leaders across State and municipal government. Thank you all.

As we enter the next biennium I am confident that the exceptional men and women who serve at the At- torney General’s Office will again be successful in meeting the legal needs of the State while ensuring that people of New Hampshire enjoy the rights and privileges guaranteed by our Constitution and laws.

Kelly A. Ayotte Attorney General Table of Contents

Criminal Justice Bureau…………………………………………..………6

Office of the Chief Medical Examiner……………………...…….….15

Consumer Protection and Antitrust Bureau…………….…..……17

Environmental Protection Bureau……………………..….………...27

Charitable Trusts Unit….……………………………………..…………34

Civil Law Bureau……………………….………..………………………...39

Transportation Law Bureau…….…………...…………..………..…..48

Administration……………………….…………………….……………...50

Appendices……………….……………..……………………………………54 Leadership

Kelly A. Ayotte………………………………..…………………….…Attorney General

Orville B. Fitch, II….…………………..………...…….….Deputy Attorney General

M. Kristin Spath……………………...…………….…...Associate Attorney General Chief of Staff

Rosemary Faretra………………………….....………...Director of Administration

Dr. Thomas A. Andrew……………………..……..………Chief Medical Examiner

Timothy Brackett……………………..……………………...Supervisor, Grants Unit

Paul E. Brodeur……………………………………………….……….Chief Investigator

Michael K. Brown……………………..……...Senior Assistant Attorney General Chief, Client Counseling

Jeffrey S. Cahill…………………..…………….Senior Assistant Attorney General Chief, Medicaid Fraud Unit

Michael S. DeLucia…………………..………..Senior Assistant Attorney General Director, Charitable Trusts Unit

Dr. Jennie V. Duval……………………….…….Deputy Chief Medical Examiner

Anne M. Edwards………………………..………...…...Associate Attorney General Chief, Litigation Unit

Stephen D. Fuller…………………………...….Senior Assistant Attorney General Chief, Criminal Appellate Unit

Suzanne M. Gorman………...…...…………..Senior Assistant Attorney General Chief, Civil Appellate Unit

Richard W. Head….………………………….…………Associate Attorney General Director, Division of Legal Counsel Chief, Environmental Protection Bureau

Mark P. Hodgdon………………….…………..Senior Assistant Attorney General Chief, Transportation and Construction Bureau Leadership (continued)

Terry M. Knowles………………….Assistant Director, Charitable Trusts Unit

Sandra Matheson………………Director, Office of Victim/Witness Assistance

Lauren J. Noether………………...…………...Senior Assistant Attorney General Chief, Consumer Protection and Antitrust Bureau

James R. Norris……………………………………....Commander, Drug Task Force

Ann M. Rice…………………...……..…………………...Associate Attorney General Director, Division of Public Protection

Bette Jane Riordan……………..………..Director, Victim’s Compensation Unit

Nancy J. Smith…………………………...…….Senior Assistant Attorney General Deputy Chief, Litigation Unit

Jeffery A. Strelzin………………….………….Senior Assistant Attorney General Chief, Homicide Unit

Jane E. Young…………………………………...Senior Assistant Attorney General Chief, Criminal Justice Bureau

Criminal Justice Bureau

The Criminal Justice Bureau trainings for police and prose- successful in sponsoring new (CJB) investigates and prosecutors both at regional events laws that not only provided cutes major criminal cases and at local police depart- punishment for those who throughout the State. In addi- ments. manufacture and traffic in tion to prosecuting all homicide methamphetamine in this State cases, the CJB also investi- With support from Governor but also laws that will protect gates and prosecutes cases of John H. Lynch, a general litiga- the environment, the first re- drug trafficking, economic tion prosecutor was added to sponders who are called to crime, Medicaid Fraud, and the Office to focus on the grow- methamphetamine labs, and matters of public integrity. The ing trend of utilizing the internet laws that will protect children CJB also represents the State to commit crimes. As part of and incapacitated adults who on all criminal appeals before this heightened effort to fight are helplessly exposed to the the Supreme Court. On a daily cybercrime, the Attorney Gen- harms posed by the production basis, the CJB provides legal eral’s Office issued a subpoena and sale of methamphetamine. guidance to law enforcement to MySpace.com, an on-line agencies on various criminal social networking site, to obtain The Attorney General and her issues, and routinely responds the names of those users who staff participated in public fo- to questions and concerns are registered sexual offenders. rums and discussions with edi- raised by members of the pub- The names obtained from torial boards across the State lic. MySpace were given to the to inform the public of the Department of Corrections to emerging methamphetamine The CJB is staffed by twenty- ascertain whether any of those problem. As part of this public three attorneys, four investiga- individuals violated their condi- awareness campaign, the At- tors, three financial analysts, tions of parole or probation by torney General’s Office part- three paralegals and seven being on this website. The At- nered with the Retail Merchants secretaries. During the bien- torney General’s Office contin- Association of New Hampshire nium the attorneys continued to ues to pressure MySpace to and the New Hampshire Gro- teach criminal law classes at establish protocols such as cers Association to alert the each of the academies con- oversight and minimum age public of the dangers associ- ducted for new law enforce- requirements in an effort to en- ated with methamphetamine ment officers at the Police sure the safety of all the minors use and protection. The Attor- Standards and Training Acad- who frequent this popular web- ney General provided the mer- emy. Further, attorneys taught site. In addition, the Attorney chants and the grocers with at regional trainings on topics General is currently involved in posters for placement in stores such as search and seizures, a vigorous educational out- alerting the public to the signs DWI laws, and asset forfeiture. reach program to inform chil- of methamphetamine use and Also, attorneys taught at Do- dren, families and schools signs of a methamphetamine mestic Violence Conferences throughout New Hampshire of lab. and Child Abuse & Neglect the dangers associated with the Conferences, both of which use of computers. Below is a more detailed de- were sponsored by the Attor- scription of the specialized ney General’s Office of Victim/ During the biennium, the Attor- units which comprise the Crimi- Witness Assistance. ney General was one of the nal Justice Bureau. catalysts for the Government The Attorney General recog- Leaders Methamphetamine The Homicide nized a need for more concen- Task Force. This Task Force trated efforts to combat DWI was created in response to the Prosecution Unit and other traffic offenses. To increase in methamphetamine address this need, a Traffic labs located in New Hampshire. The major functions of the Safety Resource Prosecutor The areas that the Task Force Homicide Prosecution Unit are (TSRP) was added to CJB. addressed included public to assist law enforcement offi- This prosecutor is responsible awareness, environmental pro- cers with legal issues that arise for assisting local and state tection, treatment, prevention, during the investigation of sus- prosecutors with all traffic protection of children and inca- picious deaths and homicides safety related offenses with a pacitated adults, law enforce- and to prosecute homicide particular emphasis on DWI. ment, and legislation. The At- cases. The Unit is staffed by The TSRP conducts regular torney General’s Office was six lawyers, two paralegals, one full-time secretary and one

6 The Criminal Justice Bureau part-time secretary. Ten other attor- fied use of deadly force. Four were such as bank records. These finan- neys assigned primarily to other cases in which no charges were cial investigations are labor intensive units within the bureau also serve as brought based on the facts of each and typically require the work of mul- co-counsel on homicide investiga- case and the conclusion that the tiple investigators, prosecutors, and tions and prosecutions. homicides were justified. In one paralegals. They often take 12 to 24 case, the grand jury indicted the de- months to complete. Two recent At the beginning of the biennium, the fendant for a less serious, non- convictions are described below: Unit had fifteen active homicide homicide charge, which is now being prosecutions pending, one of which prosecuted by the Grafton County The ECU prosecuted James Hobbs, involved multiple victims. Of those Attorney. In another case, the per- a former attorney, for forgery and fifteen cases, five went to trial during petrator was killed following the theft of over $1,000,000. Upon his the biennium, resulting in five guilty homicide. Four homicides remain conviction, the Court imposed a sen- verdicts; nine were resolved by unsolved. tence of 10-20 years at the New guilty pleas and one was resolved Hampshire State Prison. He was by a plea of not guilty by reason of The Unit has two capital murder sentenced to additional suspended insanity. cases pending. The trials are time and was ordered to pay restitu- scheduled to begin in August and tion. During the biennium, the Unit super- September of 2008, respectively. vised the investigation of forty-one Lawrence Stokes, Jr. and Bayview declared homicides and twenty-six The Economic LLC pled guilty to felony counts of suspicious death cases. Prosecu- making a false tax return. Bayview Crime Unit LLC received a suspended fine. tions were initiated in connection with twenty-four of the homicides, The court ordered the liquidation of The Economic Crime Unit (ECU) its assets and that its Seabrook sixteen of which are pending. One investigates and prosecutes com- guilty plea was obtained in connec- property not be used for a crematory plex theft cases, primarily cases that or any other corpse-handling pur- tion with one of the homicides. Of involve a theft of more than the seventeen that did not result in pose. Mr. Stokes received a sus- $100,000 or thefts that occur in mul- pended New Hampshire State criminal charges, five involved a tiple counties. In the investigation of murder followed by the suicide of the Prison sentence and a $2,000 fine these cases, various financial docu- that he was ordered to pay to the perpetrator. Two were police officer- ments are reviewed and analyzed. involved shootings, which the Crimi- Department of Revenue Administra- Grand Juries are often utilized to tion. Linda Stokes pled guilty to nal Justice Bureau determined were secure testimony of witnesses and/ the result of the officer’s legally justi- three felonies, two counts of making or to secure financial documents a false tax return and one count, approximately $250,000, of theft by deception. She received a suspended New Hampshire State Prison sentence, a $4,000 fine, and along with Mr. Stokes, was ordered to satisfy the payment to the Depart- ment of Revenue Administration of approximately $250,000.

The Public Integrity Crime Unit

The Public Integrity Crime Unit (PICU) investigates and prosecutes public officials who engage in criminal conduct during the course of their official duties. The conduct typically involves economic crimes, such as embezzling public funds, and the misuse of an official’s position to obtain benefits to which the official would not otherwise be entitled. Crimes of violence or sexual misconduct by public officials are also handled by the PICU. Police officers from all over New Hampshire and bagpipe players along with Attorney General Kelly Ayotte participated in the Police Memorial Service in May 2007.

7 The Criminal Justice Bureau Like economic crime cases, public involved, and reviewing the forensic sentenced to the New Hampshire integrity crime cases are typically evidence. The PICU must deter- State Prison for 4-10 years with one complex and require substantial re- mine whether the use of deadly year suspended from the minimum sources to investigate and success- force was legally justified under the sentence. In addition, Alger paid fully prosecute. The PICU routinely particular circumstances. During the $13,353.56 in restitution to the State reviews financial records, makes biennium, the PICU responded to of New Hampshire for the costs in- presentations to investigative grand three such events. curred by the Department of Envi- juries, and consults with various ex- ronmental Services for the clean-up perts. Drug Prosecution Unit of the laboratory located at Alger’s residence. During the biennium, the PICU The Drug Prosecution Unit (DPU) prosecuted the former Tax Collector prosecutes significant drug traffick- In another DPU case, William Cruz and Town Clerk for the Town of Car- ing crimes. In addition, the DPU and Julio Israel Jiminez-Perez a/k/a roll, Louise Staples. Staples was assists various law enforcement Omar Morales were arrested in Sa- charged with two thefts in excess of agencies during their investigations lem for possessing cocaine with the $100,000. The charges stemmed into large-scale drug traffickers. The intent to sell and conspiracy to sell a from Staples collecting cash pay- DPU is comprised of three attor- controlled drug. After trial, Cruz, ments for various town fees, state neys, a paralegal and a secretary. who had prior drug convictions, was motor vehicle registrations, and In addition to working closely with sentenced to 18 years to life at the property taxes. The funds collected the Attorney General’s Drug Task New Hampshire State Prison. should have been deposited into Force, the DPU also provides daily Jiminez-Perez a/k/a Morales was town and State accounts. Through assistance to the State Police, the sentenced after trial to 12½ -25 its investigation, the PICU deter- federal Drug Enforcement Admini- years at the New Hampshire State mined that Staples used the funds to stration and local police depart- Prison. purchase various personal items ments. The attorneys are on-call and at various gambling casinos. twenty-four hours a day not only to The Drug Task Force After being convicted by a jury on provide legal guidance but also to each count, Staples was sentenced authorize one-party interceptions of The New Hampshire Attorney Gen- to the New Hampshire State Prison telephone calls or other communica- eral’s Drug Task Force (DTF) is a for 3½ -7 years with two years of the tions pursuant to RSA 570-A:2. multi-jurisdictional task force whose minimum sentence suspended on primary mission is to enforce the the first count. She was also sen- The DPU also prosecutes all forfei- state’s drug laws and to provide tenced to a consecutive suspended ture actions initiated under RSA 318 leadership, coordination and support sentence and was ordered to pay -B:17-b and d. These forfeiture ac- to all local, county, state, and federal $117,255.38 in restitution, on the tions are intended to strip the drug law enforcement agencies in com- second count. traffickers of their ill-gotten gains bating the drug problem in New

and are also intended to strip the Hampshire. The DTF is comprised The PICU also prosecuted James drug dealers of the implements of of investigators from the Attorney McGonigle, the former Allenstown their crimes, including cars, cash, or General’s Office and police officers Police Chief. McGonigle pled guilty weapons. Once forfeited, the value from local, county, and state law to stealing approximately $2,000 of the forfeited item is divided be- enforcement agencies. The depart- from evidence at the police depart- tween the seizing agency (45%), the ments loan police officers to DTF for ment and approximately $5,000 from drug forfeiture fund (45%), and an a period of several years to work as the Allenstown Police Association account established to fund drug undercover investigators. The Attor- and the New Hampshire Police Ca- treatment programs (10%). During ney General uses federal grant det Training Academy. McGonigle the biennium, the DPU initiated 43 money to subsidize a part of the offi- received a sentence of 12 months at forfeitures and forfeited approxi- cers’ salaries. The DTF works out of the House of Corrections with all but mately $142,000 as well as several four regional offices covering the 90 days suspended. He also re- vehicles. seacoast, central, western and ceived a suspended State Prison northern regions of the state. sentence and was ordered to pay An example of a DPU case is the restitution. prosecution of Daniel Alger of Milan During the biennium, DTF was infor possession of five ounces or volved in 1561 criminal cases (an The PICU is also responsible for more of cocaine with intent to sell, 8% increase from the previous bien- investigating every incident in which theft by receiving stolen property nium), leading to 312 arrests. a New Hampshire police officer uses and felonious use of a firearm. Dur- deadly force in the course of his or ing the search of Alger’s property, The DTF seized or purchased 40 her duties. These investigations the police located a laboratory that pounds of marijuana, making it the typically involve several attorneys contained numerous ingredients for most prevalent drug purchased responding to the scene, participat- the manufacturing of methampheta- through undercover operations and ing in interviews with the officers mine. Alger pled guilty and was

8 The Criminal Justice Bureau seized during investigations. In ad- tions, and in the federal courts on During the biennium, the Appellate dition, undercover investigations petitions for habeas corpus brought Unit had a staff of three full-time as- also lead to the purchases of and by state prisoners. Approximately sistant attorneys general. In that seizures of cocaine, crack cocaine, 92% of the Unit’s work involves time, the Criminal Justice Bureau heroin and prescription drugs. cases before the New Hampshire filed 256 briefs and 33 memoran- Methamphetamine seizures have Supreme Court. dums of law with the New Hamp- remained very low due in large part The work of the Appellate Unit is shire Supreme Court, and 4 briefs to the Attorney General Office’s central to the development of the with the United States Court of Ap- methamphetamine initiative, which criminal law in this State. It regularly peals for the First Circuit. It also was designed to curtail the easy and deals with issues such as the consti- filed answers or memorandums of very dangerous production of this tutionality of a criminal statute, law in support of motions for sum- potent drug. whether a search conducted by a mary judgment in 22 habeas corpus police officer violated a person’s cases in the United States District In addition, DTF was involved in out- constitutional rights, or whether a Court. of state investigations, which in- trial court’s decision to limit cross- volved drug trafficking across the examination of a witness, or to admit Some of the more significant cases State’s borders. evidence, violated a defendant’s briefed by the Appellate Unit during constitutional right to confrontation. the biennium were: Over the course of the biennium, The opinions of the Supreme Court DTF investigators seized $347,119 in these cases provide legal guid- • State v. Ayer: The Supreme Court in cash proceeds of drug trafficking, ance to law enforcement officers, held that statements made by a wit- 18 motor vehicles, and 118 weap- prosecutors, and lower courts ness to a police officer at the scene ons. DTF also made available thou- throughout the State. of a murder that had taken place just sands of hours of training to its in- moments earlier were not vestigators and local law enforce- In every appellate case, an attorney “testimonial” for purposes of the ment officers. It jointly sponsored in- in the Appellate Unit researches the Confrontation Clause of the Sixth state regional training programs with applicable law and writes a legal Amendment because the primary the Drug Enforcement Administra- brief or memorandum of law in sup- purpose of the officer’s questions tion and the United States Attorney’s port of the State’s position. In most was to enable him to deal with an Office and provided funding for offi- cases, the attorney also appears ongoing emergency, and not just to cers to attend training seminars and before the New Hampshire Supreme establish past events. schools both in and out-of-state. Court for oral argument. The issues raised in these cases range from the • Duquette v. Warden: The Su- relatively straightforward to the Appellate Unit preme Court reaffirmed the trial highly complex and novel. Some court’s common-law authority to im-

cases require several weeks of con- pose consecutive sentences. The Criminal Bureau Appellate Unit centrated work to research and draft represents the State in the New the State’s brief. • State v. Fichera: The Supreme Hampshire Supreme Court on all Court clarified the rule regarding the appeals from state criminal convic-

6000

5000

4000

Purchased/Seized 3000 (grams)

2000

1000

0 Cocaine Crack Heroin Meth

9 The Criminal Justice Bureau sufficiency of the pretrial notice that dant’s claim of “provocation” man- second important responsibility: the a defendant must give when he in- slaughter regardless of its findings investigation and prosecution of tends to raise a defense of insanity. on first- or second-degree murder. crimes committed against residents of New Hampshire’s nursing and • State v. Horner: Interpreting the Although the great majority of the assisted living facilities. Such cases time limitations set out in RSA Unit’s work before the New Hamp- encompass physical abuse, neglect, 651:20, which governs when prison shire Supreme Court involves de- and financial exploitation. sentences can be suspended, the fending the State on appeals filed by Supreme Court held that those limi- criminal defendants, each year the The Unit consists of a seven-person tations were mandatory and could Unit initiates several appeals on be- team that includes attorneys, finan- not be waived, and that the mini- half of the State. These State ap- cial auditors, and investigators, as mum periods must be calculated peals typically involve a challenge to well as a legal assistant. The Unit separately with respect to each indi- a trial court’s suppression of evi- receives 75% federal funding for its vidual sentence being served by the dence or the dismissal of a criminal operations. defendant. charge. During the last two years, 16 briefs were filed in cases in which The Medicaid Program • State v. Knickerbocker: Where the the State was the petitioner or ap- indictment charging the defendant pellant. The Medicaid program, which was with second-degree murder was created in 1965, covers three main brought twenty years after the crime, In addition to their appellate respon- low-income groups: (1) parents and the Supreme Court reversed the sibilities, the members of the Appel- children, (2) the elderly, and (3) the lower court’s dismissal of the indict- late Unit regularly consult with local disabled. ment, rejecting the defendant’s argu- prosecutors seeking assistance. ment that he suffered actual preju- They provide information on the cur- Unlike Medicare, which is adminis- dice. The Supreme Court clarified rent status of New Hampshire crimi- tered and financed exclusively by the test to be used when deciding nal law, suggest strategies to ap- the federal government, Medicaid is whether a defendant’s right to due proach legal issues, and offer assis- a joint venture between states and process has been violated because tance in dealing with an adverse the federal government. While the of a pre-indictment delay. ruling of the trial court. federal government must approve each state’s Medicaid program, the • State v. O’Leary: In a first-degree Medicaid Fraud Unit states are responsible for day-to-day murder case, the Supreme Court administration. The federal govern- held that it was error to give an The Medicaid Fraud Unit (Unit) has ment’s financial commitment to a “acquittal first” instruction with re- statewide jurisdiction to investigate state’s Medicaid program depends spect to manslaughter based on ex- and prosecute health care providers on the state’s per capita income. treme provocation. The Court held for fraudulent and abusive billing New Hampshire receives 50% fed- that the instruction should have al- practices in serving New Hampshire eral funding, which is the minimum lowed the jury to consider the defen- Medicaid recipients. The Unit has a federal participation rate.

