May 2, 2011

Ms. Dana Colbert

Records Coordinator

Texas Youth Commission

P.O. Box 4260

Austin, Texas 78765-4260

OR2011-05951

Dear Ms. Colbert:

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# 416085 (TYC ORR# 16312).

The Texas Youth Commission (the "commission") received a request for all proposals, scoring sheets, and documentation used to make a determination in the award for a specified request for proposals. You state the commission has provided the requestor with most of the information sought. Although you take no position with respect to the public availability of the submitted information, you state the proprietary interests of a third party might be implicated. Accordingly, you provided notice of the request to Southwest Key Programs ("Southwest") and notified it of its right to submit arguments to this office explaining why its information should not be released. 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 statutory predecessor to section 552.305 permits governmental body to rely on interested third party to raise and explain applicability of exception in certain circumstances). We have received arguments submitted by Southwest. We have considered its arguments and reviewed the submitted information.

Initially, we address the commission's responsibilities under the Act. Under section 552.301(e) of the Government Code, a governmental body that receives a request for information it wishes to withhold under one of the Act's exceptions must submit to this office within fifteen business days of receiving the request (1) general written comments stating the reasons why the stated exceptions apply that would allow the information to be withheld, (2) a copy of the written request for information, (3) a signed statement or sufficient evidence showing the date the governmental body received the written request, and (4) a copy of the specific information requested or representative samples, labeled to indicate which exceptions apply to which parts of the documents. Gov't Code § 552.301(e). The commission received the request for information on February 7, 2011. Thus, the commission was required to submit a copy of the specific information requested by March 1, 2011. Consequently, because the commission submitted the information at issue on March 30, 2011, we find the commission failed to comply with the requirements of section 552.301.

Pursuant to section 552.302 of the Government Code, a governmental body's failure to comply with the procedural requirements of section 552.301 results in the legal presumption that the information is public and must be released, unless a governmental body demonstrates a compelling reason to withhold the information to overcome this presumption. See Gov't Code § 552.302; Simmons v. Kuzmich, 166 S.W.3d 342, 350 (Tex. App.--Fort Worth 2005, no pet.); Hancock v. State Bd. of Ins., 797 S.W.2d 379, 381 (Tex. App.--Austin 1990, no writ) (governmental body must make compelling demonstration to overcome presumption of openness pursuant to statutory predecessor to section 552.302); Open Records Decision No. 630 (1994). A compelling reason exists when third-party interests are at stake or when information is confidential under other law. Open Records Decision No. 150 (1977). As Southwest's information is at issue, we will consider Southwest's arguments against disclosure.

Southwest asserts section 552.110 of the Government Code, which 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, which holds a trade secret to be:

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 Hyde Corp. v. Huffines, 314 S.W.2d 776 (Tex. 1958). 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 Open Records Decision No. 552 at 5 (1990). 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.; see also Open Records Decision No. 661 at 5.

Southwest asserts that it has developed a proprietary program to provide at-risk youth with alternatives to incarceration. It states this program is based on a unique model that takes into account certain staffing, budget, and planning considerations. Southwest further states this program has taken nearly 20 years to develop, the specific details of the model are shared with only key employees, and providing information about this model to its competitors would give the competitors an advantage. Based on these representations and our review, we find Southwest has made a prima facie case the information we have marked constitutes a trade secret. Accordingly, the commission must withhold the information we have marked under section 552.110(a) of the Government Code. However, we find Southwest has failed to demonstrate any of the remaining information at issue meets the definition of a trade secret, nor has Southwest demonstrated the necessary factors to establish a trade secret claim for this information. Therefore, the commission may not withhold the remaining information under section 552.110(a) of the Government Code.

Upon further review, we find Southwest has established the pricing information and budget information we have marked is commercial or financial information, the release of which would cause it substantial competitive injury. The commission must withhold the information we have marked under section 552.110(b) of the Government Code. However, we find that Southwest has failed to demonstrate that any of the remaining information consists of commercial or financial information, the release of which would cause it substantial competitive injury. Accordingly, the commission may not withhold any of the remaining information under section 552.110(b) of the Government Code.

We note that some of the information being released is 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. Open Records Decision No. 180 at 3 (1977). However, a governmental body must allow inspection of copyrighted materials unless an exception applies to the information. Id.; see Open Records Decision No. 109 (1975). 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.

In summary, the commission must withhold the information we have marked under sections 552.110(a) and 552.110(b) of the Government Code. The remaining information must be released in accordance with applicable copyright law.

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, toll free at (888) 672-6787.

Sincerely,

Neal Falgoust

Assistant Attorney General

Open Records Division

NF/dls

Ref: ID# 416085

Enc. Submitted documents

c: Requestor

(w/o enclosures)

Ms. Elizabeth O. Nielsen

Legal Counsel

Southwest Key Programs, Inc.

6002 Jain Lane

Austin, Texas 78721

(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 Open Records Decision Nos. 319 at 2 (1982), 306 at2 (1982), 255 at 2 (1980).

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