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Office of the Attorney General - State of Texas John Cornyn |
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June 20, 2002 Ms. Janice Mullenix
OR2002-3359 Dear Ms. Mullenix: You ask whether certain information is subject to required public disclosure under chapter 552 of the Government Code. Your request was assigned ID# 164589. The Texas Department of Transportation (the "department") received four requests for proposal information submitted in response to the RFP related to the SH 130 project. You state, and provide documentation showing, that you notified the third parties whose proprietary interests may be implicated of the requests for information and of their right to submit arguments to this office as to why the requested information should not be released.(1) See Gov't Code § 552.305 (permitting interested third party to submit to attorney general reasons why requested information should not be released); see also Open Records Decision No. 542 (1990) (determining that statutory predecessor to Gov't Code § 552.305 permits governmental body to rely on interested third party to raise and explain applicability of exception in Public Information Act in certain circumstances). You raise no exception to disclosure on behalf of the department and make no arguments regarding the proprietary nature of the third parties' information. Section 552.305(d) allows a third party ten business days after the date of its receipt of the governmental body's notice to submit its reasons, if any, as to why information relating to that party should not be released. See Gov't Code §552.305(d)(2)(B). No responses were received from Lone Star Infrastructure LLC or Four Rivers Developers. Because Lone Star Infrastructure LLC and Four Rivers Developers did not submit arguments in response to the section 552.305 notice, we have no basis to conclude that these companies' information is excepted from disclosure under section 552.110. See Open Records Decision Nos. 639 at 4 (1996) (to prevent disclosure of commercial or financial information, party must show by specific factual or evidentiary material, not conclusory or generalized allegations, that it actually faces competition and that substantial competitive injury would likely result from disclosure), 552 at 5 (1990) (party must establish prima facie case that information is trade secret), 542 at 3 (1990). Responsive information of these two companies must, therefore, be released to the requestors. Zachry Construction Corporation ("Zachry"), a member of the consortium known as Texas Corridor Constructors ("TCC"), responded to the notices and asserted that sections 552.104, 552.105, and 552.110 of the Government Code except portions of the TCC proposal from public disclosure. Zachry also asserts that pricing information contained in the documents subject to the Form L Escrow Agreement is not responsive to the instant requests and is currently held by an escrow agent. The Public Information Act (the "Act") does not ordinarily require a governmental body to obtain information not in its possession. Open Records Decision Nos. 558 (1990), 499 (1988). Section 552.002 of the Government Code, however, defines public information as "information that is collected, assembled, or maintained under a law or ordinance or in connection with the transaction of official business: (1) by a governmental body; or (2) for a governmental body and the governmental body owns the information or has a right of access to it." Thus, information that is collected, assembled, or maintained by a third party may be subject to disclosure under chapter 552 of the Government Code if a governmental body owns or has a right of access to the information. See Open Records Decision No. 462 (1987); cf. Open Records Decision No. 499 (1988) (relevant facts in determining whether information held by consultant is subject to the Act are: 1) information collected by consultant must relate to the governmental body's official business; 2) consultant must have acted as agent of the governmental body in collecting information; and 3) governmental body must have or be entitled to access to the information). Where a third party has prepared information on behalf of a governmental body, the information is subject to the Act, even though it is not in the governmental body's custody. Open Records Decision No. 558 (1990). Moreover, if a governmental entity employs an agent to carry out a task that otherwise would have been performed by the entity itself, information relating to that task that has been assembled or maintained by the agent is subject to disclosure. Open Records Decision No. 518 (1989). Zachry explains that these escrowed documents, which detail how proposers calculated their price estimates, were not considered in the department's evaluation of the proposal and had no bearing on the department's selection of the winning proposal. Zachry further asserts that the documents at issue are held by the escrow agent until the contract is awarded, and then only the information pertaining to the proposal of the party awarded the contract is available for review by the department. We thus agree that the escrowed records are not public information at this time. This ruling, therefore, does not address the documents subject to the Form L Escrow Agreement. Zachry claims that portions of the submitted TCC proposal are excepted from disclosure under section 552.104 because release would give advantage to a competitor or bidder. However, we note that section 552.104 is not designed to protect the interests of private parties that submit information to a governmental body. See Open Records Decision No. 592 at 8-9 (1991). Section 