Saying that Attorney General Eliot Spitzer had overstepped his jurisdiction, an attorney for tax-preparation giant H&R Block asked a judge yesterday to dismiss much of a lawsuit Mr. Spitzer filed against the company.

In March, Mr. Spitzer filed suit in state Supreme Court accusing the Kansas City, Mo.-based company of steering hundreds of thousands of customers toward faulty retirement accounts. Poorer customers with less money to contribute were guaranteed to lose money due to hidden fees, Mr. Spitzer charged. Mr. Spitzer made the claim on behalf of more than 500,000 Americans, including about 30,000 New Yorkers who had taken out H&R Block Express IRA accounts.

During oral arguments yesterday, the H&R Block attorney, Matthew Neumeier, said that under New York law, Mr. Spitzer could file the suit only on behalf of the relatively smaller group of New Yorkers.

“The New York attorney general is not a national police authority for companies outside of New York,” Mr. Neumeier told the judge, Karla Moscowitz. He called Mr. Spitzer’s suit “an affront of the sovereignty” of other states.

Under New York law, Mr. Spitzer’s suit can go forward in its entirety if the alleged act of deception occurred in New York. A lawyer in Mr. Spitzer’s office, James Park, argued that that had indeed happened, because money from the accounts was all forwarded to a bank in New York. Once in New York, Mr. Park said, hidden fees were deducted from accounts.

Mr. Neumeier argued that the marketing literature for the accounts was developed out of state. Mr. Spitzer has alleged that those pamphlets give account holders faulty economic forecasts and do not say enough about the fees.

The company has defended its product. Mr. Spitzer seeks restitution and at least $250 million in penalties.