A group of veterans and a benefits consulting firm are suing Maine Attorney General Aaron M. Frey over claims that a new law designed to shield the state’s veterans from predatory practices is unconstitutional, according to documents filed in the U.S. District Court for Maine on Friday.

The new law, which took effect Friday, prohibits anyone from receiving compensation for preparing, advising or assisting a veteran with a benefits matter. Supporters contend it will prevent veterans from being taken advantage of by so-called “claim sharks” – individuals and companies that charge exorbitant fees to assist in filing for benefits with the U.S. Department of Veterans Affairs and are not accredited.

Such companies may promise increased payouts, expedited claims decisions or heightened disability ratings, according to the Veterans of Foreign Wars. But veterans who use their services may end up being charged hidden fees or have trouble breaking contracts with the agencies.

Under the new law, signed by Gov. Janet Mills in April, receiving that compensation becomes a violation of the state’s Unfair Trade Practices Act. It does not apply to accredited representatives of recognized veterans assistance organizations or employees of the Maine Veterans’ Home who are acting in their work capacity.

In the suit, Veterans Guardian VA Claims Consulting, a veterans agency based in North Carolina, argues that the new law violates its First Amendment rights to speech, in the form of advice and assistance, and that its enforcement should be stopped. The company operates in all 50 states and has helped more than 250 Maine veterans “vindicate their rights before the VA,” according to the complaint.

Included among the plaintiffs are three Maine veterans, David Needham, Eric Dostie and Jeremiah Westbrook, who are currently clients of Veterans Guardian and wish to continue working with the company, the complaint states.

The new law also “violates the veteran plaintiffs’ First Amendment rights to discuss their claims with Veterans Guardian, to petition the government for redress of grievances, and to associate for that purpose,” they say in the complaint.

Veterans Guardian has been listed as a “claim shark” by the VFW, alongside roughly a dozen other agencies.

The company denies that classification in the complaint, arguing that the new rule is overly broad and groups “responsible industry participants like Veterans Guardian together with companies that might not be so scrupulous.”

Applying for VA benefits can be an arduous and confusing process, and accredited veteran service agencies like the VFW struggle to meet the needs of all veterans due to limited resources and staffing, Veterans Guardian said in the complaint. The company said roughly 70% of its clients had been unsuccessful in obtaining benefits with the help of free services.

The VA had approximately 250,000 backlogged claims in June, according to its website.

“(Even) if the law’s prohibitions could constitutionally be applied to some individuals and entities – like those actually engaged in bad behavior – it is unconstitutional as applied to Veterans Guardian given the company’s scrupulous and transparent practices,” the company’s complaint argues.

Danna Hayes, spokesperson for the attorney general, said the office cannot comment on pending litigation.

Paul McDonald, an attorney with the firm Bernstein Shur who is representing the plaintiffs, did not reply to questions emailed Monday night.