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ATTORNEY GENERAL OF TEXAS
GREG ABBOTT
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March 26, 2012

Ms. Leah A. Curtis

Attorney for Hunt Memorial Hospital District

Curtis, Alexander, McCampbell & Morris, PC

P.O. Box 1256

Greenville, Texas 75403-1256

OR2012-04395

Dear Ms. Curtis:

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# 449232.

The Huntsville Memorial Hospital District ("HMHD"), which you represent, received a request for a specified contract and all associated proposals. Although HMHD takes no position regarding whether the submitted information is excepted from disclosure, you state release of the requested information may implicate the proprietary interests of Baxter Healthcare Corporation ("Baxter"), B. Braun Medical, Inc. ("Braun"), Cardinal Health ("Cardinal"), and Hospira Worldwide, Inc. ("Hospira"). Accordingly, you provide documentation showing you have notified these third parties of the request and their right to submit arguments to this office. See Gov't Code  552.305(d); see also Open Records Decision No. 542 (1990) (statutory predecessor to section 552.305 permits governmental body to rely on interested third party to raise and explain applicability of exception in the Act in certain circumstances). We have received comments from Braun. We have considered the submitted arguments and reviewed the submitted information.

We first note an interested third party is allowed 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 id.  552.305(d)(2)(B). As of the date of this ruling, we have not received comments from Baxter, Cardinal, or Hospira. Thus, we have no basis to conclude any of these third parties has a protected proprietary interest in any of the submitted information. See id.  552.110(a)-(b); Open Records Decision Nos. 661 at 5-6 (1999) (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), 552 at 5 (1990) (party must establish prima facie case that information is trade secret), 542 at 3. Accordingly, HMHD may not withhold any of the information at issue on the basis of any proprietary interest Baxter, Cardinal, or Hospira may have in the information.

Braun raises section 552.110 of the Government Code for portions of its information. Section 552.110 protects the proprietary interests of private parties by excepting from disclosure (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 a "trade secret" from section 757 of the Restatement of Torts. See Hyde Corp. v. Huffines, 314 S.W.2d 763 (Tex. 1957); see also Open Records Decision No. 552 (1990). Section 757 defines 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) (citation omitted); 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) This office will accept a claim that information subject to the Act is excepted as a trade secret under section 552.110(a) if a prima facie case for the exception is made, and no one submits an argument that rebuts the claim as a matter of law. See ORD 552 at 5. 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. 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. See ORD 661 at 5-6 (business must show by specific factual evidence that release of particular information at issue would cause substantial competitive injury).

Upon review, we find Braun has established that release of its pricing information would cause the company substantial competitive injury for purposes of section 552.110(b). Therefore, HMHD must withhold the information we have marked in Braun's proposal under section 552.110(b). However, we find Braun has not established by a factual or evidentiary showing, and has made only conclusory allegations, that release of the remaining information it seeks to withhold would cause the company substantial competitive injury for purposes of section 552.110(b). See ORD 661 (for information to be withheld under commercial or financial information prong of section 552.110, business must show specific factual evidence that substantial competitive injury would result from release of particular information at issue). In addition, we find Braun has not demonstrated the remaining information it seeks to withhold constitutes trade secrets for purposes of section 552.110(a). See ORD 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). Therefore, HMHD may not withhold any portion of Braun's remaining information under subsection 552.110(a) or (b).

We note portions of the submitted information are protected by copyright. A custodian of public records must comply with 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 copyright law and the risk of a copyright infringement suit.

In summary, HMHD must withhold the information we have marked in Braun's proposal under section 552.110(b) of the Government Code. The remaining information must be released, but any information that is protected by copyright may only be released in accordance with 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,

Misty Haberer Barham

Assistant Attorney General

Open Records Division

MHB/som

Ref: ID # 449232

Enc. Submitted documents

c: Requestor

(w/o enclosures)

c: Ms. Cathy L. Codrea

Senior Vice President

B. Braun Medical Inc.

824 Twelfth Avenue

Bethlehem, Pennsylvania 18018

(w/o enclosures)

c: Ms. Jodi Perez

Manager, Commercial Contracting

Hospira Worldwide, Inc.

Contract Marketing

275 North Field Drive

Department 361, Building H1

Lake Forest, Illinois 60045

(w/o enclosures)

c: Baxter Healthcare Corporation

Legal Department

One Baxter Parkway

Deerfield, Illinois 60015

(w/o enclosures)

c: Cardinal Health

Legal Department

10221 Wateridge Circle

San Diego, California 92121-2772

(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).

 

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