March 10, 2009

Mr. Scott A. Kelly

Deputy General Counsel

Texas A&M University System

200 Technology Way, Suite 2079

College Station, Texas 77845

OR2009-03123

Dear Mr. Kelly:

You ask whether certain information is subject to required public disclosure under the Public Information Act (the "Act"), chapter 552 of the Government Code. Your request was assigned ID# 337153.

Texas A&M University (the "university") received a request for the contract and winning proposal related to a specified project. You state the university will release the requested contract. The university takes no position on whether the submitted information is excepted from disclosure, but states that release of this information may implicate the proprietary interests of Alpha Building Corporation ("Alpha"). You notified Alpha of the request and of the company's right to submit arguments to this office as to why its information should not be released. See Gov't Code § 552.305(d) (permitting interested third party to submit to attorney general reasons why requested information should not be released); Open Records Decision No. 542 (1990) (statutory predecessor to section 552.305 permitted governmental body to rely on interested third party to raise and explain applicability of exception to disclosure under certain circumstances). We have considered the arguments submitted by Alpha and have reviewed the submitted information.

Alpha argues that portions of the submitted information are excepted from disclosure under section 552.110 of the Government Code. Section 552.110 protects (1) trade secrets, and (2) commercial or financial information, the disclosure of which would cause substantial competitive harm to the person from whom the information was obtained. See Gov't Code § 552.110(a), (b).

Section 552.110(a) protects trade secrets obtained from a person and privileged or confidential by statute or judicial decision. Id. § 552.110(a). 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. 1957); 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); see also Huffines, 314 S.W.2d at 776. 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. ⁽¹⁾ Restatement of Torts § 757 cmt. b (1939). This office must accept a claim that information subject to the Act is excepted as a trade secret if a prima facie case for the exception is made and no argument is submitted that rebuts the claim as a matter of law. See ORD 552 at 5. However, we cannot conclude that section 552.110(a) is applicable unless it has been shown that the information meets the definition of a trade secret and the necessary factors have been demonstrated to establish a trade secret claim. Open Records Decision No. 402 (1983).

Section 552.110(b) protects "[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[.]" Gov't Code § 552.110(b). This exception to disclosure requires a specific factual or evidentiary showing, not conclusory or generalized allegations, that substantial competitive injury would likely result from release of the information at issue. Id. § 552.110(b); see also Open Records Decision No. 661 at 5-6 (1991) (business enterprise must show by specific factual evidence that release of information would cause it substantial competitive harm).

Alpha contends that portions of its proposal are trade secrets excepted under section 552.110(a). Having considered Alpha's arguments, we conclude that Alpha has established a prima facie case that some of the information in its proposal, which we have marked, constitutes trade secrets. Therefore, the university must withhold the information we have marked pursuant to section 552.110(a) of the Government Code. However, Alpha has failed to demonstrate that any of the remaining information it seeks to withhold meets the definition of a trade secret, nor has Alpha demonstrated the necessary factors to establish a trade secret claim for this information. See ORD 319 at 2 (information relating to organization, personnel, market studies, professional references, qualifications, experience, and pricing not excepted under section 552.110). Thus, none of the remaining information may be withheld under section 552.110(a) of the Government Code.

Alpha also asserts that portions of its proposal are excepted under section 552.110(b). Upon review of the submitted arguments and information at issue, we find that Alpha has established that some of the remaining information, which we have marked, constitutes commercial or financial information, the release of which would cause the company substantial competitive harm. Therefore, the university must withhold the information we have marked under section 552.110(b) of the Government Code. However, Alpha has made only conclusory allegations that the release of the remaining information at issue would result in substantial damage to the company's competitive position. Thus, Alpha has not demonstrated that substantial competitive injury would result from the release of any of the remaining information at issue. Furthermore, we note that the pricing information of a winning bidder is generally not excepted under section 552.110(b). This office considers the prices charged in government contract awards to be a matter of strong public interest. See Open Records Decision No. 514 (1988) (public has interest in knowing prices charged by government contractors). See generally Freedom of Information Act Guide & Privacy Act Overview, 219 (2000) (federal cases applying analogous Freedom of Information Act reasoning that disclosure of prices charged government is a cost of doing business with government). We therefore conclude that none of the remaining information is excepted from disclosure under section 552.110(b). See Open Records Decision Nos. 661 (for information to be withheld under commercial or financial information prong of section 552.110, business must show by specific factual evidence that substantial competitive injury would result from release of particular information at issue), 509 at 5 (1988) (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 is too speculative), 319 at 2 (finding information relating to organization, personnel, market studies, professional references, qualifications, experience, and pricing not excepted under section 552.110).

Alpha claims that release of employee salary information would be "a violation of the private personal information of the affected employee." Section 552.101 excepts from disclosure "information considered to be confidential by law, either constitutional, statutory, or by judicial decision." Gov't Code § 552.101. We understand Alpha to raise section 552.101 in conjunction with common-law privacy, which protects information that is highly intimate or embarrassing, such that its release would be highly objectionable to a reasonable person, and of no legitimate public interest. See Indus. Found. v. Tex. Indus. Accident Bd., 540 S.W.2d 668, 685 (Tex. 1976). This office has found that personal financial information not relating to a financial transaction between an individual and a governmental body is excepted from required public disclosure under common-law privacy. See Open Records Decision No. 600 (1992) (public employee's withholding allowance certificate, designation of beneficiary of employee's retirement benefits, direct deposit authorization, and employee's decisions regarding voluntary benefits programs, among others, are protected under common-law privacy). Upon review, we agree that the salary information of Alpha's employees is highly intimate and not of legitimate public interest. Thus, the university must withhold the employee salary information under section 552.101 in conjunction with common-law privacy.

In summary, the university must withhold the information we have marked under section 552.110 of the Government Code and the salary information of Alpha's employees under section 552.101 in conjunction with common-law privacy. The remaining submitted information must be released to the requestor. ⁽²⁾

This letter ruling is limited to the particular information 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 information or any other circumstances.

This ruling triggers important deadlines regarding the rights and responsibilities of the governmental body and of the requestor. For more information concerning those rights and responsibilities, please visit our website at http://www.oag.state.tx.us/open/index_orl.php, or call the Office of the Attorney General's Open Government Hotline, toll free, at (877) 673-6839. Questions concerning the allowable charges for providing public information under the Act must be directed to the Cost Rules Administrator of the Office of the Attorney General at (512) 475-2497.

Sincerely,

Cindy Nettles

Assistant Attorney General

Open Records Division

CN/jb

Ref: ID# 337153

Enc. Submitted documents

c: Requestor

(w/o enclosures)

Ms. Kathleen K. Acock

Alpha Building Corporation

24850 Blanco Road

San Antonio, Texas 78260

(w/o enclosures)

Ms. Dawn B. Finlayson

The Gardner Law Firm P.C.

745 East Mulberry Avenue, Suite 500

San Antonio, Texas 78212-3154

(w/o enclosures)

Footnotes

1. The Restatement of Torts lists the following six factors as indicia of whether information constitutes a trade secret:

(1) the extent to which the information is known outside of [the company];

(2) the extent to which it is known by employees and other 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 at2 (1982), 255 at 2 (1980).

2. We note that the information being released contains a social security number. Section 552.147(b) of the Government Code authorizes a government body to redact a living person's social security number from public release without the necessity of requesting a decision from this office under the Act. See Gov't Code § 552.147.

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