Opinion
Opinion By: Albert B. Chandler III, Attorney General; Amye L. Bensenhaver, Assistant Attorney General
Open Records Decision
The question presented in this appeal is whether the University of Kentucky properly relied on KRS 61.878(1)(c)1. in denying Lexington Herald-Leader Business Editor Jacelyn Carfagno's May 14, 2001, request for:
[a]ny records compiled since Jan. 1 of this year by the University of Kentucky Livestock Diagnostic Center regarding late-term or full-term foals that have been delivered to the center . . . [including, but not limited to] the farm of origin of the animals, their breeding and any other unique identifier for each; aggregate statistics on the animals including the total number, gender, results of tests and any analysis related to geographic distribution. 1
For the reasons that follow, and upon the authorities cited, we conclude that the University's reliance on KRS 61.878(1)(c)1. was partially misplaced, and that it is obligated to disclose that portion of the necropsy report designated "Pathologist's Case Summary," with the exception of the Animal ID, and that portion of the intake or accession form designated "History" upon which the "Pathologist's Case Summary" was in part based. The University may properly withhold all identifying information that appears on the intake or accession form, and that is duplicated on the necropsy report, as well as information pertaining to insurance cases, under authority of KRS 61.878(1)(c)1.
In its May 22, 2001, 2 response, the University denied Ms. Carfagno's request for records relating to late-term or full-term foals delivered to the Center since January 1, 2001. Relying on KRS 61.878(1)(i) and (j), then University Records Custodian George J. DeBin explained:
The Diagnostic Center is preparing a report regarding foal deaths for this year; however, that report and the statistical information in the report have not been completed. Accordingly, this information is exempt from disclosure under the Kentucky Open Records Act because it is in the nature of a preliminary draft, a preliminary recommendation, or preliminary memoranda in which opinions are expressed or policies formulated or recommended. KRS 61.878(1)(i) and (j).
In a supplemental response directed to this office following commencement of The Herald-Leader's appeal, 3 the University modified its position. Records Custodian Jack C. Blanton 4 explained:
The proper answer to the first part of the request should have been, according to Diagnostic Center director Dr. Lenn Harrison, that on May 14, no records as requested had actually been "compiled" by the Diagnostic Center at that time relating to aggregate statistics, results of tests, etc. The records at that time consisted of the "accession" or intake forms filled out by owners or their vets when a dead foal was delivered to the lab, and certain preliminary or draft 5 necropsy reports prepared by the lab veterinarians who conducted analyses of the foals.
With reference to the records in existence on the date of Ms. Carfagno's request, namely the intake forms and necropsy reports, Mr. Blanton observed:
Those documents would be exempt because information on those sheets falls under the exemption contained in the specific statutory exemption contained in KRS 61.878(1)(c)(1): "records confidentially disclosed to an agency . . . generally recognized as confidential or proprietary, which if openly disclosed would permit an unfair commercial advantage to competitors of the entity that disclosed the records." The position of the University, seconded by the Kentucky Thoroughbred Owners and Breeders Association, representing 950 members of Kentucky's thoroughbred industry, believe [sic] that farm-specific information clearly falls within the exemption. 6
Continuing, Mr. Blanton asserted:
The first prong of the analysis under KRS 61.878(1)(c)(1) [sic] is whether there was a confidential disclosure to the agency when it brought in a dead foal. According to David Switzer, Executive Director of the Kentucky Thoroughbred Association, he has inquired of Kentucky horse breeders regarding this issue. On behalf of the members of the horse industry he has stated that there was meant to be a confidential disclosure of the farm and horse identities, and that in the horse industry in this context, the farm name and horse identities would be generally recognized in the industry as confidential. Dr. Lenn Harrison, Director of the Animal Disease Diagnostic Lab, confirms that he believes that the disclosures were meant to be confidential, and that the Lab considers that information confidential.