CRIMINAL BUREAU SUPREME COURT BRIEFS/MEMORANDUMS OF LAW Fiscal Years 2003 - 2007

160

140 20 10 120 7 100 MEMORANDUMS OF LAW 80

60 12 0 12 7 12 6 116 10 9 COURT BRIEFS 40 Number of Filings Number 20 0 2003 2004 2005 2006 2007 Fiscal Years

10 The Criminal Justice Bureau Medicaid Provider Fraud state agencies, law enforcement and • State v. Community Developmental private citizens. Services Agency. The provider paid The Unit has several statutory reme- the State $37,500 to reimburse the dies available to prosecute fraudu- Cases are also referred to the Unit Medicaid program for alleged defi- lent and abusive provider billing from the twelve state district offices ciencies with the residential care practices, ranging from criminal en- that review Medicaid applications for provided to an elderly and disabled forcement to administrative sanc- long-term care coverage. Applicants Medicaid beneficiary over an eight- tions. must provide financial disclosures so month period. The provider had that the State can determine finan- used a subcontractor to furnish the In January of 2005, substantial cial eligibility for Medicaid coverage. services in question. The evidence changes were made to the state’s Often, the Medicaid application is supported a finding that the benefici- Medicaid fraud statute (formerly prepared by the applicant’s author- ary’s care needs exceeded the pro- RSA 167:61). Under the new law ized representative under a durable vider’s available services and there- (RSA 167:61-(b-e), a private party power of attorney. If the eligibility fore a transfer to another care set- (“relator”) is authorized to sue on the review reveals information that the ting should have taken place. state’s behalf to recover damages authorized representative has possi- and penalties based on the submis- bly exploited the applicant by divert- • State v. West Central Behavioral sion of false claims to the state ing assets before seeking Medicaid, Health. The provider paid the State Medicaid agency. The “relator’s” then the information will be referred $221,320 to resolve a finding that it suit must be filed under seal and to the Unit for further investigation. had submitted duplicate monthly served on the Attorney General to claims for case management ser- allow the state the opportunity to In addition to investigating and vices as the result of faulty billing investigate and determine whether prosecuting elder abuse in facility software. The provider serves as to intervene. The law encourages settings, the Unit was actively in- one of the State’s twelve regional individuals to disclose Medicaid volved during the biennium in pro- community mental health centers. fraud to the state for investigation by viding training to healthcare groups allowing the “relator” to obtain a and local law enforcement officials • State v. Tessier. The defendant share of any recovery. Under the on recognizing and reporting sus- pleaded guilty to the crime of Medi- statute, the state can recover both pected elder abuse. As an example caid Fraud. The defendant, while restitution and punitive economic of its public awareness efforts, the employed as a medical assistant for sanctions. Because many states Unit published recommended proce- a physicians’ practice, ordered multi- have similar laws, this fraud enforce- dures for administrators of long-term ple fraudulent telephone prescrip- ment statute has enabled the office facilities to follow when an employee tions for controlled substances in the to collaborate during the biennium is suspected of diverting narcotics name of Medicaid beneficiaries. with attorney general offices from a resident. She then obtained the fraudulent throughout the country on cases of prescriptions for her own use. The national significance. Summary Of Medicaid Fraud Unit defendant was sentenced to ninety Activities days in jail and a consecutive sus- Patient Abuse and pended sentence of 1½ to 3 years. Financial Exploitation During the period July 1, 2005 to June 30, 2007, the investigation and • State v. King Pharmaceuticals. There are 87 licensed nursing facili- prosecution efforts of the Unit re- The defendant, as part of a national ties and 145 assisted living facilities, sulted in the issuance of forty-one settlement that the Department of which collectively represent home charges against nineteen individu- Justice joined, paid the State for almost 1% of the state’s popula- als. Twelve were convicted during $268,000 for damages caused by tion. Of the more than 7,000 indi- the same period and prosecutions the company’s failure to accurately viduals residing in the state’s nurs- are pending against six others. report its “best price” information for ing facilities, approximately 62% are several of its generic drugs. Under covered under Medicaid. The Unit For the biennium, monetary recover- federal law, companies that provide investigates and prosecutes cases ies, fines, and penalties from all pharmaceutical products to Medicaid of abuse, neglect, and financial ex- cases totaled $1,630,959. Of that recipients must provide the best ploitation of persons living in these amount, $900,738 represents recov- price information, which is used to settings. eries to the Medicaid Program. Pa- calculate rebates payable to state tient funds restitution in financial ex- Medicaid programs. The Unit’s investigation of residential ploitation cases (civil and criminal) crimes usually originates with a re- totaled $252,988. Examples of patient abuse and fi- ferral from the New Hampshire Divi- nancial exploitation cases that the sion of Elderly and Adult Services The following are examples of health Unit handled during the biennium (DEAS). The Unit also investigates care provider cases that the Unit include: reports received directly from other concluded during the biennium.

11 The Criminal Justice Bureau • State v. Clough. The defendant, a victim/witness advocates who are on the post-conviction sentence sus- licensed nursing assistant, pleaded -call 24 hours a day. Whenever a pension/review, and parole hear- guilty to abusing two nursing facility homicide occurs within the State one ings. patients. The defendant stole pain of the advocates is responsible for In addition to working with family medication patches that were ad- responding to the scene to notify the members, the advocates, as part of ministered to the residents’ bodies. victim’s family of the death of their the prosecution team, also work with The defendant served forty-five days loved one and to provide immediate the witnesses involved in each case. in jail with an additional seven crisis intervention and support to They schedule court appearances months suspended, and was barred both family members and witnesses so as to minimize any inconvenience from working in healthcare. to the crime. The advocate contin- to the witness, provide an orientation ues to work closely with the family to the courtroom, explain the court • State v. Marcus. The defendant, a during the extremely painful and dif- process and assist the witness in former nursing home bookkeeper, ficult aftermath, providing a wide obtaining their statutory witness fee. pleaded guilty to felony theft for tak- range of services which may include In the past biennium the advocates ing more than $10,000 from several arranging for the cleanup of the worked with 770 witnesses. The resident trust accounts. The defen- homicide scene, informing the family advocates also respond to numer- dant paid full restitution and served of the results of the autopsy, assist- ous calls, complaints and requests thirty days in jail with an additional ing them with funeral arrangements, from New Hampshire citizens by eleven months suspended. and explaining in general terms the providing intervention and referral process of a death investigation. services. • State v. Hiers. The defendant, who served as her mother’s financial The family will continue to receive From its inception in 1987 through agent under a power of attorney, support and services from the advo- June 30, 2007, the Office has been pleaded guilty to theft by misapplica- cate as the case progresses through involved in 471 homicides. During tion for diverting her mother’s assets the criminal justice system. Those the 2006-2007 biennium, advocates to her own use instead of paying for services include educating the family responded to 41 homicides, includ- the mother’s nursing home care. about the court process, providing ing two law enforcement officer The defendant served nine months case status reports, notifying the deaths. They worked with 520 vic- in jail and was ordered to make res- family of upcoming court hearings, tims (family members) and made titution in the amount of $93,000. accompanying family members to 9276 contacts. court and, if necessary, intervening Office Of Victim/ with an employer, school, or credi- In addition to the direct service re- tor. The advocate’s involvement sponsibilities, the Office coordinates

Witness Assistance with a family does not end with the a variety of statewide initiatives disposition of the criminal case, but aimed at standardizing the services The criminal justice system can be may continue for years, throughout and support to victims of crime and confusing and intimi- dating to people who are drawn into the system as a result of having been a victim of, or witness to a crime. The mission of the State Office of Victim/Witness Assis- tance (Office), within the New Hampshire Attorney General’s Office, is to ensure that such individuals are treated with dig- nity and respect throughout their involvement in the system.

The Office is staffed by the Director, an administrative assistant, a criminal justice specialist and two Attorney General Kelly Ayotte, Governor John Lynch and Office of Victim/Witness Assistance Director Sandra Matheson join Americorp volunteers in commemorating National Victim’s Day.

12 The Criminal Justice Bureau enhancing the systematic response information on Child Advocacy Cen- for making recommendations for to crime and crime victims through ters can be found at www.cac- systematic improvements to prevent training, protocol, and policy devel- nh.com. future deaths. These recommenda- opment. The following are brief de- • The Governor’s Commission on tions are published in annual reports scriptions of the Attorney General’s Domestic and Sexual Violence. This to the Governor. several initiatives in this area. Commission, chaired by the Attor- ney General, continues to develop • The New Hampshire SANE • The Attorney General’s Task Force and implement programs to reduce (Sexual Assault Nurse Examiner) on Child Abuse and Neglect. This the level and seriousness of domes- Program. This Program is a joint initiative is dedicated to improving tic and sexual violence, and to in- project of the Attorney General’s the investigation and prosecution of crease public awareness of the is- Office and the New Hampshire Coa- child abuse and neglect cases in sues. During the last biennium, the lition Against Domestic and Sexual New Hampshire. The Task Force Commission introduced a Faith Violence. The Program trains and recently held its 15th annual multidis- Based Domestic Violence Protocol, certifies medical professionals to ciplinary conference for 351 profes- an Interpersonal Violence Guide for provide statewide consistent care sionals. In April 2007, the Attorney the Media, and updated the Sexual that respects the emotional and General moderated the first School Assault Medical Forensic Evaluation physical needs of the sexual assault/ Violence Summit, bringing together Protocol. This protocol guides the abuse victim, while collecting the 394 law enforcement and emer- work of law enforcement, first re- best possible forensic evidence to gency services professionals, as sponders, and medical profession- promote the effective prosecution of well as educators and others con- als. The Attorney General’s Office the offender. In the past 2 years, 47 cerned with creating a multidiscipli- also provides specialized state evi- nurses were trained, bringing the nary solution to the problem of dence collection kits for use by total of available SANE nurses to school violence, with reducing medical facilities statewide. The 147. school bullying, and enhancing the Commission developed and distrib- civility of the school environment. uted Law Enforcement Victim Notifi- • During the past two years, in addi- cation Form pads to every law en- tion to the annual two-day confer- • The Attorney General, in an effort forcement agency in the state, in an ences, the Office’s training unit coor- to establish Child Advocacy Centers effort to ensure that victims receive dinated 9 day-long trainings on is- (CACs) in each county, allotted $1.5 proper notification and referrals to sues such as stalking and technol- million dollars in start-up funds from services pursuant to the require- ogy, elder abuse, school bullying, federal grants. As a result, in the ments of the domestic violence stat- domestic violence in the workplace, last 2 years 5 new CACS were ute. In June 2007, the 13th State- trauma, substance abuse and drug opened and 1 satellite office was set wide Domestic and Sexual Violence endangered children and a week- up. CACs ensure that children and and Stalking Conference was held, long forensic interviewing training for families now have access to the high with 395 professionals attending. CAC team members. A total of quality, comprehensive, specialized 2215 professionals statewide at- and culturally competent services. • The New Hampshire Child Fatality tended these training programs. CACs are available in eight counties and Domestic Violence Fatality Re- and the Attorney General is working view Committees. Under the coordi- • The Attorney General’s Office is to make them available Statewide. nation of the Attorney General, responsible for administering the The Task Force continues to spon- these committees are responsible New Hampshire Address Confidenti- sor an Annual CAC Summit, as well for reviewing cases of child deaths ality Program (ACP), which was cre- as specialized forensic interview and all domestic violence related ated in 2001 to enable people es- training for team members. More homicides in New Hampshire, and caping from violent situations to hide

The value of the advocates’ services is reflected in the following excerpts from letters that the advocates have received from families of homicide victims:

“You may say it is a part of your job but I want you to know that I felt you took the extra step to enable me to prepare for the pain. Thank you for being so empathetic and supportive to all of us.”

“There are rare occasions in life when we meet people who somehow touch and enrich our lives in such a way as to leave a lasting impression on us.”

“I will never forget the support and patience demonstrated through those tough times when I felt like I couldn’t come to court another day.”

13 The Criminal Justice Bureau their location from their assailant. The ACP sets up a substitute address that participants can use to receive services such as obtaining a driver’s license, registering a car or applying to vote as an absentee voter. Mail sent to this substitute address is then forwarded to the participants by the Office, thus keeping their location confidential. Since its inception, 154 people have registered with the program. In the last biennium, 43 new participants were enrolled and a total of 5219 pieces of mail were forwarded to program participants.

All protocols, reports, policies and other publications developed by the Office are available at www.doj.nh.gov/victim/index.html

14 The Criminal Justice Bureau Office of the Chief Medical Examiner

The New Hampshire Office of relatively young age with no are on call in every county in the the Chief Medical Examiner known significant medical prob- state 24 hours a day/7 days a (OCME) must determine the lems or had no doctor, or had a week. cause of death and the manner doctor who was unwilling to sign of death for all deaths that fall the death certificate. In addition, A major goal of OCME is to re- under their jurisdiction. Cause by law OCME must be notified duce the number of preventable of death is the illness or injury of certain deaths but may de- deaths by identifying risk factors that caused the death. Manners cline jurisdiction when the death and collaborating with other of death are: natural, accident, appears to be natural. agencies. In this biennial period suicide, homicide, undeter- OCME worked with: mined, and pending. Undeter- During this biennial period, mined is used when, after a OCME actively investigated The Consumer Safety Prod- thorough investigation, the man- 2200 deaths. Of the 2200 ucts Commission to take a ner remains unclear. For exam- deaths, 820 were autopsied. toddler bed in which a NH ple, a known drug abuser who The deaths that were not autop- infant died off the market; also has depression dies from sied received a complete exter- an overdose. It can be difficult nal exam. The external exam The Bureau of Behavioral to determine if the manner is confirms that either the dece- Health, NH DHHS by shar- accident or suicide. Pending is dent had no injuries, or, if inju- ing suicide data and sending a temporary classification that is ries are present, the injuries informational packets to sui- used until the investigation and conform to the accident scene cide survivors; all of the laboratory test results and the information given by are completed. The pie chart witnesses. The Center for Disease Con- below summarizes the figures trol by attending their Sud- for the various manners of The investigations are done by den Unexplained Infant death. trained assistant deputy medical Death Investigation training; examiners (ADMEs). Thirteen The OCME is charged with in- new investigators received train- National media outlets to vestigating all non-natural ing in 2006 and have been publicize the danger of the deaths that occur in NH. OCME added to the ADME roster. The Choking Game, a popular also investigates a significant training consisted of 160 hours and sometimes fatal “game” number of deaths where the of classroom lectures, viewing played mostly by children manner is determined to be 20 autopsies and accompanying and young teens who use a natural. These deaths need to a current ADME on 20 investiga- ligature around their neck to be investigated for various rea- tions. These 13 new investiga- cut off oxygen which creates sons, most commonly due to the tors have increased the number the sensation of being high. fact that the decedent died at a of total ADMEs to 24. ADMEs OCME also collaborates with the following agencies and committees: Manners of Death July 1, 2005 through June 30, 2007 • Youth Suicide Prevention Alliance • NH National Association 2.4% of the Mentally Ill Undetermined • Child Fatality Review Committee 39.0% 13.5% Suicide • Domestic Violence Re- Natural view Committee 1.8% Homicide

OCME hosted several sum- 43.0% mer interns in this biennial Accident 0.3% Pending period, most of whom were high school students with an interest in forensics. The students worked on individual data projects and

15 The Criminal Justice Bureau assisted in the office as needed. The data projects included: Sudden infant deaths, drownings, suicides, motorcycle crashes, and youth motor vehicle crashes.

At the end of their internships, the students presented their data to the DHHS Data Users workgroup, the NH Highway Safety Agency and the Sudden Unexplained Infant Death Investigation workgroup.

OCME is working to establish the identities of several unidentified human skeletal remains. Some of the deaths occurred before the office was founded in 1986. Three skulls have been sent to the National Cen- ter for Missing and Exploited Chil- dren where computerized facial reconstruction will be done by the Smithsonian Institute.

In 2006, an unidentified man died in NH. OCME contacted the National Center for Missing Adults and posted his information on its website. Fifteen months after his death, his family found his information on the website and came forward to claim his remains.

16 The Criminal Justice Bureau Consumer Protection and Antitrust Bureau

The Consumer Protection and three attorneys specializing in legals, secretaries, attorneys Antitrust Bureau (“Bureau”) is consumer protection/antitrust and volunteers responded to responsible for enforcing the matters, two prosecutors de- approximately 30,000 telephone consumer protection and anti- voted to the Administrative calls during the biennium. The trust laws of New Hampshire Prosecution Unit, one Insurance Consumer Hotline is staffed be- and ensuring that trades and Fraud Prosecutor, and one Elder tween 8:00 a.m. and 5:00 p.m. businesses operating within the Abuse and Exploitation Prosecu- Monday through Friday and can state comply with governing tor. be reached at (603) 271-3641 or statutes. In addition to the in- 1-888-468-4454. vestigation, regulation and en- Direct Citizen Services forcement of the Consumer Pro- Consumer Complaints tection Act and the antitrust One of the Bureau’s primary laws, the Bureau has responsi- responsibilities is directly assist- The Bureau receives and re- bilities under more than thirty ing consumers with their ques- sponds to thousands of written other statutes. The other stat- tions and problems. The Bureau complaints from consumers in utes include laws such as Fair accomplishes this with a toll free New Hampshire and other Debt Collection, Automated Consumer Hotline, a voluntary states. As of October 12, 2006, Telemarketing Calls, Security mediation program, public edu- on line complaint filing has be- Breach Notification and the Con- cation and outreach programs, come available for consumers. dominium and Land Sales Full informative brochures, a con- During the biennium, over 7,020 Disclosure Acts. In addition, the sumer guide called the NH Con- written complaints were received Administrative Prosecutions Unit sumer’s Sourcebook, on-line through the mail or via the inter- (“APU”), the Insurance Fraud complaint filing, an informative net and processed by the Bu- Prosecutor and the Elder Abuse website and direct intervention. reau. Each is reviewed and a and Exploitation Unit are at- decision is made on how best to tached to the Bureau. Telephone Hotline handle the complaint given the particular facts and circum- The Bureau was first established The Bureau supports a Con- stances. In the first instance, if in 1970. At the present time, sumer Hotline dedicated to re- appropriate, the complaint will there are 18 volunteers and 17 ceiving telephone inquiries from be referred to the Bureau’s Me- staff members, of which 7 are consumers. The Bureau’s para- diation Program. Cases are attorneys assigned as follows: also investigated for civil or criminal prosecution. If the Bureau is unable to assist a consumer, the Consumer Restitution Recovered complaint may be referred Fiscal Years 2000-2007 to other state or federal agencies, such as the $400,000.00 Federal Trade Commis- sion, Attorney General $350,000.00 Offices in other states, or referred to small claims $300,000.00 court.

$250,000.00 The top complaint catego- $200,000.00 ries in the last biennium were: $150,000.00 1. Fuel and energy $100,000.00 purchases Restitution Recovered 2. Building contractors $50,000.00 and home repair 3. Debt collection $0.00 4. Used vehicle 99-00 00-01 01-02 02-03 03-04 04-05 05-06 06-07 purchases Fiscal Year 5. Health clubs 6. Credit cards

17 Consumer Protection and Antitrust Bureau 7. Internet goods and services would otherwise be possible. Consumer Protection Website 8. Motor vehicle repair 9. Travel clubs/agents Public Education and Outreach The Bureau maintains an informa- 10. Cellular telecommunications tive website for consumers, http:// The Bureau has successfully contin- doj.nh.gov/consumer. Not only does Mediation Program ued its goal of increasing the num- it contain the complete New Hamp- ber of outreach programs offered to shire Consumer Sourcebook, but it The Bureau has utilized a voluntary New Hampshire citizens throughout also lists all of the press releases Mediation Program since 1992. The the State. Often, the Bureau part- and consumer alerts issued by the Bureau recruits and trains qualified ners with local law enforcement and Attorney General’s Office. These non-lawyer volunteers as Consumer other agencies for its presentations. press releases and alerts notify the Affairs Specialists. These volun- Bureau staff, with the help of trained public about prevalent scams and teers help fellow citizens and busi- volunteers, presented 76 outreach contain practical advice for consum- nesses resolve a wide array of con- programs in this biennium. The Bu- ers. The Bureau’s website lists the sumer complaints by informal me- reau’s outreach includes specially security breach notifications re- diation. The Bureau’s paralegals tailored seminars for high school ceived by the Attorney General’s work with the Consumer Affairs Spe- students, senior citizen groups, civic office and other noteworthy informa- cialists to handle the bulk of the organizations and business leaders. tion for the public. Consumers may cases in the Mediation Program. With the increase in identity theft also download complaint forms and This program allows the Bureau to concerns, many of the Bureau’s out- telephone log sheets to help them reach out to and assist thousands reach programs focus on preventing monitor telemarketing calls. Regis- more consumers and businesses identity theft and minimizing the tration forms for condominium and than it would otherwise be able to harm done to victims. Bureau attor- land sales can be downloaded as help. While the Mediation Program neys and staff have partnered with well. Consumers may also reach is voluntary on the part of the busi- print, radio and television media in the FTC's Do Not Call Registry from nesses, it is generally well received. an effort to reach wider audiences this site. In the biennium, 18 volunteers on an array of consumer issues as served in the Mediation Program, well. each working approximately six hours per week each, answering telephone calls and mediating individual cases.

