2006 Code of Virginia § 38.2-1916.1 - Investigation by Attorney General of suspected violations; investigative demand to witnesses; acces...

38.2-1916.1. Investigation by Attorney General of suspected violations;investigative demand to witnesses; access to business records, etc.;penalties.

A. 1. Whenever it appears to the Attorney General, either upon complaint orotherwise, that any person has engaged in, or is engaging in, or is about toengage in any act or practice prohibited by 38.2-1916, or any violation ofsubsection D of 38.2-1919, the Attorney General may, consistent with hispowers and duties to enforce the laws of the Commonwealth prohibiting conductthat unreasonably restrains trade, after notice to the Commission:

a. Either require or permit such person to file with him a statement inwriting or otherwise, under oath, as to all facts and circumstancesconcerning the subject matter;

b. Require such other data and information as he may deem relevant to thesubject matter of an investigation of a possible violation of 38.2-1916 orsubsection D of 38.2-1919; and

c. Issue an investigative demand to witnesses by which he may (i) compel theattendance of such witnesses; (ii) examine such witnesses under oath beforehimself or the Commission; (iii) subject to subsection B of this section,require the production of any documents or things that he deems relevant ormaterial to the inquiry; and (iv) issue written interrogatories to beanswered by the witness served or, if the witness served is a public orprivate corporation or a partnership or association or governmental agency,by any officer or agent, who shall furnish such information as is availableto the witness.

2. The investigative powers authorized shall not abate or terminate by reasonof any action or proceeding brought by the Attorney General or the Commissionunder this title. When a document or thing is demanded by an investigativedemand, that demand shall not (i) contain any requirement that would beunreasonable or improper if contained in a subpoena duces tecum issued by acourt of this Commonwealth; or (ii) require the disclosure of any document orthing that would be privileged, or production of which for any other reasonwould not be required by a subpoena duces tecum issued by a court of thisCommonwealth.

B. Where the information requested pursuant to an investigative demand may bederived or ascertained from the business records of the party upon whom theinterrogatory has been served or from an examination, audit, or inspection ofsuch business records, or from a compilation, abstract, or summary basedtherein, and the burden of deriving or ascertaining the answer issubstantially the same for the Attorney General as for the party from whomsuch information is requested, it shall be sufficient for that party tospecify the records from which the answer may be derived or ascertained andto afford the Attorney General, or other individuals properly designated bythe Attorney General, reasonable opportunity to examine, audit, or inspectsuch records and to make copies, compilations, abstracts, or summaries. TheAttorney General is authorized, and may so elect, to require the productionpursuant to this section, of documents or things before or after the takingof any testimony of the person summoned pursuant to an investigative demand,in which event, those documents or things shall be made available forinspection and copying during normal business hours at the principal place ofbusiness of the person served, or at such other time and place as may beagreed upon by the person served and the Attorney General.

C. Any investigative demand issued by the Attorney General under this sectionshall contain (i) a citation to this statute and section, (ii) a citation tothe statute and section pertaining to the alleged violation underinvestigation, (iii) the subject matter of the investigation, and (iv) thedate, place, and time the person is required to appear to produce testimonyor documentary material in his possession, custody or control. Such dateshall not be less than twenty days from the date of the investigative demand.Where documentary material is required to be produced, it shall be describedby class so as to clearly indicate the material demanded.

D. Service of an investigative demand as provided in this section may be madeby:

1. Delivery of a duly executed copy thereof to the person served or, if aperson is not a natural person, to the principal place of business of theperson to be served; or

2. Mailing by certified mail, return receipt requested, a duly executed copythereof addressed to the person to be served at his principal place ofbusiness in this Commonwealth, or if that person has no place of business inthis Commonwealth, to his principal office.

E. Within twenty days after the service of any such demand upon any person orenterprise, or at any time before the return date specified in the demand,whichever period is shorter, such party may file with the Commission andserve upon the Attorney General a petition for an order of the Commissionmodifying or setting aside such demand. The time allowed for compliance withthe demand, in whole or in part as deemed proper and ordered by theCommission, shall not run during the pendency of such petition in theCommission. Such petition shall specify each ground upon which the petitionerrelies in seeking such relief, and may be based upon any failure of suchdemand to comply with the provisions of this section or upon anyconstitutional or other legal right or privilege of such party. Theprovisions of this subsection shall be the exclusive means for a witnesssummoned pursuant to an investigative demand under this section to challengean investigative demand issued pursuant to subsection A of this section.

