AN ACT Relating to the creation of the office of consumer protection in the office of the governor, and transferring certain functions, powers, and duties from the attorney general to the office of consumer protection; amending RCW 19.86.010, 19.86.080, 19.86.095, 19.86.100, 19.86.110, 19.86.120, 19.86.140, and 19.86.150; reenacting and amending RCW 43.10.067; adding a new section to chapter 19.86 RCW; adding a new section to chapter 43.10 RCW; creating new sections; and providing an effective date.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. A new section is added to chapter 19.86 RCW to read as follows:

The office of consumer protection is created within the office of the governor. The office of consumer protection shall be responsible for protecting the interests of consumers who have been injured by violations of this chapter, and for enforcing and administering the provisions of this chapter as required or authorized under such provisions. The governor shall appoint the director of the office, subject to confirmation by the senate. The person appointed shall serve at the pleasure of the governor.

NEW SECTION. Sec. 2. The director may employ such personnel and take such administrative actions as deemed appropriate for carrying out the powers and duties of the director and of the office under this chapter. The director may delegate any of his or her powers or duties to employees or members of the office staff. The director's salary shall be fixed by the governor in an amount not to exceed the recommendations of the committee on salaries, as provided under RCW 43.03.040.

Sec. 3. Section 1, chapter 216, Laws of 1961 and RCW 19.86.010 are each amended to read as follows:

As used in this chapter:

(1) "Person" shall include, where applicable, natural persons, corporations, trusts, unincorporated associations and partnerships.

(2) "Trade" and "commerce" shall include the sale of assets or services, and any commerce directly or indirectly affecting the people of the state of Washington.

(3) "Assets" shall include any property, tangible or intangible, real, personal, or mixed, and wherever situate, and any other thing of value.

(4) "Office" means the office of consumer protection.

(5) "Director" means the director of the office of consumer protection.

Sec. 4. Section 8, chapter 216, Laws of 1961 as amended by section 1, chapter 26, Laws of 1970 ex. sess. and RCW 19.86.080 are each amended to read as follows:

The ((~~attorney general~~)) director may bring an action in the name of the state against any person to restrain and prevent the doing of any act herein prohibited or declared to be unlawful; and the prevailing party may, in the discretion of the court, recover the costs of said action including a reasonable attorney's fee.

The court may make such additional orders or judgments as may be necessary to restore to any person in interest any moneys or property, real or personal, which may have been acquired by means of any act herein prohibited or declared to be unlawful.

Sec. 5. Section 5, chapter 288, Laws of 1983 and RCW 19.86.095 are each amended to read as follows:

In any proceeding in which there is a request for injunctive relief under RCW 19.86.090, the ((~~attorney general~~)) director shall be served with a copy of the initial pleading alleging a violation of this chapter. In any appellate proceeding in which an issue is presented concerning a provision of this chapter, the ((~~attorney general~~)) director shall, within the time provided for filing the brief with the appellate court, be served with a copy of the brief of the party presenting such issue.

Sec. 6. Section 10, chapter 216, Laws of 1961 as amended by section 3, chapter 26, Laws of 1970 ex. sess. and RCW 19.86.100 are each amended to read as follows:

In the enforcement of this chapter, the ((~~attorney general~~)) director may accept an assurance of discontinuance of any act or practice deemed in violation of this chapter, from any person engaging in, or who has engaged in, such act or practice. Any such assurance shall be in writing and be filed with and subject to the approval of the superior court of the county in which the alleged violator resides or has his principal place of business, or in Thurston county.

Such assurance of discontinuance shall not be considered an admission of a violation for any purpose; however, proof of failure to comply with the assurance of discontinuance shall be prima facie evidence of a violation of this chapter.