552.104 excepts information from disclosure if a governmental body demonstrates that the release of the information would cause potential specific harm to its interests in a particular competitive situation. See Open Records Decision Nos. 593 at 2 (1991), 463 (1987), 453 at 3 (1986). The department has not argued that the release of TCC's proposal to the department would harm its interests in a particular competitive situation. Therefore, no portion of the submitted proposal may be withheld from disclosure pursuant to section 552.104 of the Government Code. Zachry also has raised section 552.105 of the Government Code to protect certain information in the TCC proposal. Section 552.105 excepts from disclosure information relating to: (1) the location of real or personal property for a public purpose prior to public announcement of the project; or (2) appraisals or purchase price of real or personal property for a public purpose prior to the formal award of contracts for the property. Section 552.105 was designed to protect a governmental body's planning and negotiating position with respect to particular transactions. Open Records Decision No. 564 at 2 (1990). As the department does not raise section 552.105, this section is not applicable to the requested information. Therefore, the requested information may not be withheld under section 552.105. Zachry claims that portions of the TCC proposal are excepted from disclosure pursuant to section 552.110 of the Government Code. Section 552.110 protects the property interests of private persons by excepting from disclosure two types of information: (1) trade secrets obtained from a person and privileged or confidential by statute or judicial decision and (2) commercial or financial information for which it is demonstrated based on specific factual evidence that disclosure would cause substantial competitive harm to the person from whom the information was obtained. The governmental body, or interested third party, raising this exception must provide a specific factual or evidentiary showing, not conclusory or generalized allegations, that substantial competitive injury would likely result from disclosure. Gov't Code § 552.110(b); see also National Parks & Conservation Ass'n v. Morton, 498 F.2d 765 (D.C. Cir. 1974). The Texas Supreme Court has adopted the definition of trade secret from section 757 of the Restatement of Torts. Hyde Corp. v. Huffines, 314 S.W.2d 763 (Tex.), cert. denied, 358 U.S. 898 (1958); see also Open Records Decision No. 552 at 2 (1990). Section 757 provides that a trade secret is 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. It may be a formula for a chemical compound, a process of manufacturing, treating or preserving materials, a pattern for a machine or other device, or a list of customers. It differs from other secret information in a business . . . in that it is not simply information as to single or ephemeral events in the conduct of the business . . . . A trade secret is a process or device for continuous use in the operation of the business. . . . [It may] relate to the sale of goods or to other operations in the business, such as a code for determining discounts, rebates or other concessions in a price list or catalogue, or a list of specialized customers, or a method of bookkeeping or other office management. Restatement of Torts § 757 cmt. b (1939). In determining whether particular information constitutes a trade secret, this office considers the Restatement's definition of trade secret as well as the Restatement's list of six trade secret factors. Restatement of Torts § 757 cmt. b (1939).(2) This office has held that if a governmental body takes no position with regard to the application of the trade secret branch of section 552.110 to requested information, we must accept a private person's claim for exception as valid under that branch if that person establishes a prima facie case for exception and no argument is submitted that rebuts the claim as a matter of law. Open Records Decision No. 552 at 5-6 (1990). Section 552.110(b) excepts from disclosure "[c]ommercial or financial information for which it is demonstrated based on specific factual evidence that disclosure would cause substantial competitive harm to the person from whom the information was obtained." An entity will not meet its burden under section 552.110(b) by a mere conclusory assertion of a possibility of commercial harm. Cf. National Parks & Conservation Ass'n v. Morton, 498 F.2d 765, 770 (D.C. Cir. 1974). The governmental body or interested third party raising section 552.110(b) must provide a specific factual or evidentiary showing that substantial competitive injury would likely result from disclosure of the requested information. See Open Records Decision No. 661 (1999); see also National Parks and Conservation Association v. Morton, 498 F.2d 765, 770 (D.C. Cir. 1974). After reviewing Zachry's brief, we conclude that Zachry has demonstrated the applicability of section 552.110(b) to much of the information at issue. We find that Zachry has demonstrated that the release of most of its pricing proposal would cause it substantial competitive injury. However, we find that Zachry has not adequately demonstrated that the summary numbers describing its estimated maintenance cost for the entire proposal, submitted in Sheet 12 of Form N-1, consist of either a trade secret or commercial or financial information the release of which would result in substantial competitive injury.