F. The examination of all witnesses under this section shall be conducted bythe Attorney General, or his designee, before an officer authorized toadminister oaths in this Commonwealth. The testimony shall be takenstenographically or by a sound-recording device and shall be transcribed.

G. Any person required to testify or to submit documentary evidence shall beentitled, on payment of lawfully prescribed cost, to procure a copy of anydocument produced by such person and of his own testimony as stenographicallyreported or, in the case of depositions, as reduced to writing by or underthe direction of a person taking the deposition. Any party compelled totestify or to produce documents or things may be accompanied and advised bycounsel, but counsel may not, as a matter of right, otherwise participate inthe investigation.

H. All persons served with an investigative demand by the Attorney Generalunder this section, other than any person or persons whose conduct orpractices are being investigated or any officer, director, or person in theemploy of such person under investigation, shall be paid the same fees andmileage as paid witnesses in the courts of this Commonwealth. No person shallbe excused from attending such inquiry pursuant to the mandate of aninvestigative demand, from producing a document or thing, or from beingexamined or required to answer questions, on the ground of failure to tenderor pay a witness fee or mileage, unless a demand therefor is made at the timetestimony is about to be taken and is made as a condition precedent tooffering such production or testimony and unless payment is not made.

I. Any natural person who neglects or refuses (i) to attend and testify, (ii)to answer any lawful inquiry, or (iii) to produce documents or things, if inhis power to do so, in obedience of an investigative demand or lawful requestof the Attorney General or those properly authorized by the Attorney General,pursuant to this section, shall be subject to the penalty provisions of 38.2-218. Any natural person who commits perjury, false swearing, or contemptin answering or failing to answer, or in producing a document or thing orfailing to do so in accordance with an investigative demand or lawful requestby the Attorney General, pursuant to this section, shall be guilty of amisdemeanor and upon conviction therefor by a court of competent jurisdictionshall be punished by a fine of not more than $5,000 or by imprisonment injail for not more than one year, or both.

J. In any investigation brought by the Attorney General pursuant to thischapter, no individual shall be excused from attending, testifying orproducing documentary material, objects, or intangible things in obedience toan investigative demand or under order of the Commission on the ground thatthe testimony, document, or thing required of him may tend to incriminate himor subject him to any penalty. No testimony or other information compelledeither by the Attorney General or under order of the Commission or a court orany information directly or indirectly derived from such testimony or otherinformation may be used against the individual or witness in any criminalcase. However, he may be prosecuted or subjected to penalty or forfeiture forany perjury, false swearing, or contempt committed in answering or failing toanswer, or in producing any document or thing or failing to do so inaccordance with the demand of the Attorney General or the Commission. If anindividual refuses to testify or produce any document or thing after beinggranted immunity from criminal prosecution and after being ordered to testifyor produce any document or thing as authorized by this section, he may befound to be in civil contempt by a court of competent jurisdiction andincarcerated until such time as he purges himself of contempt by testifying,producing such document or thing, or presenting a written statement asordered. Such finding of contempt shall not prevent the Attorney General frominstituting other appropriate contempt proceedings against any person whoviolates any of the provisions of this section.

K. It shall be the duty of all public state and local officials, theiremployees, and all other persons to render and furnish to the AttorneyGeneral or his designee, when so requested, all information and assistance intheir possession or within their power. Any officer participating in suchinquiry and any person examined as a witness upon such inquiry who disclosesto any person other than the Attorney General the name of any witnessexamined or any other information obtained upon such inquiry, except as sodirected by the Attorney General, shall be guilty of a misdemeanor andsubject to the sanctions prescribed in subsection I of this section. Suchinquiry may upon written authorization by the Attorney General be made public.

L. The Attorney General may recommend rules and regulations to implement andcarry out the provisions of this section. All such rules and regulationsshall be subject to the approval of the Commission.

M. It shall be the duty of the Attorney General, or his designees, tomaintain the secrecy of all evidence, testimony, documents, or other resultsof such investigations until formal proceedings are instituted. Violation ofthis subsection shall be punishable pursuant to 38.2-218. Nothing containedin this section shall be construed to prevent the disclosure of any suchinvestigative evidence by the Attorney General in his discretion to theCommissioner of Insurance, the State Corporation Commission, or to anyfederal or state law-enforcement authority that has restrictions governingconfidentiality similar to those contained in this subsection.

(1990, c. 596; 2002, c. 472.)