This is an opinion of the Commissioner of Administration issued pursuant to section 13.072 of Minnesota Statutes, Chapter 13 - the Minnesota Government Data Practices Act. It is based on the facts and information available to the Commissioner as described below.
Facts and Procedural History:For purposes of simplification, the information presented by the citizen who requested this opinion and the response from the government entity with which the citizen disagrees are presented in summary form. Copies of the complete submissions are on file at the offices of PIPA and are available for public access.
On August 4, 1995, PIPA received a letter dated August 2, 1995, from Gerald Von Korff, an attorney representing the Tri-County Solid Waste Commission, hereinafter "Tri-County." In his letter, Mr. Von Korff requested an opinion regarding the classification of certain data maintained by Tri-County.
A summary of the detailed facts surrounding this issue is as follows. Mr. Von Korff stated that Tri-County is involved in a contractual dispute with another organization. He also briefly explained the process, "A demand for arbitration resulted in the convening of a three member arbitration panel. The panel issued an interim decision that requires the parties to engage in good faith negotiations. In the event that the dispute cannot be resolved by September 30, 1995, the parties will then return to the panel, which after receiving additional evidence, will rule on the parties' claims."
In his letter, Mr. Von Korff also stated that Tri-County and the other organization have begun negotiations. As part of those negotiations, the parties must exchange settlement proposals. Tri-County has received a written settlement proposal from the opposing party and is requesting that this advisory opinion address the issue of the classification of the settlement proposal.
The Commissioner wishes to note that Mark Anfinson, attorney for the St. Cloud Times, in a letter dated August 4, 1995, submitted comments regarding Mr. Von Korff's opinion request. Essentially, Mr. Anfinson argued that Tri-County should not be able to employ Sections 13.37, subdivision 1 (b); 13.39; or 13.30 to classify the settlement proposal as not public data. He stated that certain information provided by the opposing party, i.e. major creditors and the amount of debt, does not seem to fall within the boundaries of the items listed in Section 13.37, subdivision 1 (b).
In his comments, Mr. Anfinson also asserted that based on St. Peter Herald v. City of St. Peter, 496 N.W.2d 812 (Minn. 1993), the settlement proposal cannot be classified as not public data under Section 13.39.
In addition, Mr. Anfinson stated that Section 13.30 effectively extends the attorney-client privilege. Because the proposal is not a communication between only the client and the attorney, it is not protected by Section 13.30.
The first issue raised by Mr. Von Korff is whether a written proposal for settlement of litigation, which has been submitted to Tri-County, is government data. It appears that Tri-County is a joint powers entity established pursuant to Minnesota Statutes Sections 400.01 to 400.17 (The County Solid Waste Management Act of 1971) and Minnesota Statutes Section 471.59 (joint exercise of powers.)
Minnesota Statutes Section 13.02, subdivision 7, defines government data as all datacollected, created, received, maintained, or disseminated by anystate agency, political subdivision, or statewide systemregardless of its physical form, storage media, or conditions of use. Section 13.02, subdivision 18, defines statewide system as any record keeping system in which government data is collected, stored, disseminated, and used by means of a system common to one or more state agencies or more than one of its political subdivisions, or any combination of states agencies and political subdivisions.
For the purposes of Chapter 13, Tri-County is a statewide system. Thus, pursuant to Section 13.02, subdivision 7, any data Tri-County collects, creates, receives, maintains, or disseminates are government data. Tri-County has received data, in the form of a written settlement proposal. Therefore, the settlement proposal is government data.
The second issue raised by Mr. Von Korff is whether the settlement proposal is classified as not public data by any of the following sections in Chapter 13: 13.37, subdivision 1 (b) (trade secret data); 13.39 (civil investigative data); or 13.30 (attorney data)?
In regard to the possibility that the settlement proposal is classified as not public because the data comprising the agreement are trade secret data, the Commissioner must look to the language of Section 13.37, subdivision 1 (b):
|"Trade secret information" means government data, including a formula, pattern, compilation, program, device, method, technique or process (1) that was supplied by the affected individual or organization, (2) that is the subject of efforts by the individual or organization that are reasonable under the circumstances to maintain its secrecy, and (3) that derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use.
Clearly, government entities can use the trade secret exemption to classify data as not public only if the data meet each of the specific requirements set forth in Section 13.37, subdivision 1 (b).