In the biennium, approximately 3,200 cases were referred to the Mediation Pro- gram. The total restitution recovered for consumers in the form of money, goods or services for Fiscal Year 2005- 2006 was $315,628, and $378,526 in Fiscal Year 2006 -2007, for a total of $694,155 in the last biennium. This represents an increase of nearly $113,000 over the last biennium.

The work of the Bureau’s volunteers is invaluable. Many consumers would not have received help but for the dedi- cation, commitment and out- standing success rate demonstrated by the volunteers. Their work represents the equivalent of at least two additional full-time employees and has allowed the Bureau to positively impact the lives Consumer Affairs Specialist and volunteer, Harold Moldoff, educates consumers about the pitfalls of identity of many more individuals than theft.

18 Consumer Protection and Antitrust Bureau Enforcement Criminal Prosecutions/ Protection Act. A total fine of Enforcement $500,000 was imposed. Administrative Subpoenas Criminal prosecution of consumer • State v. Michael Higgins (charged Under the Consumer Protection Act, protection violations continues to be Feb., April and May of 2006) the Attorney General has the author- a priority of the Bureau. The nature ity to subpoena businesses, docu- of the numerous complaints re- Defendant was charged with two ments and witnesses whenever it ceived by the Bureau has mandated misdemeanor charges of unfair or believes a violation of the Consumer that it focus its efforts particularly on deceptive business acts or practices Protection Act has occurred. During home contractors. The following are and was indicted on three felony the biennium, the Bureau issued 23 a sampling of the criminal matters charges of theft. Defendant pled subpoenas in an effort to investigate pursued by the Bureau: guilty to two misdemeanor unfair or and resolve consumer protection deceptive business acts or practices cases. • State v. Allen Greene (indicted charges. He was sentenced to a Feb. 16, 2006) deferred and suspended sentence Civil/Equity Actions and was ordered to pay restitution in Defendant, a contractor, pled guilty a total amount of $80,810. During the biennium, the Bureau to one theft indictment and waived filed 7 new consumer protection indictment to another felony theft • State v. Tracy Dale Atwater civil/equity suits and resolved a indictment. He was sentenced to 12 (indicted Dec. 1, 2005) number of other cases involving a months at the House of Corrections, wide variety of unfair and/or decep- stand committed and restitution in Defendant, a contractor, was tive trade practices. One major the amount of $35,789.68 and a 1½- charged with five felony charges of case, Simon Property Group Gift- 3 years suspended sentence at the theft. After trial, a jury found the de- Cards, resulted in a settlement of New Hampshire State Prison, with fendant guilty and the court sen- $440,000 restitution for consumers restitution in the amount of tenced him to 4-10 years at the New whose cards were debited to pay $387,859.20. Hampshire State Prison. He was fees the State claimed were illegal. ordered to pay total restitution in the (Please see sidebar for further de- • State v. Horizon Travel, et al amount of $26,425. tails of this litigation.) (indicted Feb. 8, 2007) • State v. James Moran (Motion to Defendant, a buying club selling Bring Forward Suspended Sentence travel services, was charged with 5 of Incarceration filed July 26, 2007) criminal violations of the Consumer

Simon GiftCards Case

The Consumer Protection Act regulates gift certificates and prohibits expiration dates and administrative fees that reduce their redeemable value.

Simon Property Group owns or manages the Mall of New Hampshire, the Rockingham Park Mall, and the Pheasant Lane Mall and sells gift cards that bore expiration dates and outlawed administrative fees. In late 2004, the Bureau contacted Simon and demanded that they comply with the law. In response, on November 12, 2004, Simon filed suit in Federal court claiming that state law does not apply because the cards were issued by Bank of America, a national bank that is not subject to state law. On November 15, 2004, the Bureau filed suit in Merrimack County Superior Court against Simon for violations of the Consumer Protection Act.

In early 2006, the federal district court ruled that preemption applied to the sales of GiftCards after September 1, 2006, when Simon had entered into a new arrangement with US Bank and Metabank and severed its ties with Bank of America. The State appealed this decision to the First Circuit Court of Appeals, which upheld the district court’s ruling. The State sought a review of the decision by the United States Supreme Court; however, that request was denied.

On February 15, 2007, the State and Simon settled the suit related to GiftCards sold prior to September 1, 2005 and issued under Simon’s prior arrangement with Bank of America. The State received a payment of $440,000 as restitution for New Hampshire consumers whose cards either expired or were subject to administrative fees the State claimed were illegal. The Bureau is currently identifying eligible consumers and will distribute restitution accordingly.

19 Consumer Protection and Antitrust Bureau Defendant contractor had previously sold in the state. New Hampshire v. N.V. Sumatra, remains in litiga- received a suspended sentence of has enacted such statutes. tion. incarceration in 2004 conditioned Currently, over 455 different brands specifically on not further engaging of cigarettes and roll-your-own to- Assurances of Discontinuance in a contracting business. This ac- bacco are sold in New Hampshire, tion alleges the defendant violated by 54 different manufacturers, and The State has entered into Assur- that ban and should be held answer- through 77 different wholesalers. Of ances of Discontinuance pursuant to able to the Court. The matter is cur- these manufacturers, under 20 NH RSA 358-A:7 with several na- rently pending. (down from 31 in the last biennium) tional retailers who sell tobacco are NPMs who we are required to products. Pursuant to these Assur- Multi-State Litigation/Settlements ensure comply with New Hamp- ances, the retailers have agreed to shire’s escrow statutes. enhance their efforts to avoid to- During the biennium, the Bureau bacco sales to underage purchas- participated in seven multi-state ac- Master Settlement Agreement Com- ers. Among the actions the retailers tions in conjunction with other pliance have voluntarily agreed to establish states. The actions involved both are mandatory training of all sales- antitrust violations and unfair and Each quarter, all NPMs are required persons, the installation of software deceptive trade practices. The re- to report their sales in New Hamp- on cash registers that prompts the sulting Settlement Agreements se- shire to the Consumer Protection input of the purchaser's birth date cured close to $131,369 in settle- and Antitrust Bureau. Wholesalers when a tobacco product is sold, the ments and financial recovery, in ad- who sell in New Hampshire are like- placement of tobacco products and dition to money paid directly to con- wise required to report NPM product advertisements for such products sumers as a result of the settle- sales in New Hampshire to the Bu- away from products of interest to ments. reau. The NPM and wholesalers’ minors, mandatory compliance numbers are compared, and then checks, and retraining/termination Tobacco Activities they are compared with information for employees who violate the sales from the Department of Revenue policies of the retailer. In the past In 1998, New Hampshire, along with Administration regarding excise tax biennium, CVS and Conoco-Phillips 46 other states and 4 territories payments. If these numbers are not entered into such Assurances of joined in the Master Settlement reasonably close, further inquiries Discontinuance. Agreement (the "MSA") to end our are made to determine the cause of litigation against the four major to- the discrepancy. Once the actual Corrective Legislation bacco companies. The original par- sales volume of each NPM is veri- ticipating manufacturers ("OPMs") fied, the escrow funds are evaluated The State’s experience in enforcing agreed to reimburse the settling to ensure that adequate funds have the model escrow statute revealed states for their costs in the treatment been placed into escrow. If an NPM defects in the statutory language of tobacco-related illnesses. This has failed to abide by its escrow ob- that caused enforcement problems results in payments of approximately ligations, a warning letter is issued. for all Settling States. For example, $40 million to New Hampshire every If the NPM does not respond ade- the original NPM Act only allowed year. These payments, however, quately, the Bureau will file suit to the Bureau to take enforcement ac- are not automatic. A complex for- enforce the escrow statute, or will tion after an entire year of noncom- mula is used every year to deter- remove the NPM’s products from the pliance had passed. Then, the only mine the amount that the State will directory of permissible tobacco avenue for enforcement was through receive. Among the factors that products, thereby barring further a lawsuit, which would result in an have an effect on the final payment sales into New Hampshire until such award of damages and an order are nationwide sales of tobacco time as the NPM comes into compli- banning the noncompliant manufac- products, the percentage of sales by ance. turer from selling in New Hampshire. OPMs compared to the sales by These were flaws in the model stat- non-participating manufacturers The ability to administratively re- ute that hindered the ability to en- ("NPMs"), or those small tobacco move noncompliant product from force the Act. producers who did not join in the sale in the State has lessened the MSA, the rate of inflation and other need for litigation to enforce the es- To correct these defects, the Legis- factors. crow statutes. This saves the State lature enacted RSA 541-D, which unnecessary expenditures of both establishes the directory of tobacco The MSA requires each settling time and money. Thus, litigation is products eligible for sale in New state to enact a statute which re- no longer the Bureau’s main means Hampshire due to their manufacturer quires NPMs to establish an escrow of MSA enforcement. In the past being in compliance with either the account in favor of each state and to biennium, the State removed the terms of the MSA or, for NPMs, be- pay into the escrow account a cer- products of seven manufacturers ing in compliance with RSA 541-C, tain amount, usually between one from the list for noncompliance or the Escrow Statute. Before a whole- and two cents, for each cigarette other reasons. Only one matter, NH saler may sell a product in the State,

20 Consumer Protection and Antitrust Bureau that wholesaler is required to check The NPM Adjustment and Diligent Actions Against Pharmaceutical the Directory to determine whether Enforcement Manufacturers that product may legally be sold in the State. This is significantly more In late 2005, it was determined that Much activity has recently taken efficient and cost-effective than the a NPM Adjustment for the year 2003 place in the pharmaceutical field. prior system, which required the was applicable to all state signato- The pharmaceutical industry con- State to litigate after the fact when a ries of the United States. New sists of two types of manufacturers - wholesaler sold nonconforming Hampshire’s April 15, 2006 payment those who are research-based and product in the State. was reduced by $5.3 million. This the generic manufacturers. The re- pattern repeated itself in 2007 rele- search-based manufacturers con- The "Allocable Share Amendment" vant to an NPM Adjustment for the duct research with the hopes of de- was passed to close a loophole in year 2004, and New Hampshire’s veloping new and profitable drugs. the Escrow Statute which served to April 15, 2007 payment was dimin- The generic manufacturers wait for encourage NPMs to identify one or ished by just under $4.3 million. the patents to expire on new drugs two small states as the market for New Hampshire filed suit in Superior and then make low-priced copies of the bulk of their sales. Because ulti- Court, claiming that pursuant to the those drugs. mately the escrow obligation of each MSA, the NPM Adjustment would manufacturer was based upon the not apply to any State that had not Therefore, the research-based nationwide sales of the manufac- been determined to have failed to manufacturers’ ability to earn a profit turer's products, by concentrating diligently enforce its NPM Act for the on their discoveries diminishes when sales in only one or two small states, year in question, and since no state their patent protection ends. As a a manufacturer could escape its ob- - including New Hampshire - had result, attempts to extend patent ligation to escrow funds. One manu- been identified as having failed to do protection beyond the patent's statu- facturer in particular managed to so, the PMs had no right to keep the tory time limit are increasing. Re- reduce its overall escrow liability in funds from the States. search-based pharmaceutical manu- New Hampshire from over $3 million facturers have also paid generic to less than $30,000 by making use Rather than contest NH’s diligent manufacturers not to produce drugs of the loophole contained in the law enforcement, the PMs challenged when the patent expires. These ac- prior to the amendment. whether the Superior Court was the tivities are attempts to maintain a proper forum. They claimed that an monopoly after the legal protection Quarterly reporting requirements arbitration clause in the MSA applied afforded by a patent expires. The have greatly increased compliance to this dispute. This Bureau vigor- resulting violations of antitrust laws with the MSA by allowing a "rapid ously defended its position in court, have been vigilantly prosecuted by response" by the State in the event but the Superior Court agreed that the states, along with the federal a manufacturer fails to meet its obli- the matter was subject to the arbitra- government. gations under the MSA. Prior to tion clause. This Bureau appealed, quarterly reporting, manufacturers and the New Hampshire Supreme The Bureau has participated in in- and wholesalers were required to Court affirmed the decision of the vestigations involving the following report their sales and escrow pay- Superior Court. We are now prepar- drugs and manufacturers in the last ments annually. Thus, the manufac- ing for the arbitration procedure. biennium: turer could be behind on its escrow obligations for a year or more before Antitrust Activities Cardizem Antitrust — Open the State would be alerted to the Purdue Pharma Antitrust — Open deficiency and take action. With The Bureau’s antitrust enforcement Relafen Antitrust — Closed quarterly reporting, such arrearages activities have generally been under- Remeron Antitrust — Closed are detected before the year is out, taken in concert with other state an- Perrigo & Alpharma creating a more efficient enforce- titrust bureaus. Most antitrust ac- antitrust — Closed ment process. tions are undertaken through the Taxol — Closed states' authority to enforce federal The combination of the amendments antitrust laws as well as native juris- Non-Pharmaceutical Antitrust Mat- to RSA 541-C and the addition of diction under state antitrust statutes. ters RSA 541-D has allowed the Bureau The scope of an antitrust enforce- to bar the distribution of noncompli- ment action is nearly uniformly multi- The Bureau has also undertaken, on ant product without the expense and state, as most violations and viola- a multistate basis, antitrust investi- delay of litigation. Simply by remov- tors exist across state borders. By gations and actions, primarily based ing a noncompliant manufacturer’s pooling resources states have found on charges of either price fixing or brand from the public directory, that they can prevail against large, monopolization, against entities these products are eliminated from even multinational, corporations other than pharmaceutical manufac- the marketplace in New Hampshire. when they violate antitrust statutes. turers. These are:

21 Consumer Protection and Antitrust Bureau Bentley Systems — Open selves, who purchased untold num- Since its inception in October 2006, Casket manufacturers and funeral ber of items containing DRAM chips. the Unit has received over 110 refer- homes — Closed rals of elder abuse, neglect, self- Dairy Farmers of America — Open New Hampshire joined this lawsuit in neglect and financial exploitation. First Data Bank — Open hopes of recouping some of the ex- Referrals come from a variety of DRAM Manufacturers — Closed cess payments made. However, the sources including law enforcement, State and its citizens were, in almost the Bureau of Elderly and Adult Ser- Antitrust Legislation all cases, indirect purchasers of the vices at the New Hampshire Depart- tainted goods. As the litigation pro- ment of Health and Human Ser- New Hampshire’s Combinations and gressed, it became clear that the vices, attorneys, phone calls from Monopolies Act, RSA 356, adopted Court was not sympathetic to any victims, or letters sent to the Attor- nearly a century ago, has routinely claim by any state that had not au- ney General’s Office from victims, been interpreted as being in agree- thorized recovery for indirect pur- their friends, or their relatives. Ap- ment with federal antitrust law. Most chasers. New Hampshire ultimately proximately 70 percent of the refer- federal antitrust law, however, is not withdrew from that lawsuit, and this rals to the Unit involve some form of legislative in nature, but is based on Bureau concentrated on obtaining financial exploitation. common law decisions and rulings the amendment to the state Combi- by the federal courts. One issue nations and Monopolies Act that In December 2006, the Unit suc- that has been the subject of federal now allows suits by indirect purchas- cessfully prosecuted the first case of court rulings is the question of who ers. elder neglect in the State of New has standing to sue for an antitrust Hampshire under a 2002 statute that violation. A number of U.S. Su- Elder Abuse and Financial makes elder neglect in New Hamp- preme Court opinions have estab- shire a felony. In State v. Danna lished an unusually complex answer Exploitation Unit Folden, a Goffstown woman was to that question related to indirect convicted of failing to provide her purchasers of goods or services The Elder Abuse and Financial Ex- 91-year-old mother with the proper where an antitrust violation has oc- ploitation Unit was created in 2006 care necessary to maintain her life. curred somewhere in the chain of to raise awareness about elder The victim developed an ulcer on distribution. The U.S. Supreme abuse, train law enforcement offi- her back that became infected with Court has held that only the party cials in the identification and re- meningitis and ultimately caused her who purchases directly from the vio- sponse to cases of suspected abuse death. lator is allowed to bring suit. How- or neglect, and to prosecute offend- ever, the Court has also held that its ers state-wide on a consistent basis. Other early successes of the Unit rule on indirect purchasers only include the conviction of Manchester binds those states that have not leg- Currently, the Unit consists of one resident Adam Rossi for assaulting islatively provided indirect purchas- prosecutor and available support his grandmother in March 2007. In ers with the right to recover for anti- staff of paralegals and investigators, May 2007, the Unit also secured an trust violations. all of whom seek to accomplish the indictment on a Tilton man for two Attorney General’s goals of in- counts of felony-level fraudulent use This year, the New Hampshire Leg- creased awareness, prevention, and of a credit card. In that case, the islature amended RSA 356 to pro- prosecution. defendant (a licensed nursing assis- vide for a right of recovery for indi- tant hired to care for the elderly and rect purchasers. The need for this The term “elder abuse” encom- disabled victim) stole the victim’s change was made fully apparent as passes both physical abuse and fi- credit cards and used them to make this Bureau pursued a multistate nancial exploitation of persons 60 personal purchases throughout antitrust action against manufactur- years of age or older. Physical Belknap and Merrimack Counties. ers of dynamic random-access abuse includes assaults, sexual memory chips (DRAM). DRAM abuse, neglect and psychological In addition to prosecuting cases of chips are components in nearly abuse typically in the form of physi- elder abuse, neglect, and financial every electronic consumer item, cal threats of harm. Financial ex- exploitation, the Unit is charged with from microwave ovens to computers ploitation includes theft of personal improving the state’s ability to re- to portable music players. That mat- effects (money, jewelry, or other spond to, and investigate cases of ter came about after several DRAM valuable assets) typically committed suspected elder abuse, neglect and manufacturers pled guilty to criminal by a perpetrator who has gained and exploitation. On May 2, 2007, the price-fixing charges brought by the then violated the victim’s trust. Unit hosted the first Elder Abuse and U.S. Department of Justice. After Common examples of financial ex- Neglect Investigation Conference, that plea, many states filed a civil ploitation include telemarketing fraud drawing 125 members of law en- suit, seeking restitution for both their such as bogus charities, investment forcement, emergency medical ser- citizens who had paid inflated prices scams, or the all-too-common vices, and adult protective services for DRAM and for the states them- fraudulent lotteries. from across the state.

