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October 15, 2019

When Congress Calls: Five Things to Consider Before You Respond

By Cindy S. Crick, Sheria Akins Clarke

ACC South Carolina Chapter Newsletter

Last month, Congress returns from the August recess to resume its work. With its return, we are sure to see a growing wave of congressional investigations. Some, such as a review of social media companies and privacy policies, were announced before Congress recessed and will be spurred on by recent events such as the Federal Trade Commission’s settlement with YouTube regarding allegations it illegally collected children’s personal information.  Others, such as data breaches at major financial institutions and investigations of e-cigarette manufacturers due to a spike in the number of individuals facing life-threatening pulmonary diseases, began during the August recess and will continue to gain momentum. The fervor to pursue investigations of corporations and their policies should come as no surprise because they focus on issues garnering national attention that impact or are of interest to most Americans. 

We have already seen a rise in congressional investigations targeting specific industries and companies since the change in House of Representatives leadership at the beginning of this Congress. These investigations, sometimes promised on the campaign trail, are often aimed at highlighting key political issues. The number of hot-button congressional investigations is only likely to grow as we near election cycles. Members frustrated with congressional gridlock may look to promote legislative priorities and issues important to their constituents in advance of the upcoming debates. Many of those issues and legislative priories will shine a public spotlight on industries such as healthcare, financial services, and technology. 

It is important to recognize the difference between a congressional investigation and other types of government investigations. A congressional investigation presents its own unique challenges and risks and is likely to garner intense media attention. Congressional committees generally have the authority to conduct sweeping investigations and issue subpoenas to companies and individuals as they deem necessary, sometimes with few limitations. These investigations may stem directly from general committee staff concerns, personal policy issues important to a specific committee member, or even from a committee member who supports a particular political agenda. In many cases, the spectacle of these congressional hearings results in negative publicity, financial ruin, and legal issues for the targeted company.