HF 1392

Introduction - 94th Legislature (2025 - 2026)

Posted on 03/05/2025 12:28 p.m.

A bill for an act
relating to commerce; establishing a consumer protection restitution account;
requiring a report; appropriating money; amending Minnesota Statutes 2024,
sections 8.31, subdivision 2c; 16A.151, subdivision 2; 290.0132, by adding a
subdivision; proposing coding for new law in Minnesota Statutes, chapter 8.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 8.31, subdivision 2c, is amended to read:

Subd. 2c.

Undistributed money to deleted text begin general fund deleted text end new text begin consumer protection restitution
account new text end .

If a court of competent jurisdiction finds that a sum recovered under this section
for the benefit of injured persons cannot reasonably be distributed to the victims, because
the victims cannot readily be located or identified, or because the cost of distributing the
money would outweigh the benefit to the victims, then the court deleted text begin may order that the money
be paid into the general fund. All sums recovered must be deposited into the state treasury
and credited to the general fund deleted text end new text begin or attorney general must deposit the money in the consumer
protection restitution account under section 8.37. Consumer enforcement public compensation
that the attorney general attempts to distribute to an eligible consumer, but that is not
redeemed by the consumer within 120 days, may be redeposited in the account new text end .

Sec. 2.

new text begin [8.37] CONSUMER PROTECTION RESTITUTION ACCOUNT.
new text end

new text begin Subdivision 1. new text end

new text begin Creation of account. new text end

new text begin The consumer protection restitution account is
established in the special revenue fund. Money in the account is appropriated annually to
the attorney general for the purposes provided under subdivision 4.
new text end

new text begin Subd. 2. new text end

new text begin Definitions. new text end

new text begin (a) The definitions in this subdivision apply to this section.
new text end

new text begin (b) "Account" means the consumer protection restitution account established under this
section.
new text end

new text begin (c) "Account administrator" means a person appointed by the attorney general as an
account administrator under this section.
new text end

new text begin (d) "Consumer enforcement action" means litigation in any forum, or settlement of a
matter that could have resulted in litigation, by the attorney general in whole or in part under
(1) the authority of the attorney general provided in section 8.31, or (2) other authority
granted to the attorney general by law to obtain the remedies provided in section 8.31.
new text end

new text begin (e) "Consumer enforcement public compensation" means money awarded or recovered
in a consumer enforcement action to vindicate public interests by providing restitution or
other compensation to persons directly impacted by unlawful acts and practices that are the
subject of the consumer enforcement action.
new text end

new text begin (f) "Court-appointed administrator" means an administrator appointed by a court under
section 8.31, subdivision 3c.
new text end

new text begin (g) "Eligible consumer" means a person who was directly impacted by unlawful acts
and practices that are the subject of a consumer enforcement action and, as a result, is eligible
to receive consumer enforcement public compensation under a final order.
new text end

new text begin (h) "Final order" means a judgment, assurance of discontinuance, consent order,
settlement, stipulation, or other order or settlement that is no longer appealable and for
which no appeals are pending. A final order does not include any judgment, assurance of
discontinuance, consent order, settlement, stipulation, or other order or settlement entered
into before July 1, 2023.
new text end

new text begin (i) "Identified amount of unpaid consumer enforcement public compensation" means a
specific amount of consumer enforcement public compensation that the attorney general,
court-appointed administrator, or fund administrator has determined a specific eligible
consumer is entitled to receive following a final order in a consumer enforcement action
and that has not been distributed to the specific eligible consumer.
new text end

new text begin Subd. 3. new text end

new text begin Money deposited in the account. new text end

new text begin 50 percent of all money recovered by the
attorney general in a consumer enforcement action that is payable to the state and not
designated as consumer enforcement public compensation or for another specific purpose
must be deposited into the account. The remaining 50 percent of money recovered by the
attorney general in a consumer enforcement action that is payable to the state and not
designated as consumer enforcement public compensation or for another specific purpose
must be deposited into the general fund.
new text end

