Oklahoma Legal and Regulatory Developments Impacting Insurance and Compliance
The Oklahoma Office of the Attorney General reached a $5 million settlement with CVS Caremark over allegations that the pharmacy benefit manager reimbursed pharmacies at rates below medication costs, impacting the viability of local pharmacies. The settlement allocates nearly $5 million to pharmacies for underpayments on over 68,000 prescriptions between January 2024 and August 2025, highlighting ongoing regulatory scrutiny of PBM reimbursement practices and their effect on pharmacy access. Attorney General Gentner Drummond’s office noted CVS denies wrongdoing but agreed to the settlement to avoid prolonged litigation. In a separate legal development, Attorney General Drummond intervened in an ongoing bad faith insurance lawsuit against State Farm Fire and Casualty Company. The suit alleges the insurer orchestrated efforts to limit roof-related insurance claim payouts while seeking premium increases, raising concerns over homeowners insurance market conduct and claims handling in Oklahoma. A defamation suit filed against Nexstar Media Group by Christopher Renyles McCleary, involving the wrongful use of his photo in a broadcast, was revived after the appellate court permitted discovery on negligence and actual malice claims. The case underlines the legal risks media companies face regarding image use and verification processes. The 10th Circuit Court of Appeals sanctioned a pro se plaintiff, Rashonna Moore, for submitting appellate filings containing fabricated legal citations generated by artificial intelligence (AI). The decision addresses concerns about the misuse of AI in legal proceedings and emphasizes the need for verifying sources to preserve judicial integrity. In another appellate ruling, the 10th Circuit upheld the dismissal of a lawsuit by dog owners against the City of Locust Grove and local officials for alleged Fourth Amendment and emotional distress claims related to the euthanasia of their dogs. The court emphasized the legal principle regarding the voluntary abandonment of property. The 10th Circuit ordered acquittal and vacated the conviction of Dennis Hebert in an aggravated sexual abuse case within Indian Country, citing prosecutorial failure to prove Hebert’s Indian status beyond a reasonable doubt. The ruling highlights procedural requirements in federal Indian law cases and leaves open potential state or tribal prosecutions. Separately, David Prince, a former Oklahoma Department of Corrections chaplain, faces felony charges related to possession and distribution of juvenile pornography, based on state-monitored computer usage and law enforcement investigation. The case underscores regulatory and criminal compliance issues within correctional system personnel. Finally, a third trial for Karl Fontenot, convicted for a 1984 murder, progresses after the Oklahoma Court of Criminal Appeals ruled that his confession can be admitted as evidence. The protracted legal saga reflects ongoing judicial review of cold case convictions and evidentiary standards. Attorney General Drummond supports the trial continuation to fully present both sides' evidence. These developments collectively illustrate active judicial oversight involving regulatory compliance, claims practices, criminal justice, and media law pertinent to Oklahoma’s insurance and legal sectors.