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Civil Investigative Demands (Anatomy and Implications) Peter A. Nolan Dawn E. Norman Winstead PC Austin, Texas April 25, 2013.

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Presentation on theme: "Civil Investigative Demands (Anatomy and Implications) Peter A. Nolan Dawn E. Norman Winstead PC Austin, Texas April 25, 2013."— Presentation transcript:

1 Civil Investigative Demands (Anatomy and Implications) Peter A. Nolan Dawn E. Norman Winstead PC Austin, Texas April 25, 2013

2 2 Civil Investigative Demands  Demand for Information by the Texas Attorney General's Office.  Information like that which would be subject to pretrial discovery.  Production of documents, interrogatories, and oral statements.

3 3  The Recipient –"Person" –broadly defined – (DTPA) possible DTPA violation  Demand for documents under Texas Deceptive Trade Practices Act §17.61  Demand for Reports and Examinations under DTPA §17.60  Request to examine books and records of a company under Business Organizations Code § Types of Civil Investigative Demands

4 Civil Investigative Demands (CID)  The Recipient −"Person" – broadly defined to include individuals and entities −(DTPA) possible DTPA violation  Service - §17.61(d) –delivering an executed copy to the person or the place of business 4

5 5 DTPA CID  Scope –Only production of documents-§17.61(a)  Distinguished from §17.60 Demand –No oral testimony –Few express protections

6 DTPA CID  Information Subject to Production –"any documentary material relevant to possible DTPA violation"-§17.61(a) –Subject matter, statute/section, and class of material for production- "reasonable specificity" -§17.61(b) –Permissive applicability of TRCP - "may contain"  Deadlines –No express restrictions –No "reasonable period" requirement 6

7 7 DTPA CID  Response –Work with Attorney General –Comprehensive/good faith –Documents - make available for inspection/copying§17.62(e) –No express provision regarding expenses –Agreements between Attorney General/Respondent are common

8 8 DTPA CID Challenges/Resisting  Petition to Modify/Set Aside –District court of residence or Travis County –20 days –Filing does not toll response deadline w/o court order-§17.61(g)  Attorney General Suit –Failure to comply –Compel Response –Intent to Evade  Misdemeanor, $5,000 fine, 1 year jail

9 9 DTPA CID Challenges/Resisting  Privileged/Confidential Information –Disclosure to "authorized employee" of Attorney General –Used by Attorney General "before any court" –Exempt under Public Information Act T EX. G OV ' T C ODE § –Trade secrets - court approval and "adequate notice" –Records may be maintained by Attorney General indefinitely  Potential Future Disclosures –Other litigation with "good cause" –Outside of litigation, Attorney General not required to give notice of disclosure

10 10 DTPA Demand for Reports and Examinations  Scope –Separate from DTPA CID statute –No requirement for "reasonable belief" that relevant information exists –Engaging in, has engaged in, is about to engage in DTPA violation or within public interest –Silent on service and notice –Person still broadly defined

11 DTPA Demand  Investigation Methods –Answers to written questions under oath-§17.60(1) –Examination under oath-§17.60(2) –Examine merchandise-§17.60(4)  Response Deadline –Silent on timing –No express standards governing Attorney General discretion on deadlines 11

12 12 DTPA Demand Challenges/Resisting  Challenging Demand –No express process for objecting or seeking court intervention –Attorney General retains same remedies and punishment options as for DTPA CID  Other Potential Pitfalls for Respondent –No right to copy of testimony –No express right to attorney representation –No express protection of trade secrets, privileged or confidential information

13 13 DTPA Demand Challenges/Resisting  Protections –Agreement with Attorney General –Seek protection from Court when Attorney General demands information –Declaratory judgment that Attorney General is not entitled to information  Privileged/Confidential Information –No express provisions protecting confidential info –Attorney General interprets §17.60 to mean documents may be subject to disclosure –Get agreement of Attorney General (perhaps return of documents) –Get court order

14 14 AG Examination Request  Authority/Scope –Texas Business Organizations Code –Examine books/records of any TX entity or foreign entity registered in TX-§  Service/Notice –Triggered by a "Visitorial Letter"-§12.152

15 15 AG Examination Request  Response –Must "immediately permit" examination –No express mechanism for judicial relief –Applies to records in and out of state –Respondent subject to forfeiture for failure to comply –Officer may be personally liable/Class B misdemeanor for refusing to allow Attorney General examination

16 16 AG Examination Request Challenges/Resisting  Privileged/Confidential Information –Attorney General may disclose in judicial/administrative proceeding, state suit to revoke registration or collect penalties, or to enforcement officers –Confidentiality provisions only apply if records requested pursuant to Request to Examine statute  Protections –No statutory method to challenge request –Use declaratory judgment –Agreement with Attorney General

17 17 Questions/Comments Peter A. Nolan WINSTEAD PC 401 Congress Ave., Suite 2100 Austin, Texas Phone:


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