In his August 2, 1995, letter, Mr. Von Korff noted that as negotiations proceed, Tri-County will likely require additional financial information about the opposing party which the opposing party may regard as trade secret. He also stated that the initial proposal contains a listing of the the opposing organization's major creditors and the amount of debt. Mr. Von Korff further expressed concern that if negotiations continue, Tri-County will require additional and more confidential data which, if disclosure is necessary, will not be forthcoming.
First, the Commissioner wishes to note that she cannot comment on any data Tri-County may receive in the future. Without knowing the content of the data, it is impossible to formulate any conclusion regarding its classification.
Second, because Mr. Von Korff did not provide the Commissioner with a copy of the actual settlement proposal, it is impossible for the Commissioner to determine whether any of the data elements comprising the proposal are trade secret data. However, the Commissioner would like to note that, if, as Mr. Von Korff states, the proposal does contain a listing of the opposing party's major creditors and the amount of debt, the Commissioner presumes that neither of those two data elements would meet the rigorous definition of Section 13.37, subdivision 1 (b).
In regard to the possibility that the settlement agreement is classified as not public because the data comprising the agreement are civil investigative data, the Commissioner must look to the relevant language in Section 13.39. Subdivision 2 of Section 13.39 states that data collected by state agencies, political subdivisions, or statewide systems, as part of an active investigation undertaken for the purpose of commencement or defense of a pending civil legal action, or which are retained in anticipation of a pending civil legal action, are classified as protected nonpublic (data not on individuals) or as confidential (data on individuals).
Subdivision 1 of Section 13.39 defines pending legal action as including, but not limited to, judicial, administrative, or arbitration proceedings. Subdivision 1 also states that the chief attorney acting for the state agency, political subdivision, or statewide system shall determine whether, for purposes of Section 13.39, a civil legal action is pending.
In 1993, the Minnesota Supreme Court, in St. Peter Herald v. City of St. Peter, 496 N.W.2d 812 (Minn. 1993), addressed an issue similar to the one at hand. In St. Peter Herald, the court held that a notice of claim provided to a political subdivision, had not been "collected" by the political subdivision in anticipation of possible commencement of litigation and thus, could be disclosed under Chapter 13. The court wrote:
|...we should prefer to characterize the notice of claim...as a nonpublic document because we believe nondisclosure until litigation is actually commenced better serves our oft repeated public policy of encouraging negotiation and compromise of disputes. Publicity tends to crystallize positions, and requiring a municipality to treat a notice of claim as a public document suggests that a notice, which might otherwise be presented simply to apprise the municipality of an event or condition, will be perceived as necessarily presaging commencement of a lawsuit.
Unfortunately, in our view Minn. Stat. ¤13.39, subd. 2 (1990) does not permit a notice of claim to be classified as a nonpublic document. The statute speaks of "Data collected by * * * political subdivision."... "Collect," then, requires affirmative action by someone, and pursuant to section 13.39, subd. 2, that someone is a political subdivision....The information contained in a notice of claim is indeed retained by a political subdivision in anticipation of the possible commencement of legal action, but is not "data collected" by the political subdivision as part of an active investigation. The political subdivision has not taken any affirmative action to gather the information contained in a notice of claim; it is simply a passive recipient of that information.
Although the Tri-County situation does not involve a notice of claim, it appears that the St. Peter Herald case is applicable. Mr. Von Korff stated that Tri-County has "received" a written settlement proposal from the opposing party. Assuming that his statement is an accurate reflection of how Tri-County came to possess the proposal, it appears, as in St. Peter Herald, that Tri-County did not take any affirmative action to gather the proposal, but rather was a passive recipient of the proposal. Therefore, based on the holding in St. Peter Herald, it appears that the settlement proposal cannot be classified as protected nonpublic data pursuant to Section 13.39.
However, the Commissioner does wish to add that she is somewhat puzzled by the holding in St. Peter Herald. It appears that Section 13.39, subdivision 2, when read in full, could certainly be interpreted to mean that data become not public if a government entity either collects the data as part of an active investigation undertaken for the purpose of the commencement or defense of a pending legal action, or if the government entity retains the data in anticipation of a pending legal action. Thus, the classification of the data would not bedependent, as the St. Peter Heraldcase suggests, on the method upon which the government entity comes to possess the data. This issue may need legislative clarification.
Regardless of the Commissioner's reluctance to fully accept the conclusion reached in St. Peter Herald, there appears to be no other case law on the issue.