new text begin Subd. 4. new text end

new text begin Permissible use of account. new text end

new text begin Money in the account must be used only to
distribute consumer enforcement action public compensation to eligible consumers under
subdivision 5 and for costs to administer the account. The costs to administer the account
may include the cost to retain for any permissible purpose an account administrator or
court-appointed administrator but must not exceed three percent of the total amount of
money available. The attorney general may pay an account administrator from the account
if the account contains excess money.
new text end

new text begin Subd. 5. new text end

new text begin Distributions to eligible consumers. new text end

new text begin Money in the account may be distributed
to any eligible consumer with an identified amount of unpaid consumer enforcement public
compensation. If the amount of money in the account is insufficient to pay all distributions
to eligible consumers with an identified amount of unpaid consumer enforcement public
compensation, the money must be distributed first to consumers eligible for unpaid consumer
enforcement public compensation based on a consumer enforcement action with a final
order of the oldest date.
new text end

new text begin Subd. 6. new text end

new text begin Impractical payments and unreasonable effort as to unpaid
compensation. new text end

new text begin (a) The attorney general may deem a distribution to an eligible consumer
with an identified amount of unpaid consumer enforcement public compensation impractical
if:
new text end

new text begin (1) the distribution to the eligible consumer is too small to justify the cost to locate the
eligible consumer or make the payment;
new text end

new text begin (2) the eligible consumer does not redeem a payment within a reasonable time; or
new text end

new text begin (3) other circumstances make distributing the unpaid consumer enforcement compensation
to the eligible consumer unreasonable.
new text end

new text begin (b) The attorney general may deem an attempt to determine an identified amount of
unpaid consumer enforcement public compensation for some or all eligible consumers
relating to a consumer enforcement action is unreasonable when the judgment, assurance
of discontinuance, consent order, settlement, stipulation, or other order or settlement does
not identify specific amounts of consumer enforcement public compensation for specific
consumers if:
new text end

new text begin (1) the number of likely eligible consumers and the amount of likely unpaid consumer
enforcement public compensation is too small to justify the cost to determine an identified
amount of unpaid consumer enforcement public compensation;
new text end

new text begin (2) the information needed to identify an amount of unpaid consumer enforcement public
compensation is unavailable or too costly to obtain; or
new text end

new text begin (3) other circumstances make an attempt to determine an identified amount of unpaid
consumer enforcement public compensation unreasonable.
new text end

new text begin Subd. 7. new text end

new text begin Concluded distributions. new text end

new text begin The attorney general must stop providing distributions
of unpaid consumer enforcement public compensation relating to a consumer enforcement
action when the attorney general determines:
new text end

new text begin (1) all eligible consumers with an identified amount of unpaid consumer enforcement
public compensation for the consumer enforcement action have received a distribution
through the account or the distribution has been deemed impractical under subdivision 6,
paragraph (a); and
new text end

new text begin (2) no additional eligible consumers with unpaid consumer enforcement public
compensation for the consumer enforcement action exist or the attorney general has deemed
identifying unpaid compensation under subdivision 6, paragraph (b), unreasonable.
new text end

new text begin Subd. 8. new text end

new text begin Annual report. new text end

new text begin (a) The attorney general must publish on the attorney general's
website an annual report identifying the following information for the annual period:
new text end

new text begin (1) the consumer enforcement actions resulting in payment of money to the account and
the amount of money paid to the account for each consumer enforcement action;
new text end

new text begin (2) the consumer enforcement actions for which distributions were made to eligible
consumers and the amount of money distributed for each consumer enforcement action;
new text end

new text begin (3) the consumer enforcement actions for which there are eligible consumers awaiting
distribution from the account and the amount of money for which those eligible consumers
are awaiting distribution for each consumer enforcement action;
new text end

new text begin (4) the consumer enforcement actions for which the attorney general has concluded
account distribution;
new text end

new text begin (5) the consumer enforcement actions in which the attorney general determined that
some or all eligible compensation was impractical to distribute or unreasonable to determine
under subdivision 6; and
new text end

new text begin (6) the cost incurred to administer the account.
new text end

new text begin (b) The attorney general must provide the report to the chairs and ranking minority
members of the legislative committees with jurisdiction over the consumer protection
restitution account.
new text end

