A recent ruling by a federal court has curtailed the use of a century-old investigative tool previously employed by Texas Attorney General Ken Paxton. This decision restricts one of the more aggressive strategies in Paxton’s arsenal, compelling him to now rely on more restrained mechanisms when seeking information from businesses and organizations. The tool, known as the Request to Examine statute, has been deemed unconstitutional. This statute mandated the immediate production of records under threat of criminal prosecution, without allowing a pre-compliance review by a judge — a stipulation that Magistrate Judge Mark Lane found in violation of a 2015 Supreme Court decision. Further details on this development can be found here.
This particular ruling emerged from a case involving Spirit AeroSystems Inc., a Kansas-based manufacturer for Boeing 737 jets. Paxton’s office had issued an examination request in March to investigate alleged misrepresentations by Spirit as part of a private class action lawsuit in New York. The aggressive application towards a non-Texan entity brought Paxton’s use of this statute into question, especially given Spirit AeroSystems’ minimal presence in Texas. Legal experts, such as Gregg Sofer of Husch Blackwell, suggest that Paxton may have overextended his reach, placing the statute’s validity under scrutiny.
Historically, Paxton has utilized two principal investigative tools: the Request to Examine and Civil Investigative Demand (CID). The latter remains intact post-ruling, offering targets the option of pre-compliance judicial review. While the CID is less coercive, instances such as those involving PFLAG Inc., demonstrate its limitations, as seen when a Texas court blocked an investigation spurred by a CID initiated by Paxton. For more on the PFLAG case, refer to the ruling here.
In another significant ongoing case, Paxton’s office’s action against the Annunciation House Inc., an El Paso nonprofit, drew international attention. The swift demand for document production was criticized and halted by a trial court, a decision now pending review by the Texas Supreme Court. The case, which will see oral arguments in January, reflects the contentious nature of Paxton’s use of the Request to Examine, raising broader questions about the power dynamics inherent in state-level investigations.
Paxton’s office, for now, faces uncertainty on whether it will appeal the recent federal ruling, potentially altering its investigative approaches moving forward. The anticipated written decision by Judge Lane in the coming weeks is awaited by various stakeholders, including those previously targeted by the disputed statute.