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COMMONWEALTH PENNSYLVANIA v. EDWARD C. SHULTS (08/17/76)

decided: August 17, 1976.

COMMONWEALTH OF PENNSYLVANIA, ACTING BY ATTORNEY GENERAL ISRAEL PACKEL
v.
EDWARD C. SHULTS, PRESIDENT, ACTIVE TV SERVICE OF AMERICA, INC., APPELLANT



Appeal from the Order of the Court of Common Pleas of Philadelphia County, in case of Commonwealth of Pennsylvania v. Edward C. Shults, President, Active TV Service of America, Inc., No. 594 October Term, 1974.

COUNSEL

Gilbert B. Abramson, with him Jeffrey M. Freedman, and Eilberg, Corson, Getson & Abramson, for appellant.

John E. Kelly, Assistant Attorney General, with him Joel Weisberg, Deputy Attorney General, and Robert P. Kane, Attorney General, for appellee.

President Judge Bowman and Judges Crumlish, Jr., Kramer, Wilkinson, Jr., Mencer, Rogers and Blatt. Opinion by President Judge Bowman.

Author: Bowman

[ 26 Pa. Commw. Page 131]

This is an appeal from an order of the Philadelphia County Court of Common Pleas finding Edward C. Shults, President, Active TV Service of America, Inc. (appellant), in contempt of court for willful violation of that court's prior order directing him to comply with a subpoena issued and served by the Pennsylvania Bureau of Consumer Protection (Bureau) under authority of the Attorney General.

On September 6, 1974, the Bureau issued a subpoena pursuant to Section 919 of The Administrative Code of 1929*fn1 (Code), directing appellant to appear at a private hearing and to bring documentary materials relating to certain enumerated aspects of his television repair business which had been under investigation by the Bureau for several months. After appellant refused to appear, the Commonwealth sought and obtained in the court below, an order, dated January 2, 1975, to compel compliance with the subpoena.

An appeal (No. 80 C.D. 1975) and a petition for supersedeas to this Court followed. By Order of January

[ 26 Pa. Commw. Page 13230]

, 1975, Judge Rogers granted a supersedeas of the order of the lower court with regard to oral testimony but denied the same with regard to the production of documentary materials. After appellant again refused to produce the subpoenaed materials, the Commonwealth initiated contempt proceedings which resulted in the order from which the present appeal was taken.*fn2

Since the appellant admits refusal to obey the initial compliance order of the court below, the issue here becomes the validity of that order, or more precisely, the validity of the underlying subpoena. The scope of judicial inquiry in a subpoena enforcement action is whether "the inquiry is within the authority of the agency, the demand is not too indefinite and the information sought is reasonably relevant." United States v. Morton Salt Co., 338 U.S. 632, 652 (1950); see also Pennsylvania Crime Commission v. Nacrelli, 5 Pa. Commonwealth Ct. 551, 577 (1972).

The thrust of appellant's attack on the subpoena is based on the first leg of the three-legged test developed in Morton Salt Co., supra, that the investigation is not within the authority of the Bureau. Appellant argues that the subpoena was issued for the purpose of preparing for litigation, specifically an injunctive action pursuant to Section 4 of the Unfair Trade Practices and Consumer Protection Law*fn3 (hereinafter UTPCPL), and that a subpoena issued for such purpose is not authorized by Section 919 of the Code. As evidence that the Bureau's investigation had shifted from an ostensibly authorized purpose to that of preparing

[ 26 Pa. Commw. Page 133]

    for litigation, appellant cites a letter received from a Bureau attorney on July 2, 1974, prior to the issuance of the subpoena. The letter states:

"Pursuant to the policy of the Attorney General, this is to advise you that after an extensive investigation, this office intends to initiate action against the above captioned business [Active TV Service of America, Inc.] and its officers. This action will be taken under the Unfair Trade Practices and Consumer Protection Law. (73 P.S. ยง 201-1)

"If you wish to discuss this matter prior to filing of suit, either you or your attorney should contact me."*fn4

Appellant asserts that the Bureau, having decided to bring suit, is now attempting through the subpoena to engage in a "fishing expedition" under the guise of its investigatory powers, thus, in effect, boot-strapping itself into the suit, as well as achieving pretrial discovery without the limitations and mutuality provided by the Pennsylvania Rules of Civil Procedure.*fn5

[ 26 Pa. Commw. Page 134]

The Commonwealth responds first that litigation pursuant to Section 4 of the UTPCPL is one of the Bureau's functions under the Code so that even if preparation for such litigation was the purpose of the subpoena, it would nevertheless be valid. However, the Commonwealth argues such was not the purpose, and the letter of July 2, 1974, was not meant to indicate that the investigation had terminated. Rather it was designed to advise appellant of the possibility of litigation and to elicit his cooperation in the Bureau's investigation and/or resolution of the matter. Further, the Commonwealth asserts that the Bureau can move beyond its ...


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