new text begin Subd. 9. new text end

new text begin Account administrator. new text end

new text begin (a) The attorney general may appoint an administrator
for any of the following purposes:
new text end

new text begin (1) determining identified amounts of unpaid consumer enforcement public compensation
for eligible consumers;
new text end

new text begin (2) collecting money that can be deposited, in whole or in part, to the account;
new text end

new text begin (3) distributing money to eligible consumers; or
new text end

new text begin (4) any other costs to administer the account.
new text end

new text begin (b) The attorney general may appoint more than one account administrator.
new text end

new text begin Subd. 10. new text end

new text begin No private right of action. new text end

new text begin A person does not have a private right of action
with respect to a payment from the account or administration of the account.
new text end

new text begin Subd. 11. new text end

new text begin Collection efforts unaffected. new text end

new text begin The distribution of money from the account
to eligible consumers does not affect the attorney general's authority to collect, satisfy, or
enforce final orders against persons ordered to pay consumer enforcement public
compensation to eligible consumers in the final order. To the extent the attorney general
collects consumer enforcement public compensation pursuant to a final order after money
has been distributed from the account to eligible consumers that are the subject of that final
order, the collected consumer enforcement public compensation must be deposited in the
account in an amount equal to the prior account distribution.
new text end

Sec. 3.

Minnesota Statutes 2024, section 16A.151, subdivision 2, is amended to read:

Subd. 2.

Exceptions.

(a) If a state official litigates or settles a matter on behalf of specific
injured persons or entities, this section does not prohibit distribution of money to the specific
injured persons or entities on whose behalf the litigation or settlement efforts were initiated.
If money recovered on behalf of injured persons or entities cannot reasonably be distributed
to those persons or entities because they cannot readily be located or identified or because
the cost of distributing the money would outweigh the benefit to the persons or entities, the
money must be paid into the general fund.

(b) Money recovered on behalf of a fund in the state treasury other than the general fund
may be deposited in that fund.

(c) This section does not prohibit a state official from distributing money to a person or
entity other than the state in litigation or potential litigation in which the state is a defendant
or potential defendant.

(d) State agencies may accept funds as directed by a federal court for any restitution or
monetary penalty under United States Code, title 18, section 3663(a)(3), or United States
Code, title 18, section 3663A(a)(3). Funds received must be deposited in a special revenue
account and are appropriated to the commissioner of the agency for the purpose as directed
by the federal court.

deleted text begin (e) Tobacco settlement revenues as defined in section 16A.98, subdivision 1, paragraph
(t), may be deposited as provided in section 16A.98, subdivision 12.
deleted text end

deleted text begin (f) deleted text end new text begin (e) new text end Any money received by the state resulting from a settlement agreement or an
assurance of discontinuance entered into by the attorney general of the state, or a court order
in litigation brought by the attorney general of the state, on behalf of the state or a state
agency, related to alleged violations of consumer fraud laws in the marketing, sale, or
distribution of opioids in this state or other alleged illegal actions that contributed to the
excessive use of opioids, must be deposited in the settlement account established in the
opiate epidemic response fund under section 256.043, subdivision 1. This paragraph does
not apply to attorney fees and costs awarded to the state or the Attorney General's Office,
to contract attorneys hired by the state or Attorney General's Office, or to other state agency
attorneys.

deleted text begin (g) deleted text end new text begin (f) new text end Notwithstanding paragraph deleted text begin (f) deleted text end new text begin (e) new text end , if money is received from a settlement
agreement or an assurance of discontinuance entered into by the attorney general of the
state or a court order in litigation brought by the attorney general of the state on behalf of
the state or a state agency against a consulting firm working for an opioid manufacturer or
opioid wholesale drug distributor, the commissioner shall deposit any money received into
the settlement account established within the opiate epidemic response fund under section
256.042, subdivision 1. Notwithstanding section 256.043, subdivision 3a, paragraph (a),
any amount deposited into the settlement account in accordance with this paragraph shall
be appropriated to the commissioner of human services to award as grants as specified by
the opiate epidemic response advisory council in accordance with section 256.043,
subdivision 3a, paragraph (e).