22 Consumer Protection and Antitrust Bureau Since October 2006, the Unit has ment to an insurance company by a collected by the Bureau in connec- conducted trainings at the NH Police claimant. Insurance related criminal tion with these regulatory activities. Academy, the Office of the NH Medi- activity includes crimes such as theft cal Examiner, police and fire depart- of premiums, forgery by insurance Health Clubs ments throughout the state, and for agents, perjury at workers’ compen- members of the Rockingham Ambu- sation hearings, theft of money by The bureau registered 401 health lance Service. The Unit has also fake insurance companies, unli- clubs during the biennium. The Bu- spoken to the Goffstown Rotary, censed producers, and forged work- reau aggressively sought out health senior groups and appeared on ers’ compensation insurance certifi- clubs that were not complying with Derry Public Access Television. cates. Many of these crimes have a the statutory registration require- more direct impact on consumers ment. Fees from registration of In 2007-2008 it is anticipated that than claims fraud. health clubs totaled $40,100. One the Unit will be actively involved with gym, World Gym, closed unexpect- the Incapacitated Adult Fatality Re- The Insurance Prosecutor has edly and without notice to consum- view Committee. The purpose of played an active role in developing ers. The Consumer Protection Bu- the committee is to study fatalities of legislation to strengthen insurance reau then filed a stipulated judgment incapacitated adults in NH to deter- law protections and to ensure appro- in order to access the $50,000 bond mine what, if any, systemic changes priate criminal sanctions. As this that the gym had posted. The bond need to be made to prevent such new unit was only recently opened, was paid to the State, which has so deaths and to improve the state’s only one case was initiated during far reimbursed approximately 100 ability to respond to the needs of this biennium. This case, State v. consumers a total of $19,167. incapacitated adults. The Attorney David Burbine, involved an insur- General’s Office is charged with ad- ance producer (agent) who forged a Other Registrations ministering the committee and filing client’s name to a policy amendment annual reports with the Governor’s document that eliminated the disabil- Fourteen automatic telephone dial- office. ity rider to the policy. The client did ers registered with the Bureau dur- not find out about it until he was in- ing the biennium. Those telemar- Insurance Prosecution Unit jured and attempted to collect on the keters using pre-recorded messages disability portion of the policy. When must file and pay a $20 filing fee. At the end of Fiscal Year 2005, the questioned by a Insurance Depart- Only one distributorship was regis- Legislature approved funding for a ment Fraud Unit investigator, the tered during the biennium. The Bu- specialized Insurance Fraud Prose- defendant admitted to signing the reau registered 241independent liv- cutor. The Insurance Prosecution client’s name. The defendant pled ing retirement communities this bi- Unit was launched in February, 2006 guilty. ennium. with the hiring of this Prosecutor by the Insurance Department. While an Registration/Regulation RSA 151:31 requires all hospitals in employee of the Insurance Depart- the State of New Hampshire to file ment, this prosecutor works under Condominium and Land Sales an annual report with the Bureau the supervision of the Attorney Gen- detailing the relationship between eral’s Office pursuant to RSA 7:13. During the biennium, the Bureau the hospitals and Physician Hospital The creation of this new position has issued 196 certificates of registration Organizations. It also requires the been praised nationally by the in- or exemptions for subdivisions under Bureau to report a summary of the surance industry and others. The the Land Sales Full Disclosure Act results annually to the legislature. Prosecutor handles both Insurance and 177 certificates of registration or Twenty-four New Hampshire hospi- Fraud and insurance related criminal exemption under the Condominium tal and health care provider institu- activity. Insurance Fraud is defined Act. The State derived $287,500 in tions have filed reports. The Bureau by statute as a false material state- revenues from the application fees submits an annual report to the leg-

Number of New Cases Opened in the APU 200

Number of APU Cases Closed (including cases from previous term) 237

Number of APU Cases Resulting in License Suspension, Surrender or Revocation 45

Number of APU Cases Resulting in Confidential Letters of Concern 49

Number of APU Cases Resulting in No Discipline 79

Total Fines Issued in APU cases $101,200

23 Consumer Protection and Antitrust Bureau islature based on the information carried forward from the previous ated with the Board by providing received from the hospitals. biennium. documentation of treatment and follow-up support services until de- Administrative A sample of the matters handled clared fit to return to part-time work. during the biennium by APU for their The practitioner was reprimanded

Prosecutions Unit client boards follows. but continued to practice under supervision and with conditions of on- The Bureau's Administrative Prose- Professional Engineers Board going follow-up care. cutions Unit (APU) regularly investigates and prosecutes professional APU negotiated three settlement Board of Dental Examiners misconduct cases before the follow- agreements for unprofessional con- ing New Hampshire licensing bod- duct by licensed engineers. One APU assisted the Board with the ies: The Board of Allied Health Pro- case involved an engineer who investigation and prosecution of sev- fessions; the Board of Chiropractic failed to follow statutory require- eral dentists and dental hygienists. Examiners; the Board of Dental Ex- ments after the Board’s mandate. In one matter, the Board disciplined aminers; the Joint Board of Licen- The engineer was reprimanded and a dentist for improperly dispensing sure and Certification; the Board of fined $1,000. A second engineer controlled medications and inade- Mental Health Practitioners; the was disciplined for misuse of the quate record keeping. The dentist Board of Pharmacy; and the Board engineer's professional stamp. The also failed to secure the controlled of Veterinary Medicine. During the engineer was reprimanded and fined medications. The dentist was re- biennium, the APU also investigated $4,000. The third engineer was quired to pay a fine and participate and/or prosecuted cases for the found to have misrepresented ex- in continuing education. Board of Accountancy, the Board of penditures for reimbursement on The Board disciplined a dentist for Registration in Podiatry and the Real company expense reports. He was unprofessional, disruptive behavior Estate Appraisers Board. reprimanded and fined $10,000. in the work place. The dentist was fined and required to participate in Two attorneys, an investigator and a Board of Pharmacy remedial measures including arrang- paralegal staff the Administrative ing for sexual harassment training Prosecutions Unit. In those cases The Board disciplined several phar- for his employees. that were heard by an administrative macies, one pharmacy supply com- Board at which an APU attorney pany, and numerous pharmacists The Board held a hearing on a prac- acted as hearing counsel, two re- and pharmacy technicians. Each titioner who failed to abide by the sulted in a reprimand or required the business was reprimanded and Board's orders and the conditions of licensee to take remedial measures; fined. A medical supply company a settlement agreement. APU com- eight resulted in license denial, sus- was fined $29,000 for its part in an municated with the dentist to obtain pension or revocation; and two re- interstate cooperative that sent his cooperation in following the sulted in dismissal. In some cases, counterfeit medications into the mar- Board's orders and the Settlement multiple hearings were necessary to ketplace. Agreement. The dentist failed to reach a final disposition. comply with the Board's orders in Physical Therapy Governing Board full, resulting in his license being Settlements after investigation re- suspended after two further hear- sulted in 45 license suspensions, APU helped the Board investigate ings. surrenders or revocations; 49 confi- and prosecute a physical therapist dential letters of concern; and 79 who was practicing without a valid Board of Medicine findings of no discipline warranted. license. The Board also disciplined In addition, the boards assessed a physical therapy assistant who APU helped the Board investigate $101,200 in fines in the biennium in took medication from a client during and prosecute six case involving cases prosecuted by APU lawyers a home visit. The physical therapy violations of the physician/patient and investigators. $29,000 of the assistant's license was suspended relationship. assessed fines were conditionally and the completion of remedial edu- stayed or suspended. cation and substance abuse treat- Three of these cases involved sex- ment was required prior to reinstate- ual misconduct with a patient. In The APU opened 200 cases in fiscal ment. two of the cases, the Board issued years 2005 and 2006. The largest Emergency Orders suspending the number were opened for the Board Respiratory Care Practitioners Gov- physicians' licenses for five years, of Medicine (57), the Board of Den- erning Board and requiring each to participate in tal Examiners (32), the Board of extensive remedial education and Pharmacy (29), and the Board of A respiratory care practitioner was treatment. The Board held a hearing Mental Health Practice (27). found to be practicing while im- in the third case in a case where a The APU closed 237 cases during paired. The practitioner was placed physician developed a romantic rela- the biennium, including many cases on a leave of absence and cooper- tionship with a patient. His license

24 Consumer Protection and Antitrust Bureau was suspended for five years and he practitioner's home life by engaging the licensee, required an appropriate was fined. the patient in activities with the prac- log of all animal deaths, required titioner's family members while the participation in continuing education Two physicians were found to have therapeutic relationship was on- and imposed a fine. violated the physician/patient bound- going. This practitioner received a ary by allowing a personal relation- five-year suspension and require- Board of Chiropractic Examiners ship with the patient to blur their pro- ments for mental health treatment. fessional judgment. In the first In another case, a practitioner was APU assisted the Board in the boundary violation case, the physi- alleged to have taken controlled, prosecution of a practitioner who cian's untreated alcohol dependence prescription medications belonging failed to maintain adequate patient contributed to the misconduct. After to a client during the practitioner's records. The licensee signed a Set- significant education and treatment, home visit. The matter had been tlement Agreement and agreed to his license was suspended for two investigated by the local police de- provide the Board with documenta- years and specific practice condi- partment and a not guilty verdict had tion of remedial measures and to tions and supervision were ordered been returned after trial. The obtain further education. In a sec- prior to the Board's consenting to a Board's investigation revealed that ond case, it was discovered that the return to practice. In the second the practitioner was suffering from same licensee failed to provide re- case, the physician was found to substance addiction and the licen- cords to patients in a timely fashion. have prescribed controlled sub- see surrendered her license. During the investigation, it was stances for a friend and colleague learned that the licensee engaged in without maintaining an appropriate Board of Veterinary Medicine sexual misconduct with a patient. In record of the treatment. This physi- addition, the practitioner failed to cian was reprimanded, fined, and APU prosecuted a licensee whose abide by the prior settlement agree- required to complete continuing edu- misconduct resulted in the death of ment. The practitioner agreed to a cation. two animals. In the first instance, second settlement suspending her the licensee failed to conduct an license for five years. Additional Board of Mental Health Practice adequate preoperative work up on a terms of the settlement require that small animal who had a fatal reac- the licensee complete a psychologi- The Board accepted a voluntary sur- tion to anesthesia. In the second cal evaluation prior to reapplying for render of license from two practitio- case, the practitioner failed to docu- licensure. ners. In one case the practitioner ment preoperative findings and em- was found to have breached the ployed a less common method of APU prosecuted a licensee who therapist/patient relationship by ex- administering anesthesia prior to failed to respond to the Board's in- tensively involving the patient in the surgery. The Board reprimanded quiry about a complaint. The under-

Consumer Protection and Antitrust Bureau Biennium At-A-Glance

Number 1 Consumer Complaint Fuel oil and energy sales Consumer Hotline 30,000 calls Written Consumer Complaints 7,000 Outreach programs 76 Consumer Restitution in Mediation Program $694,155 Restitution Obtained From Multi-State Actions $131,569 Number of Criminal Prosecutions Initiated 8 Condominium and Subdivision Applications Processed 373 Condominium and Subdivision Fees Collected $287,500 Health Clubs Registered 401 Distributorships Registered 1 Automatic Telephone Dialers Registered 14 Number of Cases Opened in APU 200 Total Fines Issued in APU Cases $101,200

25 Consumer Protection and Antitrust Bureau lying complaint was that the licensee failed to release patient x-rays and failed to reimburse the patient for gift certificates for services purchased before the licensee closed the practice. The licensee provided the x-rays and reimbursed the patient. The Board accepted a Settlement Agreement reprimand- ing the licensee for her conduct.

The Board reprimanded a practitioner for inappropriate commentary and conduct while examining a patient. The practitioner was required to pay a fine and participate in continuing education.

Land Surveyors Governing Board

APU negotiated two settlement agreements with land surveyors. The first case involved incompe- tent surveying and inadequate record keeping. The licensee was fined, ordered to take continuing education, and subjected to peri- odic record review.

In the second case, the licensee billed for unauthorized services, misused his professional stamp and produced substandard work. He was ordered to take continuing education and adhere to supervision requirements.

26 Consumer Protection and Antitrust Bureau

Environmental Protection Bureau

The Environmental Protection tect the public interest and to both as an individual and under Bureau ("EPB") is comprised of bring public nuisance actions in the name of Black Oaks Laco- six attorneys, two paralegals, the name of the state. During nia, LLC, erected a road through and a legal secretary. Among the last biennium, the EPB has wetlands on land owned by Ori its many roles in state govern- taken an active role in multi- Ron of Saugus, Massachusetts ment, the EPB enforces environ- state initiatives to protect air and without first obtaining a dredge mental laws and rules through water quality in New Hampshire, and fill permit from DES. He administrative, civil, and criminal and in consultation with the cli- also clear-cut more than actions. It also provides legal ent agencies, has pursued viola- 100,000 square feet of land counsel and representation to tions of federal and state laws owned by Black Oaks Laconia, state agencies for the protection, and rules regarding air pollution, LLC, without obtaining a site- control, and preservation of the storage and disposal of septage, specific permit from DES. The State’s environment and to pro- solid waste and hazardous EPB, in conjunction with the tect human health associated waste, oil discharges, ground Belknap County Attorney’s Of- with hazardous environmental and surface water quality rules fice, pursued criminal charges conditions. Some agencies rep- and other laws designed to pro- against Shaughnessy and Black resented by the EPB are the tect human health and the envi- Oaks Laconia. Following a jury Department of Environmental ronment. trial, Shaughnessy was found Services (“DES”) and the Fish & guilty of two Class A misde- Game Department. EPB attor- Environmental Crimes meanors (Unpermitted Terrain neys also represent other state Alteration, RSA 485-A:17 and agencies in bankruptcy matters, The EPB investigated seventeen 485-A:22 and Unpermitted Fill in including the Department of criminal cases in the biennium. Wetlands, RSA 482-A:3, I and Revenue Administration, the With the assistance of DES, RSA 482-A:14, I). Black Oaks Liquor Commission, and the state, county, and local law en- Laconia, LLC was found guilty of Department of Labor. The forcement, and the United one felony charge of Unpermit- cases and matters cited in this States Environmental Protection ted Fill in Wetlands and one Report are only a sampling of Agency, the EPB prosecuted Class A misdemeanor the work performed by the EPB numerous environmental crimes, (Unpermitted Terrain Alteration). on a daily basis. some ending with plea agreements and others ending after On July 2, 2007, the Court sen- Environmental trial and conviction. tenced Shaughessy to one year in the house of corrections, forty Enforcement in Successful prosecution of envi- -five days to be served, and the

New Hampshire ronmental crimes is a vital part balance suspended for five of the EPB’s work. Not only years, a $2,000 fine and two The General Court has provided does sentencing provide for in- years of probation. Black Oaks the Attorney General and the carceration, fines, or both, but Laconia, LLC, received a Department of Environmental generally the sentence will also $100,000 fine with $50,000 of Services (DES) with legal au- provide for remediation or resto- that fine suspended for a period thority to protect public health ration of the affected area. Miti- of ten years on the wetlands and the environment and to pre- gation of environmental injury is conviction. Both defendants serve the natural resources of crucial in order to protect New were ordered to remediate the the State of New Hampshire. Hampshire’s wetlands, forests, harm done to the wetlands Rules promulgated by the Com- groundwater and shoreland. caused by the construction of missioner of DES pursuant to Also, a guilty verdict in an envi- the road. On the terrain altera- environmental statutes have the ronmental case sends a strong tion convictions, the Court sen- force of law and, in addition to message to the public that viola- tenced Shaughessy to one year the statutes, are enforced by the tions of environmental law will in the house of corrections, Environmental Protection Bu- ultimately result in significant which he suspended for a period reau. There are provisions in penalties and even incarcera- of five years, and a $2,000 fine, the law that provide for adminis- tion. which was also suspended, and trative, civil and criminal en- two years of probation. Black forcement of environmental • State v. Edward Shaughnessy Oaks Laconia, LLC was sen- laws. The EPB also has author- and Black Oaks Laconia, LLC tenced to a $10,000 fine, which ity to use the Attorney General’s was suspended in full for a pe- common law authorities to pro- In 2005, Edward Shaughnessy, riod of five years on the terrain

27 Environmental Protection Bureau alteration conviction. During the abatement without being properly • State v. Elementis Chemical sentencing hearing, the Court noted licensed to do so. As of the end of that the violations were “not insignifi- the biennium, a third person, Celso On August 15, 2001, DES personnel cant” and that they were “deliberate Gervacio, faced trial for one felony inspected an abandoned facility and extensive”. count of certifying a false statement. owned by Elementis Chemical and found significant violations of the • State of New Hampshire v. Richard Civil Enforcement of Hazardous Waste Act. The facility Porter was not secured from trespassers or

Environmental Laws vandals. They found acetic acid, On November 2, 2005, a Grand Jury combustible waste, and various indicted Richard Porter on eleven During the biennium, the EPB tanks, drums and containers poten- felony counts of forgery, one felony opened approximately 47 new civil tially containing hazardous waste. count of fraudulent handling of re- environmental enforcement matters. They immediately issued an Immi- cordable writings, and seven misde- EPB attorneys filed contempt mo- nent Hazard Order, stating, meanors, all of which have elements tions in at least nineteen cases dur- “[Elementis], as the owner and op- of fraud. Mr. Porter had used an- ing the biennium to enforce the erator of the Facility where the other individual’s signature stamp to terms of settlements or other court waste is located, has liability under execute five checks totaling orders. RSA 147-A:9. By abandoning this $329,500. Those checks were waste, [Elementis] has created an drawn on closed accounts. He also Not only does the EPB litigate mat- imminent threat to human health and falsified subdivision plot plans to be ters in the State’s Supreme and Su- the environment pursuant to RSA recorded at the Rockingham County perior courts, EPB attorneys often 147-A:13.” The EPB then filed suit Register of Deeds and DES, made a appear in front of administrative ad- against Elementis to comply with false report to law enforcement per- judicatory bodies that are appointed DES’ orders. Following lengthy sonnel, misused a surveyor’s stamp, by the Governor. When a citizen court proceedings, including two and failed to deliver a valid title to disagrees with a decision that an appeals to the Supreme Court, on the buyer of a motor vehicle he pur- agency has made, the applicable April 30, 2007, Elementis was found ported to own. Mr. Porter is a fugi- board or council may hear the ap- responsible for violations of the haz- tive from justice and has not been peal with EPB attorneys often repre- ardous waste laws, and remitted a tried. senting DES. check for $95,100 in payment of civil penalties. • Falsification of Asbestos Waste Abatement Training Documents Water The EPB’s waste management en- Samuel E. Rosario Moreta and Car- forcement cases were brought under Many of the EPB’s enforcement los A. Williams Miranda were both the Hazardous Waste Management cases involve the illegal dredging charged with certifying on DES as- Act, RSA chapter 147-A, the Haz- and filling of wetlands or the con- bestos abatement license applica- ardous Waste Cleanup Fund, RSA struction of unpermitted facilities tions that the information they sub- 147-B, the Solid Waste Manage- over or adjacent to state waters, mitted with the application was true ment Act, RSA chapter 149-M, as both governed by the Fill and to the best of their knowledge and well as the Oil Discharge or Spillage Dredge in Wetlands Act, RSA chap- belief. Both defendants knowingly Act, RSA chapter 146-A and the Un- ter 482-A. The EPB also brought submitted falsified training certifi- derground Storage Facilities Act, actions under the Comprehensive cates with their applications. RSA chapter 146-C. Shoreland Protection Act, RSA Miranda pled guilty to one felony chapter 483-B, the Water Pollution count of certifying a false statement Pursuant to RSA 149-M:9, the EPB and Waste Disposal Act, RSA chap- and one felony count of identity conducts comprehensive back- ter 485-A, and the Safe Drinking fraud. He was sentenced to two ground investigations on companies Water Act, RSA chapter 485. concurrent terms of six months in and key personnel who apply for the house of corrections with five solid or hazardous waste permits. • State of New Hampshire v. Joseph months suspended for a period of The purpose is to ensure that those and Rose Marino one year. Moreta pled guilty on entrusted to store, transfer, treat or February 22, 2007 to one misde- dispose of solid waste are law- State of New Hampshire Depart- meanor count of Tampering with abiding citizens who have sufficient ment of Environmental Services v. Public or Private Records and was integrity and honesty to hold a dis- Joseph and Rose Marino went to sentenced to six months at the posal permit from the State. In the trial on August 24, 2006. The trial house of corrections, which sen- biennium, the EPB conducted and court found that the defendants con- tence was suspended in full for a reported to DES on eight back- structed a fully functional single- period of two years, and fined ground investigations. family home on Back Lake in Pitts- $1,000. Both defendants were or- burg, New Hampshire without any dered not to perform any asbestos State approvals. The defendants

28 Environmental Protection Bureau did not seek, nor did they receive, a sought an order to correct ex- particles come to New Hampshire septic system permit from DES. The ceedances of methane and other from coal-burning power plants lo- defendants also violated the State emissions, to expand the landfill gas cated in upwind Midwestern states, Shoreland Act by constructing a pri- collection system in a timely man- as well as from motor vehicles. The mary residence within fifty feet of the ner, to maintain cover integrity, to small particles can cause severe shoreline. The trial court noted that timely install sufficient density of gas illness, especially in children and when DES informed the Marinos collectors, to report exceedances those with respiratory ailments. The that they needed to cease construc- and to properly monitor gas collec- case is in its early stages before the tion immediately, they did not stop. tion wells. The Petition also alleged U.S. Court of Appeals for the District Instead, they told their builder to federal and state New Source Re- of Columbia. “rush to completion”. Following the view violations. The negotiated set- two-day trial, Judge Vaughan ruled tlement required WMNH to pay a The EPB has also been actively par- that the Marinos had knowingly dis- total civil penalty of $1,750,000 and ticipating in enforcement and EPA regarded environmental laws. The to exceed minimum environmental rulemaking initiatives regarding order required the Marinos to obtain requirements for controlling and “New Source Review” or “NSR,” a septic system approval from DES, to monitoring landfill gases. The settle- Clean Air Act requirement that major obtain a wetlands permit for work on ment monies were used to fund part emitters update their pollution con- the bank, and to obtain authorization of the University of New Hamp- trols when they make any changes under the Shoreland Act. Any com- shire’s landfill gas-to-energy project that could affect their emissions. ponent of the home that could not be and to fund energy efficiency pro- After years of litigation, New Hamp- approved was subject to removal. jects in the cities of Rochester and shire, along with the other plaintiff The court also fined the defendants Dover. states, citizen plaintiffs, and the fed- $65,000. The Court specifically eral government, reached settlement noted that the Mr. Marino’s conduct Multi-State Air Litigation with American Electric Power, the “showed a callous disregard for the nation’s largest utility, resolving the rule of law”. The Superior Court’s During the biennium, the EPB con- claims filed in U.S., et al. v. AEP. decision was appealed by the defen- tinued its active involvement in multi- The settlement requires AEP to re- dants to the New Hampshire Su- state litigation to enforce the critical duce emissions from power plants preme Court where it was upheld. provisions of the federal Clean Air by as much as 800,000 tons per Act, which protect New Hampshire’s year. To accomplish this, AEP will • State v. Badger’s Island citizens from air pollution trans- reduce emissions from many plants ported from upwind states. For ex- whose emissions reach New Hamp- In 2006, the EPB filed a complaint ample, in 2006, the EPB joined other shire. The cost of the equipment against the owners of a 100 foot states in challenging rules adopted needed to achieve these reductions long barge holding a 3 bedroom 2- by the United States Environmental will cost as much as $4.5 billion. In story house that was sunk and Protection Agency (“EPA”) to regu- addition, AEP will pay $15 million in abandoned on the bank and bottom late mercury emissions from power civil penalties and $60 million to- of the Piscataqua River in Newing- plants (New Jersey, et al. v. EPA). wards environmental mitigation pro- ton. A settlement was reached and The states allege that the rules are jects. The federal district court for the barge was removed in the sum- too lax, adopt an illegal cap and the Southern District of Ohio must mer of 2007 at the expense of the trade program for mercury and do still approve the settlement. An im- owners, Badger’s Island, LLC. not protect citizens that live near portant victory was handed down power plants from mercury hotspots. from a federal appeals court in a • State of New Hampshire v. Waste The case has been submitted to the multi-state challenge to EPA reforms Management of NH, Inc. United States Court of Appeals for to the “routine maintenance exemp- the District of Columbia Circuit and a tion” to the federal NSR rules (NY, et On February 28, 2006, the Environ- decision is pending. al. v. EPA). The EPB has also par- mental Protection Bureau received ticipated in submission of public court approval of a landmark settle- Another example is the recent multi- comment to additional proposed re- ment with Waste Management of state challenge to a revised national forms to the NSR rules. New Hampshire (“WMNH”) regard- ambient air quality standard for fine ing federal and state air violations at particulate matter. In State of New Administrative Appeals the Turnkey Landfill in Rochester. York, et al. v. EPA, filed in Decem- The settlement represented the larg- ber 2006, twelve other states, the • Appeal of Stephen Andrews and est civil penalty in the state’s history District of Columbia and the South John Carpenter for environmental violations. The Coast Air Quality Management Dis- Petition filed by the state alleged trict joined together to sue EPA for In early 2006, two neighbors who that WMNH had failed to meet its failing to strengthen the national air lived on Canobie Lake filed a re- federal and state air pollution obliga- quality standard for fine particles quest for a waiver of the “no-swim” tions, including failure to collect because doing so could save thou- rule that applies to Canobie Lake. landfill gases at a sufficient rate, and sands of lives every year. The small Canobie Lake is the main source of