The next question is whether there would be harm to the owners if the information would be disclosed. As the Kentucky Supreme Court stated in Southeastern United Medigroup, Inc. v. Hughes, Ky., 952 S.W.2d 195 (1997), "because words and phrases such as 'confidential' 'proprietary, ' and 'unfair advantage' apply with more or less strength to a variety of documents, the effect of protecting a given document from scrutiny by the public . . .should be considered in the balance . . . . [I]f it is established that a document is confidential or proprietary, and that disclosure to competitors would give them substantially more than a trivial unfair advantage, the document should be protected from disclosure . . ." Id. at 199. Both Mr. Switzer and Dr. Harrison have advised that in their opinion the release of the names of farms where foal deaths occurred, especially if coupled with the numbers of deaths or the sires or dams of the dead foals, would certainly lead to an unfair commercial advantage to other horse owners, who could use the information to disparage other owners or breeders. Given the nature of the horse industry in Kentucky and the fact that the reputations of farms and breeding stock are an extremely valuable asset of those farms, release of this information would clearly be more than a "trivial" unfair advantage, especially since it would allow competitors to "ascertain the economic status" of affected farms. See Marina Management Services, Inc. v. Cabinet for Tourism, Ky., 906 S.W.2d 318 (1995). The Attorney General has recognized that records relating to private financial affairs can be exempted under the Kentucky Open Records Act. See 93-ORD-85 and Hoy v. Kentucky Industrial Revitalization Authority, Ky., 906 S.W.2d 766 (1995) and 01-ORD-92.
In closing, Mr. Blanton maintained that the public's right to know that the Livestock Disease Diagnostic Center is properly executing its function is not advanced by disclosure of the identities of the owners, farms, and breeding lineage of dead foals, and that that right will best be served "by the publication of its findings, once they are completed in the ordinary course of business." 7
The University's position was substantiated in correspondence directed to this office from the Kentucky Thoroughbred Owners and Breeders, Inc., and the Kentucky Veterinary Medical Association. In a letter dated July 11, 2001, KTOB Executive Director David A. Switzer confirmed:
When an owner delivers an animal to the Diagnostic Center (Center), they do so thinking that (1) the report will be divulged to either the owner or his/her veterinarian, only. Thus the information would be confidential and proprietary. When the animal is delivered to the Center, a form is completed giving the Owner/Manager's name, Farm name, address and phone number. The name of the owners veterinarian is included. If records indicated that farm "A" had a number of cases presented to the Center and farm "B" had few if any, farm B could use this information to advertise against farm "A" and possibly move customers away from farm "A". In the case of Mare Reproductive Loss Syndrome (MRLS) for which there is not a known cause, as yet, this could put farm "A" at a disadvantage if the requested information were made public.
As additional support, KVMA President Roger H. Murphy, DVM, advised us in a letter dated July 25:
The information and animal specimens submitted to the UKLDDC are done so under the "Veterinarian-Client-Patient Relationship," KRS 321.185 and are deemed confidential records. The specimens are submitted for diagnostic purposes only and the information submitted is the history obtained by the veterinarian through physical and symptomatic examinations. Under 201 KAR 16:010, Code of ethical conduct, A veterinarian shall take sufficient time and conduct the appropriate tests necessary to diagnose the condition of the patient which he is treating. Section 1. A veterinarian shall not abuse or take advantage of the confidence reposed in him by his client. Section 21.(I). A veterinarian shall maintain a confidential relationship with his clients, except as otherwise provided by law, or required by considerations of public health or animal health. Section 23.
On every pathologist case summary report provided by the UKLDDC, it states "Privileged Information - Not for Publication"; thus keeping with the confidentiality of records and the veterinary-client-patient relationship.
The veterinary profession in Kentucky is also guided by the Principles of Veterinary Medical Ethics of the American Veterinary Medical Association. I have enclosed a copy for your review and highlighted the section pertaining to medical records. 8
For all of these reasons, Mr. Switzer and Dr. Murphy expressed their support for the University's denial of The Herald-Leader's request. 9
Pursuant to KRS 61.880(2)(c), the Attorney General requested additional documentation from the University on August 7, 2001. Our questions, and the University's responses, follow:
1. What assurances, written or otherwise, were given to the horse owners/breeders or their vets when the dead foals were brought to the Center that the intake forms and necropsy reports would be treated as confidential?
According to Dr. Lenn Harrison, the Diagnostic Lab has consistently told users of the facility that information could be treated as confidential or proprietary. . . . Also, the Accession Sheet states above the required signature of the owner or representative that information relating to the case will not be released to an insurance company without the owners consent. Also note that the necropsy reports are stamped as "Privileged Information - Not for Publication.
2. What measures have been taken to insure that confidentiality is maintained from intake, throughout the diagnostic process, to the present?
Dr. Harrison has stated that all Diagnostic Lab personnel are instructed about the confidentiality of information relating to the function of the Lab and that release is prohibited except through approval of his office. No releases have been authorized.
3. Given the wide media coverage of the incidents of foal deaths when they occurred, haven't the identities of many of all of the farms at which they occurred already been disclosed?
