Civil Investigative Demands
(Anatomy and Implications)
Peter A. Nolan
Dawn E. Norman
Winstead PC
Austin, Texas
April 25, 2013
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.
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Types of Civil Investigative
Demands
 Demand for documents under Texas
Deceptive Trade Practices Act §17.61
 The
Recipient
Demand
for Reports and Examinations
– "Person"
–broadly
defined
under
DTPA
§17.60
– (DTPA) possible DTPA violation
 Request to examine books and records of a
company under Business Organizations
Code §12.151
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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
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DTPA CID
 Scope
– Only production of documents-§17.61(a)
 Distinguished from §17.60 Demand
– No oral testimony
– Few express protections
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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
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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
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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
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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 TEX. GOV'T CODE
§552.101
– 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
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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
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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
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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
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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
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AG Examination Request
 Authority/Scope
– Texas Business Organizations Code
– Examine books/records of any TX entity or foreign
entity registered in TX-§12.151
 Service/Notice
– Triggered by a "Visitorial Letter"-§12.152
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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
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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
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Questions/Comments
Peter A. Nolan
WINSTEAD PC
401 Congress Ave., Suite 2100
Austin, Texas 78701
Phone: 512-370-2800
pnolan@winstead.com
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