29 Environmental Protection Bureau water for the Salem Water Depart- • Petroleum Fund Appeals (Oil Dis- and representation in numerous ment, which supplies drinking water charge and Disposal Fees) matters involving wildlife manage- to 20,000 people. DES denied the ment, licensing of hunters, land ac- request, and two individuals filed an State law requires all oil importers to quisitions, legislation, complex per- appeal with the Water Council. A pay environmental fees to be used sonnel appeals, and marine fisheries two-day hearing ensued, where an for oil spill cleanups through the Oil regulation and litigation. EPB attorney presented evidence Discharge and Disposal Cleanup that human bathing in a public water Fund, which is administered by the • Massachusetts and New Hamp- supply poses significant health risks Oil Fund Disbursement Board and shire v. Gutierrez, et al. to those who consume the water. collected by Department of Safety, Witnesses included a nationally re- both of whom are represented by In November 2006, EPB attorneys, nowned infectious disease physician the Attorney General. The first chal- working in cooperation with the Mas- who testified that parasites called lenge to payment of oil importation sachusetts Attorney General’s Of- cryptosporidium enter the water from fees was made by C.N. Brown Com- fice, filed suit against Secretary of human waste and cause severe ill- pany, a fuel oil distributor, on Commerce Gutierrez and others to ness when ingested by humans. grounds that fuel oil used in off-road block the implementation of new These parasites are immune to chlo- equipment and to generate electric- marine fisheries regulations con- rinization and can only be removed ity was exempt from the fees. The cerning the groundfish fishery in the by filtration. He cited an example Department of Safety had performed Gulf of Maine. The new scope of where hundreds of thousands of an audit, as it does for all fuel/ regulation would count fishing days people fell ill in Milwaukee in the heating oil distributors for the pur- at 2 days used for every one actually early 1990s due to failure of the pose of determining if the distribu- fished for nearly all New Hampshire city’s water filtration system. The tors have paid the fees. In the case fishermen. This counting is ex- Town of Salem also presented evi- of C.N. Brown, the audit concluded pected to have a devastating impact dence in support of DES’s decision that some of the diesel fuel sold by on the small boat fishery that com- to deny the waiver request. The the distributor had been converted to prises the bulk of New Hampshire’s Water Council upheld DES’s deci- fuel oil but that fuel oil fees had not fleet. The suit seeks to have the sion to deny the waiver request, thus been paid. In April 2006, City Fuel Secretary reconsider the regulations preserving a valuable water supply appealed the audit findings through in light of flaws in the scientific source and protecting the health and the Department of Safety Bureau of model used and the availability of a safety of consumers. Hearings. The Environmental Pro- regulatory exception, among other tection Bureau represented the reasons. The case is pending in the • Appeal of Regenesis Corp. State’s position that insufficient fees federal court in Boston. A ruling is had been paid and on May 12, 2006, expected by Spring of 2008. The Environmental Protection Bu- the Report of the Hearings Examiner reau defended DES in a solid waste upheld the State’s position on the Agency Counsel, Cost permit revocation appeal during the fees. C.N Brown did not pursue its last biennium. In 2005, DES re- case further. A related appeal filed Recovery and Defense voked a solid waste permit issued to by City Fuel, another distributor, was Regenesis Corp. after learning that withdrawn as a result of the deci- Apart from its enforcement responsi- one of its former directors was a sion. bilities, the EPB also plays a signifi- convicted felon. Under the solid cant role in representing the inter- waste statute, RSA 149-M, a permit A second appeal of the fuel oil fee ests of its client agencies. In situa- cannot be issued to an organization was filed by Halle Fuel, Inc. on tions where client agencies have if there is a felony conviction within grounds that the fuel sold was used spent State funds to address envi- the 5 years preceding an applica- for exempt purposes. The Environ- ronmental or natural resource- tion. Regensis has obtained a per- mental Protection Bureau again rep- related problems, the EPB pursues mit to burn construction and demoli- resented the State’s position that cost recovery against responsible tion debris, which is a solid waste, at insufficient fees had been paid. A parties. During the biennium, the its Hopkinton plant. When it was second favorable decision was is- EPB recovered a total of $2,145,751 revoked, Regensis appealed to the sued by the Department of Safety in costs incurred by the State Waste Management Council, which Hearings Examiner after a hearing against responsible parties. In addi- held a hearing in which evidence was conducted and no further ap- tion, the EPB reviewed 1,136 was submitted by both sides, as well peal was taken. agency contracts prior to their sub- as several intervenors. The Waste mission to Governor and Council. Management Council upheld the The EPB also represents its client Fish and Game agencies in personnel matters and, permit revocation in 2006. Regene- sis subsequently appealed to the Department on occasion, in litigation relating to Supreme Court, and that appeal is such matters. The EPB defends the still pending. EPB attorneys have provided the legality of environmental statutes Fish & Game Department advice

30 Environmental Protection Bureau and the agency rules promulgated • Regenesis v. State Land Use and Acquisition pursuant to the laws. In 2006, Regenesis sued the State The EPB reviews and approves When the Department of Fish & for requiring compliance with New property acquisitions, most often for Game sought to copyright the Source Review requirements before conservation purposes, by client “Licensed Guide” and “Fish & resuming operations at its Hopkinton programs including Fish & Game Game” logos, it turned to the EPB plant. The State filed a motion to and the Land Conservation and for assistance. EPB staff re- dismiss the action and, in 2007, re- Heritage Investment Program searched copyright laws and led the ceived a partial victory from the Mer- (“LCHIP”). At times, EPB attorneys Department through the process. rimack County Superior Court. Re- become involved in litigation defend- genesis can pursue its NSR claims ing state property interests, as in the • Oil Fund Disbursement Board v. but cannot preclude the State from case of Klein v. Fish and Game ExxonMobil Corporation applying federal NSR policies ab- where an owner of property claimed sent agency rulemaking. The case to have a right-of-way over conser- The EPB represented the Oil Fund will now proceed to trial on whether vation land. The State prevailed. Disbursement Board in seeking re- Regenesis can resume operations Over the past biennium, hundreds of payment of more than $2 million in without complying with NSR require- acres have been preserved as con- petroleum fund reimbursements ments. servation land with assistance from from ExxonMobil as a result of an EPB staff. insurance settlement between the In 2007, the State prevailed in de- company and its private carriers. fending DES against a challenge to The EPB acts as legal counsel to Because the petroleum funds under new septage rules filed by Gerald the State Conservation Committee, RSA 146-D are excess insurance, Bell, a septage hauler located in the Conservation Land Stewardship, the EPB alleged that ExxonMobil Swanzey. Bell filed a petition in the Rivers Management Advisory should repay all cleanup cost reim- Merrimack County Superior Court Committee, and the Lakes Manage- bursements made to its New Hamp- several years ago, claiming that the ment Advisory Committee. Also, shire gas stations. A negotiated set- rules were unconstitutional because EPB attorneys review property tlement was reached under which his open septage lagoons would transfers for the Land Conservation ExxonMobil repaid $ 2.1 million to have to meet new buffer rules or be and Heritage Investment Program the petroleum funds. enclosed to protect abutters from (“LCHIP”), as well as review all pro- odors. The Superior Court rejected posed deed, chain of title and • NCES v. State of New Hampshire Bell’s challenge and found that the boundary descriptions and when rules were reasonable. Bell has ap- necessary, negotiate with other In July 2006, North Country Environ- pealed the decision to the Supreme landowners on behalf of state inter- mental Services, Inc. (“NCES”), Court and the case is still pending. ests. owner and operator of the Bethle- hem landfill filed a lawsuit against • State v. Pontook Operating Limited the State alleging that a recent Partnership MTBE Litigation change to a tax exemption statute was unconstitutional. Pontook Operating Limited Partner- The EPB has continued to success- ship (“Pontook”) owns a hydroelec- fully pursue the state law claims it The Legislature adopted House Bill tric dam in Dummer, New Hamp- filed in 2003 against oil companies 1429 on June 15, 2006, which re- shire. The facility is located on land for contaminating state waters with moved privately owned landfills from owned by the State. Pontook pays the gasoline additive methyl tertiary eligibility for pollution-related tax ex- the State rent based on its gross butyl ether, or “MtBE.” New Hamp- emptions. NCES challenged the revenue from the sale of electricity. shire was the first state to file such constitutionality of the provision, cit- The State believed that Pontook was an action. In January 2006, the Su- ing violations of the equal protection selling electricity to a related com- preme Court agreed with the State and the due process clauses of the pany for an artificially low price. The that, under its sovereign authority to federal and New Hampshire Consti- State also believed the lease terms represent the interests of all state tutions. The EPB prevailed in Merri- entitled it to a portion of the money citizens, individual municipalities mack County Superior Court, where that Pontook received in a bank- could not seek recovery against the the court agreed with the State’s ruptcy settlement with USGen. After oil companies for MtBE damage to argument that there was a rational extensive negotiations, Pontook water supplies and had to yield to basis for treating landfills differently agreed to pay the State an addi- the State’s lawsuit. State v. City of from other types of facilities in that tional $1.2 million dollars for discrep- Dover, et al. landfills were the least-preferred ancies in rental payments. method of solid waste disposal. Also, in May 2006, a federal appeals NCES has appealed the Court’s or- court agreed with the State that its der to the New Hampshire Supreme claims should be heard in state court Court and the case is still pending. rather than in federal court. NH v.

31 Environmental Protection Bureau Amerada Hess, et al. The case has counsel for the public was able to • In re: St. Jude’s Residence been remanded to the Merrimack ask questions of the parties involved Superior Court from a federal district in order to ensure that the public’s On April 3, 2004, pursuant to a court in New York, which was hear- interests were protected. Counsel to search warrant, law enforcement ing the case after defendants re- the public reached an agreement personnel searched the St. Jude’s moved it in 2003. It is significant with the project’s owners that pro- Residence, an unlicensed facility for that the Second Circuit Court of Ap- tects avian species, protects nearby the treatment of drug and alcohol peals ruled that there was no federal residences from noise impacts, and addiction. The search resulted in, jurisdiction over the case, in large preserves land for conservation pur- among other things, the seizure of part because the federal govern- poses. Recently, the Site Evaluation approximately $341,000. Following ment did not mandate the use of Committee, having heard all parties the investigation, the two principals MtBE as a gasoline additive. This and deliberated, approved the pro- at St. Jude’s Residence, Mr. Kim environmental case with statewide ject. Tari and Mr. Joseph San Giovanni, significance will now proceed for- were each indicted on fifteen counts ward in state court, to be tried before Bankruptcy Matters of theft by deception for leading fif- a jury of New Hampshire citizens. teen different individuals to believe During the biennium, a bankruptcy that they were going to be treated Energy Efficiency attorney in the Environmental Pro- for alcohol or drug addiction, charging each person between $3,400 tection Bureau handled most bank- Initiatives and $43,000. Shortly after the in- ruptcy matters affecting State interests. In addition to litigating bank- dictments, St. Jude’s Residence During the last biennium, the EPB filed for Chapter 11 bankruptcy. continued to pursue the United ruptcy matters, the bankruptcy attorney devoted considerable time to The trustee, Tim Smith, then filed States Department of Energy (DOE) suit against Attorney General Kelly in multi-state litigation initiatives di- assisting other attorneys and other agencies with settlements, consent Ayotte for return of the money to the rected towards requiring the agency debtor. The EPB negotiated a set- to comply with Congressional man- decrees and other transactions. Significant bankruptcy matters dur- tlement with the trustee so that the dates to update energy efficiency Attorney General will maintain in a standards. In 2006, New Hampshire ing the biennium include the following: trust account for the victims the and thirteen other states, New York amount of $231,000 and the trustee City, and consumer and environ- • Collins & Aikman distributed approximately $25,000 to mental groups filed suit against DOE some of the victims. for failing to meet deadlines set by Congress for updating energy effi- Collins & Aikman filed for Chapter ciency standards for more than 11 bankruptcy on May 17, 2005. It twenty consumer products. The is a prominent manufacturer of auto- lawsuit resulted in a consent decree mobile components with plants requiring DOE to adopt energy effi- around the country. At the time of ciency rules for manufacturers of the bankruptcy, the Department of certain products, including furnaces Environmental Services was in the and air conditioners, under a binding process of investigating Collins & schedule. Aikman for violating environmental law at their plants in New Hamp- shire, including three in Dover and Counsel For The Public one in Farmington. The violations involved chemical contamination of In mid-2006, Community Energy, groundwater, including a Town of LLC and Lempster Wind, LLC, ap- Farmington well. The costs for past plied to the Site Evaluation Commit- and future cleanup totals more than tee for permission to construct a $91,000,000. Collins & Aikman be- wind powered generation project on gan a complete liquidation in Janu- a prominent ridgeline in Lempster. ary 2007 which will likely result in no The Attorney General appointed a recovery for holders of $42 billion in EPB attorney to represent the inter- unsecured claims. Nevertheless, ests of the citizens of New Hamp- the EPB was able to secure in the shire in the matter. Several public bankruptcy proceeding $3,600,000 meetings and a three-day eviden- and a plant and land in Farmington tiary hearing were held in which citi- assessed at more than $5,500,000. zens and representatives of various towns and businesses had the opportunity to testify to either their support or rejection of the project. Also,

32 Environmental Protection Bureau Environmental Protection Bureau Bureau At-A-Glance

Environmental Program Amount Recovered (Total Dollar Value)* Air Pollution $118,000 Air Pollution/Solid Waste $1,750,000 Asbestos Abatement $337,000 Dams $1,200,000 OHRV License Fees $12,000 ENVIRONMENTAL Hazardous Waste $95,000 ENFORCEMENT Oil Fund Reimbursement $2,141,438 Safe Drinking Water $10,000 Septic $1,282 Solid Waste $382,000 Wetlands/Shoreland/Water Pollution $571,500

TOTAL $6,618,220

Case State Agency Dollars Recovered

Atlantic Paper & Foil Environmental Services $100,000 $3,600,000 plus ownership of facility and land valued at Collins & Aikman Environmental Services $6,575,890

Merrimac Paper Environmental Services $4,507 $131,000 (Paid to Plymouth Village District for Hazardous Peter & Beverly Smith Environmental Services Waste Damage)

Troy Mills; State v. Environmental Services $25,000

Venture Holding Environmental Services $64,395 BANKRUPTCY Baldwin's on Elm Liquor $4,050 $100,000 (Collected for Car Components Technology Labor worker benefits) Health & Human Ser- D'Abre, Kathleen Therese vices $16,000

Foss Manufacturing Revenue Administration $346,992 Jillian's Liquor $534

Pittsfield Weaving Revenue Administration $20,000 Snyder, Theodora Simpson Liquor $3,500 $231,000 (Money held in trust St. Jude's Senior Residence Justice for victims) $5,064 (Collected for worker Tillotson Healthcare Corporation Labor benefits) TOTAL $4,652,042

Combined Criminal Sentences Imposed 3.5 years, $151,000

Agency Contracts Reviewed 1,136

* Environmental Enforcement Data does not include additional restoration or cleanup ordered.

33 Environmental Protection Bureau Charitable Trusts Unit

The mission of the Charitable review of New Hampshire’s mately 2,650 additional charita- Trusts Unit (the Unit) is to pro- community benefits statute; and ble trusts registered with the tect the public’s interest in the (d) scrutiny of mergers, consoli- Unit – or approximately 440 property and assets committed dations and affiliations involving additional charitable trusts per to charitable purposes in the nonprofit entities. year. This proliferation, uninter- State of New Hampshire rupted and unparalleled in New through effective registration, Proliferation of the Nonprofit Hampshire history, underscores education and enforcement. Sector two important trends. First, a During the biennium, the Unit healthy, diverse, mature and registered the highest number During the biennium, the num- dynamic charitable sector now of charities in its history; and ber of charities registering with exists in this state, ranging from the value of the charitable as- the Unit reached the highest the smallest youth sport sets in New Hampshire was in levels since the creation of the leagues to the largest private excess of $13.6 billion dollars. Unit in 1943. As of June 30, universities and most sophisti- The charitable sector in New 2007, the total number of chari- cated nonprofit hospitals. Sec- Hampshire remains strong, di- table trusts registered in New ond, from a regulatory perspec- verse and responsive to the Hampshire was 6,236, a figure tive, the demands on the Unit growing demands placed upon that does not include testamen- for its expertise, time and skills the sector. tary trusts (e.g. those trusts cre- have increased proportionally. ated by means of a will). If the Recent Developments testamentary trusts (of which The increase in the number of there were approximately 539 charities in New Hampshire has During the biennium, the Unit registered) are added, the total accelerated during the last 6 dealt with a series of cases in- number of registered charities years, with an additional 440 volving museums, religious enti- was approximately 6,775. If the charities being registered each ties, colleges and universities, municipal trustees are added, year with the Unit. Each chari- land trusts, and public libraries, the total number of registered table entity must file a copy of among others. In addition, the charitable trusts is approxi- its Federal IRS Form 990 or Unit handled matters involving mately 7,000. The proliferation Form 990 PF with the Unit, as (a) the implementation of the of charities that began in the well as New Hampshire forms. Uniform Trust Code, the first mid-1990’s and accelerated In addition, charities with reve- major modernization of trust law rapidly after 2001 continued nue in excess of $1,000,000 in New Hampshire; (b) coopera- uninterrupted during this bien- per year must file audited finan- tion with the Legislature and the nium. cial returns. These documents Pari-Mutuel Commission on the are publicly available. nonprofit gambling statutes; (c) Statistically, during the period 2001-2007, there were approxi- The value of the registered charities native to New Hamp- shire is estimated by the Urban Proliferation of Charitable Trusts Institute to be $13.6 billion dollars. This figure understates the real value of the nonprofit sector in New Hampshire. It does not include the value of

assets held by (i) religious or- 1995-2001 ganizations, (ii) municipal trusts,

2001-2007 and (iii) the smallest charities in 1,246 additional this state, all of which would Charitable 2,644 additional significantly increase the valua- Trusts Charitable Trusts tion of charitable assets well beyond $13.6 billion.