In regard to the possibility that the settlement agreement is classified as not public because the data comprising the agreement are attorney data, the Commissioner must look to the language in Section 13.30:
|Notwithstanding the provisions of this chapter and section 15.17, the use, collection, storage, and dissemination of data by an attorney acting in a professional capacity for the state, a state agency or a political subdivision shall be governed by statutes, rules, and professional standards concerning discovery, production of documents, introduction of evidence, and professional responsibility; provided that this section shall not be construed to affect the applicability of any statute, other than this chapter and section 15.17, which specifically requires or prohibits disclosure of specific information by the attorney, nor shall this section be construed to relieve any responsible authority, other than the attorney, from duties and responsibilities pursuant to this chapter and section 15.17.
The Commissioner believes the intent behind and the purpose of Section 13.30 is to clarify that the use, collection, storage, and dissemination of data by attorneys acting in their professional capacities is controlled by statutes, rules, and professional standards which relate to discovery, production of documents, introduction of evidence, and professional responsibility. In other words, if certain data are protected, pursuant to a particular statute, rule, or professional standard, by the attorney/client privilege, no provision in Chapter 13 or Section 15.17 can supersede and/or alter the classification/treatment of those data.
It should be noted, however, that the last phrase of Section 13.30 indicates the Legislature did not intend for this section to relieve responsible authorities, other than attorneys, from their duties and responsibilities under Chapter 13 or Section 15.17.
If a government entity wishes to classify certain data as not public because those data are protected under Section 13.30, the entity must be able to point to the statute, rule, and/or professional standard which provides that the data should be not public. Given that Tri-County has not provided the Commissioner with any such documentation, it is difficult for the Commissioner to hypothesize as to which statute, rule, and/or professional standard Tri-County deems to be appropriate in this situation.
However, since Mr. Anfinson has raised the issue of data protected by attorney/client confidentiality, the Commissioner believes it may be helpful to address that particular possibility. Attorney/client confidentiality is a rule of conduct which serves to protect information provided by a client to her/his attorney. The question at hand is whether the settlement proposal received by Tri-County could be considered information which is protected by attorney/client confidentiality.
The main provision regarding attorney/client confidentiality can be found in Rule 1.6 of the Minnesota Rules of Professional Conduct. In part, Rule 1.6 states that except where otherwise permitted, a lawyer shall not knowingly: (1) reveal a confidence or secret of a client; (2) use a confidence or secret of a client to the disadvantage of the client; (3) use a confidence or secret of a client for the advantage of the lawyer or a third person, unless the client consents after consultation. Because there does not appear to be any relevant case law, the Commissioner must look directly to the plain language of the rule.
Clearly, the language of the rule defines privileged information as a confidence or secret which is shared by a client with her/his attorney. Given that definition, it is difficult to argue reasonably that the data in question, the opposing party's settlement proposal, is privileged information. The proposal is obviously not a confidence or secret of Tri-County's; the opposing party has been the source of the data in question.
Therefore, it does not appear that Tri-County could rely on the attorney/client privilege to classify the settlement proposal as not public data under Section 13.30.
Finally, the Commissioner wishes to point out that while it does not appear Mr. Von Korff can use any of the aforementioned provisions of Chapter 13 to classify the settlement proposal as not public data, he does make some persuasive policy arguments as to why such proposals ought, initially, to be not public data. He writes:
|...a settlement proposal is inadmissable as evidence in the later litigation. The law protects settlement proposals to encourage settlement negotiations. Parties may be reluctant to offer compromise in the context of negotiations, because their proposal, if public, will be viewed as an admission of weakness. Moreover, once the proposal becomes public, it inevitably gets communicated to the finder of fact; parties may be concerned that if they make a proposal, it will prejudice the decision of the tribunal.
[Tri-County] recognizes that once the litigation reaches a proposed resolution, that the public policy implications of the proposed resolution must be fully aired in public, and that the public then has a right to access to data which may help to inform the public so that the public can be fully involved in the policy discussions. [Tri-County] however is concerned that it may never obtain reasonably acceptable concessions from its litigation adversary if initial proposals must be disclosed.
While Mr. Von Korff's arguments are compelling, they collide with current policy which, as articulated in Chapter 13, states a very strong presumption of public accessibility to government data. However, his comments, if brought to the Minnesota Legislature, might result in some changes to the way settlement proposal data are classified.
Based on the correspondence in this matter, my opinion on the issues raised by Mr. Von Korff is as follows:
Elaine S. Hansen
Dated: September 21, 1995