87R5019 MWC-F
 
  By: Creighton S.B. No. 1247
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the Texas Free Enterprise and Antitrust Act of 1983.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 15.03, Business & Commerce Code, is
  amended by adding Subdivision (2-a) to read as follows:
               (2-a)  The term "investigative file" means any
  documentary materials or information collected, assembled, or
  maintained by or on behalf of the attorney general with respect to
  an investigation or litigation conducted under this chapter. The
  term includes:
                     (A)  interagency or intra-agency communications
  or memoranda;
                     (B)  notes;
                     (C)  reports;
                     (D)  products of discovery;
                     (E)  records of internal or external meetings;
                     (F)  civil investigative demands; and
                     (G)  other documents and communications with the
  attorney general that are relevant to the investigation or
  litigation.
         SECTION 2.  Section 15.10, Business & Commerce Code, is
  amended by amending Subsections (b), (c), (e), (g), (h), (i), and
  (k) to read as follows:
         (b)  Authority to Issue Demand. Whenever the attorney
  general has reason to believe that any person may be in possession,
  custody, or control of any documentary material or may have any
  information relevant to a civil antitrust investigation, the
  attorney general may, prior to the institution of a civil
  proceeding, issue in writing and serve upon such person a civil
  investigative demand requiring the person to produce or make
  available such documentary material for inspection and copying, to
  answer in writing written interrogatories, to give oral testimony,
  or to provide any combination of such material, answers, and
  testimony; provided, however, that the attorney general may not
  issue and serve a demand for documentary material upon a
  proprietorship or partnership whose annual gross income does not
  exceed $5 million.
         (c)  Contents of Demand.
               (1)  Each demand shall describe the nature of the
  activities that are the subject of the investigation and shall set
  forth each statute and section of that statute that may have been or
  may be violated as a result of such activities. Each demand shall
  advise the person upon whom the demand is to be served that
  objections [the person has the right to object] to the demand may be
  made in accordance with [as provided for in] this chapter
  [section].
               (2)  Each demand for production of documentary material
  shall:
                     (A)  describe the class or classes of material to
  be produced with reasonable specificity so that the material
  demanded is fairly identified;
                     (B)  prescribe a return date or dates which will
  provide a reasonable period of time within which the material is to
  be produced; and
                     (C)  identify the individual or individuals
  acting on behalf of the attorney general to whom the material is to
  be produced or made available for inspection and copying.
               (3)  Each demand for answers to written interrogatories
  shall:
                     (A)  propound the interrogatories with
  definiteness and certainty;
                     (B)  prescribe a date or dates by which answers to
  interrogatories shall be submitted; and
                     (C)  identify the individual or individuals
  acting on behalf of the attorney general to whom the answers should
  be submitted.
               (4)  Each demand for the giving of oral testimony
  shall:
                     (A)  prescribe a reasonable date, time, and place
  at which the testimony shall begin; and
                     (B)  identify the individual or individuals
  acting on behalf of the attorney general who will conduct the
  examination.
               (5)  No demand for any product of discovery may be
  returned until 20 days after the attorney general serves a copy of
  the demand upon the person from whom the discovery was obtained.
         (e)  Service; Proof of Service.
               (1)  Service of any demand or of any petition filed
  under Subsection (f) or (h) of this section may be made upon any
  natural person by delivering a duly executed copy of the demand or
  petition to the person to be served or by mailing such copy by
  registered or certified mail, return receipt requested, to such
  person at his or her residence or principal office or place of
  business.
               (2)  Service of any demand or of any petition filed
  under Subsection (f) or (h) of this section may be made upon any
  person other than a natural person by delivering a duly executed
  copy of the demand or petition to a person to whom delivery would be
  appropriate under state law if the demand or petition were process
  in a civil suit.
               (3)  A verified return by the individual serving any
  demand or any petition filed under Subsection (f) or (h) setting
  forth the manner of service shall be proof of such service. In the
  case of service by registered or certified mail, the return shall be
  accompanied by the return post office receipt of delivery of the
  demand or petition.
               (4)  Service of any demand may be made upon any person
  by e-mail or other electronic means if the person being served has
  consented to the electronic service in writing. Electronic service
  is complete upon sending, but electronic service is not effective
  if the attorney general learns that the demand did not actually
  reach the person to be served. Written confirmation of receipt
  through electronic service by the person being served constitutes
  proof of the service.
         (g)  Compliance With Demand.
               (1)  A person on whom a demand is served shall comply
  with the terms of the demand unless otherwise provided by court
  order.
               (2)  The time for compliance with the demand in whole or
  in part shall not run during the pendency of any petition filed
  under Subsection (f) of this section; provided, however, that the
  petitioner shall comply with any portions of the demand not sought
  to be modified or set aside.
               (3)  Documentary Material.