Transparency and Accountability

A major objective of the Unit is providing accurate and timely

34 Charitable Trusts Unit information to donors in order to nally conceived of a Charitable Trust from the real estate tax; (iii) sessions help them make informed decisions Unit when he served as Attorney sponsored by the NH Bar Associa- about the charities to which they General of New Hampshire. In tion or the National Association of contribute. In this era of transpar- 1943, New Hampshire became the Attorneys General (NAAG) on the ency and accountability, New Hamp- first state in the nation with a Chari- Uniform Trust Code, the Federal IRS shire donors are entitled to have as table Trust Unit and the Unit has Form 990 issues, and charitable much information as possible before served as a model for other states. regulation generally; and (iv) work- supporting a charity; consequently, The statute creating the Charitable shops offered with the New Hamp- the Unit provides links on its website Trust Unit (RSA 7:19) provides the shire Center for Nonprofits, the Gov- to assist donors in making informed Attorney General’s Office with com- ernor’s Annual Conference on Vol- giving decisions (www.doj.nh.gov/ mon law and statutory authority to unteerism, the United Way, and the charitable/index.html). The Unit also enforce charitable trust laws. National Business Institute. In addi- provides Guidebooks and other pub- tion, the Unit has published articles lications that allow donors to under- Outreach in the “NH Bar Journal,” the stand the laws that govern charitable “Nonprofit Quarterly,” and “NH Town trusts. Given the proliferation of charities and City.” (2001-2007), the Unit has main- To carry out its core missions, the tained its commitment to educating Members of the Unit have met with Unit is staffed with one attorney (the boards of directors on their fiduciary the CEOs, governing boards, audit Director of Charitable Trusts), one duties, ethical behavior, internal con- committees and staff members of Assistant Director, two investigative trols, and other major issues. nonprofit entities to discuss fiduciary paralegals, and one records control responsibilities, community benefits, clerk to carry out its statutory man- The Unit has engaged the public in a governance, best practices, merg- dates. variety of ways, including: (i) ers, and other issues. educational forums for the trustees Chief Justice Frank Kenison of cities and towns, (ii) educational The Charitable Trusts Unit has pre- forums for Selectmen and Tax As- sented workshops to New Hamp- Chief Justice Frank Kenison origi- sessors on charitable exemptions shire’s municipal trustees for over 20 years. Nearly 400 cemetery trustees, library trustees, and trustees of trust funds were in attendance at the 2007 sessions held in Gorham and Concord.

The Legal Structure

The laws governing charitable trusts in New Hampshire are complex and the Director of Charitable Trusts (the Director) is responsible for the supervision and enforcement of charitable trusts and charitable solicita- tions. The Director is a necessary party to all judicial proceedings that affect the purposes of a charitable organization, whether in Probate Court or Superior Court.

In terms of statutory mandates, the principal functions of the Unit include:

• Enforcement of charitable trusts in New Hampshire (RSA 7:19-32 and the common law);

• Review of all nonprofit healthcare mergers (RSA 7:19-b);

Chief Justice Frank Kenison • Licensing of professional fundraisers soliciting charitable donations

35 Charitable Trusts Unit from New Hampshire citizens (RSA Mediation ment Center to present educational 7:28); sessions on the critical property tax The Probate Court continues to en- exemption issue. The Unit also con- • Monitoring the issuance of charita- courage parties to litigation involving tinues to collaborate with the Depart- ble gift annuities (RSA 403-E); charitable trusts to attempt to medi- ment of Health and Human Services ate their differences prior to litiga- in identifying emerging trends in • Cooperating with the Pari-Mutuel tion. The mediation program is vol- public health care in the state. This Commission in enforcing gaming untary, not mandatory. The Unit has Interagency Work Group is now in laws relating to Bingo and Lucky 7’s; actively engaged in the mediation its fifth year of the collaborative ef- process and has entered into a num- fort and has received a major grant • Cooperating with the Criminal Bu- ber of successful resolutions, includ- dealing with the community benefits reau in investigating allegations of ing the Chandler Library in Nashua statute. criminal activities by officers and and the Sargent Museum in Man- directors of charitable trusts. chester. Civil Enforcement

Major Transactions The Sargent Museum mediation in- The Unit has the authority under volved 900 boxes of Native Ameri- RSA 7:24 and 7:25 to issue Notices The Unit is mandated to appear as a can artifacts as well as a collection to Attend Investigation whenever a necessary party in the ten Probate of records and journals kept by New question arises regarding the opera- Courts in New Hampshire on chari- Hampshire’s most recognized ar- tion of a charity. During the bien- table trust issues. During the report- chaelogist, Howard Sargent. The nium, the Unit issued 10 Notices and ing period, a number of these cases collection will be conveyed to the conducted 16 hearings, for a variety involved novel or significant issues, Mount Kearsarge Indian Museum; of reasons, including failure to regis- including the following: and the photo, taken in the summer ter or failure to report or failure to of 2007, shows a Native American comply with RSA 31:28 or 287: D-5. (1) the dissolution of the Sargent powwow at the Museum. The Unit referred 6 cases to the Museum in Manchester and the dis- Criminal Bureau during the relevant tribution of its collection of Native Interagency Collaboration period, resulting thus far in one in- American artifacts to a successor dictment. organization; (2) the resolution of The Unit has collaborated with the several cases involving youth sports Department of Revenue Administra- The Unit’s work includes enforce- leagues, including tion (DRA) and the Local Govern- breaches of fiduciary duties; (3) the dissolution of the Gentle Wind Project in cooperation with the Attor- ney General of the State of Maine; (4) the sale of the Centennial Senior Center building in Concord; (5) the sale of the Chandler library in Nashua; (6) the sale of the Ivie Chapel in Bethle- hem; (7) the sale of St. Francis Xavier Church land and buildings in Nashua; (8) the expansion of the NH Institute of Art to include additional dormitory space in Manchester; and (8) the Candia Lions Club investigation into improper use of assets and the redirection of those funds to other Li- ons’ Clubs charities. Fi- nally, the Unit was involved in the working group that resulted in the original en- actment of - and later amendments to - the Uni- form Trust Code.

36 Charitable Trusts Unit ment of the charitable solicitation the Unit. During fiscal year 2006, the tion with the Internal Revenue Ser- law. Unit reviewed 3,634 annual reports vice’s Fed/State Retrieval Project. filed by charities and 365 probate The Unit works with the Pari-Mutuel During fiscal year 2006, the Unit re- accounts filed by testamentary Commission to enforce the Games viewed 443 solicitation notices and trusts. During this period, reports of Chance, Bingo, and Lucky 7 stat- registered 206 professional fund- were received from the 243 towns utes. As part of its application re- raisers. During fiscal year 2007, the and cities having custody of trust view, the Commission ensures the Unit reviewed 395 solicitation no- funds for the benefit of cemeteries, charities involved are registered with tices and registered 204 profes- libraries, parks, and other public pur- the Unit. This involves monthly re- sional fundraisers. poses. These reports were reports from the Unit to the Commis- viewed to ensure compliance with sion and frequent telephone contact Registration and Licensing applicable statutes. between the two state entities.

In fiscal year 2006, the Unit col- The Unit has installed the FileNet Litigation and Estates lected $442,295 in registration and Optical Character Recognition sys- filing fees from charitable trusts and tem and is now in the process of The Director is a necessary party in $144,800 in filing fees from profes- scanning financial reports into the any litigation involving charitable sional fundraisers. In fiscal year Unit’s database and capturing se- trusts. During fiscal year 2006, the 2007, the Unit collected $455,435 in lected data elements. The ultimate Unit opened 52 cases. In fiscal year registration and filing fees from goal of the FileNet system is to 2007, 42 new cases were opened. charitable trusts and $130,875 in make scanned images of the finan- These cases range from extensive filing fees from professional fund- cial reports, community benefits re- involvement by the Unit to monitor- raisers. ports, and other information relating ing the case for status and develop- to charitable organizations available ments. They include reformation of By the end of the reporting period, to the public on the Internet. The trust instruments, removal of trus- there were 6,236 charities and 539 Unit continues to explore the possi- tees, determination of beneficiaries, testamentary trusts registered with bility of electronic filing in conjunc- petitions for cy pres (that is, the redi-

In January 2007, the Charitable Trusts Unit successfully recovered and returned approximately $230,000 to the NH Lions, a nonprofit organization, after it had been misappropriated. $115,000 was disbursed to the Lions Camp Pride, a handicapped accessible facility that benefits special needs children, and $115,000 was disbursed to NH Lions Sight & Hearing, which provides services to deaf and visually impaired low- income NH residents.

37 Charitable Trusts Unit rection of charitable assets for charitable entities that can no longer be maintained), and investigations into allegations of wrongdoing by charities and their officers, directors and professional fundraisers, as well as the various cases mentioned earlier in this report.

Pursuant to statutes and court rules, the ten Probate Courts send the Unit a copy of any will that mentions a charity or trust. These wills are reviewed and information is entered into the Unit’s database. When the estate is closed and distributions are made to the charities, that information is also entered into the database, making it easier to retrieve financial information as well to satisfy requests from charities regarding their responsibilities in holding trust funds. In fiscal year 2006, the Unit processed 310 wills and recorded $22,231,003.00 in bequests to charity, in fiscal year 2007 the Unit processed 257 wills and recorded $22,813.003.56 in bequests to charity.

38 Charitable Trusts Unit Civil Law Bureau

The Civil Law Bureau (Civil) is separate chief. A Civil Appellate ing or assisting in negotiations of responsible for providing legal Chief position was also created State agency contracts, re- advice and representation in to oversee all civil appellate searching a question of statutory superior court, federal court and briefs. Civil attorneys now have authority for an agency, investi- appellate court civil matters for a primary focus in client coun- gating an elections complaint, or 115 executive branch agencies, seling or litigation. In 1999 Civil advising an administrative li- boards, commissions and coun- had formed a sub-unit within the censing board. cils. Civil provides legal advice bureau to handle the increased and representation in civil law- number of complex federal Litigation suits to 38 State agencies, many cases. The Federal Litigation of which have multiple divisions Unit (FLU) continues to function Civil spends more time in litiga- with varied duties and functions. with attorneys that specialize in tion than in client counseling. Civil also provides legal advice federal court procedure; how- Approximately forty-nine percent and representation to 53 licens- ever, these attorneys also pro- (49%) of Civil’s legal practice ing/regulatory boards and 24 vide client counseling and han- time is now devoted to litigation, councils/commissions. During dle State court matters as well. compared to twenty-seven per- this biennium the bureau was The Attorney General’s Office cent (27%) for client counseling. staffed by 14 to 16 attorneys, 2 has a permanent seat on the Eighty percent (80%) of the liti- of whom are part-time, 2 part- Federal Court Advisory Commit- gation is in trial courts, seven- time contract attorneys, 3 para- tee that makes recommenda- teen percent (17%) is appellate legals and 4 secretaries. tions to the United States District and the remainder is administra- Court on policy and local rules. tive. Civil does both trial and appellate court litigation for all its cli- Civil is a dynamic bureau that During this biennium, 362 new ents and provides legal advice addresses a wide variety of trial court litigation or administra- through formal written opinions, challenging legal issues. In any tive proceeding cases were informal memoranda and by given week, a Civil attorney may opened, an increase of 21% telephone. Civil continues to be arguing a First Amendment over the prior biennium. Civil see a marked increase in both case in federal court, defending attorneys also worked on hun- the number and complexity of an agency and its employees in dreds of other litigation matters cases and legal issues. In mid- State court, briefing and arguing still active from prior years. Dur- 2006, Civil began a reorganiza- a case in the New Hampshire ing the biennium, approximately tion into a Client Counseling Unit Supreme Court or at the First 26 cases were settled and many and Litigation Unit, each led by a Circuit Court of Appeals, review- cases were resolved judicially. The nature and complexity of the litigation varied significantly. Civil Practice by Type Some cases were resolved in a few months through written motions to the court or a single court hearing. Other more complex litigation will take a number of years to resolve and may Client span the biennium and beyond, Counseling 27% including both a trial and an appeal. Litigation

49% School Funding Other - Trg, Admin, There have been a number of leave lawsuits related to school fund- 24% ing issues during the biennium. Four cases, encompassing 33 properties in Rye and Ports- mouth, challenged the constitutionality of the Statewide education property tax. They alleged that the assessing practices

39 Civil Law Bureau throughout the State are not uniform shire Supreme Court and, after an claims, finding that while not com- enough to ensure the constitutionally expedited appeal, on September 7, plete, the State’s commitment to the -required proportionality necessary 2006, the Supreme Court found the deinstitutionalization of those for for allocating the Statewide property State’s definition of an adequate whom community integration is de- tax between individual taxpayers in education unconstitutional. The Su- sirable is genuine, comprehensive different communities. The State preme Court gave the Legislature and reasonable. vigorously defended the property tax until June 30, 2007 to enact a con- system and demonstrated the sub- stitutional definition of an adequate There have also been several law- stantial improvements made to the education. The Nashua case was suits, followed by appeals, involving system since the last constitutional stayed pending the outcome of the Medicaid rates, including challenges challenge in 2000. 2007 Legislative Session. During to the rates for nursing homes (Bel- that Session, the Legislature de- Air cases), pharmacies (Maxi Drug Following a four-day trial, the Supe- bated many bills proposing to define cases), two cases involving county rior Court issued two orders in No- an adequate education. HB 927 reimbursement for Old Age Assis- vember 2005, finding the property defining an adequate education, tance (“OAA”) or Aid to the Perma- tax system unconstitutional for tax passed both houses and was signed nently and Totally Disabled (“APTD”) years 2002 through 2004. The State by Governor John Lynch on June recipients who are “in nursing appealed to the New Hampshire 29, 2007. homes” (New Hampshire Associa- Supreme Court. On August 17, tion of Counties), rates paid to resi- 2007, the Supreme Court reversed Class Action Lawsuits dential child care facilities (Chase the Superior Court’s Order finding Home et al.) and payment of “direct that the taxpayers had failed to meet During the last biennium, Civil attor- medical education” subsidies to their burden of proof. neys have been involved in approxi- teaching hospitals for FY2006-2007 mately 10 new complex class action (Mary Hitchcock Memorial Hospital In 2005, the State enacted House Bill or multiple party lawsuits in federal et al.). For example, in Maxi Drug et 616, 2005 New Hampshire Laws and State courts. They have also al. v. Commissioner, a group of Chapter 257, which provided funding continued to handle several class pharmacies enrolled as providers in to schools based on four types of aid action matters that remained pend- the State’s Medicaid program sued and revenue from the Statewide en- ing from the prior biennium. Prior the Department of Health and Hu- hanced education tax. Two lawsuits, class action suits that have been man Services (DHHS) alleging that City of Nashua v. State and London- resolved by consent decrees, such certain actions taken by DHHS re- derry School District, et al. v. State, as Cassandra Hawkins v. DHHS garding reimbursement rates consti- were filed challenging the constitu- (dental care for children) and tuted invalid rulemaking in violation tionality of Chapter 257. Both suits Holliday v. DOC (inmate mental of the State Administrative Proce- were initially filed in the Supreme health and medication delivery), dures Act. The pharmacies also Court, but were dismissed and refiled continue to be monitored by Civil. challenged DHHS’ authority to ob- in Hillsborough County Superior These matters require substantial tain information regarding the acqui- Court, Southern District. Both suits attorney involvement in meeting re- sition cost of pharmaceuticals. The included various claims challenging porting requirements and compli- New Hampshire Supreme Court up- the constitutionality of Chapter 257. ance meetings with class counsel. held DHHS’ actions under State law, Londonderry also claimed that the deciding that rules relative to rates State failed to define an adequate The longstanding Bryson et al. v. of reimbursement are exempt from education. Commissioner et al. class action the Administrative Procedures Act, was finally resolved during the bien- and affirmed DHHS’ authority to re- The Nashua case was tried in mid- nium. In this lawsuit, a group of indi- view acquisition cost data in admin- December 2005. The Londonderry viduals with acquired brain disorders istering its Medicaid reimbursement case proceeded on a motion for sum- (or brain injuries) had challenged the program. mary judgment in early 2006. In State’s administration of its Medicaid March 2006, the Superior Court is- home and community-based care Another new class action suit, sued orders in both cases declaring waiver for persons with acquired served in early 2007, seeks injunc- Chapter 257 unconstitutional due to brain disorders. The plaintiffs were tive relief against the State for failure the State’s failure to define an ade- individuals who were on a waiting to make Aid to the Permanently and quate education. The Superior Court list for services funded by the Totally Disabled (“APTD”) determi- also found that the State had failed to waiver. The plaintiffs’ claims in- nations with the 90-day time limit set reasonably determine the cost of an cluded alleged violations of the Fed- by federal regulations and also al- adequate education and had not en- eral Medicaid Act, the Americans leges that DHHS fails to provide a acted a constitutional accountability with Disabilities Act (ADA), and the required notification that the appli- system. Due Process Clause of the United cant has the right to appeal the de- States Constitution. In September lay if the determination is not going The State filed timely appeals of 2006 the District Court ruled in favor to be made within 90 days. While these orders with the New Hamp- of the State on the remaining ADA this litigation was in its early stages,

40 Civil Law Bureau a thorough review of the program eral Ayotte to prepare the brief, portion to GE’s activities in New confirmed that DHHS has not been which was argued by Attorney Gen- Hampshire in violation of the Due able to make timely determinations eral Ayotte. The Supreme Court, in Process and Commerce Clauses of for some time. Therefore, in order to January 2006, unanimously ruled the United States Constitution. In avoid the extensive attorney’s fees that the lower courts should not 2005, the Department prevailed at that could be claimed if the case have invalidated the entire measure the trial court. The superior court were litigated, as well as to allow the and ordered the lower courts to re- granted the State’s motion to dis- agency to correct the process, the view the legislative intent regarding miss the case because the Court State has requested that an order be exceptions to the law for medical found that GE did not have standing entered requiring the State to bring emergencies. The case is over, as to bring the lawsuit. The court also its APTD processing into compliance the State legislature in the 2007 ses- granted the State’s motion for sum- with federal law. sion repealed the challenged sec- mary judgment, ruling on the merits tion. in favor of the State, finding that In 2003, several plaintiffs filed the even if GE had standing, GE failed case of Planned Parenthood of Tax Litigation to demonstrate how the statute is Northern New England et al. v. Ay- unconstitutional. GE then appealed otte, challenging the constitutionality There were several significant tax to the New Hampshire Supreme of HB 763 that required physicians cases where Civil attorneys de- Court. to notify by certified letter a parent or fended the State’s financial inter- guardian of a minor who is seeking ests. In General Electric Company, In 2006, the New Hampshire Su- an abortion at least 48 hours before Inc. v. Commissioner, NH Dept. of preme Court reversed the trial performing the procedure. The U.S. Revenue, General Electric (“GE”) court’s order granting the State’s District Court and the 1st Circuit challenged a provision of the busi- motion to dismiss because the court Court of Appeals subsequently ness profits tax statute (RSA 77-A:4, found that GE had standing to chal- struck down the entire law. The IV). In 2002, GE appealed a deci- lenge the constitutionality of the stat- State appealed the rulings to the sion from the Commissioner of the ute. Nevertheless, the Department United States Supreme Court, argu- Department of Revenue Administra- prevailed in that appeal because the ing that the courts failed to give ap- tion (the “Department”) to the supe- Supreme Court affirmed the trial propriate deference to the State leg- rior court claiming that the dividends court’s grant of summary judgment, islative intent regarding the judicial received deduction allowed under thereby upholding the constitutional- bypass clause in the measure com- RSA 77-A:4, IV should be invali- ity of the statute and finding that bined with other State laws that al- dated because the statute discrimi- RSA 77-A:4, IV does not facially dis- low doctors to act in an emergency nates against foreign commerce in criminate against a dividend-paying to protect a woman's health. The writ violation of the Commerce Clause of foreign subsidiary that does not con- of certorari was accepted. Civil at- the United States Constitution and duct business in New Hampshire. In torneys worked with Attorney Gen- results in unfair taxation out of pro- 2007, GE sought review of the New Hampshire Supreme Court’s decision in the United States Supreme Court. The parties filed their briefs regarding certiorari, and the Solicitor General has filed a brief expressing the views of the United States, which supports the State’s position. The supreme court denied certiorari, leaving the New Hampshire Su- preme Court decision as the final outcome.

