Request By:
[NO REQUESTBY IN ORIGINAL]
Opinion
Opinion By: Albert B. Chandler III, Attorney General; Amye L. Bensenhaver, Assistant Attorney General
Open Meetings Decision
The question presented in this appeal is whether the Bowling Green-Warren County Regional Airport Board violated the Open Meetings Act at its October 20, 1998, regular meeting when it went into executive session under authority of KRS 61.810(1)(c). For the reasons that follow, we find that the Airport Board properly relied on the cited exemption in conducting an executive session to discuss proposed or pending litigation.
On October 23, 1998, Joey Roberts, executive director of Kentucky Citizens Accountability Project, submitted a complaint to Tom Smith, Chairman of the Bowling Green-Warren County Airport Board, in which he alleged that the Airport Board's closed session discussion of a new owner/operator refueling policy and a storm damage insurance settlement, at its October 20 meeting, constituted a violation of the Open Meetings Act. Mr. Roberts maintained that the Airport Board's reliance on KRS 61.810(1)(c) was misplaced "given the absence of 'proposed' or 'pending' litigation," and requested that the Board "correct these violations of Kentucky Law by conducting a full and open discussion of both matters," and agree to "cease and desist from invoking the exception of 'pending litigation' unless actual imminent litigation ? will be discussed."
On behalf of the Airport Board, Linda B. Thomas, Board Counsel, responded to Mr. Roberts's complaint on October 28. Ms. Thomas offered the following explanation for the Board's decision to go into closed session:
Prior to the Board meeting, the Board had received written notice from a group of pilots demanding reconsideration of parts of the fueling policy adopted by the Board August 11, 1998; and giving notice of areas of the policy which would be contested in the absence of action on this issue at the October 20, 1998 meeting. The Board's deliberations and instructions to its advocate concerning potential legal outcomes, and strategy to meet this threat of litigation fell squarely within the communications which KRS 61.810(1)(c) was enacted to protect.
With respect to the storm damage insurance settlement, Ms. Thomas stated:
The Board has been in negotiations with its insurer for several months in an attempt to reach an amiable resolution of the Airport's property damage claims resulting from the hail damage. Payment of the property damage claims at the Airport without question directly financially affects the public interest; and negotiations with the insurer had reached an impasse. The Board went into a closed session to discuss a time table, legal issues to be researched which will form the basis of the Board's claims, litigation strategy, and tactics for negotiation should settlement become a possibility at an amount deemed reasonable by the Airport. In this instance also, the confidentiality exception of KRS 61.810(1)(c) protected the confidentiality of the Board's deliberations preparatory to litigation and instructions to its counsel.
In closing, Ms. Thomas noted that in both instances to which Mr. Roberts objected "administrative agency and/or court litigation was and is eminent [sic]; in the first instance, against the Airport; and in the second, by the Airport."
In a letter dated December 23, 1998, and received on December 28, Mr. Roberts initiated this open meetings appeal. He expressed the view that the Airport Board has repeatedly abused exemptions available under the Kentucky Open Meetings Law by going into closed session under the pretext of 'pending litigation' when no actual litigation was discussed." Noting that his review of the pilots' demand for reconsideration of the refueling policy failed to disclose any threat of litigation, he argued that in any event "the mere 'threat' of litigation does not fulfill the language of KRS 61.810(1)(c)," which requires "proposed or pending litigation. "
Similarly, Mr. Roberts asserted, no litigation has been initiated on the issue of storm damage insurance. He explained that the Board "began using this excuse for closed session discussions immediately following the occurrence of the storm damage before the position of the insurer was ever known." It is his position that the Open Meetings Law does not authorize a closed session "simply because there is some remote possibility that the 'negotiation' of a settlement might reach an impasse. "
In its supplemental response, the Airport Board restated its view that the closed session discussions at its October 20 meeting were warranted by the threat of litigation relative to its refueling policy and its stalled negotiations on storm damage insurance settlement. With respect to the former, the Board submitted a copy of the minutes of a September 22, 1998, tenant's meeting at which one pilot openly threatened litigation and two other pilots questioned the legality of the policy. The Board also submitted a copy of the pilots' "Petition for Reconsideration" the opening paragraph of which concludes with the statement that unless a compromise is reached, "this controversy may degenerate into an enforcement contest." The Board reiterated that during its October 20 closed session, "the pilots' procedural requirements before administrative agencies, legal strategies for response in court, and potential outcomes of such strategy on specific parts of the refueling policy were discussed."
As for the issue of storm damage, the Board explained that an impasse had been reached after several months of settlement negotiations, and the closed session discussion centered on a time table, legal issues to be researched which would form the basis of the complaint against the insurer, litigation strategy, and tactics for response to any further settlement offers." The discussion "concerned specific matters anticipated to be issues in the litigation which the Board intended to commence ." (Emphasis added.) In closing, the Airport Board asserted:
Both of the matters which are the subjects of Roberts' appeal concerned discussions between the Board and its counsel concerning legal strategy, procedure, and tactics for iminent [sic] litigation, in the instance of the fueling policy, against the Airport; and in the instance of the storm damage, by the Airport. As such, both matters are protected by KRS 61.810(1)(c), and the discussions held in closed session thereunder were proper.
We agree.
