PAC Rejects "Trade Secret" Exemption in Binding PAC Opinion
The PAC recently found a public body in violation of FOIA when it failed to release public records relating to redevelopment project costs in response to a FOIA request. PAC Op. 18-004.
A newspaper reporter filed a FOIA request with a municipality seeking a copy of the "latest revised redevelopment cost budget" submitted by a private developer to the municipality. The city denied the request under section 7(1)(g), which protects trade secrets and commercial or financial information, where that information is furnished under a claim that it is proprietary, privileged or confidential and release would cause competitive harm.
The requester filed a complaint with the PAC. The city argued that the private developer had submitted the budget cost information to the city with the belief that the information would remain confidential. The PAC rejected the city's argument, finding that even if the developer had furnished the financial information to the city under a claim of confidentiality, the city failed to establish that disclosure of this information would cause competitive harm to the developer. The PAC noted that the exemption in 7(1)(g) required the city to establish that the information was provided under a claim of confidentiality and that disclosure would cause competitive harm - harm that must be "substantial" in nature, according to the PAC. Because the city failed to provide facts or evidence to demonstrate how disclosure would result in competitive harm to the developer, that exemption did not apply. The PAC acknowledged that the city provided information about how release would harm the city by dissuading developers from doing business with the city, but that was not relevant to the PAC.
In sum, the PAC rejected the city's use of section 7(1)(g) to deny the FOIA request for financial information submitted by a private entity.
Post Authored by Julie Tappendorf
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