SENATE BILL REPORT

SB 6330

BYSenators Benitz and Rasmussen; by request of Attorney General

Amending consumer protection provisions.

Senate Committee on Energy & Utilities

Senate Hearing Date(s):January 19, 1990; January 25, 1990; January 26, 1990

Majority Report:  That Substitute Senate Bill No. 6330 be substituted therefor, and the substitute bill do pass.

      Signed by Senators Benitz, Chairman; Bluechel, Vice Chairman; Metcalf, Nelson, Owen, Stratton, Sutherland.

Senate Staff:David Monthie (786-7198)

                  January 30, 1990

AS REPORTED BY COMMITTEE ON ENERGY & UTILITIES, JANUARY 26, 1990

BACKGROUND:

The Consumer Protection Act permits the Attorney General to obtain information relevant to an investigation of possible violations through the use of a "civil investigative demand" (CID).  A CID is an order from the Attorney General to a person believed to have such information to produce documents or records, answer written questions, or submit to oral questioning.  The information obtained from the CID may not be disclosed by the Attorney General's office to any other person, unless permitted by a court order.  The process is not applicable to criminal prosecutions.

The value of this investigative tool has sometimes been diminished by the disclosure of the receipt of a CID to third parties.  For example, CIDs have been sent to telephone companies to obtain phone records for persons believed to be involved in unlawful activity; some telephone companies have felt themselves obligated to inform the customer of the demand from the Attorney General, thereby possibly compromising the investigation.  Similarly, an individual or company directly receiving a CID may be able to alert others with whom they are involved in possible unlawful activity.

In addition, the confidentiality provisions applicable to the CID process have prevented the Attorney General from providing details of unlawful activity to members of the Legislature or to other law enforcement agencies.

SUMMARY:

If a CID specifically prohibits the disclosure of its existence or contents to third parties, and in the absence of a superior court order to the contrary, a person who makes such a disclosure commits a misdemeanor.  An exception is made for disclosure to counsel for the recipient or as otherwise required by law.

Any material produced in response to a CID may be used in presentations to any committee or subcommittee of the state Legislature or the United States Congress.  Any material produced in response to a CID may be presented by the Attorney General to any officials and agencies of the federal government or other states, provided that prior to such disclosure the Attorney General has obtained a written agreement from such officials and agencies to abide by the confidentiality restrictions in the statute.

EFFECT OF PROPOSED SUBSTITUTE:

The Attorney General is permitted to order nondisclosure of a civil investigative demand only if permitted to do so by prior court order.  The provisions that would permit disclosure of information by the Attorney General to legislative committees and to other agencies are deleted.

Appropriation:    none

Revenue:    none

Fiscal Note:      requested January 11, 1990

Senate Committee - Testified: Cliff Finch, Assn. of Washington Business; Mike Grant, Jim Beaulaurier, Attorney General's Office; Jerry Sheehan, ACLU; Dale Vincent, U.S. West