The Airport Board's position finds ample support in prior opinions of this office, as well as in case law. In analyzing the litigation exception, codified at KRS 61.810(1)(c), this office recently observed:
At KRS 61.810 the General Assembly declared:
Recognizing that there are extraordinary circumstances which may warrant a public agency in conducting its business in a closed session, the General Assembly has carved out a number of exceptions to this general rule. Among those meetings which are excepted from the general rule of openness are meetings involving "discussions of proposed or pending litigation against or on behalf of the public agency. " KRS 61.810(1)(c). This, along with the other eleven exceptions to the Open Meetings Act "must [be] narrowly construe[d] and appl[ied] ? so as to avoid improper or unauthorized closed, executive or secret meetings." Floyd County Board of Education v. Ratliff, Ky., 955 S.W.2d 921, 923 (1997).
In Floyd County Board of Education v. Ratliff, the Kentucky Supreme Court construed KRS 61.810(1)(c), reasoning:
The drafters of the legislation clearly envisioned that this exception would apply to matters commonly inherent to litigation, such as preparation, strategy or tactics. Obviously, anything that would include the attorney-client relationships would also fall within this exception. The statute expressly provides that the litigation in question need not be currently pending and may be merely threatened. However, the exception should not be construed to apply 'any time the public agency has its attorney present' or where the possibility of litigation is still remote. See Jefferson County Board of Education v. The Courier-Journal, Ky.App., 551 S.W.2d 25 (1977 Floyd County Board of Education at 923, 924.
98-OMD-105, p. 3, 4.
At pages 3 and 4 of 93-OMD-119, this office articulated a standard for determining the propriety of an agency's reliance on KRS 61.810(1)(c), observing:
When the public agency has become a party plaintiff or defendant in a lawsuit, when a public agency has been threatened with litigation, or when the chance of litigation involving that agency is more than a remote possibility, the agency can then legally and properly invoke the exception set forth in KRS 61.810(1)(c). The public agency can at that time discuss in a closed session such matters as strategy, tactics, possible settlement and other matters pertaining to that case or that anticipated or probable case.
See also 92-OMD-1728 (holding that Highland Heights City Council properly conducted closed session to discuss strategy, tactics, and the possible settlement of condemnation proceedings against the city); 97-OMD-96 (holding that Kentucky Employers' Mutual Insurance Authority properly conducted a closed session to discuss whether to appeal an open records decision of the Attorney General); compare 93-OMD-110 (holding that the board of trustees of the Louisville Firefighters Pension Fund improperly conducted a closed session to discuss litigation which did not involve the Pension Fund but instead involved the similarly situated Policemen's Pension Fund); 95-OMD-57 (holding that the Lexington-Fayette Urban County Government improperly conducted a closed session to discuss a dispute between the city and state concerning property known as the "Ben Snyder Block"); 94-OMD-110 (holding that Owensboro Municipal Utilities improperly conducted closed session to discuss a matter which might cause a private corporation to file a bankruptcy petition, but which did not involve litigation by or against OMU); 98-OMD-105 (holding that Bourbon County Fiscal Court failed to make a sufficient showing that it properly conducted closed session to discuss pending litigation) .
Resolution of 98-OMD-105, cited above, turned on the Bourbon County Fiscal Court's failure to "shed any light on the general nature of the proposed or pending litigation anticipated or the immediacy of the threat of litigation." 98-OMD-105, p. 6. In the appeal before us, the Airport Board describes, in sufficient detail, the general nature of the underlying threat of litigation, namely, the thread made by pilot Dave Southard at the September 22, 1998, tenant's meeting to initiate legal proceedings to challenge the Board's refueling policy, along with a more general threat, in the pilots' "Petition for Reconsideration" of the policy, that the "controversy may degenerate into an enforcement contest" if a compromise is not reached, as well as the immediacy of the threat. The Board describes, with similar, if not equal, specificity, the nature of the threatened litigation it may initiate against its insurer over disputed storm damage insurance. Contrary to Mr. Roberts's belief, a lawsuit need not be pending in the courts before an agency can properly invoke KRS 61.810(1)(c) to go into closed session to discuss strategy and tactics so long as there have been "direct suggestions of litigation conditioned on the occurrence or nonoccurrence of a specific event." OAG 91-141, p. 3. Here, it appears that the pilots will initiate action against the Airport Board to challenge the legality of the new refueling policy if a compromise is not soon reached, and that the Airport Board will initiate action against its insurer if a settlement is not soon reached. The possibility of litigation is sufficiently great to warrant invocation of KRS 61.810(1)(c).
We remind the Bowling Green-Warren County Regional Airport Board of the Supreme Court's admonition at page 924 of Ratliff , above, that "matters discussed under KRS 61.810(1)(c) must not be expanded to include general discussions of everything tangential to the topic" that is at the heart of the threatened litigation, and of its more general observation that "the exceptions to the open meetings laws are not to be used to shield the agency from unwanted or unpleasant public input, interference or scrutiny." Id. This view echoes the statement of legislative intent found at KRS 61.800:
The General Assembly finds and declares that the basic policy of KRS 61.805 to 61.850 is that the formation of public policy is public business and shall not be conducted in secret and the exceptions provided for by KRS 61.810 or otherwise provided for by law shall be strictly construed.
Although KRS 61.810(1)(c)authorizes the Airport Board to conduct closed session discussions of litigation preparation, strategy, or tactics, as well as "anything that would include the attorney-client relationships," Ratliff at 924, it does not authorize general discussion of the Board's new refueling policy or the storm damage which the Airport incurred in the Spring of 1998. We urge the Board to bear these observations in mind in the interest of promoting agency accountability and insuring strict compliance with the spirit and the letter of the Open Meetings Act.
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.