                     (A)  Any person upon whom any demand for the
  production of documentary material has been duly served under this
  section shall produce or make such material available to the
  attorney general for inspection and copying during normal business
  hours on the return date specified in the demand at the person's
  principal office or place of business or as otherwise may be agreed
  upon by the person and the attorney general. The attorney general
  shall bear the expense of any copying. The person may substitute
  copies for originals of all or part of the requested documents so
  long as the originals are made available for inspection. The person
  shall indicate in writing which if any of the documents produced
  contain trade secrets or confidential information.
                     (B)  The production of documentary material in
  response to any demand shall be made under a sworn certificate in
  such form as the demand designates by a natural person having
  knowledge of the facts and circumstances relating to such
  production to the effect that all of the requested material in the
  possession, custody, or control of the person to whom the demand is
  directed has been produced.
               (4)  Interrogatories.
                     (A)  Each interrogatory in any demand duly served
  under this section shall be answered separately and fully in
  writing, unless it is objected to, in which case the basis for the
  objection shall be set forth in lieu of an answer. The person shall
  indicate in writing which if any of the answers contain trade
  secrets or confidential information.
                     (B)  Answers to interrogatories shall be
  submitted under a sworn certificate in such form as the related
  demand designates by a natural person having knowledge of the facts
  and circumstances relating to the preparation of the answers to the
  effect that all of the requested information in the possession,
  custody, control, or knowledge of the person to whom the demand is
  directed has been set forth fully and accurately.
               (5)  Oral Examination.
                     (A)  The examination of any person pursuant to a
  demand for oral testimony duly served under this section shall be
  taken before any person authorized to administer oaths and
  affirmations by the laws of Texas or the United States. The person
  before whom the testimony is to be taken shall put the witness on
  oath or affirmation and shall personally or by someone acting under
  his or her direction and in his or her presence record the witness's
  testimony. At the expense of the attorney general, the testimony
  shall be taken stenographically and may be transcribed.
                     (B)  The oral testimony of any person taken
  pursuant to a demand served under this section shall be taken in the
  county where the person resides, is found, transacts business, or
  in such other place as may be agreed upon by the person and the
  attorney general.
                     (C)  Any person compelled to appear under a demand
  for oral testimony under this section may be accompanied,
  represented, and advised by counsel. Counsel may advise such
  person in confidence, either upon the request of such person or upon
  counsel's own initiative, with respect to any question arising in
  connection with the examination.
                     (D)  The individual conducting the examination on
  behalf of the attorney general shall exclude from the place of
  examination all other persons except the person being examined, the
  person's counsel, the counsel of the person to whom the demand has
  been issued, the person before whom the testimony is to be taken,
  any stenographer taking the testimony, and any persons assisting
  the individual conducting the examination.
                     (E)  During the examination, the person being
  examined or his or her counsel may object on the record to any
  question, in whole or in part, and shall briefly state for the
  record the reason for the objection. An objection may properly be
  made, received, and entered upon the record when it is claimed that
  such person is entitled to refuse to answer the question on grounds
  of any constitutional or other legal right or privilege, including
  the privilege against self-incrimination. Neither such person nor
  his or her counsel shall otherwise object to or refuse to answer any
  question or interrupt the oral examination. If the person refuses
  to answer any question, the attorney general may petition the
  district court in the county where the examination is being
  conducted for an order compelling the person to answer the
  question.
                     (F)  If and when the testimony has been fully
  transcribed, the person before whom the testimony was taken shall
  promptly transmit the transcript of the testimony to the witness
  and a copy of the transcript to the attorney general. The witness
  shall have a reasonable opportunity to examine the transcript and
  make any changes in form or substance accompanied by a statement of
  the reasons for such changes. The witness shall then sign and
  return the transcript, unless he or she is ill, cannot be found,
  refuses to sign, or in writing waives the signing. If the witness
  does not sign the transcript within 15 days of receiving it, the
  person before whom the testimony has been given shall sign it and
  state on the record the reason, if known, for the witness's failure
  to sign. The officer shall then certify on the transcript that the
  witness was duly sworn and that the transcript is a true record of
  the testimony given by the witness and promptly transmit a copy of
  the certified transcript to the attorney general.
                     (G)  Upon request, the attorney general shall
  furnish a copy of the certified transcript to the witness.
                     (H)  The witness shall be entitled to the same
  fees and mileage that are paid to witnesses in the district courts
  of Texas.
         (h)  Failure To Comply With Demand.
               (1)  Petition for Enforcement. Whenever any person
  fails to comply with any demand duly served on such person under
  this section, the attorney general may file in the district court in
  Travis County or in the county in which the person resides, is
  found, or transacts business and serve on the person a petition for
  an order of the court for enforcement of this section. [If the
  person transacts business in more than one county, the petition
  shall be filed in the county of the person's principal office or
  place of business in the state or in any other county as may be
  agreed upon by the person and the attorney general.]
               (2)  Deliberate Noncompliance. Any person, who, with
  intent to avoid, evade, or prevent compliance in whole or part with
  a demand issued under this section, removes from any place,
  conceals, withholds, destroys, mutilates, alters, or by any other
  means falsifies any documentary material or otherwise provides
  inaccurate information is guilty of a misdemeanor and on conviction
  is punishable by a fine of not more than $5,000 or by confinement in
  county jail for not more than one year or by both.
