Dozens of state attorneys general are opposing a private class-action settlement with Encore Capital Group, the nation’s largest debt buyer. Encore has reached a proposed agreement to pay $5.7 million to settle claims that it used phony affidavits to collect on debts. In some cases, borrowers ended up jail because of bad paperwork.

One lawyer said that the settlement would complicate state enforcement efforts because there would be nothing “left to go after.” The Mass. AG’s office claimed that the deal would leave Encore free to continue to engage in “wrongful debt-collection practices.” What are their practical concerns? Does legal preclusion apply? Are states’ remedies limited by the terms of private settlements?