Request By:
[NO REQUESTBY IN ORIGINAL]
Opinion
Opinion By: ALBERT B. CHANDLER III, ATTORNEY GENERAL; Amye L. Bensenhaver, Assistant Attorney General
Open Records Decision
This is an appeal from the City of Louisville's response to Brian Cullinan's August 1, 1997, request for "the letter to the Securities and Exchange Commission from a City contract attorney requesting an investigation of Cullinan Associates, Inc. which was the subject of 96-ORD-277 and 97-ORD-120." On August 4, 1997, the City of Louisville denied Mr. Cullinan's request, advising him that the city's position "is the same now as it was with [Mr. Cullinan's] brother Royden's two previous requests for the same record (one of which was decided in 97-ORD-120) and [Mr. Cullinan's] associate, Anthony Trusty's previous request for the same record (96-ORD-277)." Noting that the SEC had concluded its investigation of the Louisville Policemen's Retirement Fund, and attaching an edited copy of a letter dated April 3, 1997, from Betty A. Hopkins, FOIA/Privacy Act Branch Chief for the SEC, which confirmed this fact, Mr. Cullinan asked that the city reconsider its position on August 6, 1997. The city reaffirmed its denial on August 11, commenting that it was "unfamiliar with the letter and unable to appreciate its relevance" to his request. The city again relied on 96-ORD-277 and 97-ORD-120, which "discussed KRS 61.878(1)(j)," concluding that it had "fully and substantially complied with its statutory duties. . . ."
The question presented in this appeal is whether the City of Louisville properly relied on KRS 61.878(1)(j) in denying Mr. Cullinan's request. For the reasons which follow, we conclude that the city properly denied the request.
In 96-ORD-277, this office held that the disputed record "[fell]squarely within the parameters of KRS 61.878(1)(j) as a preliminary document in which opinions are expressed." 96-ORD-277, p. 2. That record was described as "correspondence from an attorney, retained by the city to give legal counsel to the mayor, to the Securities and Exchange Commission in which the attorney engages in preliminary discussions, expresses opinions, and describes concerns relating to the basis for a possible investigation and enforcement action." 96-ORD-277, p. 2. In 97-ORD-120, we revisited this issue. The City of Louisville again denied a request for the letter, relying on 96-ORD-277 and KRS 61.878(1)(j) and arguing that "preliminary documents . . . do not lose their exempt status unless adopted by the agency as part of some final action. " (Emphasis in original.) At page 3 of that decision, we observed:
The facts giving rise to this appeal have apparently not changed since we issued 96-ORD-277. [The requester] acknowledges as much by noting that "there is no investigation pending by the Securities and Exchange Commission relative to the requested records. Nor is there such an investigation pending by the City of Louisville.
From the requester's statement, we concluded that this matter had not proceeded to an investigation of any kind. As we have noted, however, in his September 3, 1997, letter of appeal, Mr. Cullinan advised us that the SEC had notified him that it conducted an investigation of the Louisville Policemen's Retirement Fund from December 10, 1993, to March 7, 1997, and that the investigation is now concluded. Based on these new facts, Mr. Cullinan argued that we were in error in 97-ORD-120, and that the Open Records Law mandates disclosure of the letter.
The question presented in this appeal is factual and not legal in nature. The law is clear. If the disputed letter constituted a complaint to the SEC which resulted in its investigation of the Louisville Policemen's Retirement Fund, the letter forfeited its preliminary characterization and became releasable once final action was taken by the
SEC. City of Louisville v. Courier-Journal and Louisville Times Company, Ky. App., 637 S.W.2d 658 (1982);
Kentucky State Board of Medical Licensure v. Courier-Journal and Louisville Times Company, Ky.App., 663 S.W.2d 953 (1983);
University of Kentucky v. Courier-Journal and Louisville Times Company, Ky., 830 S.W.2d 373 (1992). If, on the other hand, the letter constituted nothing more than a preliminary memorandum or recommendation in which opinions were expressed, it retained its preliminary characterization and remains forever exempt. Id. As the court noted in
Beckham v. Board of Education of Jefferson County, Ky., 873 S.W.2d 575, 578 (1994):
From the exclusions we must conclude that with respect to certain records, the General Assembly has determined that the public's right to know is subservient to . . . the need for governmental confidentiality. A cursory examination of KRS 61.878 reveals an extensive list of matters excluded from public access, and this also suggests an absence of legislative intent to create unrestricted access to records.
Based on our review of the letter, and discussions with officials at the Security and Exchange Commission in Washington, D.C., and Chicago, Illinois, we conclude that the disputed letter did not precipitate the SEC investigation, and that it was properly characterized as a preliminary document excluded from inspection by KRS 61.878(1)(j) in 96-ORD-277 and 97-ORD-120.
Mr. Cullinan maintains that the letter spawned the SEC's investigation of the Louisville Policemen's Retirement Fund. The letter was, however, dated April 1, 1988. The investigation did not commence until December 10, 1993, over five years later. It seems unlikely that the SEC was this slow to move on a specific complaint. The chronological evidence therefore does not support Mr. Cullinan's claim.
Moreover, based on discussions with SEC officials, it is our understanding that the SEC received a tip from a specifically identified individual, who was not the author of the letter, concerning insider trading, and that it was this tip which led to the investigation. The substance of the disputed letter does not relate to insider trading. Thus, our discussions with the SEC do not support Mr. Cullinan's claim.
We therefore affirm our earlier decisions and find that the City of Louisville properly denied Mr. Cullinan's request. Because the letter to the SEC merely expressed opinions and did not spawn its 1993 investigation, we conclude that it is a preliminary document protected from disclosure by KRS 61.878(1))(j).
A party aggrieved by this decision may appeal it by initiating action in the appropriate circuit court pursuant to KRS 61.880(5) and KRS 61.882. Pursuant to KRS 61.880(3), the Attorney General should be notified of any action in circuit court, but should not be named as a party in that action or in any subsequent proceeding.