(3) See Open Records Decision Nos. 509 at 5 (1988) (stating that because costs, bid specifications, and circumstances would change for future contracts, assertion that release of bid proposal might give competitor unfair advantage on future contracts was entirely too speculative); cf. Open Records Decision No. 514 (1988) (public has interest in knowing prices charged by government contractors). In addition, information relating to personnel, organization, qualifications, professional references and experience are not excepted under section 552.110, and therefore may not be withheld from disclosure. See Open Records Decision No. 319 (1982). We conclude that Zachry has not shown that the remainder of the submitted information is excepted under section 552.110. Id. We have marked the information that the department must withhold from disclosure under section 552.110(b). We note that the submitted information also contains e-mail addresses that have been provided by members of the public for the purpose of communicating electronically with the governmental body. The Seventy-seventh Legislature recently added section 552.137 to chapter 552 of the Government Code. This new exception makes certain e-mail addresses confidential.(4) Section 552.137 provides in relevant part: (a) An e-mail address of a member of the public that is provided for the purpose of communicating electronically with a governmental body is confidential and not subject to disclosure under this chapter. (b) Confidential information described by this section that relates to a member of the public may be disclosed if the member of the public affirmatively consents to its release. Gov't Code § 552.137. You do not inform us that the member of the public has affirmatively consented to the release of his or her e-mail address. We have marked the type of information the department must withhold under section 552.137. We also note that certain information is protected by section 552.136 of the Government Code. The Seventy-seventh Legislature added section 552.136 to chapter 552 of the Government Code.(5) This newly enacted exception to public disclosure makes certain account number information confidential, and provides in relevant part: (a) In this section, "access device" means a card, plate, code, account number, personal identification number, electronic serial number, mobile identification number, or other telecommunications service, equipment, or instrument identifier or means of account access that alone or in conjunction with another access device may be used to:
(1) obtain money, goods, services, or another thing of value; or (2) initiate a transfer of funds other than a transfer originated solely by paper instrument. (b) Notwithstanding any other provision of this chapter, a credit card, debit card, charge card, or access device number that is collected, assembled, or maintained by or for a governmental body is confidential. Gov't Code § 552.136. We have marked the type of account number information that the department must withhold under section 552.136 of the Government Code. Social security numbers may be excepted from disclosure in some circumstances under section 552.101 of the Government Code.(6) A social security number or "related record" may be excepted from disclosure under section 552.101 in conjunction with the 1990 amendments to the federal Social Security Act, 42 U.S.C. § 405(c)(2)(C)(viii)(I). See Open Records Decision No. 622 (1994). These amendments make confidential social security numbers and related records that are obtained and maintained by a state agency or political subdivision of the state pursuant to any provision of law enacted on or after October 1, 1990. See id. We have no basis for concluding that any of the social security numbers in the submitted documents are confidential under section 405(c)(2)(C)(viii)(I), and therefore excepted from public disclosure under section 552.101 on the basis of that federal provision. We caution, however, that section 552.352 of the Public Information Act imposes criminal penalties for the release of confidential information. Prior to releasing any social security number information, the department should ensure that no such information was obtained or is maintained pursuant to any provision of law, enacted on or after October 1, 1990. Finally, we note that some of the materials at issue may be protected by copyright. A custodian of public records must comply with the copyright law and is not required to furnish copies of records that are copyrighted. Attorney General Opinion JM-672 (1987). A governmental body must allow inspection of copyrighted materials unless an exception applies to the information. Id. If a member of the public wishes to make copies of copyrighted materials, the person must do so unassisted by the governmental body. In making copies, the member of the public assumes the duty of compliance with the copyright law and the risk of a copyright infringement suit. See Open Records Decision No. 550 (1990). In summary, we have marked the information that must be withheld under section 552.110(b). E-mail addresses of members of the public must be withheld from disclosure under section 552.137. The department must withhold account number information under section 552.136. Social security numbers may be confidential under federal law. The department must comply with federal copyright law. The remainder of the submitted information must be released to the requestors. This letter ruling is limited to the particular records at issue in this request and limited to the facts as presented to us; therefore, this ruling must not be relied upon as a previous determination regarding any other records or any other circumstances. This ruling triggers important deadlines regarding the rights and responsibilities of the governmental body and of the requestor. For example, governmental bodies are prohibited from asking the attorney general to reconsider this