| COMMITMENTS AND CONTINGENCIES | NOTE 11. COMMITMENTS AND CONTINGENCIES Legal Proceedings and Investigations We and certain of our subsidiaries are involved in various claims, legal proceedings, internal and governmental investigations (collectively, proceedings) that arise from time to time in the ordinary course of our business, including, among others, those relating to product liability, intellectual property, regulatory compliance and commercial matters. While we cannot predict the outcome of these proceedings and we intend to defend vigorously our position, an adverse outcome in any of these proceedings could have a material adverse effect on our current and future financial position, results of operations and cash flows. Matters that are not being disclosed herein are, in the opinion of our management, immaterial both individually and in the aggregate with respect to our financial position, results of operations and cash flows. If and when such matters, in the opinion of our management, become material either individually or in the aggregate, we will disclose such matters. As of June 30, 2017 , our reserve for loss contingencies totaled $1,335.6 million , of which $1,294.6 million relates to our liability accrual for vaginal mesh cases and other mesh-related matters. Although we believe there is a reasonable possibility that a loss in excess of the amount recognized exists, we are unable to estimate the possible loss or range of loss in excess of the amount recognized at this time. Product Liability We and certain of our subsidiaries have been named as defendants in numerous lawsuits in various U.S. federal and state courts, as well as in Canada and other countries, alleging personal injury resulting from the use of certain products of our subsidiaries. These matters are described below in more detail. We believe that certain settlements and judgments, as well as legal defense costs, relating to certain product liability matters are or may be covered in whole or in part under our product liability insurance policies with a number of insurance carriers. In certain circumstances, insurance carriers reserve their rights to contest or deny coverage. We intend to contest vigorously any and all such disputes with our insurance carriers and to enforce our rights under the terms of our insurance policies. Accordingly, we will record receivables with respect to amounts due under these policies only when the resolution of any dispute has been reached and realization of the potential claim for recovery is considered probable. Amounts recovered under our product liability insurance policies will likely be less than the stated coverage limits and may not be adequate to cover damages and/or costs relating to claims. In addition, there is no guarantee that insurers will pay claims or that coverage will otherwise be available. Vaginal Mesh Cases. In October 2008, the FDA issued a Public Health Notification (October 2008 Public Health Notification) regarding potential complications associated with transvaginal placement of surgical mesh to treat pelvic organ prolapse (POP) and stress urinary incontinence (SUI). The notification provided recommendations and encouraged physicians to seek specialized training in mesh procedures, to advise their patients about the risks associated with these procedures and to be diligent in diagnosing and reporting complications. In July 2011, the FDA issued an update to the October 2008 Public Health Notification regarding mesh to further advise the public and the medical community of the potential complications associated with transvaginal placement of surgical mesh to treat POP and SUI. In the July 2011 update, the FDA stated that adverse events are not rare. Furthermore, the FDA questioned the relative effectiveness of transvaginal mesh as a treatment for POP as compared to non-mesh surgical repair. The July 2011 notification continued to encourage physicians to seek specialized training in mesh procedures, to consider and to advise their patients about the risks associated with these procedures and to be diligent in diagnosing and reporting complications. In January 2016, the FDA issued a statement reclassifying surgical mesh for transvaginal POP repair from Class II to Class III. Surgical mesh for SUI repair remains a Class II device. Since 2008, we and certain of our subsidiaries, including AMS and/or Astora, have been named as defendants in multiple lawsuits in the U.S. in various state and federal courts, including a multidistrict litigation (MDL) in the U.S. District Court for the Southern District of West Virginia (MDL No. 2325), and in Canada and other countries, where various class action and individual complaints are pending alleging personal injury resulting from the use of transvaginal surgical mesh products designed to treat POP and SUI. Plaintiffs in these suits allege various personal injuries including chronic pain, incontinence and inability to control bowel function and permanent deformities, and seek compensatory and punitive damages, where available. We and certain plaintiffs’ counsel representing mesh-related product liability claimants have entered into various Master Settlement Agreements (MSAs) and other agreements to resolve up to approximately 71,000 filed and unfiled mesh claims handled or controlled by the participating counsel. These MSAs and other agreements were entered into at various times between June 2013 