Texas 2025 - 89th Regular

Texas House Bill HB5621 Compare Versions

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1	1		By: Dutton H.B. No. 5621
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4	6		A BILL TO BE ENTITLED
5	7		AN ACT
6	8		Relating to the jurisdiction of district and county attorneys to
7	9		prosecute certain consumer protection violations.
8	10		BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
9	11		SECTION 1. Section 17.48, Business & Commerce Code, is
10	12		amended by adding the following:
11	13		(a) An act to which this section applies is subject to
12	14		action by a district or county attorney under Sections 17.58,
13	15		17.60, 17.61, and 17.62 to the same extent as the act is subject to
14	16		action by the consumer protection division under those sections.
15	17		(b) If a district or county attorney, under the authority of
16	18		this section, accepts assurance of voluntary compliance under
17	19		Section 17.58, the district or county attorney must file the
18	20		assurance of voluntary compliance in the district court in the
19	21		county in which the alleged violator resides or does business.
20	22		(c) If a district or county attorney, under the authority of
21	23		this section, executes and serves a civil investigative demand and
22	24		files a petition described in Section 17.61(g), the petition must
23	25		be filed in the district court in the county where the parties
24	26		reside.
25	27		(ad) It is the duty of the district and county attorneys to
26	28		lend to the consumer protection division any assistance requested
27	29		in the commencement and prosecutions of actions under this
28	30		subchapter.
29	31		(be) A district or county attorney, with prior written
30	32		notice to the consumer protection division, may institute and
31	33		prosecute actions under Section 17.47 to the same extent and in the
32	34		same manner as the consumer protection division so long as the
33	35		consumer protection division does not intend to institute or
34	36		prosecute an action with respect to that matter. A district or
35	37		county attorney may institute a suit described by this section on or
36	38		after the 90th day after the date the consumer protection division
37	39		receives written notice unless before the 90th day after the date
38	40		the notice is received the attorney general responds that it is
39	41		actively investigating or litigating at least one of the alleged
40	42		violations set forth in the notice. The consumer protection
41	43		division shall notify the district or county attorney it no longer
42	44		intends to actively investigate or litigate an alleged violation
43	45		within a reasonable time of such determination. On request, the
44	46		consumer protection division shall assist the district or county
45	47		attorney in any action taken under this subchapter. If an action is
46	48		prosecuted by a district or county attorney alone, he shall make a
47	49		full report to the consumer protection division including the final
48	50		disposition of the matter. No district or county attorney may bring
49	51		an action under this section against any licensed insurer or
50	52		licensed insurance agent transacting business under the authority
51	53		and jurisdiction of the State Board of Insurance unless first
52	54		requested in writing to do so by the State Board of Insurance, the
53	55		commissioner of insurance, or the consumer protection division
54	56		pursuant to a request by the State Board of Insurance or
55	57		commissioner of insurance.
56	58		(f) In an action prosecuted by a district or county attorney
57	59		under this subchapter for a violation of Section 17.46(b)(28),
58	60		three-fourths of any civil penalty awarded by a court must be paid
59	61		to the county where the court is located.
60	62		(g) A district or county attorney is not required to obtain
61	63		the permission of the consumer protection division to prosecute an
62	64		action under this subchapter for a violation of Section
63	65		17.46(b)(28), if the district or county attorney provides prior
64	66		written notice to the divisionas required by Subsection (b).
65	67		SECTION 2. Section 17.61, Business & Commerce Code is
66	68		amended to read as follows.
67	69		(a) Whenever the consumer protection division believes that
68	70		any person may be in possession, custody, or control of the original
69	71		copy of any documentary material relevant to the subject matter of
70	72		an investigation of a possible violation of this subchapter, an
71	73		authorized agent of the division may execute in writing and serve on
72	74		the person a civil investigative demand requiring the person to
73	75		produce the documentary material and permit inspection and copying.
74	76		(b) Each demand shall:
75	77		(1) state the statute and section under which the
76	78		alleged violation is being investigated, and the general subject
77	79		matter of the investigation;
78	80		(2) describe the class or classes of documentary
79	81		material to be produced with reasonable specificity so as to fairly
80	82		indicate the material demanded;
81	83		(3) prescribe a return date within which the
82	84		documentary material is to be produced; and
83	85		(4) identify the persons authorized by the consumer
84	86		protection division to whom the documentary material is to be made
85	87		available for inspection and copying.
86	88		(c) A civil investigative demand may contain a requirement
87	89		or disclosure of documentary material which would be discoverable
88	90		under the Texas Rules of Civil Procedure.
