Open Records Decision No. 232
December 27, 1979

	Re:  Whether construction contract bids are excepted from public disclosure after 
contract is awarded.

Mr. Dan Pleitz
Naman, Howell, Smith, Lee & Muldrow
Attorneys for Texas Municipal Power Agency
P. O. Box 1470
Waco, Texas  76703

Dear Mr. Pleitz:

	You request our decision pursuant to section 7 of article 6252-17a, V.T.C.S., the 
Texas Open Records Act.

	The Texas Municipal Power Agency solicited bids for a general construction 
contract to build the Gibbons Creek Steam Electric Station.  Four companies submitted 
bids.  Following an evaluation of the bids, the contract was awarded to the low bidder.  
Two of the bidders, including the successful bidder, have requested to inspect the other 
bids and materials submitted with them.  A third bidder stated that it had no objection to 
disclosure, but the fourth bidder, H. B. Zachry Company, contends that information 
submitted with its bid should not be disclosed.  The agency has also received a request 
for the bid evaluation report prepared by its consulting engineer.  This report contains 
some of the same information contended to be excepted by Zachry.  The agency states 
that it takes no position on whether or not the bids are or are not excepted from required 
public disclosure, but states that it believes certain portions of the bid of the bidder who 
objects to disclosure may be excepted under sections 3(a)(4) or 3(a)(10) of the Open 
Records Act.  The agency invited the bidder who objects to disclosure to submit its 
argument to this office, which it did.

	The construction project around which this controversy centers is estimated in the 
bid evaluation to cost over $50 million dollars.  A bid does not consist of a simple dollar 
figure, but includes a considerable volume of information prepared by the bidder.  There 
is no dispute that the summary figures are public.  These include totals for (1) field 
overhead; (2) fixed fee; (3) total target man hours; (4) composite wage rate; and (5) list 
of milestone dates.

	Zachry contends that the bid information submitted by it is excepted from 
disclosure under sections 3(a)(4), 3(a)(10), or both.  These exceptions protect from 
required public disclosure:

	(4)	information which, if released, would give advantage to 
competitors or bidders;

	. . . .

	(10)	trade secrets and commercial or financial information 
obtained from a person and privileged or confidential by statute or 
judicial decision.

	Zachry places particular emphasis on the circumstances under which the 
information supporting its bid was submitted, and contends that it was induced to 
disclose the information under a promise of confidentiality by the consulting engineer for 
the agency.  A letter from the engineer to the bidders said:

	Attached hereto is the Bid Tabulation for the above referenced 
project, which lists the items which will be publicly read from your 
bid on July 16, 1979.

	Also attached is the Bid Evaluation Checklist.  The information 
listed thereon will not be publicly read, but will be reviewed in 
detail during the bid evaluation; therefore, it is imperative that this 
information be included in your proposal.

	An agency may not make information confidential by the promulgation of a rule.  
To imply such authority would be to allow the agency to circumvent the purpose of the 
Open Records Act.  Industrial Foundation of the South v. Texas Industrial Accident 
Board, 540 S.W.2d 668, 677 (Tex. 1976).  An agency may not bring information within 
section 3(a)(4) or 3(a)(10) merely by a promise that it will not be disclosed, where there 
is no statutory authority to make such a promise.  We do not believe that the letter from 
the consulting engineer makes an absolute promise of confidentiality, and even if it did, 
we do not believe that authority exists for such a promise in this instance.

	With reference to the section 3(a)(10) exception, there is no statutory provision or 
judicial decision holding that information of the type requested is privileged or 
confidential.  The inquiry then is whether the information is a trade secret.  Texas has 
adopted the definition of “trade secret” contained in the Restatement of Torts, § 757(b) 
1939.  Hyde Corporation v. Huffines, 314 S.W.2d 763, 776 (Tex. 1958).  See Open 
Records Decision Nos. 184 (1978); 175 (1977); 89 (1975); 50 (1974).  That definition 
provides:

A trade secret may consist of any formula, pattern device or 
compilation of information which is used in one's business, and 
which gives him an opportunity to obtain an advantage over 
competitors who do not know or use it.

In addition, the Penal Code, in making theft of a trade secret a third degree felony, 
defines it as:

the whole or any part of any scientific or technical information, 
design, process, procedure, formula, or improvement that has value 
and that the owner has taken measures to prevent from becoming 
available to persons other than those selected by the owner to have 
access for limited purposes.