and August 2017, were solely by way of compromise and settlement and were not in any way an admission of liability or fault by us or any of our subsidiaries. All MSAs are subject to a process that includes guidelines and procedures for administering the settlements and the release of funds. In certain cases, the MSAs provide for the creation of qualified settlement funds (QSFs) into which funds may be deposited pursuant to certain schedules set forth in those agreements. All MSAs have participation requirements regarding the claims represented by each law firm party to the MSA. If certain participation requirements are not met, then we will have the right to terminate the settlement with that law firm. In addition, one agreement gives us a unilateral right of approval regarding which claims may be eligible to participate under that settlement. To the extent fewer claims than are authorized under an agreement participate, the total settlement payment under that agreement will be reduced by an agreed-upon amount for each such non-participating claim. Funds deposited in QSFs are included in restricted cash and cash equivalents in the Condensed Consolidated Balance Sheets . Distribution of funds to any individual claimant is conditioned upon the receipt of documentation substantiating the validity of the claim, a full release and a dismissal of the entire action or claim as to all AMS parties and affiliates. Prior to receiving funds, an individual claimant is required to represent and warrant that liens, assignment rights or other claims identified in the claims administration process have been or will be satisfied by the individual claimant. Confidentiality provisions apply to the amount of settlement awards to participating claimants, the claims evaluation process and procedures used in conjunction with award distributions, and the negotiations leading to the settlements. In June 2017, the Hon. Joseph R. Goodwin, U.S. District Court Judge for the Southern District of West Virginia, entered a case management order in MDL 2325 that includes a provision requiring plaintiffs in newly filed MDL cases to provide expert disclosures on specific causation within one hundred twenty (120) days of filing a claim (the Order). Under the Order, a plaintiff's failure to meet the foregoing deadline may be grounds for the entry of judgment against such plaintiff. In July 2017, a similar order was entered in Minnesota state court. Beginning in the second quarter of 2017, we aggressively pursued a settlement strategy in connection with our mesh litigation. Consequently, the Company increased its mesh liability accrual by $775.5 million in the second quarter of 2017, which is expected to cover approximately 22,000 known U.S. mesh claims, subject to a claims validation process for all resolved claims, as well as all of the international mesh liability claims of which the Company is aware and other mesh-related matters. This increase reflects the Company’s conclusion that a loss was probable with respect to all unsettled mesh-related matters of which we are aware as of the date of this report and our current liability accrual applies to such matters. Although the Company believes it has appropriately estimated the probable total amount of loss associated with all matters as of the date of this report, it is reasonably possible that further claims may be filed or asserted and adjustments to our liability accrual may be required. This could have a material adverse effect on our business, financial condition, results of operations and cash flows. The following table presents the changes in the QSFs and mesh liability accrual balance during the six months ended June 30, 2017 (in thousands): Qualified Settlement Funds Mesh Liability Accrual Balance as of January 1, 2017 $ 275,987 $ 963,117 Additional charges — 775,474 Cash contributions to Qualified Settlement Funds 522,770 — Cash distributions to settle disputes from Qualified Settlement Funds (440,190 ) (440,190 ) Cash distributions to settle disputes — (3,794 ) Other 510 — Balance as of June 30, 2017 $ 359,077 $ 1,294,607 As of June 30, 2017 , $868.9 million of the mesh liability accrual amount shown above is classified in the Current portion of the legal settlement accrual in the Condensed Consolidated Balance Sheets , with the remainder classified as Long-term legal settlement accrual, less current portion. Charges related to vaginal mesh liability and associated legal fees and other expenses for all periods presented are reported in Discontinued operations, net of tax in our Condensed Consolidated Statements of Operations . To date, the Company has made total mesh liability payments of approximately $2.8 billion , $359.1 million of which remains in the QSFs as of June 30, 2017. We expect to fund into the QSFs the remaining payments under all settlement agreements during 2017, 2018 and 2019. As the funds are disbursed out of the QSFs from time to time, the liability accrual will be reduced accordingly with a corresponding reduction to restricted cash and cash equivalents. In addition, we may pay cash distributions to settle disputes separate from the QSFs, which will also decrease the liability accrual and decrease cash and cash equivalents. We were contacted in October 2012 regarding a civil investigation initiated by a number of state attorneys general into mesh products, including transvaginal surgical mesh products designed to treat POP