Sec. 7. Section 11, chapter 216, Laws of 1961 as last amended by section 1, chapter 137, Laws of 1982 and RCW 19.86.110 are each amended to read as follows:

(1) Whenever the ((~~attorney general~~)) director believes that any person (a) may be in possession, custody, or control of any original or copy of any book, record, report, memorandum, paper, communication, tabulation, map, chart, photograph, mechanical transcription, or other tangible document or recording, wherever situate, which he or she believes to be relevant to the subject matter of an investigation, answer written interrogatories, or give oral testimony of a possible violation of RCW 19.86.020, 19.86.030, 19.86.040, 19.86.050, or 19.86.060, or (b) may have knowledge of any information which the ((~~attorney general~~)) director believes relevant to the subject matter of such an investigation, he or she may, prior to the institution of a civil proceeding thereon, execute in writing and cause to be served upon such a person, a civil investigative demand requiring such person to produce such documentary material and permit inspection and copying, to answer in writing written interrogatories, to give oral testimony, or any combination of such demands pertaining to such documentary material or information: PROVIDED, That this section shall not be applicable to criminal prosecutions.

(2) Each such demand shall:

(a) State the statute and section or sections thereof, the alleged violation of which is under investigation, and the general subject matter of the investigation;

(b) If the demand is for the production of documentary material, describe the class or classes of documentary material to be produced thereunder with reasonable specificity so as fairly to indicate the material demanded;

(c) Prescribe a return date within which the documentary material is to be produced, the answers to written interrogatories are to be made, or a date, time, and place at which oral testimony is to be taken; and

(d) Identify the members of the ((~~attorney general's~~)) office staff to whom such documentary material is to be made available for inspection and copying, to whom answers to written interrogatories are to be made, or who are to conduct the examination for oral testimony.

(3) No such demand shall:

(a) Contain any requirement which would be unreasonable or improper if contained in a subpoena duces tecum, a request for answers to written interrogatories, or a request for deposition upon oral examination issued by a court of this state; or

(b) Require the disclosure of any documentary material which would be privileged, or which for any other reason would not be required by a subpoena duces tecum issued by a court of this state.

(4) Service of any such demand may be made by:

(a) Delivering a duly executed copy thereof to the person to be served, or, if such person is not a natural person, to any officer or managing agent of the person to be served; or

(b) Delivering a duly executed copy thereof to the principal place of business in this state of the person to be served; or

(c) Mailing by registered or certified mail a duly executed copy thereof addressed to the person to be served at the principal place of business in this state, or, if said person has no place of business in this state, to ((~~his~~)) that person's principal office or place of business.

(5)(a) Documentary material demanded pursuant to the provisions of this section shall be produced for inspection and copying during normal business hours at the principal office or place of business of the person served, or at such other times and places as may be agreed upon by the person served and the ((~~attorney general~~)) director;

(b) Written interrogatories in a demand served under this section shall be answered in the same manner as provided in the civil rules for superior court;

(c) The oral testimony of any person obtained pursuant to a demand served under this section shall be taken in the same manner as provided in the civil rules for superior court for the taking of depositions. In the course of the deposition, the ((~~assistant attorney general~~)) office's staff member conducting the examination may exclude from the place where the examination is held all persons other than the person being examined, the person's counsel, and the officer before whom the testimony is to be taken;

(d) Any person compelled to appear pursuant to a demand for oral testimony under this section may be accompanied by counsel;

(e) The oral testimony of any person obtained pursuant to a demand served under this section shall be taken in the county within which the person resides, is found, or transacts business, or in such other place as may be agreed upon between the person served and the ((~~attorney general~~)) director.

(6) No documentary material, answers to written interrogatories, or transcripts of oral testimony produced pursuant to a demand, or copies thereof, shall, unless otherwise ordered by a superior court for good cause shown, be produced for inspection or copying by, nor shall the contents thereof be disclosed to, other than an authorized employee of the ((~~attorney general~~)) office, without the consent of the person who produced such material, answered written interrogatories, or gave oral testimony: PROVIDED, That, under such reasonable terms and conditions as the ((~~attorney general~~)) director shall prescribe, the copies of such documentary material, answers to written interrogatories, or transcripts of oral testimony shall be available for inspection and copying by the person who produced such material, answered written interrogatories, or gave oral testimony, or any duly authorized representative of such person. The ((~~attorney general or any assistant attorney general~~)) director may use such copies of documentary material, answers to written interrogatories, or transcripts of oral testimony as he or she determines necessary in the enforcement of this chapter, including presentation before any court: PROVIDED, That any such material, answers to written interrogatories, or transcripts of oral testimony which contain trade secrets shall not be presented except with the approval of the court in which action is pending after adequate notice to the person furnishing such material, answers to written interrogatories, or oral testimony.

