74th OREGON LEGISLATIVE ASSEMBLY--2007 Regular Session
Enrolled
Senate Bill 119
Printed pursuant to Senate Interim Rule 213.28 by order of the
President of the Senate in conformance with presession filing
rules, indicating neither advocacy nor opposition on the part
of the President (at the request of Attorney General Hardy
Myers for Department of Justice)
CHAPTER ................
AN ACT
Relating to Attorney General enforcement of securities law.
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + Section 2 of this 2007 Act is added to and made
a part of ORS 59.005 to 59.451. + }
SECTION 2. { + (1) Subject to subsection (2) of this section
and after providing notice and an opportunity to participate to
the Director of the Department of Consumer and Business Services,
the Attorney General may:
(a) Make public or private investigations within or outside
this state as the Attorney General considers necessary to:
(A) Determine whether a person has violated or is about to
violate any provision of the Oregon Securities Law or any rule or
order of the director adopted or issued under the Oregon
Securities Law; or
(B) Aid in the enforcement of the Oregon Securities Law or any
rule or order of the director adopted or issued under the Oregon
Securities Law.
(b) Require or permit a person to file a statement in writing,
under oath or otherwise as the Attorney General determines, as to
all the facts and circumstances concerning a matter to be
investigated.
(c) Administer oaths and affirmations, subpoena witnesses,
compel the attendance of witnesses, take evidence and require the
production of books, papers, correspondence, memoranda,
agreements or other documents or records that the Attorney
General considers relevant or material to an investigation.
(d) Bring suit in the name and on behalf of the State of Oregon
in the circuit court of any county to:
(A) Enjoin any acts or practices the Attorney General has
reason to believe that a person has engaged, is engaging or is
about to engage in that constitute a violation of any provision
of the Oregon Securities Law or any rule or order of the director
adopted or issued under the Oregon Securities Law; or
(B) Enforce compliance with the Oregon Securities Law or any
rule or order of the director adopted or issued under the Oregon
Securities Law.
Enrolled Senate Bill 119 (SB 119-A) Page 1
(2) The Attorney General may take action under subsection (1)
of this section only in connection with any of the following
alleged violations or cases:
(a) Alleged violations involving companies whose securities are
listed on the New York Stock Exchange, the American Stock
Exchange or the National Association of Securities Dealers
Automated Quotation System, Inc. National Market System;
(b) Cases in which the Attorney General is pursuing or intends
to pursue an investigation or litigation under ORS 166.715 to
166.735;
(c) Cases in which the Attorney General is pursuing or intends
to pursue an investigation or litigation under ORS 646.605 to
646.652; or
(d) Cases in which the Attorney General is pursuing or intends
to pursue an investigation or litigation under ORS 646.705 to
646.805.
(3) The Attorney General may take action under subsection (1)
of this section with respect to cases described in subsection
(2)(b), (c) or (d) of this section only after receiving the
director's consent. The director may elect to be a named party in
any action the Attorney General takes.
(4) Each witness who appears before the Attorney General under
a subpoena issued under this section shall receive the fees and
mileage provided for witnesses in ORS 44.415 (2). If a person
fails to comply with a subpoena issued under this section or if a
party or witness refuses to testify on any matters, the judge of
the circuit court of any county, on the application of the
Attorney General, shall compel obedience by proceedings for
contempt as in the case of disobedience of the requirements of a
subpoena issued from the court or a refusal to testify in the
court.
(5) In an action brought under this section, a court:
(a) Shall grant a permanent or temporary injunction,
restraining order or writ of mandamus upon a proper showing by
the Attorney General under subsection (1)(d) of this section.
(b) May award reasonable attorney fees to:
(A) The Attorney General if the Attorney General prevails in an
action under this section.
(B) A defendant if the defendant prevails in an action under
this section and the court determines that the Attorney General
had no objectively reasonable basis for asserting the claim or no
reasonable basis for appealing an adverse decision of the trial
court.
(6) The Attorney General may include any of the following in an
action authorized by this section:
(a) A claim for restitution or damages under ORS 59.115, 59.127
or 59.137, on behalf of the persons injured by the act or
practice constituting the subject matter of the action. If the
court finds that enforcement of the rights of the injured persons
by private civil action, whether by class action or otherwise,
would be so burdensome or expensive as to be impractical, the
court has jurisdiction to award appropriate relief to the injured
persons.
(b) A claim for disgorgement of illegal gains or profits
derived. The Attorney General shall deposit any moneys recovered
under this paragraph in the General Fund of the State Treasury
unless the court requires other disposition.
(c) A claim for the appointment of a receiver of any property
derived by means of any act or practice that constitutes a
violation of any provision of the Oregon Securities Law or any
Enrolled Senate Bill 119 (SB 119-A) Page 2
rule or order of the director adopted or issued under the Oregon
Securities Law and of any books of account and papers relating to
the property. Property for which a receiver may be appointed
includes other property with which the property derived by means
of a violation has been commingled if the property cannot be
identified in kind because of the commingling. The receiver shall
take possession of the property, books and papers and shall
liquidate the property for the benefit of all persons who
intervene in the action and establish an interest in the
property. Subject to the approval of the court, the expenses and
attorney fees of the receiver and any expenditures required in
the liquidation proceeding shall be paid out of the funds of the
receivership. The receiver may be the Attorney General. The court
may not require the Attorney General to post a bond.
(d) A claim for a fine of not more than $20,000 for each
violation. The fine shall be entered as a judgment and paid to
the General Fund of the State Treasury. Each violation is a
separate offense. In the case of a continuing violation, each
day's continuance is a separate violation, but the maximum
penalty for any continuing violation may not exceed $100,000.
(7) This section does not apply to:
(a) A failure to file a notice and pay a fee under ORS 59.049
(1), (2) or (3);
(b) A failure to file a notice and pay a fee under ORS 59.165
(7);
(c) A failure to pay a fee under ORS 59.175 (8);
(d) A violation of any rule adopted by the director under ORS
59.165 (7); or
(e) A company that the director has licensed under ORS
59.165. + }
SECTION 3. { + Section 2 of this 2007 Act applies to
violations or alleged violations of any provision of the Oregon
Securities Law, or of any rule or order of the Director of the
Department of Consumer and Business Services adopted or issued
under the Oregon Securities Law, that occur on or after the
effective date of this 2007 Act. + }
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Passed by Senate May 11, 2007
...........................................................
Secretary of Senate
...........................................................
President of Senate
Passed by House June 8, 2007
...........................................................
Speaker of House
Enrolled Senate Bill 119 (SB 119-A) Page 3
Received by Governor:
......M.,............., 2007
Approved:
......M.,............., 2007
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2007
...........................................................
Secretary of State
Enrolled Senate Bill 119 (SB 119-A) Page 4