and SUI. In November 2013, we received a subpoena relating to this investigation from the state of California, and we have subsequently received additional subpoenas from California and other states. We are currently cooperating with this investigation. At this time, we cannot predict the ultimate outcome of these matters and we are unable to estimate the possible range of any additional losses that could be incurred, which could be material to the Company’s operating results and cash flows for the period in which they are resolved or become estimable. Testosterone Cases. We and certain of our subsidiaries, including Endo Pharmaceuticals Inc. (EPI) and Auxilium Pharmaceuticals, Inc. (subsequently converted to Auxilium Pharmaceuticals, LLC and hereinafter referred to as Auxilium), along with other pharmaceutical manufacturers, have been named as defendants in lawsuits alleging personal injury resulting from the use of prescription medications containing testosterone, including FORTESTA ® Gel, DELATESTRYL ® , TESTIM ® , TESTOPEL ® , AVEED ® and STRAINT ® . Plaintiffs in these suits allege various personal injuries, including pulmonary embolism, stroke and other vascular and/or cardiac injuries and seek compensatory and/or punitive damages, where available. In June 2014, an MDL was formed to include claims involving all testosterone replacement therapies filed against EPI, Auxilium and other manufacturers of such products, and certain transferable cases pending in federal court were coordinated in the U.S. District Court for the Northern District of Illinois as part of MDL No. 2545. In addition, litigation has also been filed against EPI in the Court of Common Pleas for Philadelphia County and in certain other state courts. Litigation similar to that described above may also be brought by other plaintiffs in various jurisdictions, and we expect cases brought in federal court to be transferred to the U.S. District Court for the Northern District of Illinois as tag-along actions to MDL No. 2545. However, we cannot predict the timing or outcome of any such litigation, or whether any such additional litigation will be brought against us. We intend to contest the litigation vigorously and to explore all options as appropriate in our best interests. As of July 31, 2017 , approximately 1,285 cases are currently pending against us; some of which may have been filed on behalf of multiple plaintiffs. The first MDL trial against Auxilium involving TESTIM ® is set to begin in November 2017; the first trial against Auxilium in the Court of Common Pleas for Philadelphia County involving TESTIM ® is set to begin in January 2018; and the first MDL trial against EPI involving FORTESTA ® Gel is set to begin in September 2018. In November 2015, the U.S. District Court for the Northern District of Illinois entered an order granting defendants’ motion to dismiss claims involving certain testosterone products that were approved pursuant to ANDAs, including TESTOPEL ® . Plaintiffs filed a motion for reconsideration and clarification of this order. In March 2016, the District Court granted plaintiffs’ motion in part and entered an order permitting certain claims to go forward to the extent they are based on allegations of fraudulent off-label marketing. In November 2014, a civil class action complaint was filed in the U.S. District for the Northern District of Illinois against EPI, Auxilium and various other manufacturers of testosterone products on behalf of a proposed class of health insurance companies and other third party payors that had paid for certain testosterone products, alleging that the marketing efforts of EPI, Auxilium and other defendant manufacturers with respect to certain testosterone products constituted racketeering activity in violation of 18 U.S.C. §1962(c), and other civil Racketeer Influenced and Corrupt Organizations Act claims. Further, the complaint alleged that EPI, Auxilium and other defendant manufacturers violated various state consumer protection laws through their marketing of certain testosterone products and raised other state law claims. In March 2015, defendants filed a motion to dismiss the complaint and plaintiffs responded by filing amended complaints, which defendants also moved to dismiss. In February 2016, the District Court granted in part and denied in part defendants’ motion to dismiss. The District Court declined to dismiss plaintiffs’ claims for conspiracy to commit racketeering activity in violation of 18 U.S.C. §1962(d) and claims for negligent misrepresentation. In April 2016, plaintiffs filed a third amended complaint, which defendants moved to dismiss in June 2016. In August 2016, the court denied the motion to dismiss, and we filed a response to the third amended complaint in September 2016. In October 2015, a similar civil class action complaint was filed against EPI and other defendant manufacturers in the U.S. District for the Northern District of Illinois. Similar litigation may be brought by other plaintiffs. We are unable to predict the outcome of these matters or the ultimate legal and financial liability, if any, and at this time cannot reasonably estimate the possible loss or range of loss for these matters, if any, but we intend to contest this litigation vigorously and will explore all options as appropriate in our best interests. Unapproved Drug Litigation In September 2013, the State of Louisiana filed a petition for damages