In a second case, Oracle Corpora- tion appealed the Department's assessment of over $7 million in business profits taxes, interest, and penalties, arising out of an audit of Ora- cle for the tax years 1999 and 2000. The primary issue was whether capital gains Oracle received on the sale of stock in two of its subsidiaries constitute unitary income to Oracle for NH business profits tax purposes, subject to the statutory Attorney General Ayotte, with Civil attorneys Mullen and Lombardi, answering press questions at United States Supreme Court following oral argument on the Planned Parenthood case. method of apportionment. The par-

41 Civil Law Bureau ties settled one claim in November pearance. The father of the missing upheld the Liquidator’s defense of a 2006 in which Oracle paid the State woman has again appealed the de- challenge to the constitutionality of a $1,001,680, and settled the remain- termination to the New Hampshire provision in the liquidation statute ing claims in May 2007 with Oracle Supreme Court. In a second case at that allows third party claimants to paying the State an additional the Superior Court level, the suc- file direct claims against an insolvent $5,339,971. cessful bidder for the State contract insurer but requires claimants to re- for the DHHS Medicaid Manage- lease the policy holder. In Decem- In a newly filed tax case, New ment Information System obtained a ber of 2006, after a difficult 3-year Hampshire Internet Service Provid- court order preventing the release of contest that involved two previous ers (“NHISPA”) and Destek claim proprietary portions of its bid pro- appeals to the Supreme Court and that Verizon and other carriers col- posal. extensive proceedings in England, lection of the Communications Ser- the Supreme Court upheld an agree- vices Tax on T-1 and T-3 services/ Insurance ment that the Liquidator had entered lines is illegal as it is pre-empted by into with certain United Kingdom- federal law. The Department be- In re: Liquidation of The Home Insur- based insurers. The agreement is a lieves that collection of the tax is ance Company is a multi-billion dol- novel application of the insurance legitimate because the Department’s lar insurance liquidation proceeding liquidation statute and stands to sig- right to collect the tax is grand- commenced in State Superior Court nificantly add to the assets of the fathered under federal law. This has in 2003. The Home Insurance Com- estate. been an ongoing concern since pany specialized in complex liability 2005. There were various legislative insurance for large, international The liquidation of The Home has and rule-making activities in the last corporations. By statute, the Insur- become a model in the industry for session which ultimately did not ad- ance Commissioner acts as the Liq- its successes in collecting assets, dress the issue. While the original uidator and is charged with marshal- providing early distributions to State lawsuit filed in federal court has ling assets, processing claims and guaranty funds, establishing a web- been dismissed, the suit has been administering the estate. With esti- site to provide parties and the public re-filed in State court. In a report to mated assets of $2 billion, gross with access to pleadings, reports the Legislature in 2003, the Depart- undiscounted liabilities of $5.1 billion and other information and providing ment stated that the estimated loss and 20,000 proofs of claim, many of detailed and frequent reporting to of revenue if the tax were declared which deal with several thousand the Court, creditors and the public. invalid or the grandfathering provi- claimants and involve asbestos, en- sion were repealed would be be- vironmental and mass tort liabilities, In In the Matter of the Rehabilitation tween $1,000,000 and $3,000,000 in The Home is one of the largest and of ACA Assurance, on October 11, regards to T1-T3 services and other most complex insurance liquidations 2006, Civil, on behalf of the Com- similar lines. If broadband and ISP ever filed. Because the liquidation missioner of the New Hampshire Access telephone were also in- required the attention of at least one Insurance Department, filed a Veri- cluded, the amount of lost revenue full-time attorney, in 2005 the De- fied Petition for Rehabilitation of could be an additional $3,000,000 to partment requested and received ACA Assurance, a fraternal benefit $5,5000,000. authority to hire a temporary attor- society domiciled in Manchester, ney to work exclusively on The which provides a variety of insur- Right to Know Litigation Home matter, the expense of which ance products to its members. The is paid for by The Home estate. Petition, filed pursuant to RSA 402- There were several significant court C, was based on the failure of ACA cases involving the New Hampshire In addition to the ongoing litigation of to timely file certain financial disclo- Right to Know law. In Murray v. disputed claims in the Superior sures, and on the Commissioner’s State Police Special Investigation Court, the Liquidator has pursued or belief that accounting and manage- Unit, the New Hampshire Supreme defended cases in the New Hamp- ment irregularities were jeopardizing Court refined the test for determining shire Supreme Court, the United the financial stability of the Associa- whether active law enforcement in- States District Court, the First Circuit tion. vestigation files are available to the Court of Appeals, State and federal public. Following an evidentiary re- courts in various other States, and A Special Deputy Commissioner hearing, the Superior Court, apply- the High Court of Justice in England. was appointed to assume temporary ing the new standard again upheld Ancillary receiverships for The day-to-day management of the As- the State’s withholding of the major- Home are pending in Idaho, Oregon, sociation, with the help of a rehabili- ity of the investigative file. The New York, Massachusetts, and New tation team. The team reviewed the Court found that the State had made Mexico in addition to a Scheme of Association’s financial and opera- an adequate showing that produc- Arrangement in the United Kingdom tional records, analyzed its strengths tion of the requested records would and separate liquidation of The and weaknesses, and recom- jeopardize the investigation and the Home’s Canadian branch. mended a variety of measures de- State’s ability to pursue potential signed to ensure the Association’s charges in a young woman’s disap- In May of 2006, the Supreme Court long-term financial stability. The

42 Civil Law Bureau Commissioner, the Special Deputy, prison conditions. Many of these defense of State action and six (6) Insurance Department personnel cases have multiple claims and are were State appeals. Juvenile abuse and Civil attorneys worked coopera- filed against as many as forty indi- and neglect and termination of pa- tively with the Association’s Board of vidual State employees as defen- rental rights cases accounted for Directors to implement these meas- dants. forty-two (42) of the appeals. These ures. Excess real property and capi- are the most common types of ap- tal equipment was liquidated; sever- Tort Litigation peals. ance agreements were revised; un- derperforming product lines were Civil defends State agencies and This reflects an increase of sixty two eliminated or modified; and a one- employees that are sued in negli- percent (62%) in the total number of time assessment against certain gence and civil rights suits, unless appellate matters handled by Civil policies was instituted in order to the Attorney General’s Office deter- from the prior biennium. In January achieve an appropriate operating mines that the employees’ conduct 2004, the Supreme Court amended surplus. was outside the scope of their duties its rules and implemented a manda- and wanton or reckless. In the past tory appeal system. This change On July 6, 2007, the Superior Court biennium, this litigation ranged from has dramatically increased the Bu- granted the Commissioner’s motion simple slip and fall accidents to reau’s appellate practice. In 2003, to terminate the rehabilitation, be- wrongful death cases involving the year before the mandatory ap- cause the Association had been re- drownings at Hampton Beach. Civil peal process was implemented, Civil turned to a position reasonably cer- is also representing Corrections in filed twenty-three (23) briefs in the tain to result in long-term financial connection with a series of cases New Hampshire Supreme Court. In stability. The Insurance Department involving two former corrections offi- fiscal year 2005, the first full year of continues to monitor the Association cers, both of whom are accused of mandatory appeals, Civil submitted closely to ensure that this remains sexually abusing multiple inmates. forty-three (43) New Hampshire Su- so. This successful rehabilitation Civil is not representing the former preme Court briefs. This increased prevented the serious financial im- corrections officers in these matters. the Civil Bureau’s appellate work by pact on thousands of Association eighty-seven percent (87%). In this members, as well as creditors, that Appellate Litigation biennium, one hundred thirty two almost certainly would have resulted (132) State Supreme Court briefs had the State not acted. Under RSA 7:6, the Attorney Gen- were filed, for an average of sixty-six eral must act as attorney for the (66) briefs per year, an increase of Inmate Litigation State in all civil cases in the Su- fifty-three percent (53%). preme Court where the State has an The Department of Corrections interest. During this biennium the Election Law (Corrections) accounts for 12% of Civil Bureau handled one hundred the Civil’s overall time and 26.5% of fifty-two (152) appeals. One hun- Part I, article 11 of the New Hamp- Civil litigation time. In addition to the dred thirty-two (132) briefs were filed shire Constitution provides, in part, lawsuits filed in federal and State in the New Hampshire Supreme that “[a]ll elections are to be free, courts, inmates also regularly file Court; twenty (20) were filed in the and every inhabitant of the State of petitions for writs of habeas corpus First Circuit Court of Appeals or the 18 years of age and upwards shall in State court claiming that they are United States Supreme Court. One have an equal right to vote in any being held in prison unlawfully. hundred forty-six briefs (146) were in election.” To safeguard this consti- Forty-one petitions were filed during the biennium. The State prevailed in the overwhelming majority of these cases. Habeas corpus petitions are usually resolved within a month after submission of a written pleading and a hearing in superior court.

Much more time consuming and lengthy are the inmate civil rights actions that are increasingly filed in federal court. Although the federal magistrate dismisses a small percentage of the cases prior to service, at least sixty-five federal cases were filed in the last biennium by inmates against State agencies, primarily Corrections, alleging civil rights violations or complaining of

43 Civil Law Bureau tutional provision, and pursuant to tives also conducted on-site inspec- legal demands upon Civil. Gener- RSA 7:6-c, the Legislature desig- tions of polling places throughout the ally, HAVA requires the State to: nates the Attorney General to en- State on election day. force all election laws in New Hamp- • Provide at least one voting ma- shire. Civil fulfills this responsibility Enforcement Activities chine in each polling place to enable and provides legal counsel to the most voters with disabilities to vote Secretary of State, who administers Civil receives and investigates elec- privately and independently; elections throughout the State. Civil tion law complaints regarding State attorneys defend the State or the and local elections, town, school and • Create a new uniform centralized Secretary of State in actions before village district meetings, and other Statewide database of registered the Ballot Law Commission, Supe- alleged election law violations. Elec- voters that shall be the source for rior Court and the Supreme Court. tion law complaints include a wide the official checklist for each town Approximately seven percent of the range of issues including but not and city; Civil Bureau’s efforts address elec- limited to: (1) the right to petition for tion law related legal issues and liti- warrant articles; (2) election day • Assist towns and cities in ensuring gation. voter registration and absentee bal- their polling places are accessible lot use; (3) political advertising and for people with disabilities and the Election Day Activities automated pre-recorded political elderly; calls associated with State or mu- During the November 2006 General nicipal elections and town meetings; • Ensure each qualified individual Election, Civil responded to approxi- (4) electioneering; (5) preparation of has an equal right to register and mately 100 complaints, via the Attor- the polling place – accessibility; and vote through Statewide uniform elec- ney General’s Election Line, a toll- (6) counting votes. tion procedures and standards; free election phone line. Civil responded to and resolved each com- The election law attorneys within • Provide voter and election official plaint on election day. To help facili- Civil work closely with local election education; and, tate this process, as with past State- officials to assist in preventing elec- wide elections, attorneys and inves- tion law violations and to provide • Maintain a Statewide complaint tigators from the Attorney General’s guidance in interpreting New Hamp- system for the uniform, nondiscrimi- Office, and specially trained sheriffs’ shire’s election laws to deter election natory investigation and resolution of deputies, served as the Attorney law violations. While many election complaints. General’s representatives to assist law complaints may be answered in responding to election-day com- without conducting an official investi- Civil continues to work closely with plaints where the Attorney General’s gation, during the past biennium, the Secretary of State, providing physical presence at a polling place Civil conducted one hundred twenty- legal advice throughout the acquisi- was necessary. In most cases, be- three (123) election law investigation and development of the State- cause these representatives were tions. wide voter database of registered strategically positioned throughout voters, the ongoing acquisition of the State, the Attorney General’s Help America Vote Act technology to assist voters with dis- Office could respond “in-person” to abilities and in developing and pre- any polling place in the State within The Help America Vote Act of 2002 senting the required election law fifteen minutes. These representa- (“HAVA”) has imposed significant training.

HAVA will continue to demand significant Civil attorney work hours while the HAVA programs are implemented and maintained in the State. Civil attorneys will continue to provide local election officials with election law training and continue enforcement efforts to ensure local compliance with HAVA.

Polling Place Accessibility

In fulfillment of the obligations imposed by HAVA and as part of an ongoing effort to enforce Part 1, Arti- cle 11 of the New Hampshire Consti- tution, which requires that polling places be accessible to person with

44 Civil Law Bureau disabilities, during the biennium, which gave first position to the can- perior Court decision, thus rejecting Civil has conducted inspections of didates of the party that received the the Libertarian Party’s claim that the over 300 polling places in the State. most votes in the prior election, pro- State’s ballot access laws violated To help facilitate this inspection vides those candidates with an im- its Equal Protection rights. process, deputy sheriffs from every permissible advantage. They asked county in the State conducted an the Court to impose some form of Campaign Contributions and initial survey of all polling places. name and party column rotation on Expenditures, Gift Reports, Where deficiencies were identified, ballots and/or random selection of Lobbyist Reports, Ethics Reports attorneys worked with accessibility which candidate or party is placed in specialists who conducted extensive the first position. The State argued The Civil Bureau also fulfills the At- inspections and worked with local in support of the statute stating that torney General’s statutory duties to officials to identify practical solutions the State had a compelling interest monitor public disclosures related to to accessibility deficiencies. As a in presenting voters with a clear and campaign finance, gifts to public offi- result of this process, currently, all easy-to-read ballot, and that deter- cials or employees, lobbyist income New Hampshire polling places are mining ballot structure is a preroga- and expense reports, and ethics re- accessible. tive of the Legislature. The Superior ports. Court agreed and ruled that the stat- Educational Activities ute is constitutional. On appeal, the Client Counseling New Hampshire Supreme Court re- Pursuant to RSA 652:22, Civil attor- versed the Superior Court’s deci- Providing legal advice to State agen- neys and the Secretary of State’s sion, finding that the ballot position cies, boards and commissions is a Office published the 2006-2007 edi- provided an impermissible advan- core function of Civil and represents tion of New Hampshire’s Election tage and that RSA 656:5 was un- approximately 33% of Civil attorney Procedure Manual (EPM) for New constitutional. Since the 2006 Gen- legal practice time for the biennium. Hampshire’s local election officials eral Election, the Secretary of State Agencies require legal assistance and citizens. The EPM provides an chooses a letter using a random se- interpreting and implementing the easy-to-read interpretation of New lection process and reorders the laws that define their obligations. Hampshire’s election laws. In Sep- names on the ballot according to The type of legal assistance varies tember 2006, and prior to the No- that letter. depending on the nature of the is- vember 2006 Statewide election, the sue. Some questions have broad EPM was sent to every town/city In Libertarian Party, the Libertarian applicability throughout State gov- clerk, moderator and supervisor of party challenged the constitutionality ernment, involve significant legal the checklist in the State. of New Hampshire statutes which research and require a written analy- provide avenues for nominating a sis by the assigned attorney. Other Civil attorneys routinely conduct or candidate to be placed on the gen- questions can be answered by a support election law training for local eral election ballot. Generally, these brief memoranda to the agency. government officials and the public statutes require third parties or inde- Civil attorneys also consult with their at large. During this biennium, the pendent candidates to demonstrate clients informally and frequently Civil Bureau election law attorneys a minimal level of support, by obtain- through telephone contact or e-mail. presented election law training to ing petitions signed by a certain The goal is to be accessible to the over 1500 local election officials number of voters, in order to have client agencies and provide them throughout the State. their names placed on the ballot. with the legal tools they need to The Libertarian party alleged that carry out their missions. Election Law Litigation this minimum level of support for third parties and independent candi- Each of the 115 State agencies or The New Hampshire Supreme Court dates violated their “equal right to be boards has a miscellaneous matter, rendered two decisions involving elected” under Part 1, article 11 of where the day-to-day questions and New Hampshire’s election laws dur- the New Hampshire Constitution. answers are documented. However, ing this past biennium. Libertarian Civil argued that the State has a if substantial research or multiple Party of New Hampshire v. State of compelling interest in keeping the meetings are required, a client coun- New Hampshire, 154 N.H. 376 ballot free from confusing or decep- seling matter is opened. Two hun- (2006) and Akins v. Secretary of tive or frivolous candidates and that dred fifty-eight (258) client counsel State, 154 N.H. 67 (2006). this issue is settled under the United matters were opened during the bi- States Constitution with courts con- ennium. In Akins, the plaintiffs challenged the sistently upholding more onerous constitutionality of RSA 656:5 that ballot access requirements than Examples of some of the significant specified the relative position of can- those imposed by New Hampshire client counseling topics in which didates names and the political par- law. The Superior Court ruled in the Civil was involved during the bien- ties with which they are affiliated on State’s favor and dismissed the nium include advice concerning fed- the general election ballot. The claim. On appeal, the New Hamp- eral audit findings, effects of the new plaintiffs argued that RSA 656:5, shire Supreme Court upheld the Su- civil union statute, agency reorgani-

45 Civil Law Bureau zations, personnel issues, collective town. Toward that end, Civil attor- tion continues. During the past bien- bargaining issues, contract review neys negotiated additional trail ease- nium, Civil attorneys began work on and approval, assistance with legis- ments over private property abutting significant land conservation pro- lation, real property issues including the Connecticut Lakes Headwater jects that will be finalized this bien- land conservation, implementation of property near Lake Francis in nium. Specifically, the State is work- the sexually violent predator act and Clarksville. ing toward acquiring a fee interest in various teaching and training activi- a 330-acre parcel surrounding Jeri- ties. Civil attorneys also worked with the cho Lake in Berlin, as well as a fee Department of Agriculture, Food and interest in the old Temple Mountain Land Conservation Markets, which acquires and man- Ski Area in Temple. ages agricultural land preservation The Legislature charged the State to easements. New Hampshire, like Representation Of Professional protect land, through purchases of many other States, is facing popula- Licensing Boards conservation easements or fee inter- tion growth resulting in the develop- ests, in order to sustain traditional ment of large tracts of land tradition- Civil represents and provides legal forest uses, such as logging; ensure ally used for agricultural purposes. advice to licensing boards and other multiple use conservation purposes, In order to protect some of these executive branch agencies whose such as limiting development but properties, the Legislature estab- statutory duties include adjudicative, allowing public access for recrea- lished the Agricultural Land Preser- prosecutorial and investigative functional use; and to protect and to sus- vation Committee and authorized it tions. These boards are comprised tain traditional agricultural uses. to purchase or accept gifts of ease- primarily of volunteers from the li- During the past biennium, Civil attor- ments that preserve land for agricul- censed professions and the general neys assisted with conserving thou- tural uses. One of the highlights of public. The role of Civil attorneys is sands of acres of land in the State this program over the past biennium to assist each board to effectively through several conservation pro- was the acquisition of an agricultural and lawfully carry out its statutory jects including: acquiring 7200 land preservation easement over the duties. acres in Berlin for purposes of con- Rossview Farm in Concord, in which structing a multi-use recreational Civil attorneys were actively in- In an effort to provide broad support park; the Beaver Falls conservation volved. for the boards, the Civil and Con- easement in Colebrook; the 13 Mile sumer Protection Bureaus have pre- Woods conservation easement in The benefits to the State, as a result sented annual training seminars for Errol; the Moose Mountain conser- of the conservation of these proper- board members and staff. In 2006 vation easement in Middleton; the ties, will continue for generations to over 160 board members and staff Willard Pond – Bald Mountain con- come and work on further conserva- attended the full day training and in servation easement in Antrim; the Willard Pond – Robb Reservoir conservation easement in Stoddard; the Rossview Farm conservation easement in Concord; the Scribner- Fellows State Forest; and the Allen State Forest property in Concord.

Additionally, following extensive negotiations, Civil attorneys, working with the Department of Resources and Economic Development, negotiated with the Cog Railway to obtain the easement rights necessary to lay electric power cables to the summit of Mount Washington. This project will provide much needed power to the summit and eliminate the need to operate power generators at the summit.

Civil attorneys continued to provide assistance on management of the The 376 acre Bald Mountain conservation easement, part of the Willard Pond Forest Legacy Connecticut Lakes Headwaters Project, was completed on March 21, 2007. The property, owned by NH Audubon, will continue property, which consists of approxi- to be managed as a working forest and is open to the public for recreational uses mately 172,000 acres of property in such as hiking, hunting, and fishing. Pittsburg, Clarksville, and Stewarts-

46 Civil Law Bureau 2007 over 173 attended. Training topics include a presentation by Su- preme Court Justice Gary Hicks, writing orders, ethical issues, how to conduct an administrative hearing, the applicability of the Right-To- Know Law, principles of due process and mock hearings. The goal of Civil’s work with the boards is to ensure due process, prevent problems from occurring and minimize the potential for appeals by assisting boards in all stages of proceedings.

A recent trend is the increased complexity and litigious nature of the proceedings before the boards. Par- ties to contested cases are now more likely to be represented by counsel, file more sophisticated motions and demand more extensive discovery—resulting in longer hear- New Hampshire Supreme Court Justice Gary Hicks addressing participants at 2007 admin- ings. Civil has been fortunate in istrative board training. having the services of two part-time contract attorneys that have been dedicated to assisting the boards.

Contract Review

Review of contracts and leases is an important aspect of providing legal assistance to State agencies. Every contract for services for more than $5,000 must be approved by the Attorney General’s Office. Over the last two-year period, Civil reviewed and approved more than 3500 contracts and leases. Most of these contracts are reviewed and returned to the agencies within one week. All executive branch agencies submit contracts and leases to their assigned attorney for review to ensure legal sufficiency prior to submission to Governor and Council. In addition to reviewing final contract documents, attorneys also frequently consult with agency staff regarding contract and bid related questions. Civil attorneys also assist State agencies with Information Technol- ogy procurement projects and review numerous Information Technol- ogy contracts. The complexities of these contracts have required substantial legal resources.

