I have mentioned before that there are serious consequences to not responding to a subpoena issued by the Attorney General. In this article, I want to explain a little more about those consequences. Generally speaking, both Wyoming and Colorado have similar statutory authority for issuing and enforcing civil investigative subpoenas. However, there are a couple of distinctions between them.
Penalties for not responding
Both states allow the Attorney General to issue subpoenas to gather evidence and interview witnesses. If a party fails to respond to the subpoena, the Attorney General is authorized to apply to the district court for an order to enforce the subpoena. Colorado's statute goes one step further and even allows the court to issue an order prohibiting the subpoenaed company from the sale or advertisement of its property in the state. Colorado courts have also issued orders requiring the subpoenaed company to pay the Attorney General's attorneys fees and costs in enforcing the subpoena. This can affect your company even if it is out of state, as the Colorado Attorney General's Office has been known to take such an order and file it in the state in which the target company is located, and enforce the order there to recover the fees and costs.
Another difference between Wyoming and Colorado is that Wyoming companies are subject to dissolution of they fail to respond to a valid subpoena. What this means is that if you formed a Wyoming limited liability company (LLC) or corporation, and your company fails to respond to a subpoena issued by the Wyoming Attorney General's Office, then your company could be dissolved by the Wyoming Secretary of State.
The bottom line is that if your company fails to respond to a Colorado subpoena, it could face an order prohibiting it from operating in Colorado and being obligated to pay attorneys fees. If your company fails to respond to a Wyoming subpoena, and it is a Wyoming company, it could be dissolved. And in every case, your company could be subject to a civil action in district court to enforce the subpoena.
The focus may turn to you personally if the company does not respond
Another downside to not responding to a civil investigative subpoena is that the Attorney General's Office may go after you personally. There is a legal basis to pursue consumer protection act claims against those directly involved in the alleged violations. Even if you have formed an LLC to insulate you from liability, you can still be personally liable for violations of the consumer protection act.
Contact Harmony Law for assistance
If you receive a civil investigative subpoena, please feel free to contact Harmony Law for assistance. Harmony Law is very familiar with numerous strategies for dealing with subpoenas. Harmony Law can provide the best solution to dealing with the subpoena.