against certain of our subsidiaries, including EPI, and over 50 other pharmaceutical companies alleging the defendants or their subsidiaries marketed products that were not approved by the FDA. See State of Louisiana v. Abbott Laboratories, Inc., et al ., C624522 (19th Jud. Dist. La.). The State of Louisiana sought damages, fines, penalties, attorneys’ fees and costs under various causes of action. In October 2015, the District Court ordered judgment for defendants on their exception for no right of action. The State of Louisiana appealed that decision and in October 2016, the Louisiana Court of Appeals, First Circuit, issued a decision affirming the dismissal as to certain counts and reversing the dismissal as to others. The State filed a petition for rehearing, which was denied by the court in December 2016. Both sides applied to Louisiana Supreme Court for a writ of certiorari to review the First Circuit’s decision. Those writs were denied in March 2017. Defendants filed exceptions for no cause of action in May 2017. A hearing on Defendants’ exceptions was held in July 2017. In March 2017, the State of Mississippi filed a complaint against our subsidiary EPI in the Chancery Court for the First Judicial District of Hinds County, Mississippi, alleging that EPI marketed products that were not approved by the FDA. The State of Mississippi seeks damages, penalties, attorneys’ fees, costs and other relief under various causes of action. In April 2017, EPI removed this case to the U.S. District Court for the Southern District of Mississippi. See State of Mississippi v. Endo Pharmaceuticals Inc. , No. 3:17-CV-277 (S.D. Miss.). In May 2017, the State of Mississippi filed a motion to remand and the case was consolidated for purposes of the remand motion with five other nearly identical cases brought by the State of Mississippi against other manufacturers. That motion is fully briefed and remains pending. We intend to contest the above cases vigorously and to explore other options as appropriate in our best interests. Litigation similar to that described above may also be brought by other plaintiffs in various jurisdictions. However, we cannot predict the timing or outcome of any such litigation, or whether any such litigation will be brought against us. We are unable to predict the outcome of these matters or the ultimate legal and financial liability, if any, and at this time cannot reasonably estimate the possible loss or range of loss for these matters, if any. Opioid-Related Litigations, Subpoenas and Document Requests In June 2014, Corporation Counsel for the City of Chicago filed suit in Illinois state court against multiple defendants, including our subsidiaries Endo Health Solutions Inc. (EHSI) and EPI, for alleged violations of city ordinances and other laws relating to defendants’ alleged opioid sales and marketing practices. In June 2014, the case was removed to the U.S. District Court for the Northern District of Illinois. In December 2014, defendants moved to dismiss the amended complaint and in May 2015, the District Court issued an order granting that motion in part, dismissing the case as to EHSI and EPI. In August 2015, plaintiff filed its second amended complaint against multiple defendants, including EPI and EHSI. In November 2015, defendants moved to dismiss the second amended complaint. In September 2016, the District Court granted in part and denied in part defendants’ motions to dismiss and provided plaintiff an opportunity to amend its complaint. Plaintiff filed the third amended complaint in October 2016. In December 2016, defendants moved to dismiss the re-pled claims in the third amended complaint, and filed their answers as to the claims not previously dismissed by the Court. Defendants are currently awaiting a ruling on their motions to dismiss. In May 2014, a lawsuit was filed in California Superior Court (Orange County) in the name of the People of the State of California, acting by and through County Counsel for Santa Clara County and the Orange County District Attorney, against multiple defendants, including our subsidiaries EHSI and EPI (with EPI being added as part of the first amended complaint in June 2014). The complaint asserted violations of California’s statutory Unfair Competition and False Advertising laws, as well as asserting a claim for public nuisance, based on alleged misrepresentations in connection with sales and marketing of opioids, including OPANA ® ER. Plaintiff sought declaratory relief, restitution, civil penalties (including treble damages), abatement, an injunction and attorneys’ fees and costs. Defendants, including our subsidiaries, filed various motions attacking the pleadings, including one requesting that the Superior Court refrain from proceeding under the doctrines of primary jurisdiction and equitable abstention. That motion was granted in August 2015, and the case was stayed pending further proceedings and findings by the FDA. In June 2016, plaintiffs filed a motion to lift the stay and to amend the complaint. Defendants, including EHSI and EPI, opposed that motion. Following a hearing in July 2016, the court provided plaintiffs an opportunity to seek leave to file another amended complaint. In August 2016, plaintiffs filed a renewed motion to lift the stay and amend the complaint. In October 2016, the court granted, in part, plaintiffs’ renewed motion to lift the stay and the plaintiffs filed their third