47 Civil Law Bureau Transportation Law Bureau

The Transportation Law Bureau and legal issues effecting the countered diverse legal chal- (Bureau) acts as legal counsel proper valuation for the acquisi- lenges, which threaten their for the New Hampshire Depart- tion of property necessary for completion. Legal challenges to ment of Transportation transportation or public works transportation improvement pro- (NHDOT). The Bureau repre- improvements. After the initia- jects continued throughout the sents the NHDOT and Depart- tion of eminent domain proceed- biennium, with more anticipated. ment of Administrative Services, ings, the Bureau represents the The Conservation Law Founda- Bureau of Public Works in a State during the litigation striving tion (CLF) filed actions against broad array of legal matters, to reach a fair and equitable the State water quality certificate including eminent domain, real resolution for the public. The and federal environmental ap- estate, contract, construction, eminent domain process re- provals for the I-93 improve- administrative, personnel and mains an essential tool in com- ments. The challenge to the personal injury cases related to pleting the public projects nec- State’s water quality approvals the State’s transportation sys- essary to improve the safety and was successfully defended. tems and public works projects. efficiency of the State’s infra- CLF’s other challenge to the Its role encompasses a wide structure network. During the project under the National Envi- range of trial and appellate ad- last biennium, 100 new eminent ronmental Policy Act (NEPA) vocacy in state and federal domain cases were opened and was filed in federal district court. courts, as well as hearings be- 59 were resolved. The number The suit raised more than 22 fore a variety of administrative of new cases increased from 70 alleged deficiencies with proc- boards. The legal workload in the previous two-year period ess and involved analysis of generated by the breadth of the in part due to unusually large some 29,000 pages of docu- NHDOT’s and Public Works’ projects including the I-93 Ex- ments. The suit remained ongo- responsibilities resulted in 409 pansion and Airport Access ing at the close of the biennium. new files being opened by the Road reaching fruition. Moreover, landowners have filed Bureau during the two-year pe- challenges to other projects at riod. This represents an in- Not only has the number of ac- an unprecedented rate. The crease of 84 new cases over the quisitions increased, but there Manchester Airport Access previous biennium. At the same has also been a marked rise in Road and the reconstruction of time, the Bureau resolved 250 the complexity of the State’s Route 111 in Windham faced matters. The Bureau performed acquisitions. For example, this claims. These claims have been critical legal roles in major pro- biennium saw the State com- successfully defended. jects, including the Conway By- plete the purchase of an entire pass, Manchester Airport Ac- timeshare condominium com- Personal Injury and cess Road, the Granite Street plex, Cranmore Place Condo- Extension, the implementation of miniums, the first eminent do- Property Damage E-ZPass, and the I-93 Expan- main action of its kind in the na- Claims sion Project, as well as a multi- tion. More than 550 separate tude of smaller projects through- unit owners interests had to be Tort claims handled by the Bu- out the State. Public Works’ acquired and negotiations com- reau encompass a variety of improvements included new pleted. This presented ground- claims of death, personal injury courthouses and the major con- breaking challenges in title re- and property damage allegedly struction of a new Emergency search, document drafting and caused by the negligent design, Operations Center. In addition, valuation. Because no other construction or maintenance of severe weather brought new state has acquired a complete the State’s transportation sys- legal challenges for emergency timeshare complex, each issue tem. In the last biennium, the operations, disaster response has presented new challenges Bureau defended against 94 tort and property damage claims. that no other jurisdiction has claims, a slight decrease over confronted. the previous biennium’s 105. A Eminent Domain total of $25,268.79 was awarded Environmental and against the NHDOT and settlements totaling $178,700 were Land acquisitions continue to be Legal Challenges to one of the central functions of paid out from State funds during

the Bureau. Prior to condemna- Major Projects the two-year period. Despite the tion, the Bureau routinely ad- slight decline in total claims, the vises the NHDOT on land title The State’s transportation im- resulting sum of $203,968.79 in issues, document preparation provement projects have en- payments to claimants repre-

48 Transportation Law Bureau sents a significant increase from the strictly and that delays related to total of $129,622 paid during the utility installations were not con- previous biennium. trolled by the state and thus liability would not be borne by the taxpayer. Contract Law Weather Related Legal The Bureau reviewed and approved Issues 781 State contracts and leases during the recent two-year period. The last biennium saw no less than Many of these contracts were 3 storm events of historic proportion. unique or highly complex in nature. The epic amounts of rainfall which Implementation of E-ZPass, for in- resulted from these 3 separate stance, continued to require sub- storms resulted in widespread flood- stantial legal work overseeing its ing and water damage to State infra- implementation, customer service structure and private property. program and enforcement. The Bu- These exceptionally heavy rainfalls reau has also addressed requests washed away roads, bridges, cul- for E-ZPass records and ensuring verts and even many homes. In the proper protection of private informa- immediate aftermath, Bureau per- tion. sonnel assisted the NHDOT in obtaining permission to enter onto pri- Human Resources vate land to remove debris or repair roads and arrange for private con- The Bureau has provided risk man- tractors to help when necessary. agement advice regarding disciplinary actions including warnings and After the events, at legislative direc- terminations and participated in in- tion, the Bureau assisted the vestigations of suspected miscon- NHDOT in purchasing the properties duct. The Bureau has also con- of many displaced persons. In many ducted training for senior manage- cases, this required the acquisition ment on issues ranging from sexual of lands that no longer physically harassment to the new Conflict of existed due to the rerouting of water Interest law enacted by the Legisla- courses. This provided these citi- ture. zens some compensation for their horrific losses. While the number of hostile work environment claims has declined in The unusual flooding also has re- the last biennium from 27 to 16, the sulted in numerous claims against number of disciplinary reviews has the NHDOT for flooding damage. increased to 238 separate cases, a These claims are primarily related to 10 percent increase. In fiscal year culverts or other drainage structures 2007 alone the Bureau defended 12 which were overwhelmed causing actions at the Personnel Appeals water damage to private property. Board including claims regarding While the State is vigorously defend- non-selection for promotion, suspen- ing against the claims, the damages sions without pay, and terminations. alleged are in the millions of dollars. The Board denied or dismissed each action.

Construction Issues

The Bureau successfully resolved a number of claims related to construction disputes. A significant victory came in the case of Audley Construction v. Department of Transportation. In that case, the Merrimack County Superior Court found that the State’s contractual language should be interpreted

49 Transportation Law Bureau Administration

Program professional and an attorney. tions are requests for assistance The Commission meets once a from family members of a victim

Administration month with the two staff mem- of negligent homicide and drunk bers from the Attorney General’s driving. Portions of funeral ex- The New Hampshire Depart- Office to review the applications, penses, loss of economic sup- ment of Justice administers a award claims and process the port for dependent family mem- variety of programs which pro- payments. bers, uninsured medical costs, vide service to all areas of New and crime scene clean up are Hampshire’s criminal justice sys- In SFY 2006-2007, the Victims’ examples of expenses eligible tem. These programs are sup- Compensation Unit paid for assistance. ported by federal, state and $1,189,991 in total compensa- dedicated funds and are admin- tion to victims involving over 839 The Internet has played a signifi- istered by the following units: claims. As of June 30, 2007, the cant role in the increase of sex- program has experienced both ual abuse cases against chil- Witness Payment Unit an increase in the number of dren, thereby increasing applica- survivors of violent crimes who tions for assistance. Financial Since 1992, this agency has had have received benefits, as well awards have been made to the responsibility for paying all as an increase in the amount of families whose needs included law enforcement and civilian compensation paid to the victims mental health counseling both witnesses who are subpoenaed and families. for their child as well as them- by the state in criminal cases. In selves and other siblings; reim- State Fiscal Years (SFY) 2006 The funds allowed for relocation bursement for the parents’ lost and 2007, the office processed of 80 families in life-threatening, wages for time missed due to witness payments totaling domestic violence situations, court appearances, attending $1,927,945 for over 70,000 wit- paying a total of $152,365. The counseling and bringing their nesses. The Business Office allowable amount for relocation child to therapy appointments; processes the Witness Pay- has increased from $4,000 to and payment of any uninsured, ments. $5,000 per claim. This benefit crime-related medical costs. allows for security deposits, two Victim’s Compensation Unit months rent, start up utilities The following are examples of expenses and moving and stor- how the Victims Compensation In 1990, New Hampshire em- age costs. Victims are required funds have benefited people in barked on a program to finan- to sign a one-year lease, and New Hampshire: cially assist innocent victims of payments are made directly to violent crime by providing com- their landlord. Other payments • Marla had been a long-term pensation to them and to imme- are made to the service provid- victim of domestic violence by diate family members for losses ers, except when the victim has her husband of seventeen incurred due to personal injury documentation to show an years, and had been subjected or death of the victim. The eco- out-of-pocket expense, and in to both physical and emotional nomic losses must be directly those situations the Office reim- abuse, which resulted in court related to an eligible misde- burses the victim directly. In proceedings. The offender meanor or felony crime. This addition to relocations, these threatened to kill her, intimidated program is funded by money funds benefited others in areas and subjected her to obscene collected through penalty as- of lost wages, dental, mental physical treatment, often in front sessment on criminal fines and health, funeral, and medical ex- of their young daughter. The by a federal grant. A Victims’ penses as well as other types of offender violated Protective Or- Assistance Commission was eligible support. ders, began stalking his victim, also established and consists of and escalated in abusive ac- five individuals who are nomi- The program has experienced a tions, causing the victim to seek nated by the Attorney General marked increase in the number assistance from a crisis center and confirmed by the Governor of families of homicide victims and their victim advocates. The and Council. These individuals who have applied for and been crisis center referred Marla and volunteer their time and cur- awarded financial assistance, as her daughter to our program and rently consist of a victim of a well as an increase in the the Commission awarded com- home invasion, a dentist, an amount of compensation paid to pensation, allowing our program Emergency Room trauma physi- these survivors of homicide to provide mental health therapy cian, a licensed mental health crimes. Included in the applica- for both victims; lost wages to

50 Administration Marla, as well as relocation assis- available financial resources have • Child advocacy centers for victims tance for their move to another been made available. Two individu- of child sexual assault and child state. Marla was fortunate to have als staff the unit. abuse. These centers are designed the cooperation of her employer who to minimize the trauma inflicted on also assisted with the moving ex- Grants Management Unit child victims through multidiscipli- penses, and provided her with a job nary teams who assist in the investi- in their out of state office. Marla was The Grants Management Unit exists gation of child abuse and recom- able to obtain counsel to represent to make a difference in the lives of mend and ensure follow-through her in divorce proceedings and child the citizens of New Hampshire by with the best course of treatment for custody issues. She has also taken ensuring the proper use of federal the child. advantage of our Address Confiden- funds for criminal justice purposes. tiality Program, which will aid in This unit began in 1985 with the • Victim/witness units exist in all the keeping her exact whereabouts con- Crime Control Act of 1984. Cur- County Attorneys’ Offices and DOJ fidential. rently this unit administers twenty grants fund the 6 in the rural coun- different grant program units with ties. • Deborah’s husband was murdered. expenditures over the last biennium Through the efforts of the Criminal of $21,635,679.93. The Unit oper- • Funding for various programs with Bureau’s Victim Witness Advocate, ates with just four grant administra- the NH Coalition Against Domestic & Deborah filed applications on behalf tors. As the graph indicates, there Sexual Violence; funding for crisis of her deceased husband and re- are four main purpose areas focus- centers and shelters. ceived compensation toward the ing on crime prevention and justice. cost of the funeral. She also filed These four purpose areas are: Cor- • Seven family visitation centers applications on behalf of herself and rections, Victims, the Multi- across the state are supported with the surviving dependent children. Jurisdictional Drug Task Force and grant funds. Studies have shown Another adult family member was Other Criminal Justice Areas. that the risk of violence is often able to receive assistance on his greater for victims of domestic vio- own application, and received lost There were a total of 263 separate lence and their children after separa- wages as well as counseling. The grants awarded over the two-year tion from an abusive situation. program paid for mental health period. These awards went to city/ These centers provide a safe envi- counseling for Deborah, each of her towns (74), non-profit agencies (93), ronment for the safe visitation and children, as well as mileage costs for county agencies (57) and state exchange for NH families with a his- therapy and medical appointments. agencies (39). These figures reflect tory of family violence. It also provided reimbursement for the recipient of each of those grants, lost wages for the adult victims and although some organizations may • Seven domestic and sexual vio- loss of economic support for the mi- have received multiple grants during lence prosecutors located in the nor children of the victim. this period. counties of Belknap, Cheshire, Coos, Grafton, Hillsborough, Merri- • Elizabeth is the mother of a twelve- Because of grant dollars, New mack and Rockingham. year-old child, a victim of sexual as- Hampshire’s citizens receive many sault by the next-door neighbor. services that would not otherwise be • Court appointed special advocacy Elizabeth and her husband learned available. A partial list of programs programs; also, funding for Ameri- of the assaults through their daugh- benefiting from these grant dollars corps and CASA. ter’s computer, reported it to police, follows: who intercepted a phone conversa- • Victim-offender mediation pro- tion and arrested the offender in his Programs in the Correctional Arena grams. home. The offender had used In- $3,068,171.25 stant Messaging and the Internet to • Prosecution and law enforcement communicate with the victim to con- • Completion of the new Sununu based victim advocacy programs. vince her to meet him at his home. Youth Services Center in Manches- The offender was convicted of five ter • Ongoing comprehensive training separate crimes. The program as- for advocates, law enforcement, sisted in paying for mental health • Substance abuse treatment for prosecutors, and various members counseling and after-insurance youth at the Sununu Youth Services in the field. medical expenses, and the victim’s Center father for lost wages incurred as a • Support for Domestic Violence result of the crime. • Substance abuse treatment for Units in the communities of Man- male and female offenders at four chester and Nashua. The program is the payer of last re- county correctional facilities. sort after all free care, health insur- • Support for efforts by NH colleges ance, workers compensation, pro- Programs for Victims $8,836,708.19 to end violence against women by ceeds from settlements or other building strong consortiums.

51 Administration • Emergency legal services to victims seeking protective orders against abusers.

• Training for the Courts in the area of domestic and sexual violence.

Drug Task Force Programs $2,472,324.61

• The Attorney General leads a multi-jurisdictional drug task force of approximately 30 individuals from many police departments across the state (see Criminal section for details). Grant funds reimburse part of the costs for local law enforcement agencies who send an officer to the task force.

Other Criminal Justice Programs $3,629,237.94

• Development of strategic cybercrime efforts in NH.

• Ongoing efforts with J-One—a comprehensive criminal justice information system involving the courts, state police, and corrections.

• Funding to combat underage drinking through aggressive enforcement of underage drinking laws by local police departments, county sheriffs, campus police, and the Bureau of Liquor Enforcement. Funds are also used for public education and media campaigns.

• Funding from the New Hampshire Highway Safety Agency for a Traffic Safety Resource Prosecutor to conduct regional trainings and provide technical assistance to law enforcement and prosecutors in the area of impaired driving and alcohol-related motor vehicles crimes.

• HAVA funding from the Secretary of State to assist with the Help America Vote Act requirements.

After September 11th, 2001 and the creation of Homeland Security, a number of justice related grant programs were either eliminated or have received reduced funding. Those that continue are always at risk from competing funding needs at the federal level.

52 Administration More details as to the level of funding and grant type are as follows:

Grant Types FY06 FY07 Total Drug Task Force – Byrne 1,152,676.90 1,319,647.71 2,472,324.61 Other Criminal Justice Byrne 11,617.01 14,845.17 Byrne Evaluations 88,004.22 Byrne – CJ Information Systems 227,798.48 307,674.86 Byrne Youth-At-Risk Programs 65,106.44 16,503.75 Bulletproof Vests 5,285.51 Domestic Preparedness 284,594.14 0 Enforcing Underage Drinking Laws 380,454.57 378,553.20 Help America Vote Act 433,784.91 164,995.87 Natl. Criminal History Improvement Program 454,537.67 278,394.63 Natl. Forensic Science Improvement 17,115.00 46,909.68 Project Safe Neighborhoods 156,522.48 126,621.95 PSN Anti Gang 14,685.97 Statistical Analysis Center 27,199.74 43,906.36 USAO DTF 33,946.29 47,450.58 Prescription Drug Monitoring 2,577.92 151.54 Total: 2,183,258.87 1,445,979.07 3,629,237.94 Corrections Residential Substance Abuse and Treatment 58,544.01 140,775.11 Violent Offender Incarceration/Truth in Sentencing 2,643,033.38 225,818.75 Total: 2,701,577.39 366,593.86 3,068,171.25 Victims Children’s Justice Act 102,274.08 111,924.84 Rural Domestic Violence & Child Victimization 112,024.27 140,248.83 Safe Havens Visitation Centers 86,236.17 314,689.99 State Victim Fund – Victim Compensation State Portion 361,549.58 389,017.30 State Victim Fund Grants to Victim Programs 369,335.00 581,060.50 Victims Compensation – Federal 128,674.35 296,652.36 Victims of Crime Act 1,981,421.55 1,975,317.68 Violence Against Women Act 930,015.34 956,266.35 Total: 4,071,530.34 4,765,177.85 8,836,708.19

Totals Drug Task Force – Byrne 1,152,676.90 1,319,647.71 2,472,324.61 Other Criminal Justice 2,183,258.87 1,445,979.07 3,629,237.94 Corrections 2,701,577.39 366,593. 86 3,068,171.25 Victims 4,071,530.34 4,765,177.85 8,836,708.19

53 Administration Appendix A

Reports Required Under RSA 570-A:10, III and RSA-B:7 (Authorized Recordings)

During the biennium, the Attorney General filed zero petitions for authorization to intercept telecommunic- tions under RSA 570-A:7. The Attorney General applied for and received zero orders to install and use pen register devices under RSA 570-B:4. The Attorney General, or designated Assistant Attorneys General, authorized 591 interceptions pursuant to RSA 570-A:2.

Appendix B

Personnel Data

Current Number of Positions 6/30/06 6/30/07

1. Unclassified 69 69 2. Classified 62 62

3. Temporary 1 1

TOTAL 132 132

PHYSICAL PLANT AND PROPERTY APPRAISAL

6/30/06 6/30/07 1. Equipment $2,153,315.50 $2,263,186.68 2. Physical Plant 0 0 3. Farm 0 0 4. Highway 0 0 TOTAL $2,153,315.50 $2,263,186.68

54 Appendix Appendix C

Receipts And Expenditures SFY 06 SFY 07 Receipts 1 Federal Funds $11,288,435 $8,876,855 2 Fees, Registrations, Fines, Forfeitures - restricted 1,069,133 1,193,586 3 Transfers from Other Agencies 1,808,248 2,105,739 4 Health Club Registrations - unrestricted 22,530 19,260 5 Consumer Land/Condo Registrations - unrestricted 176,060 118,990 6 Judgments and Recoveries - unrestricted 415,947 134,972 7 Tobacco Settlement 38,961,255 40,780,640 8 All Other Sources 8,983,762 10,271,353 Total $62,725,370 $63,501,395 Expenditures 1 Permanent Personnel $6,749,579 $7,390,540 2 Current Expense incl Rent and Trfr General Services 449,696 478,768 3 Equipment 78,070 72,221 4 Benefits incl Retirees Benefits 2,666,042 2,789,868 5 In State Travel 114,087 149,545 6 Out of State Travel 68,048 80,539 7 Litigation 654,275 596,962 8 Witness Fees 799,931 1,128,014 9 Autopsy Expense 239,150 311,466 10 Miscellaneous 394,529 467,130 Total $12,213,407 $13,465,053 Disbursements to Cities, Towns, Non-Profits and On Behalf of Victims 1 Towns $845,816 $838,565 2 Counties 985,265 609,660 3 Non-Profits 3,668,352 4,814,103 4 Victim's Compensation Payments/Victim's Assistance Grants 1,178,692 1,385,979 Total $6,678,125 $7,648,307 Disbursements to State Agencies 1 Department of Justice $168,194 $105,957 2 New Hampshire Multi-jurisdictional Drug Task Force 527,922 745,097 3 Department of Corrections 335,636 514,949 4 Division of Alcohol and Drug Abuse Prevention 13,254 4,677 5 Department of Safety 449,778 103,840 6 Admin. Office of the Courts 477,151 363,829 7 DHHS - YDC facility 2,600,666 124,416 8 New Hampshire Liquor Commission 144,859 159,124 9 Police Standards and Training 0 15,922 10 Department of Administrative Services 0 9,471 11 Office Information Technology (OIT) 273,383 351,209 12 Miscellaneous to State Agencies 5,720 21,065 13 University 90,217 72,913 Total $5,086,781 $2,592,467 Total of all Expenditures $23,978,313 $23,705,828

55 Appendix Appendix D

OPINIONS July 1, 2005 - June 30, 2007

There were no opinions issued during this biennium.

Appendix E

Expenditures Pursuant to RSA 7:12

SFY 2006

December 2005 to Fiscal Meeting RSA 7:12 request for $75,000 for autopsies increasing the total to $225,000.

March 2006 Fiscal Meeting RSA 7:12 request for $300,000 for litigation increasing the total budget to $650,000.

SFY 2007

October 23, 2006 letter to Fiscal and G&C RSA 7:12 not to expend funds of $420,000 for litigation costs in the case of State v. Michael Addison.

February 16, 2007 Fiscal Meeting RSA 7:12 request for $450,000 for litigation expenditures to address the balance of the year, thereby increasing the total budget to $800,000.

February 16, 2007 RSA 7:12 request not to exceed $360,000 for witness fees increasing the total budget to $1,160,000.

56 Appendix