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Asserting Privileges and Protections in Response to an FTC Civil Investigative Demand
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Asserting Privileges and Protections in Response to an FTC Civil Investigative Demand
When a company receives a civil investigative demand (CID) from the Federal Trade Commission (FTC), it can be an intimidating and concerning experience. A CID is essentially a subpoena that requires the recipient to provide information, documents, answers to interrogatories, or oral testimony related to an FTC investigation. While concerning, there are important privileges and protections available when responding to an FTC CID.
Meet and Confer
The first step when receiving a CID should always be to contact the FTC counsel listed on the demand and schedule a “meet and confer” within 14 days. This meeting provides the opportunity to ask questions, clarify anything that is unclear, and discuss modifying the CID to reduce the burden and cost of compliance [1].
- Get details on the scope and purpose of the investigation
- Ask questions about anything that is unclear in the CID
- Discuss limiting the date ranges or search terms to reduce volume
- Talk through technical questions about searching/producing electronically stored information
Protecting Privileged Information
It’s critical to carefully review a CID to identify any requests that encompass privileged information. Common privileges include:
- Attorney-client privilege – Protects confidential communications between attorney and client for the purpose of obtaining legal advice
- Work product doctrine – Protects materials prepared in anticipation of litigation by or for a party or representative
- Fifth Amendment – Protects against self-incrimination in criminal matters
During the meet and confer, you can discuss asserting privilege claims with FTC counsel. Be prepared to explain the nature of the privilege and potentially provide a privilege log that identifies documents withheld on privilege grounds without revealing privileged content itself [12].
Petition to Limit or Quash
If the meet and confer does not resolve issues with the CID, it may be possible to petition to have it limited or quashed in federal court. Grounds for petitions include that the information requested is duplicative, irrelevant to the investigation, or unduly burdensome to produce.
That said, the FTC’s investigative authority is broad and courts generally defer to it so the bar for quashing or limiting a CID is high. Consult experienced legal counsel when considering this option [9].
Responding Appropriately
Carefully following the below tips can help ensure an appropriate response to an FTC CID:
- Get organized immediately – Assemble key players to coordinate response
- Understand the requests – Review in detail, identify anything unclear
- Assert privileges properly – But don’t overreach
- Negotiate limits if appropriate – But pick battles carefully
- Maintain confidentiality – CIDs not usually made public initially
- Respond on time – Avoid risk of enforcement action
It can be helpful to consult with legal counsel that has specific experience dealing with FTC investigations and responses to ensure compliance with all requirements [3].
Consequences of Noncompliance
Failing to comply with an FTC CID can lead to significant consequences:
- An enforcement action petitioning a federal court to order compliance
- Fines for civil contempt for noncompliance
- Increased likelihood of eventual enforcement action or litigation
Given the substantial investigative powers, it is always wise to take an FTC CID very seriously and ensure responses are timely, appropriate and compliant.