amended complaint. Defendants were not required to respond to this complaint. In July 2017, plaintiffs filed a fourth amended complaint, to which defendants’ response is not yet due. In December 2015, a lawsuit was filed in the Chancery Court of the First Judicial District of Hinds County, Mississippi by the State of Mississippi against multiple defendants, including our subsidiaries EHSI and EPI. The complaint alleges violations of Mississippi’s Consumer Protection Act and various other claims arising out of defendants’ alleged opioid sales and marketing practices. Plaintiff seeks declaratory relief, restitution, civil penalties, abatement, an injunction and attorneys’ fees and costs. In March 2016, defendants moved to dismiss the complaint and to transfer the case from Hinds County to Rankin County. The motion to transfer was denied in February 2017. In March 2017, Defendants petitioned for an interlocutory appeal of that ruling, and in May 2017 the Mississippi Supreme Court agreed to hear the appeal and stayed proceedings in the Hinds County Chancery Court until resolution of the appeal. The motion to dismiss also remains pending. In August 2016, the County of Suffolk, New York filed suit in New York Supreme Court (Suffolk County) against multiple defendants, including our subsidiaries EHSI and EPI, for alleged violations of state false and deceptive advertising and other statutes, public nuisance, common law fraud and unjust enrichment based on opioid sales and marketing practices. The County of Suffolk is seeking compensatory damages, interest, costs, disbursements, punitive damages, treble damages, penalties and attorneys’ fees. Defendants, including our subsidiaries, filed motions to dismiss and to stay in January 2017. The hearing on those motions is scheduled for September 2017. In February 2017, Broome County, New York, and Erie County, New York, filed similar suits in New York Supreme Court (Broome County and Erie County, respectively). Defendants also filed motions to dismiss in Broome and Erie Counties. Between May and June 2017, several other New York counties also filed similar suits in New York Supreme Court within their respective counties. Those counties are: Orange County, Dutchess County, Seneca County, Sullivan County, Nassau County and Schenectady County. In July 2017, the pharmaceutical defendants, including our subsidiaries, moved to coordinate the nine New York county suits within the Supreme Court of the State of New York, County of Suffolk for pre-trial purposes. The State of New York Supreme Court Litigation Coordinating Panel granted the motion in July 2017. In March 2017, the Boone County Commission filed suit in the U.S. District Court for the Southern District of West Virginia against multiple defendants, including our subsidiary Generics Bidco I, LLC, for the alleged violation of federal and state safety laws designed to monitor, detect and prevent the diversion of controlled substances. The complaint generally seeks compensatory and punitive damages for the alleged creation of a public nuisance. That case is currently stayed as to Generics Bidco I, LLC, pending resolution of motions to dismiss filed by certain other pharmaceutical distributor defendants. In May 2017, San Joaquin County, the City of Stockton, California and the Montezuma Fire Protection District filed suit in California Superior Court (San Joaquin County) against multiple defendants, including our subsidiaries EHSI and EPI, asserting various claims arising out of defendants’ alleged misrepresentations in connection with sales and marketing of opioids. The plaintiffs in that case seek compensatory damages, punitive damages and attorneys’ fees and costs. In July 2017, our subsidiaries removed the case to the U.S. District Court for the Eastern District of California. In May 2017, the State of Ohio filed suit in the Ohio state court (Ross County) against multiple defendants, including EPI and EHSI. The complaint asserts that defendants, including our subsidiaries, violated the Ohio Consumer Sales Practices Act, the Ohio Medicaid Fraud Act and the Ohio Corrupt Practices Act. The complaint also asserts other statutory and common law claims against the defendants, including our subsidiaries. The State’s claims arise out of defendants’ alleged misrepresentations in connection with sales and marketing of opioids. The State of Ohio seeks declaratory and injunctive relief, compensatory, punitive and treble damages, restitution, civil penalties and attorneys’ fees and costs. In June 2017, the City of Dayton, Ohio filed suit in Ohio state court (Montgomery County) against our subsidiaries EPI and EHSI and other defendants, asserting claims for violation of Ohio’s consumer sales practice statute, violation of Ohio’s deceptive trade practices statute, public nuisance, unjust enrichment and fraud arising from alleged misrepresentations in connection with sales and marketing of opioids. The complaint also asserts a claim for negligence against pharmaceutical distributors named as defendants, but does not assert that claim as to EPI or EHSI. The City of Dayton seeks compensatory damages, treble damages, penalties, punitive damages, interest, costs and disbursements. In July 2017, our subsidiaries removed the case to the U.S. District Court for the Southern District of Ohio. In August 2017, the City of Dayton filed a motion to remand the case to state court, which remains pending. The