Congressional Investigations in the 119th Congress

The 119th United States Congress will begin on Jan. 3, 2025, with Republicans in control of both the House of Representatives and Senate. In the Senate, Republicans will hold 53 seats, while in the House the Republicans will hold a small majority following both a narrow election and subsequent departures by several members through resignation or anticipated nominations to serve in the second Trump Administration. Although these numbers will pose challenges to Congress passing legislation without budget reconciliation or bipartisan agreement, Republicans will control every committee, providing considerable bandwidth and resources to conduct congressional investigations.

This Holland & Knight alert outlines the powers Congress holds to conduct investigations of nongovernmental entities and the likely investigative priorities of Republican committee chairs. The alert also outlines important considerations for companies, institutions and individuals that may be subject to congressional scrutiny.

Populism and the Changing Nature of the Modern Republican Party: Effects on Congressional Investigations

It is anticipated that Republicans in Congress will be as inclined toward investigations of the private sector as their Democrat counterparts (although often on different topics). The modern Republican Party is – in many ways – not the party it was in past decades – it is much more populist and its members and voters are far less inclined to view corporate America or large institutions as natural allies. As a result, congressional investigations in a Republican Congress are no longer expected to be limited to traditional conservative concerns. A wide array of the new economy – from media to manufacturing to energy – can expect to face scrutiny.

Likely Republican Oversight Priorities

As a result of this increased willingness to investigate nongovernmental entities and a Republican-led government, Republican committee chairs will likely conduct oversight and launch investigations involving a litany of private sector entities including matters including, but not limited to:

• Green Tech. Legislation passed in during the Biden Administration drove significant funding to the green energy sector, including nearly $369 billion in direct investment to ensure energy security, reduce carbon emissions, increase energy innovation and support environmental justice objectives, with direct support for underserved communities under the Inflation Reduction Act of 2022. The use of these funds and the private sector entities that received funding are likely to be a top priority of congressional investigators.
• Big Tech. Congressional Republicans are likely to continue oversight of social media platforms and internet companies on issues such as alleged discriminatory practices against conservative outlets, data privacy and Chinese influence.
• Higher Education. Few sectors experienced more congressional scrutiny in the 118th Congress than higher education following campus events in the wake of the Oct. 7, 2023, terror attacks in Israel and the Israeli response. This attention is unlikely to wane in the 119th Congress but instead can be expected to expand to other issues such as college endowments and campus speech codes, along with environmental, social and governance (ESG) and diversity, equity and inclusion efforts (DEI) and other matters.
• ESG, DEI and "Woke Capitalism." Corporate practices related to ESG and DEI, as well as related efforts by private equity, could be of continued interest to congressional Republicans in the 119th Congress. Although many companies have reduced their focus on these efforts in recent years, the perception that corporate leaders are prioritizing left-leaning policies over shareholder value continues and will likely be examined by a range of committees.
• Nonprofit Sector. The nonprofit sector, especially large nonprofits active in political and policy matters, may receive attention both as a target worthy of congressional oversight but also in consideration of tax policy changes. These may include not only advocacy organizations, but also those that have worked closely with government agencies and been connected to prominent liberal causes.
• Chinese Influence. The People's Republic of China (PRC) will be a primary focus of oversight in the 119th Congress by the Select Committee on the Chinese Communist Party (CCP) and other committees. Any PRC-owned entities or U.S. companies with supply chains originating in China are very likely to come under scrutiny related to the influence of the CCP in domestic affairs. A major part of the expected oversight will include the U.S. supply chain, influence of the Chinese government in higher education and risks to both U.S. intellectual property (IP) and individual privacy.

Congressional Democrats

Though House and Senate Democrats may not hold committee gavels, they will still be active in launching congressional investigations. Ranking members – whichever party is out of power – have in recent years been very active in issuing oversight letters, demanding documents and using media attention to conduct investigations. Though much of this activity may be focused on the Trump Administration, the private sector will not be spared. And although targets of these inquires may not be forced to appear at hearings, many of the pressures of congressional oversight very much still apply.

Congressional Investigations Generally

Even though Congress's power to investigate does not appear in the Constitution, courts have long held that Congress has broad investigative powers as a corollary to its Article I power to legislate. Most congressional committees have a formidable arsenal with which to conduct investigations, including the power to issue subpoenas for records and testimony, conduct depositions or transcribed interviews, hold public hearings, hold parties in civil or criminal contempt, and refer matters to the executive branch for additional action. Yet the most often used – and effective – tool is the ability to sway the court of public opinion through press releases, the use of traditional and social media, and the microphones of committee members.