(7) At any time before the return date specified in the demand, or within twenty days after the demand has been served, whichever period is shorter, a petition to extend the return date for, or to modify or set aside a demand issued pursuant to subsection (1), stating good cause, may be filed in the superior court for Thurston county, or in such other county where the parties reside. A petition, by the person on whom the demand is served, stating good cause, to require the ((~~attorney general~~)) director or any person to perform any duty imposed by the provisions of this section, and all other petitions in connection with a demand, may be filed in the superior court for Thurston county, or in the county where the parties reside. The court shall have jurisdiction to impose such sanctions as are provided for in the civil rules for superior court with respect to discovery motions.

(8) Whenever any person fails to comply with any civil investigative demand for documentary material, answers to written interrogatories, or oral testimony duly served upon him or her under this section, or whenever satisfactory copying or reproduction of any such material cannot be done and such person refuses to surrender such material, the ((~~attorney general~~)) director may file, in the trial court of general jurisdiction of the county in which such person resides, is found, or transacts business, and serve upon such person a petition for an order of such court for the enforcement of this section, except that if such person transacts business in more than one county such petition shall be filed in the county in which such person maintains his or her principal place of business, or in such other county as may be agreed upon by the parties to such petition. Whenever any petition is filed in the trial court of general jurisdiction of any county under this section, such court shall have jurisdiction to hear and determine the matter so presented and to enter such order or orders as may be required to carry into effect the provisions of this section, and may impose such sanctions as are provided for in the civil rules for superior court with respect to discovery motions.

Sec. 8. Section 12, chapter 216, Laws of 1961 as amended by section 5, chapter 26, Laws of 1970 ex. sess. and RCW 19.86.120 are each amended to read as follows:

Any action to enforce a claim for damages under RCW 19.86.090 shall be forever barred unless commenced within four years after the cause of action accrues: PROVIDED, That whenever any action is brought by the attorney general for a violation of RCW 19.86.020, 19.86.030, 19.86.040, 19.86.050, or 19.86.060, except actions for the recovery of a civil penalty for violation of an injunction or actions under RCW 19.86.090, the running of the foregoing statute of limitations, with respect to every private right of action for damages under RCW 19.86.090 which is based in whole or part on any matter complained of in said action by the ((~~attorney general~~)) director, shall be suspended during the pendency thereof.

Sec. 9. Section 14, chapter 216, Laws of 1961 as last amended by section 2, chapter 288, Laws of 1983 and RCW 19.86.140 are each amended to read as follows:

Every person who shall violate the terms of any injunction issued as in this chapter provided, shall forfeit and pay a civil penalty of not more than twenty-five thousand dollars.

Every person, other than a corporation, who violates RCW 19.86.030 or 19.86.040 shall pay a civil penalty of not more than one hundred thousand dollars. Every corporation which violates RCW 19.86.030 or 19.86.040 shall pay a civil penalty of not more than five hundred thousand dollars.

Every person who violates RCW 19.86.020 shall forfeit and pay a civil penalty of not more than two thousand dollars for each violation: PROVIDED, That nothing in this paragraph shall apply to any radio or television broadcasting station which broadcasts, or to any publisher, printer or distributor of any newspaper, magazine, billboard or other advertising medium who publishes, prints or distributes, advertising in good faith without knowledge of its false, deceptive or misleading character.

For the purpose of this section the superior court issuing any injunction shall retain jurisdiction, and the cause shall be continued, and in such cases the ((~~attorney general~~)) director acting in the name of the state may petition for the recovery of civil penalties.