deleted text begin (h) deleted text end new text begin (g) new text end If the Minnesota Pollution Control Agency, through litigation or settlement of a
matter that could have resulted in litigation, recovers $250,000 or more in a civil penalty
from violations of a permit issued by the agency, then 40 percent of the money recovered
must be distributed to the community health board, as defined in section 145A.02, where
the permitted facility is located. Within 30 days of a final court order in the litigation or the
effective date of the settlement agreement, the commissioner of the Minnesota Pollution
Control Agency must notify the applicable community health board that the litigation has
concluded or a settlement has been reached. The commissioner must collect the money and
transfer it to the applicable community health board. The community health board must
meet directly with the residents potentially affected by the pollution that was the subject of
the litigation or settlement to identify the residents' concerns and incorporate those concerns
into a project that benefits the residents. The project must be implemented by the community
health board and funded as directed in this paragraph. The community health board may
recover the reasonable costs it incurs to administer this paragraph from the funds transferred
to the board under this paragraph. This paragraph directs the transfer and use of money only
and does not create a right of intervention in the litigation or settlement of the enforcement
action for any person or entity. A supplemental environmental project funded as part of a
settlement agreement is not part of a civil penalty and must not be included in calculating
the amount of funds required to be distributed to a community health board under this
paragraph. For the purposes of this paragraph, "supplemental environmental project" means
a project that benefits the environment or public health that a regulated facility agrees to
undertake, though not legally required to do so, as part of a settlement with respect to an
enforcement action taken by the Minnesota Pollution Control Agency to resolve
noncompliance.

deleted text begin (i) deleted text end new text begin (h) new text end A community health board receiving a transfer of funds under paragraph deleted text begin (h) deleted text end new text begin (g) new text end
must, no later than one year after receiving the funds, submit a report to the chairs and
ranking minority members of the senate and house of representatives committees with
primary jurisdiction over environment policy and natural resources that describes:

(1) the process of community engagement employed to solicit community input regarding
the use of the funds;

(2) the purposes and activities for which the funds were used; and

(3) an account of expenditures.

deleted text begin (j) deleted text end new text begin (i) new text end The commissioner of the Minnesota Pollution Control Agency must submit a
report in September each even-numbered year, beginning in 2024, to the chairs and ranking
minority members of the senate and house of representatives committees with primary
jurisdiction over environmental policy and natural resources that includes:

(1) the amount transferred under paragraph deleted text begin (h) deleted text end new text begin (g) new text end to each community health board
during the previous two years; and

(2) any agency services provided to the community health board or community residents
during the duration of the project funded by the transfer, and the cost of those agency
services, for consideration by the legislature for future appropriations that address
reimbursement of the amount of the transfers and the cost of services provided by the agency.

deleted text begin (k) deleted text end new text begin (j) new text end Any money received by the state resulting from a settlement agreement or an
assurance of discontinuance entered into by the attorney general of the state, or a court order
in litigation brought by the attorney general of the state on behalf of the state or a state
agency related to alleged violations of consumer fraud laws in the marketing, sale, or
distribution of electronic nicotine delivery systems in this state or other alleged illegal
actions that contributed to the exacerbation of youth nicotine use, must be deposited in the
tobacco use prevention account under section 144.398. This paragraph does not apply to:
(1) attorney fees and costs awarded or paid to the state or the Attorney General's Office; (2)
contract attorneys hired by the state or Attorney General's Office; or (3) other state agency
attorneys. The commissioner of management and budget must transfer to the tobacco use
prevention account, any money subject to this paragraph that is received by the state before
May 24, 2023.

new text begin (k) This section does not apply to money deposited in the consumer protection restitution
account under section 8.37.
new text end

Sec. 4.

Minnesota Statutes 2024, section 290.0132, is amended by adding a subdivision
to read:

new text begin Subd. 36. new text end

new text begin Consumer enforcement public compensation payments. new text end

new text begin The amount of
consumer enforcement public compensation received as a distribution to an eligible consumer
under section 8.37, subdivision 5, is a subtraction.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective retroactively for taxable years beginning
after December 31, 2023.
new text end