Attorney General v Eli Lilly and Company (Mich Sup Ct, Docket No. 165961, decided July 31, 2026)
For more than two decades, some of Michigan’s biggest businesses had a powerful shield against consumer lawsuits: if a company was licensed or regulated by the state, courts often threw out claims under the Michigan Consumer Protection Act before they ever got started. On July 31, 2026, the Michigan Supreme Court took that shield away.
In a 4-3 decision, the Court ruled that being a licensed, regulated business does not give a company a free pass to deceive the public. The ruling revives Attorney General Dana Nessel’s investigation into insulin pricing by drugmaker Eli Lilly, and, more importantly for the rest of us, it restores real teeth to Michigan’s most important consumer-protection law.
What the case was about
Back in 2022, the Attorney General’s office began investigating whether Eli Lilly engaged in price-gouging on insulin, the life-sustaining medication that millions of Americans depend on. To dig into the company’s pricing practices, the Attorney General sought to enforce investigative subpoenas under the Michigan Consumer Protection Act (MCPA).
Eli Lilly pushed back and won in the lower courts, arguing that because pharmaceutical companies are heavily regulated, their conduct was exempt from the MCPA altogether. The case worked its way up to the Michigan Supreme Court, which heard arguments in late 2025.
The loophole the Court closed
The MCPA is supposed to protect Michigan residents from unfair, deceptive, and misleading business practices. But the law contains an exemption, MCL 445.904(1)(a), for conduct that is “specifically authorized” by a regulatory agency.
Two earlier Michigan Supreme Court decisions, Smith v Globe Life Insurance Co (1999) and Liss v Lewiston-Richards, Inc (2007), read that exemption very broadly. Under those cases, if the general kind of transaction a business engaged in was regulated or licensed by the state, the company was treated as exempt, even when the specific misconduct a consumer complained about had nothing to do with the licensing rules. In practice, that swept entire industries, including insurance, real estate, construction, finance, and health care, largely outside the reach of the law.
Writing for the majority, Justice Noah Hood concluded that those earlier cases had misread the statute. The exemption, the Court held, is far narrower than Smith and Liss suggested. What matters is whether the specific conduct being challenged was actually authorized by the regulator, not simply whether the business happens to hold a license or operate in a regulated field. Because the exemption had been stretched well beyond what the Legislature wrote, the Court overruled both prior decisions.
The case now returns to the Ingham County Circuit Court, where the Attorney General’s investigation can move forward. “Now, our extraordinary Consumer Protection Team can go back to helping residents who have been deceived by licensed businesses,” Nessel said after the ruling.
The dissent
The decision was not unanimous. In a dissent led by Justice Kyra Harris Bolden, three justices would have held that the dispute was not yet ripe for the Court to decide. Because the Attorney General had not yet formally accused Eli Lilly of an actual MCPA violation, the dissenters reasoned, there was no live controversy for the courts to resolve. It is a reminder that the investigation is still at an early stage, and that the company has not been found to have done anything wrong.
What this means for Michigan consumers
For everyday Michiganders, this ruling matters far beyond one drug company:
- Licensed businesses can once again be held accountable. A professional license or state oversight is no longer an automatic get-out-of-jail-free card when a business misleads or takes advantage of its customers.
- The Consumer Protection Act has its teeth back. Claims that were routinely dismissed under the old rule, involving regulated industries like insurance, home building, health care, and lending, may now be able to proceed.
- Regulation is a floor, not a ceiling. The decision confirms that following some licensing rules does not excuse deceptive or unfair conduct that harms the public.
The bottom line
The Michigan Supreme Court’s decision in Attorney General v Eli Lilly is a significant win for consumers. By closing a loophole that had protected powerful, well-regulated companies for a generation, the Court has made clear that Michigan’s consumer-protection law means what it says, and that no business is too big or too regulated to answer for deceiving the people it serves.
If you believe a licensed business, whether an insurer, a health care provider, a lender, or a contractor, has treated you unfairly or misled you, you may have more options now than you did a week ago. It is worth talking with a lawyer about your rights.
This post is provided for general informational purposes and is not legal advice. Reading it does not create an attorney-client relationship. For advice about your specific situation, please consult a licensed attorney.
About the Author
Emily Peacock — Medical Malpractice & Nursing Home Abuse Attorney, Olsman MacKenzie Peacock
Emily Peacock is a Michigan medical malpractice and nursing home abuse attorney who brings more than a decade of defense-side experience to representing injured patients and families. She graduated from Wayne State University Law School in the top of her class and has been named a Michigan Super Lawyer every year since 2019. Her background defending hospitals and physicians gives her unique insight into how healthcare institutions evaluate and defend claims.
Michigan Super Lawyer (2019–2026). Treasurer, Michigan Association for Justice. J.D., Wayne State University Law School — Order of the Coif.