89	91		(d) Service of any demand may be made by:
90	92		(1) delivering a duly executed copy of the demand to
91	93		the person to be served or to a partner or to any officer or agent
92	94		authorized by appointment or by law to receive service of process on
93	95		behalf of that person;
94	96		(2) delivering a duly executed copy of the demand to
95	97		the principal place of business in the state of the person to be
96	98		served;
97	99		(3) mailing by registered mail or certified mail a
98	100		duly executed copy of the demand addressed to the person to be
99	101		served at the principal place of business in this state, or if the
100	102		person has no place of business in this state, to his principal
101	103		office or place of business.
102	104		(e) Documentary material demanded pursuant to this section
103	105		shall be produced for inspection and copying during normal business
104	106		hours at the principal office or place of business of the person
105	107		served, or at other times and places as may be agreed on by the
106	108		person served and the consumer protection division.
107	109		(f) No documentary material produced pursuant to a demand
108	110		under this section, unless otherwise ordered by a court for good
109	111		cause shown, shall be produced for inspection or copying by, nor
110	112		shall its contents be disclosed to any person other than the
111	113		authorized employee of the office of the attorney general or
112	114		district or county attorney without the consent of the person who
113	115		produced the material. The office of the attorney general or
114	116		district or county attorney shall prescribe reasonable terms and
115	117		conditions allowing the documentary material to be available for
116	118		inspection and copying by the person who produced the material or
117	119		any duly authorized representative of that person. The office of
118	120		the attorney general or district or county attorney may use the
119	121		documentary material or copies of it as it determines necessary in
120	122		the enforcement of this subchapter, including presentation before
121	123		any court. Any material which contains trade secrets shall not be
122	124		presented except with the approval of the court in which the action
123	125		is pending after adequate notice to the person furnishing the
124	126		material.
125	127		(g) At any time before the return date specified in the
126	128		demand, or within 20 days after the demand has been served,
127	129		whichever period is shorter, a petition to extend the return date
128	130		for, or to modify or set aside the demand, stating good cause, may
129	131		be filed in the district court in the county where the parties
130	132		reside, or a district court of Travis County.
131	133		(h) A person on whom a demand is served under this section
132	134		shall comply with the terms of the demand unless otherwise provided
133	135		by a court order.
134	136		(i) Personal service of a similar investigative demand
135	137		under this section may be made on any person outside of this state
136	138		if the person has engaged in conduct in violation of this
137	139		subchapter. Such persons shall be deemed to have submitted
138	140		themselves to the jurisdiction of this state within the meaning of
139	141		this section.
140	142		SECTION 3 Section 59.006 of the Texas Finance Code is
141	143		amended to read as follows:
142	144		(a) This section provides the exclusive method for
143	145		compelled discovery of a record of a financial institution relating
144	146		to one or more customers but does not create a right of privacy in a
145	147		record. This section does not apply to and does not require or
146	148		authorize a financial institution to give a customer notice of:
147	149		(1) a demand or inquiry from a state or federal
148	150		government agency authorized by law to conduct an examination of
149	151		the financial institution;
150	152		(2) a record request from a state or federal
151	153		government agency or instrumentality under statutory or
152	154		administrative authority that provides for, or is accompanied by, a
153	155		specific mechanism for discovery and protection of a customer
154	156		record of a financial institution, including a record request from
155	157		a federal agency subject to the Right to Financial Privacy Act of
156	158		1978 (12 U.S.C. Section 3401 et seq.), as amended, or from the
157	159		Internal Revenue Service under Section 1205, Internal Revenue Code
158	160		of 1986;
159	161		(3) a record request from or report to a government
160	162		agency arising out of:
161	163		(A) the investigation or prosecution of a
162	164		criminal offense;
163	165		(B) the investigation of alleged abuse, neglect,
164	166		or exploitation of an elderly or disabled person in accordance with
165	167		Chapter 48, Human Resources Code; or
166	168		(C) the assessment for or provision of
167	169		guardianship services under Subchapter E, Chapter 161, Human
168	170		Resources Code;
169	171		(4) a record request in connection with a garnishment
170	172		proceeding in which the financial institution is garnishee and the
171	173		customer is debtor;
172	174		(5) a record request by a duly appointed receiver for
173	175		the customer;
174	176		(6) an investigative demand or inquiry from a state
175	177		legislative investigating committee;
176	178		(7) an investigative demand or inquiry from the
177	179		attorney general of this state or a district or county attorney as
178	180		authorized by law other than the procedural law governing discovery
179	181		in civil cases;
180	182		(8) the voluntary use or disclosure of a record by a
181	183		financial institution subject to other applicable state or federal
182	184		law; or
183	185		(9) a record request in connection with an
184	186		investigation conducted under Section 1054.151, 1054.152, or
185	187		1102.001, Estates Code.