With respect to violations of RCW 19.86.030 and 19.86.040, the ((~~attorney general~~)) director, acting in the name of the state, may seek recovery of such penalties in a civil action.

Sec. 10. Section 15, chapter 216, Laws of 1961 and RCW 19.86.150 are each amended to read as follows:

Upon petition by the ((~~attorney general~~)) director, the court may, in its discretion, order the dissolution, or suspension or forfeiture of franchise, of any corporation which shall violate RCW 19.86.030 or 19.86.040 or the terms of any injunction issued as in this chapter provided.

NEW SECTION. Sec. 11. A new section is added to chapter 43.10 RCW to read as follows:

Except to the extent of an agreement to the contrary between the attorney general and the director of the office of consumer protection, the attorney general shall not provide any legal services required for the administration or enforcement of chapter 19.86 RCW.

Sec. 12. Section 43.10.067, chapter 8, Laws of 1965 as last amended by section 108, chapter 7, Laws of 1985 and by section 2, chapter 133, Laws of 1985 and RCW 43.10.067 are each reenacted and amended to read as follows:

No officer, director, administrative agency, board, or commission of the state, other than the attorney general, shall employ, appoint or retain in employment any attorney for any administrative body, department, commission, agency, or tribunal or any other person to act as attorney in any legal or quasi legal capacity in the exercise of any of the powers or performance of any of the duties specified by law to be performed by the attorney general, except where it is provided by law to be the duty of the judge of any court or the prosecuting attorney of any county to employ or appoint such persons: PROVIDED, That RCW 43.10.040, and RCW 43.10.065 through 43.10.080 shall not apply to the administration of the judicial council, the judicial qualifications commission, the state law library, the law school of the state university, the administration of the state bar act by the Washington State Bar Association, or the representation of an estate administered by the director of the department of revenue or the director's designee pursuant to chapter 11.28 RCW.

The authority granted by chapter 1.08 RCW and RCW 44.28.140 shall not be affected hereby.

This section shall not apply to the office of consumer protection under chapter 19.68 RCW.

NEW SECTION. Sec. 13. All reports, documents, surveys, books, records, files, papers, or other written material in the possession of the attorney general and which pertain to the attorney general's administration or enforcement of chapter 19.86 RCW shall be delivered to the custody of the office of consumer protection. All cabinets, furniture, office equipment, motor vehicles, and other tangible property used by the attorney general in carrying out the powers and duties of chapter 19.86 RCW shall be made available to the office of consumer protection. All funds, credits, or other assets held in connection with the attorney general's functions or powers or duties under chapter 19.86 RCW, shall be assigned to the office.

Any appropriations made to the attorney general for the purpose of carrying out the powers and duties of the attorney general under chapter 19.86 RCW, shall, on the effective date of this act, be transferred and credited to the office of consumer protection for the purpose of carrying out the transferred powers and duties.

Whenever any question arises as the transfer of any personnel, funds, including unexpended balances within any accounts, books, documents, records, papers, files, equipment or any other tangible property used or held in the exercise of the powers and the performance of the duties and functions of the attorney general under chapter 19.86 RCW, the director of financial management shall make the determination as to the proper allocation and certify the same to the state agencies involved.

NEW SECTION. Sec. 14. All classified employees of the attorney general employed primarily in the administration or enforcement of chapter 19.86 RCW are transferred to the jurisdiction of the office of consumer protection where they shall be assigned to perform their usual duties upon the same terms as formerly, without any loss of rights, subject to any action that may be appropriate thereafter in accordance with the laws and rules governing state civil service.

NEW SECTION. Sec. 15. All pending business before the attorney general's office on the effective date of this act and which relate to the administration or enforcement of chapter 19.86 RCW shall be transferred to the office of consumer protection.

NEW SECTION. Sec. 16. The transfers of powers, duties, functions and personnel of the attorney general, as required by sections 13 though 15 of this act, shall not affect the validity of any act performed prior to the effective date of this act by the attorney general or any employee of the attorney general.

NEW SECTION. Sec. 17. This act shall take effect on July 1, 1986.

NEW SECTION. Sec. 18. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.