The University of Kentucky has not disclosed the identities of owners of the farms. The fact that the media may have been able to secure comments from some farm owners who have experienced foal deaths does not impair the exceptions of the Open Records Act. 10
As requested, the University furnished this office with copies of the intake forms and necropsy reports at issue in this appeal.
Having reviewed the record on appeal, including a broad sampling of the intake farms and necropsy reports that are in dispute, we find that the University's reliance on KRS 61.878(1)(c)1. as the basis for denying The Herald-Leader's request was partially misplaced. It is the opinion of this office that only the identifying information furnished by the owners on the intake form, and mirrored in the necropsy report, qualifies as a record "confidentially disclosed to an agency or required by an agency to be disclosed to it, generally recognized as confidential or proprietary, which if openly disclosed would permit an unfair commercial advantage to competitors of the entity that disclosed the record[]." KRS 61.878(1)(c)1. That nonidentifying portion of the necropsy report that is generated by the Livestock Disease Diagnostic Center, and the nonidentifying "History " portion of the intake form, that provides, in part, the basis for the "Pathologist's Case Summary" cannot be so characterized insofar as they are created by, rather than confidentially disclosed to, the Center. In so holding, we attempt to strike a fair balance between the public's right to know what the ongoing research at the Center has disclosed, and the private farm owners right to voluntarily cooperate in the research efforts with the reasonable expectation that the identifying information they furnish will be treated circumspectly, and without compromising their competitive status.
KRS 61.878(1)(c)1. authorizes the nondisclosure of:
Records confidentially disclosed to an agency or required by an agency to be disclosed to it, generally recognized as confidential or proprietary, which if openly disclosed would permit an unfair commercial advantage to competitors of the entity that disclosed the records[.]
This office has consistently recognized that in order to qualify for exclusion under KRS 61.878(1)(c)1., public records must be:
1) confidentially disclosed to an agency or required by an agency to be disclosed to it;
2) generally recognized as confidential or proprietary; and
3) of such a character that disclosure would permit an unfair commercial advantage to competitors of the entity that disclosed them.
See, e.g., 96-ORD-135; 97-ORD-66; 97-ORD-132. On at least two occasions, the Kentucky Supreme Court has analyzed this provision, concluding that the public agencies, which had invoked it on behalf of a private entity, met their statutory burden of proof. In Marina Management Services, Inc. v. Cabinet for Tourism, above, the Court held that records containing financial information of privately owned marina operators were exempt from disclosure. The Court reasoned that disclosure would provide an unfair advantage to competitors by allowing them to ascertain the economic status of the marina operators. At page 319 of that opinion, the Court observed:
The records submitted to the Parks Department include information on asset values, notes payable, rental amounts on houseboats, related party transactions, profit margins, net earnings, and capital income. These are records of privately owned marina operators, disclosure of which would unfairly advantage competing operators. The most obvious disadvantage may be the ability to ascertain the economic status of the entities without the hurdles systematically associated with acquisition of such information about privately owned organizations. Further, the facts on the record indicate that the audit statements were disclosed confidentially to Tourism and the Auditors Office. On these facts alone, the exemption clearly applies.
Thus, the Parks Department adduced sufficient proof to support invocation of the exemption.
Similarly, in Hoy v. Kentucky Industrial Revitalization Authority, above, the Court found:
The financial information required to be submitted by GE in its application to KIRA detailed the company's business and revitalization project. Under administrative regulations adopted by KIRA, such information included a financial history of the corporation, projected cost of the project, the specific amount and timing of capital investment, copies of financial statements and a detailed description of the company's productivity, efficiency and financial stability. . . . It does not take a degree in finance to recognize that such information concerning the inner workings of a corporation is "generally recognized as confidential or proprietary" and falls within the wording of KRS 61.878(1)(c)(2).
Again, the public agency from which access to confidentially disclosed records of a private corporation was sought established that those records were generally recognized as confidential or proprietary.
In the appeal before us, the record supports the University's position that the disputed records are generally recognized as confidential or proprietary, and that their disclosure would permit an unfair commercial advantage to competitors of the entity that disclosed them, thus satisfying parts two and three of the three part test. As noted above, the farm owners or their veterinarians voluntarily delivered their dead foals to the Center with the expectation that the information they submitted was considered confidential. This is confirmed by Dr. Lenn Harrison, Director of the Livestock Disease Diagnostic Center, David Switzer, Executive Director of Kentucky Thoroughbred Owners and Breeders, Inc., and Dr. Roger H. Murphy, President of the Kentucky Veterinary Medical Association. It is consistent with the principles underlying the veterinarian-client-patient relationship statutorily recognized at KRS 321.185, and implemented in 201 KAR 16:010 Section 23, 11 and the ethical principles under which veterinarians operate, particularly Principle VII, C. 12 Principles of Veterinary Medical Ethics of the American Veterinary Medical Association (1999 Revision). In our view, it was by no means unreasonable for the farm owners to assume that the confidential relationship that exists between a veterinarian and his or her client extended to the staff of the Center.