186	188		(b) A financial institution shall produce a record in
187	189		response to a record request only if:
188	190		(1) it is served with the record request not later than
189	191		the 24th day before the date that compliance with the record request
190	192		is required;
191	193		(2) before the financial institution complies with the
192	194		record request the requesting party pays the financial
193	195		institution's reasonable costs of complying with the record
194	196		request, including costs of reproduction, postage, research,
195	197		delivery, and attorney's fees, or posts a cost bond in an amount
196	198		estimated by the financial institution to cover those costs; and
197	199		(3) if the customer is not a party to the proceeding in
198	200		which the request was issued, the requesting party complies with
199	201		Subsections (c) and (d) and:
200	202		(A) the financial institution receives the
201	203		customer's written consent to release the record after a request
202	204		under Subsection (c)(3); or
203	205		(B) the tribunal takes further action based on
204	206		action initiated by the requesting party under Subsection (d).
205	207		(b-1) If the requesting party has not paid a financial
206	208		institution's costs or posted a cost bond as required by Subsection
207	209		(b)(2), a court may not:
208	210		(1) order the financial institution to produce a
209	211		record in response to the record request; or
210	212		(2) find the financial institution to be in contempt
211	213		of court for failing to produce the record.
212	214		(c) If the affected customer is not a party to the
213	215		proceeding in which the record request was issued, in addition to
214	216		serving the financial institution with a record request, the
215	217		requesting party shall:
216	218		(1) give notice stating the rights of the customer
217	219		under Subsection (e) and a copy of the request to each affected
218	220		customer in the manner and within the time provided by Rule 21a,
219	221		Texas Rules of Civil Procedure;
220	222		(2) file a certificate of service indicating that the
221	223		customer has been mailed or served with the notice and a copy of the
222	224		record request as required by this subsection with the tribunal and
223	225		the financial institution; and
224	226		(3) request the customer's written consent authorizing
225	227		the financial institution to comply with the request.
226	228		(d) If the customer that is not a party to the proceeding
227	229		does not execute the written consent requested under Subsection
228	230		(c)(3) on or before the date that compliance with the request is
229	231		required, the requesting party may by written motion seek an in
230	232		camera inspection of the requested record as its sole means of
231	233		obtaining access to the requested record. In response to a motion
232	234		for in camera inspection, the tribunal may inspect the requested
233	235		record to determine its relevance to the matter before the
234	236		tribunal. The tribunal may order redaction of portions of the
235	237		records that the tribunal determines should not be produced and
236	238		shall enter a protective order preventing the record that it orders
237	239		produced from being:
238	240		(1) disclosed to a person who is not a party to the
239	241		proceeding before the tribunal; and
240	242		(2) used by a person for any purpose other than
241	243		resolving the dispute before the tribunal.
242	244		(e) A customer that is a party to the proceeding bears the
243	245		burden of preventing or limiting the financial institution's
244	246		compliance with a record request subject to this section by seeking
245	247		an appropriate remedy, including filing a motion to quash the
246	248		record request or a motion for a protective order. Any motion filed
247	249		shall be served on the financial institution and the requesting
248	250		party before the date that compliance with the request is required.
249	251		A financial institution is not liable to its customer or another
250	252		person for disclosure of a record in compliance with this section.
251	253		(f) A financial institution may not be required to produce a
252	254		record under this section before the later of:
253	255		(1) the 24th day after the date of receipt of the
254	256		record request as provided by Subsection (b)(1);
255	257		(2) the 15th day after the date of receipt of a
256	258		customer consent to disclose a record as provided by Subsection
257	259		(b)(3); or
258	260		(3) the 15th day after the date a court orders
259	261		production of a record after an in camera inspection of a requested
260	262		record as provided by Subsection (d).
261	263		(g) An order to quash or for protection or other remedy
262	264		entered or denied by the tribunal under Subsection (d) or (e) is not
263	265		a final order and an interlocutory appeal may not be taken.
264	266		SECTION 4. The changes in law made by this Act apply only to
265	267		a cause of action that accrues on or after the effective date of
266	268		this Act. A cause of action that accrues before the effective date
267	269		of this Act is governed by the law as it existed immediately before
268	270		the effective date of this Act, and that law is continued in effect
269	271		for that purpose.
270	272		SECTION 5. This Act takes effect immediately if it receives
271	273		a vote of two-thirds of all members eleted to each house, as
272	274		provided by Section 39, Article III, Texas Constitution. If this
273	275		Act does not receive the vote necessary for immediate effect, this
274	276		Act takes effect September 1, 2025.