         (i)  Disclosure and Use of Material and Information.
               (1)  No [Except as provided in this section or ordered
  by a court for good cause shown, no] documentary material, answers
  to interrogatories, or transcripts of oral testimony, or copies or
  contents thereof, shall be available for examination or used by any
  person other than by an authorized official, employee, or agent of
  the attorney general, except:
                     (A)  by court order for good cause shown;
                     (B)  with [without] the consent of:
                           (i)  the person who produced the material,
  answers, or testimony; and
                           (ii) [,] in the case of any product of
  discovery, [of] the person from whom the discovery was obtained;
                     (C)  to an agency of this state, the United
  States, or another state or territory for official law enforcement
  purposes; or 
                     (D)  as provided elsewhere in this section.
               (2)  The attorney general may make available for
  inspection or prepare copies of documentary material, answers to
  interrogatories, or transcripts of oral testimony in his or her
  possession as he or she determines may be required by the state in
  the course of any investigation or a judicial proceeding in which
  the state is a party.
               (3)  The attorney general may make available for
  inspection or prepare copies of documentary material, answers to
  interrogatories, or transcripts of oral testimony in his or her
  possession as he or she determines may be required for official use
  by any officer of the State of Texas, [or of] the United States, or
  another state or territory charged with the enforcement of the laws
  of the State of Texas, [or] the United States, or that state or
  territory, as applicable; provided that any material disclosed
  under this subsection may not be used for criminal law enforcement
  purposes.
               (3-a)  The attorney general may make available for
  inspection or prepare copies of documentary material, answers to
  interrogatories, or transcripts of oral testimony in the attorney
  general's possession as may be required for official use by any
  authorized official, employee, or agent of the attorney general.
               (4)  Upon request, the attorney general shall make
  available copies of documentary material, answers to
  interrogatories, and transcripts of oral testimony for inspection
  by the person who produced such material or information and, in the
  case of a product of discovery, the person from whom the discovery
  was obtained or by any duly authorized representative of the
  person, including his or her counsel.
               (5)  Not later than 15 days prior to making public
  [disclosing] any documentary material or answers to written
  interrogatories designated as containing trade secrets or
  confidential information under this subsection, the attorney
  general shall notify the person who produced the material of the
  attorney general's intent to make the information public [such
  disclosure]. The person who produced the documentary material or
  answers to written interrogatories may petition a district court in
  any county of this state in which the person resides, does business,
  or maintains its principal office for a protective order limiting
  the terms under which the attorney general may use the [disclose
  such] trade secrets or confidential information in public,
  including in public court filings.
               (6)  Upon written request, the attorney general shall
  return documentary material produced under this section in
  connection with an antitrust investigation to the person who
  produced it whenever:
                     (A)  any case or proceeding before any court
  arising out of the investigation has been completed; or
                     (B)  the attorney general has decided after
  completing an examination and analysis of such material not to
  institute any case or proceeding before a court in connection with
  the investigation.
         (k)  Nonexclusive Procedures. Nothing in this section shall
  preclude the attorney general from using procedures not specified
  in the section in conducting an antitrust investigation; provided,
  however, that in conducting such an investigation, the attorney
  general shall use the procedures set forth in this section in lieu
  of those set forth in Article 1302-5.01 through Article 1302-5.06,
  Texas Miscellaneous Corporation Laws Act. Information, documentary
  materials, and communication with the attorney general provided
  under a procedure not specified in this section is confidential but
  may be used in a judicial proceeding at the attorney general's
  discretion.
         SECTION 3.  Section 15.12, Business & Commerce Code, is
  amended to read as follows:
         Sec. 15.12.  ADDITIONAL PROCEDURES. (a) In addition to the
  procedures set forth in this subchapter, the attorney general and
  any other party to a suit brought by the attorney general to enforce
  any of the prohibitions in Section 15.05 of this Act may request
  discovery and production of documents and other things, serve
  written interrogatories, and subpoena and depose witnesses in
  accordance with the applicable provisions of the Texas Rules of
  Civil Procedure and other state law relating to discovery.
         (b)  Documents and other information discovered or produced
  under Subsection (a) are confidential.
         SECTION 4.  Subchapter B, Chapter 15, Business & Commerce
  Code, is amended by adding Section 15.14 to read as follows:
         Sec. 15.14.  CONFIDENTIALITY OF INVESTIGATIVE FILES AND
  OTHER INFORMATION. The attorney general's investigative file,
  wholly or partly, and any other information or documentary material
  provided to the attorney general under this chapter are
  confidential and not subject to disclosure under Chapter 552,
  Government Code.
         SECTION 5.  The changes in law made by this Act apply only to
  a cause of action that accrues on or after the effective date of
  this Act. A cause of action that accrues before the effective date
  of this Act is governed by the law applicable to the cause of action
  immediately before that date, and that law is continued in effect
  for that purpose.
         SECTION 6.  This Act takes effect September 1, 2021.