Federal government agencies have many tools to obtain private information from people and entities prior to the initiation of formal court proceedings. One tool is a Civil Investigative Demand (CID). This is an administrative subpoena that demands the production of documents, answers to interrogatories, and/or oral testimony under oath. For example, the False Claims Act expressly authorizes the government to use civil investigative demands in False Claims Act investigations and describes the process the government must follow, 31 U.S.C. § 3733. Failure to comply with the CID opens up the recipient to civil and criminal liability. The CID must be taken seriously.
The government typically will hand-serve CIDs to the recipients. If in receipt of a CID, it is critically important to act swiftly. The CID can have multiple deadlines for providing responsive documents and answers.
One of the first steps that should be taken is to institute a legal hold to prevent the destruction of any relevant information. Whether intentional or not, the destruction of information by a person or entity who has been issued a CID can lead to sanctions and contempt proceedings. Thus, it is important to immediately suspend any routine data deletions.
After instituting the legal hold, the recipient of a CID should seek experienced legal counsel. Counsel will review the CID and formulate appropriate responses and legal strategies. Counsel may contact the issuing federal agency, seek extensions, and/or attempt to limit the scope of the CID.
Moreover, the CID may indicate that the recipient is the target of a federal investigation. As previously discussed in this blog, What is a Target, Subject, and Witness in a White Collar Investigation?, if you are a target, that means the government believes there is substantial evidence that you have committed a crime. Criminal charges are possible. A target needs to be advised about his or her Fifth Amendment rights against self-incrimination and will need to vigorously exercise those rights.
Experienced counsel can assist recipients of CIDs. nIf in receipt of a CID, it is very important to promptly seek advice.
Matthew P. Massey is a Partner in the White Collar, Government Investigations, and Special Matters Group. He is a former Assistant U.S. Attorney with the U.S. Attorney’s Office for the District of Columbia. He represents businesses and individuals in high stakes matters including federal criminal defense and white collar crimes.