July 27, 2012

Ms. Dawn Burton

Assistant General Counsel

Texas Department of State Health Services

P.O. Box 149347

Austin, Texas 78714-9347

OR2012-11750

Dear Ms. Burton:

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# 460648 (DSHS File: 20221/2012).

The Texas Department of State Health Services (the "department") received a request for records pertaining to a specified food processing facility. You state you have made some information available to the requestor. Although you take no position with respect to the public availability of the submitted information, you state release of this information may implicate the proprietary interests of Columbia Packing Company, Inc. ("Columbia"). Accordingly, you have notified Columbia 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); 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 Columbia. We have considered the submitted arguments and reviewed the submitted information.

Initially, we must address the department's obligations under the Act. Section 552.301 of the Government Code describes the obligations placed on a governmental body that receives a written request for information it wishes to withhold. Pursuant to section 552.301(b) of the Government Code, the governmental body must request a ruling from this office and state the exceptions to disclosure that apply within ten business days after receiving the request. Gov't Code § 552.301(b). Section 552.301(e) requires a governmental body to submit to this office within fifteen business days of receiving an open records 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. Id. § 552.301(e). You state the department received the request on May 8, 2012. Upon review of the submitted documentation, we find the department received the initial request for information on April 23, 2012. We note the department sought clarification of the request on April 27, 2012 and received clarification from the requestor on May 1, 2012. See id. § 552.222(b) (governmental body may communicate with requestor for purpose of clarifying or narrowing request for information); see also City of Dallas v. Abbott, 304 S.W.3d 380 (Tex. 2010) (holding when governmental entity, acting in good faith, requests clarification or narrowing of unclear or overbroad request for public information, ten-day period to request attorney general ruling is measured from date request is clarified or narrowed). The department exchanged e-mails with the requestor on May 8, 2012, but the requestor did not further clarify the request on that date. Thus, we find the request was received by the department on May 1, 2012. Accordingly, the department's ten-business-day deadline was May 15, 2012, and the department's fifteen-business-day deadline was May 22, 2012. However, you did not request a ruling from this office and did not submit the information required by section 552.301(e) to this office until May 23, 2012. See Gov't Code § 552.308 (describing rules for calculating submission dates of documents sent via first class United States mail, common or contact carrier, or interagency mail). Accordingly, we find the department failed to comply with the requirements of section 552.301 of the Government Code.

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 requested information is public and must be released unless the governmental body demonstrates a compelling reason to withhold the information from disclosure. See id. § 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, 381-81 (Tex. App.--Austin 1990, no writ); Open Records Decision No. 319 (1982). 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). Because the interests of a third party can provide a compelling reason for non-disclosure under section 552.302, we will consider whether the submitted information must be withheld to protect the interests of Columbia.

Next, Columbia asserts, and we agree, portions of submitted information, which we have marked, are not responsive to the instant request as they do not consist of records of the specified food processing facility. This ruling does not address the public availability of non-responsive information, and the department is not required to release non-responsive information in response to the request.

Columbia claims section 552.110 of the Government Code for the responsive information. Section 552.110 protects the proprietary interests of private parties by excepting from disclosure two types of information: trade secrets and commercial or financial information, the release of which would cause a third party substantial competitive harm. See Gov't Code § 552.110(a)-(b). Section 552.110(a) excepts from disclosure "[a] trade secret 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. 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); 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 private person's claim for exception as valid under section 552.110(a) if that person establishes a prima facie case for exception, and no argument is submitted that rebuts the claim as a matter of law. ORD 552 at 5-6. However, we cannot conclude that section 552.110(a) applies 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. See Open Records Decision No. 402 (1983).

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." Gov't Code § 552.110(b). Section 552.110(b) requires a specific factual or evidentiary showing, not conclusory or generalized allegations, that substantial competitive injury would likely result from release of the requested information. See Open Records Decision No. 661 at 5-6 (1999) (business enterprise must show by specific factual evidence that release of information would cause it substantial competitive harm).

After reviewing the submitted arguments and the information at issue, we conclude Columbia has demonstrated that a portion of its information constitutes trade secrets for purposes of section 552.110(a). Accordingly, the department must withhold the information we have marked under section 552.110(a). However, we find Columbia has failed to establish any of the remaining information at issue meets the definition of a trade secret, nor has Columbia demonstrated the necessary factors to establish a trade secret claim for the remaining information. Thus, the department may not withhold any portion of the remaining information under section 552.110(a) of the Government Code.

After reviewing the submitted arguments and the information at issue, we conclude Columbia has established that release of portions of the remaining information would cause the company substantial competitive harm. Accordingly, the department must withhold the information we have marked in the remaining information under section 552.110(b). However, we find Columbia has failed to provide specific factual evidence demonstrating release of any of the remaining information would result in substantial competitive harm to the company. 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 3 (information relating to organization and personnel, professional references, market studies, and qualifications are not ordinarily excepted from disclosure under statutory predecessor to section 552.110), 175 at 4 (1977) (resumes cannot be said to fall within any exception to the Act). Accordingly, the department may not withhold any of the remaining information pursuant to section 552.110(b) of the Government Code.

In summary, the department must withhold the information we have marked under section 552.110 of the Government Code. The remaining responsive 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,

Sarah Casterline

Assistant Attorney General

Open Records Division

SEC/som

Ref: ID# 460648

Enc. Submitted documents

c: Requestor

(w/o enclosures)

Footnotes

1. The following are the six factors the Restatement gives 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 (1939); see also Open Records Decision Nos. 319 at 2 (1982), 306 at 2 (1982), 255 at 2 (1980).

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