May 13, 2011

Ms. Patricia M. Pettet

Legal Administrator/FOIA Officer

Adjutant General's Department

Texas Military Forces

P.O. Box 5218

Austin, Texas 78763

OR2011-06695

Dear Ms. Pettet:

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# 417460.

The Adjutant General's Department (the "department") received a request for the winning proposal submitted by Weaver and Tidwell, LLP ("Weaver") in response to request for proposals number 401-0-0240. Although you take no position on whether the requested information is excepted from disclosure, you state release of this information may implicate the proprietary interests of Weaver. Accordingly, you have notified Weaver of the request and of its right to submit arguments to this office as to why the submitted 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 received comments from an attorney for Weaver. We have reviewed the submitted information.

Initially, we address the department's statement that Weaver marked portions of its submitted proposal as confidential. We note that information is not confidential under the Act simply because the party that submits the information anticipates or requests that it be kept confidential. See Indus. Found. v. Tex. Indus. Accident Bd., 540 S.W.2d 668, 677 (Tex. 1976). In other words, a governmental body cannot overrule or repeal provisions of the Act through an agreement or contract. See Attorney General Opinion JM-672 (1987); Open Records Decision Nos. 541 at 3 (1990) ("[T]he obligations of a governmental body under [the Act] cannot be compromised simply by its decision to enter into a contract."), 203 at 1 (1978) (mere expectation of confidentiality by person supplying information does not satisfy requirements of statutory predecessor to section 552.110). Consequently, unless the information falls within an exception to disclosure, it must be released, notwithstanding any expectation or agreement to the contrary.

Weaver claims section 552.110 for portions of the submitted information. Section 552.110(a) protects trade secrets obtained from a person and privileged or confidential by statute or judicial decision. Gov't Code § 552.110(a). The Texas Supreme Court has adopted the definition of a "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 a single or ephemeral event 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 763, 776 (Tex. 1958). This office will accept a private person's claim for exception as valid under section 552.110(a) if that person establishes a prima facie case for the exception, and no one submits an argument that rebuts the claim as a matter of law. See Open Records Decision No. 552 at 5 (1990). However, we cannot conclude section 552.110(a) is applicable unless it has been shown the information meets the definition of a trade secret and the necessary factors have been demonstrated to establish a trade secret claim. ⁽¹⁾ 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); Open Records Decision No. 661 at 5-6 (to prevent disclosure of commercial or financial information, party must show by specific factual evidence, not conclusory or generalized allegations, that release of requested information would cause that party substantial competitive harm).

Weaver seeks to withhold portions of its submitted information and its subcontractor information under section 552.110(a). Upon review, we conclude Weaver has established a prima facie case some of its customer information constitutes trade secrets. We note, however, that Weaver has made some of the customer information it seeks to withhold publicly available on its website. Because Weaver has published this information, which we have marked for release, it has failed to demonstrate that this information is a trade secret, and none of it may be withheld under section 552.110(a). However, the department must withhold Weaver's remaining customer information, which we have marked, under section 552.110(a) of the Government Code. Additionally, we find Weaver has failed to establish how any of the remaining information it seeks to withhold constitutes trade secrets under section 552.110(a). See ORDs 402 (section 552.110(a) does not apply unless information meets definition of trade secret and necessary factors have been demonstrated to establish trade secret claim); 319 at 2 (information relating to organization, personnel, market studies, professional references, qualifications, experience, and pricing not excepted under section 552.110). We note pricing information pertaining to a particular proposal or contract is generally not a trade secret because it is "simply information as to single or ephemeral events in the conduct of the business," rather than "a process or device for continuous use in the operation of the business." See Restatement of Torts § 757 cmt. b (1939); Huffines, 314 S.W.2d at 776; ORDs 319 at 3, 306 at 3. Thus, no portion of the remaining information may be withheld under section 552.110(a) of the Government Code.

Weaver also raises section 552.110(b) of the Government Code for portions of its information. Upon review, we find Weaver has established release of some of its information would cause it substantial competitive injury. Therefore, the department must withhold the information we have marked under section 552.110(b) of the Government Code. However, as previously stated, Weaver has made some of its client information publicly available on its website. Because Weaver has published this information, it has failed to demonstrate how release of this information would cause it substantial competitive injury. Further, we find Weaver has made only conclusory allegations that release of its remaining information would result in substantial damage to its competitive position and has provided no specific factual or evidentiary showing to support such allegations. See ORD 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); see also ORD 319 at 3 (information relating to organization and personnel, professional references, market studies, qualifications, and pricing are not ordinarily excepted from disclosure under statutory predecessor to section 552.110). Furthermore, we note that the pricing information of a winning bidder, such as Weaver, 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 Dep't of Justice Guide to the Freedom of Information Act 344-345 (2009) (federal cases applying analogous Freedom of Information Act reasoning that disclosure of prices charged government is a cost of doing business with government). Accordingly, we determine none of Weaver's remaining information is excepted from disclosure under section 552.110(b).

Section 552.136(b) of the Government Code states that "[n]otwithstanding any other provision of [the Act], 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." ⁽²⁾ Gov't Code § 552.136(b). This office has determined that insurance policy numbers are access device numbers for purposes of section 552.136. See id. § 552.136(a) (defining "access device"). Therefore, the department must withhold the insurance policy numbers we have marked pursuant to section 552.136 of the Government Code. ⁽³⁾

In summary, the department must withhold the information we have marked under section 552.110 of the Government Code, as well as the information we have marked under section 552.136 of the Government Code. The remaining information must be released.

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,

Vanessa Burgess

Assistant Attorney General

Open Records Division

VB/dls

Ref: ID# 417460

Enc. Submitted documents

c: Requestor

(w/o enclosures)

Ms. Janet Sobey Bubert

Brackett & Ellis, P.C.

For Weaver & Tidwell, L.L.P.

100 Main Street

Fort Worth, Texas 76102

(Third party 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 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; see also Open Records Decision Nos. 319 at 2 (1982), 306 at 2 (1982), 255 at 2 (1980).

2. The Office of the Attorney General will raise a mandatory exception on behalf of a governmental body, but ordinarily will not raise other exceptions. See Open Records Decision Nos. 481 (1987), 480 (1987), 470 (1987).

3. We note that this office issued Open Records Decision No. 684 (2009), a previous determination to all governmental bodies authorizing them to withhold ten categories of information, including insurance policy numbers under section 552.136, without the necessity of requesting an attorney general decision.

POST OFFICE BOX 12548, AUSTIN, TEXAS 78711-2548 TEL: (512) 463-2100 WEB: WWW.OAG.STATE.TX.US
An Equal Employment Opportunity Employer