Penal Code § 31.05(a)(4).

	The Restatement lists six factors to be considered in determining whether 
particular information is a trade secret:

(1) the extent to which the information is known outside of his 
business; (2) the extent to which it is known by employees and 
others involved in his business; (3) the extent of measures taken by 
him to guard the secrecy of the information; (4) the value of the 
information to him and to his competitors; (5) the amount of effort 
or money expended by him in developing the information; (6) the 
ease or difficulty with which the information could be properly 
acquired or duplicated by others.

Restatement of Torts § 757, comment b (1939).

	We have found no judicial decision which has held the type of information at 
issue here to be a trade secret.  To the contrary, it has been held that an analysis 
technique used in a particular business which would be developed by an experienced 
person in the business was not entitled to protection as a trade secret.  Hallmark 
Personnel of Texas, Inc., v. Franks, 562 S.W.2d 933, 936 (Tex. Civ. App. -- Houston 
[1st Dist.] 1978, no writ).  Matters of general knowledge in an industry cannot be 
appropriated by one as a trade secret.  Wissman v. Boucher, 240 S.W.2d 278 (Tex. 
1951).  Methods of manufacture or design and details of construction which are matters 
of general scientific knowledge in the industry do not constitute “trade secrets.”  
Midland-Ross Corp. v. Sunbeam Equipment Corp., 316 F. Supp. 171, 178 (W.D. Pa. 
1970), aff'd, 435 F.2d 159 (3rd Cir. 1970).

	While Zachry states that the information here is regarded as highly private and 
secret and is known only to a very limited number of company engineers and officers 
there is no showing of any measures taken to guard the secrecy of the information, nor to 
what extent the information is different from that generally known in the industry, nor 
the difficulty of duplicating this type of information.  We do not believe that there has 
been a sufficient showing that the information submitted with a bid would disclose “trade 
secrets.”  The agency to whom the information was submitted is not convinced that the 
information is a trade secret, for it takes no position in the matter, and none of the other 
bidders regard the information submitted by them as a trade secret.  It is our decision that 
the information is not excepted from required public disclosure under section 3(a)(10).

	The issue is then whether the information is excepted under section 3(a)(4) as 
“information the disclosure of which would give advantage to competitors or bidders.”  
This office has construed this exception narrowly, requiring a showing of a specific 
actual or potential harm in a particular competitive situation.  See Open Records 
Decision Nos. 222 (1979); 203, 184 (1978); 170 (1977); 124 (1976); 95, 75 (1975); 48, 
46, 45 (1974).  The information at issue here relates to a particular project on which the 
bidding has been completed.  There can be no harm to any of the parties to this particular 
competitive situation.  A federal court confronted with a claim of confidentiality under a 
similar provision in the Federal Freedom of Information Act held that once the agency 
selects a bidder to perform the service or supply the goods, the cost proposals, including 
the low offeror's proposals, abstracts of proposals and bid evaluation, are releasable 
under the Federal Act.  The court pointed out that even if new bids were solicited on the 
same project, the passage of time would be such that new and different cost proposals 
would inevitably be submitted.  Shermco Industries v. Secretary of the United States Air 
Force, 452 F. Supp. 306, 324 (N.D. Tex. 1978).  Here, the potential for harm from 
disclosure of the information is speculative and general.  It is not related to a specific 
bidding situation, but only to the general competition among contractors on projects of 
this type.  Based on the detail involved in the lengthy specifications and requirements for 
this particular massive project, we cannot assume that there is a sufficient similarity in 
the construction of steam electric stations that disclosure of these particular bids would 
give advantage to Zachry's competitors in unspecified bidding situations which might 
occur in the future.  It is our decision that the information requested is not excepted from 
required public disclosure by section 3(a)(4).

	In summary, we do not believe that the information requested has been shown to 
be excepted from required public disclosure under either of sections 3(a)(4) or 3(a)(10), 
and therefore it is public and should be disclosed.

Very truly yours,

Mark White
Attorney General of Texas

John W. Fainter, Jr.
First Assistant Attorney General

Ted L. Hartley
Executive Assistant Attorney General

Prepared by William G Reid
Assistant Attorney General

APPROVED:
OPINION COMMITTEE

C. Robert Heath, Chairman
David B. Brooks
Bob Gammage
Susan Garrison
Rick Gilpin
William G Reid
Bruce Youngblood