ruling. Gov't Code § 552.301(f). If the governmental body wants to challenge this ruling, the governmental body must appeal by filing suit in Travis County within 30 calendar days. Id. § 552.324(b). In order to get the full benefit of such an appeal, the governmental body must file suit within 10 calendar days. Id. § 552.353(b)(3), (c). If the governmental body does not appeal this ruling and the governmental body does not comply with it, then both the requestor and the attorney general have the right to file suit against the governmental body to enforce this ruling. Id. § 552.321(a). If this ruling requires the governmental body to release all or part of the requested information, the governmental body is responsible for taking the next step. Based on the statute, the attorney general expects that, within 10 calendar days of this ruling, the governmental body will do one of the following three things: 1) release the public records; 2) notify the requestor of the exact day, time, and place that copies of the records will be provided or that the records can be inspected; or 3) notify the requestor of the governmental body's intent to challenge this letter ruling in court. If the governmental body fails to do one of these three things within 10 calendar days of this ruling, then the requestor should report that failure to the attorney general's Open Government Hotline, toll free, at 877/673-6839. The requestor may also file a complaint with the district or county attorney. Id. § 552.3215(e). If this ruling requires or permits the governmental body to withhold all or some of the requested information, the requestor can appeal that decision by suing the governmental body. Id. § 552.321(a); Texas Department of Public Safety v. Gilbreath, 842 S.W.2d 408, 411 (Tex. App.--Austin 1992, no writ). Please remember that under the Act the release of information triggers certain procedures for costs and charges to the requestor. If records are released in compliance with this ruling, be sure that all charges for the information are at or below the legal amounts. Questions or complaints about over-charging must be directed to Hadassah Schloss at the Texas Building and Procurement Commission at 512/475-2497. If the governmental body, the requestor, or any other person has questions or comments about this ruling, they may contact our office. We note that a third party may challenge this ruling by filing suit seeking to withhold information from a requestor. Gov't Code § 552.325. Although there is no statutory deadline for contacting us, the attorney general prefers to receive any comments within 10 calendar days of the date of this ruling. Sincerely, Cindy Nettles
c: Ms. Kelly Daniel
Mr. Sam White
Ms. Kathy Alexander
Mr. Mark Leintz
C. Brian Cassidy
Footnotes 1. The third parties that were sent notice under section 552.305 are the following: Lone Star Infrastructure LLC, Texas Corridor Constructors c/o Zachry Construction Corporation, and Four Rivers Developers c/o Granite Construction. We note that the fourth request is from Mr. Mark Leintz of Four Rivers Developers. 2. The six factors that the Restatement gives as indicia of whether information constitutes a trade secret are: (1) the extent to which the information is known outside of [the company]; (2) the extent to which it is known by employees and others involved in [the company's] business; (3) the extent of measures taken by [the company] to guard the secrecy of the information; (4) the value of the information to [the company] and [its] competitors; (5) the amount of effort or money expended by [the company] 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 cmt. b (1939); see also Open Records Decision Nos. 319 at 2 (1982), 306 at 2 (1982), 255 at 2 (1980). 3. We note that Zachry does not seek to withhold the summary numbers describing its estimated cost for the entire proposal, submitted in Sheet 10 of Form M-1. 4. House Bill 2589, which also makes certain e-mail addresses confidential, took effect on September 1, 2001. See Act of May 22, 2001, 77th Leg., R.S., H.B. 2589, § 5 (to be codified at Gov't Code § 552.136). The language of section 552.136, as added by House Bill 2589, is identical to that of section 552.137. 5. The Legislature also enacted two other bills that add a section 552.136 to chapter 552. House Bill 2589 makes certain e-mail addresses confidential. See Act of May 22, 2001, 77th Leg., R.S.,ch. 545, § 5, 2001 Tex. Sess. Law Serv. 974, 975 (Vernon) (codified at Gov't Code § 552.136). Senate Bill 15 makes information maintained by family violence shelter centers confidential. See Act of May 3, 2001, 77th Leg., R.S., ch. 143, § 1, 2001 Tex. Sess. Law Serv. 279 (Vernon) (codified at Gov't Code § 552.136). Senate Bill 694 also enacted the same language as House Bill 2589 regarding the confidentiality of e-mail addresses, but codified it as section 552.137 of the Government Code. See Act of May 14, 2001, 77th Leg., R.S., ch. 356, § 1, 2001 Tex. Sess. Law Serv. 614 (Vernon) (codified at Gov't Code § 552.137). 6. The Office of the Attorney General will raise a mandatory exception like section 552.101 on behalf of a governmental body, but ordinarily will not raise other exceptions, because chapter 552 of the Government Code prescribes criminal penalties for the release of confidential information. Gov't Code §§ 552.007, .352; Open Records Decision Nos. 481 (1987), 480 (1987), 470 (1987) 325 (1982). Section 552.101 excepts from disclosure "information considered to be confidential by law, either constitutional, statutory, or by judicial decision." This section encompasses information protected by other statutes. POST OFFICE BOX 12548, AUSTIN, TEXAS 78711-2548 TEL: (512) 463-2100 WEB: WWW.OAG.STATE.TX.US |