For even the most experienced and well-resourced entities, congressional investigations can be harrowing experiences. They often take place publicly and begin without warning, potentially causing harm to reputations, as well as legal, regulatory, policy and financial interests. Unlike civil litigation or executive branch investigations, there is no judge or neutral third-party arbiter to resolve disputes and no standard for launching an investigation. In most cases, the only recourse for disputes over the scope of an inquiry, requests to respect privileges or confidentiality, or efforts to extend response deadlines is through negotiations with the committee staff conducting the investigation, and decisions on these matters are largely at the chair's discretion. Congressional committees are, in essence, both prosecutor and judge.

Committee Tools to Conduct Investigations

Congressional committees have a range of tools with which to conduct investigations, extending from purely voluntary requests to compulsory process. These include:

• Voluntary Requests. The vast majority of congressional investigations is conducted through voluntary document requests and negotiations, but the ability of Congress to compel compliance, if it so chooses, always looms in the background of any voluntary process. Voluntary requests may come in the form on a public letter from the committee chair, which often appears online or in media before leadership on the receiving end is aware it was issued.
• Subpoenas. With very few exceptions, congressional committees have the power to compel the production of records and public or private testimony. Negotiation might continue post-subpoena, but the public relations effects and potential legal consequences are serious matters. Failure to comply with a subpoena to the committee's satisfaction can lead to a party being held in civil or criminal contempt. Committees differ on the process of issuing a subpoena, including whether the chair has the authority to issue it independently or whether a vote or the agreement of the ranking member is required. (Note: In some cases, a party may request a "friendly subpoena," which is typically a nonpublic subpoena that the party requires to provide certain sensitive information.)
• Contempt. Should a committee find that a party has failed to comply with a subpoena, it can vote to hold the party in contempt. There are technically three forms of contempt – civil, criminal and inherent. In civil contempt, the House or Senate brings a party to federal court to enforce a subpoena. In criminal contempt, the House or Senate finds the party in criminal contempt of Congress, and the U.S. Department of Justice is tasked with pursuing the matter criminally. (This is more effective when the same party controls both Congress and the executive branch.) Inherent contempt is more of a relic of the 19th and early 20th centuries, when Congress would on rare occasion forcibly detain individuals and try them before the relevant house of Congress.
• Depositions and Staff Interviews. Private interviews with individuals, whether or not they are a target of the investigation, are a useful tool for committees to find facts relevant to an inquiry. Both formal depositions and less-formal staff interviews are conducted in private and generally transcribed, and criminal penalties are applicable should a witness make a statement that is not true or complete to the best of his or her ability.
• Public Hearings. Committee hearings are the most high-stakes aspect of congressional investigations. They can occur either at the culmination of an inquiry or in response to immediate newsworthy events. Regardless of why they occur, senior leaders of an organization can be subject to hours of combative questioning, and a single misstep can be turned into a clip that lives on for years after the hearing is over. The threat of a hearing – perhaps more than a subpoena – is often used as a tool to compel compliance with other committee requests.

Considerations

Congressional oversight is not a challenge to be viewed in a silo but should be properly understood in context with a range of interests, including parallel litigation, legislative and regulatory efforts, risk and reputation management communication strategy, and related media relations.

Although the specific entities of congressional oversight in the 119th Congress remain unknown, there are steps potential subjects of inquiry can take to minimize the risk of congressional scrutiny. Before congressional inquiries begin, it is critical to both establish communication hygiene and take stock of potential risks, as well as develop a response plan and team that will coordinate response. These matters should not be considered routine lobbying issues or white collar litigation – the risks they pose and the strategies necessary to counter them are entirely different.

Holland & Knight Capabilities

Holland & Knight has one of the country's premier congressional investigations and white collar defense and investigations practices. Our attorneys routinely represent companies under congressional inquiry or criminal investigation, particularly with respect to the receipt and use of federal funds. Holland & Knight does not approach these inquiries as isolated matters to be handled in a silo, but as serious challenges affecting a broad range of legal, policy, regulatory and public relations concerns.

Holland & Knight's attorneys, public policy professionals and crisis management advisors also have deep insight into congressional investigations strategy, a thorough understanding of the legal and policy issues facing potential investigative targets and skill in high-stakes communications and witness preparation.

For more information or questions, please contact the authors.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.