City of Lorain, Ohio filed a similar suit in Ohio state court (Lorain County) in June 2017, which also names our subsidiaries, along with other defendants. In August 2017, our subsidiaries removed the case to the U.S. District Court for the Northern District of Ohio. In June 2017, Barry Staubus in his official capacity as the District Attorney General for the Second Judicial District, TN, Tony Clark, in his official capacity as the District Attorney General for the First Judicial District, TN, and Dan Armstrong, in his official capacity as the District Attorney General for the Third Judicial District, TN, along with plaintiff “Baby Doe,” filed suit against EPI, EHSI and other defendants in Tennessee Circuit Court (Sullivan County). The suit asserts claims for violation of the Tennessee Drug Dealer Liability Act and public nuisance and also seeks a declaration that Tennessee’s statutory caps on personal injury and punitive damages violate Tennessee’s state constitution. The plaintiffs also seek compensatory and punitive damages, restitution, injunctive relief and attorneys’ fees and costs. In July 2017, our subsidiaries removed the case to the U.S. District Court for the Eastern District of Tennessee. In August 2017, the plaintiffs filed a motion to remand the case to state court, which remains pending. In June 2017, the State of Missouri filed suit against EPI, EHSI and other defendants in the Circuit Court of St. Louis City, Missouri asserting claims for violations of the Missouri Merchandising Practices Act and other state law claims based on defendants’ alleged misrepresentations in connection with sales and marketing of opioids. The state seeks civil penalties, damages, restitution, attorneys’ fees and costs and punitive damages. In June 2017, a lawsuit was filed in the Illinois Circuit Court of the First Judicial Circuit (Union County) in the name of the People of the State of Illinois, the People of Union County and Union County against EPI, EHSI and other defendants. The complaint asserts state statutory claims based on alleged misrepresentations in connection with sales and marketing of opioids. A similar lawsuit was also filed in the Illinois Circuit Court of the Seventh Judicial Circuit (Jersey County) in the name of the People of the State of Illinois, the People of Jersey County and Jersey County against EPI, EHSI and other defendants. Both complaints seek injunctive relief, restitution, disgorgement, civil penalties, attorneys’ fees and costs. In June 2017, a class action complaint was filed in the United States District Court of the Western District of Arkansas against our subsidiaries EPI and EHSI and other defendants. The complaint alleges that defendants violated Arkansas deceptive trade practices law and have been unjustly enriched by their alleged opioid sales and marketing practices, and seeks an order requiring defendants to fund a medical monitoring program to identify problematic opioid use. The complaint also seeks damages, restitution, disgorgement, other injunctive relief and attorneys’ fees and costs. In August 2017, the County of Multnomah, Oregon filed suit in Oregon state court against our subsidiaries EPI and EHSI and other defendants, asserting claims for public nuisance, abnormally dangerous activity, gross negligence, fraud and deceit, and negligence. The plaintiff seeks damages, interest and costs. We intend to contest the lawsuits identified above vigorously. In addition to the lawsuits described above, the Company and/or its subsidiaries have received subpoenas, civil investigative demands and informal requests for information concerning the sale and marketing of opioids, including the following: In September 2014, our subsidiaries EHSI and EPI received a Request for Information from the State of Tennessee Office of the Attorney General and Reporter seeking documents and information regarding the sales and marketing of opioids, including OPANA ® ER. In August 2015, our subsidiaries EHSI and EPI received a subpoena from the State of New Hampshire Office of the Attorney General seeking documents and information regarding the sales and marketing of opioids, including OPANA ® ER. We were cooperating with the State of New Hampshire Office of the Attorney General in its investigation until we learned it was being assisted by outside counsel hired on a contingent fee basis. The New Hampshire Attorney General initiated an action in the Superior Court for the State of New Hampshire to enforce the subpoena despite this contingent fee arrangement, and we (along with other companies that had received similar subpoenas) responded by filing a motion for protective order to preclude the use of contingent fee counsel. In addition, we filed a separate motion seeking declaratory relief. In March 2016, the Superior Court granted the motion for protective order on the grounds that the contingent fee agreement was invalid as ultra vires and that the office of the Attorney General had acted outside of its statutory authority in entering into the agreement with the contingent fee counsel. In April 2016, both the New Hampshire Attorney General and the companies that received subpoenas from the New Hampshire Attorney General, including EHSI and EPI, appealed, in part, the March 2016 Superior Court order to the New Hampshire Supreme Court. In June 2017, the New Hampshire Supreme Court issued its decision on the appeals, reversing the Superior Court |