Moreover, we find ample support for the University's argument that disclosure of identifying information concerning the farms, and particularly those most affected, would permit an unfair commercial advantage to competitors of the farms that disclosed the information. The University persuasively argues that a farm's reputation is a valuable business asset in the breeding industry. Again, Dr. Harrison and Mr. Switzer confirm this assertion. While the identities of the farms, standing alone, could not be accorded protection as information the open disclosure of which would give competitors of the farms an unfair commercial advantage, where that information is correlated to incidents of foal deaths, the resulting competitive disadvantage is apparent. As the Kentucky Supreme Court observed in Southeastern United Medigroup, Inc. v. Hughes, Ky., 952 S.W.2d 195, 199 (19997), "If it is established that a document is confidential or proprietary, and that disclosure to competitors would give them substantially more than a trivial unfair advantage, the document should be protected from disclosure . . . ." Given the fact that the breeding farms' reputations represent their primary asset, and the potential, if not likelihood, that information concerning foal deaths at the farms would be used to compromise this asset, we believe the disputed records clearly satisfy the third requirement of KRS 61.878(1)(c)1.
Whether the records satisfy the first requirement of KRS 61.878(1)(c)1. as "records confidentially disclosed" is a closer question. In at least two decisions, the Attorney General has determined that a public agency improperly relied on this exemption in denying access to records generated by or for the agency. Thus, in 97-ORD-66 we held that Kentucky Employers' Mutual Insurance Authority (KEMI) violated the Open Records Act in refusing to disclose operational and financial records, as well as personnel files, that it created in the ordinary course of business, under authority of KRS 61.878(1)(c)1. At pages 8 and 9 of that decision, we observed:
By its express terms, this provision is inapplicable to records generated by KEMI as opposed to records confidentially disclosed to KEMI or required by KEMI to be disclosed to it. KRS 61.878(1)(c)1. It is aimed at protecting records of private entities which, by virtue of involvement in public affairs, must disclose confidential or proprietary records to a public agency, if disclosure of those records would place the private entities at a competitive disadvantage . . . .
Operational and financial records, as well as personnel files, created by KEMI in the normal course of business do not fall within the wording of KRS 61.878(1)(c)1. That exemption's protection simply does not extend to the agency's own records. If, on the other hand, KEMI requires a private employer seeking to purchase workers compensation insurance from it to disclose records which are generally recognized as confidential or proprietary, and KEMI can demonstrate that release of those records would permit an unfair commercial advantage to the private employer's competitors, then KEMI can properly rely on KRS 61.878(1)(c)1. Otherwise, this provision has no application. Bearing in mind, once again, that "the exceptions provided for by KRS 61.878 . . . shall be strictly construed," we find that KEMI improperly relied on this exemption. KRS 61.871.
Similarly, in 01-ORD-87 we rejected the Franklin Electric Plant Board's reliance on KRS 61.878(1)(c)1. to support its denial of a request for the minutes of its meeting, and financial projections submitted to the board by a sister electric plant board acting as an outside consultant since these were records generated by or for the Board. At page 7, we reasoned:
In the case of financial projections, the "entity that disclosed the records" is the outside consultant, a sister electric plant board. No claim is made that the sister plant board would be competitively disadvantaged by disclosure, and none could be made since the financial projections relate to the Franklin Electric Plant Board. [Footnote omitted.] In the case of minutes of regular meetings, such records are not "confidentially disclosed to an agency or required by an agency to be disclosed to it" nor are they "generally recognized as confidential or propriety." The fact that comments were ill-advisedly made in the course of an open, public meeting that placed the Board at a risk of competitive harm is not enough to bring minutes reflecting those comments within the scope of KRS 61.878(1)(c)1.
As records generated by or for KEMI and the Franklin Electric Plant Board, these financial and operational records and minutes of meetings did not enjoy the protection of KRS 61.878(1)(c)1.
In the appeal before us, the disputed records consist of an intake form on which private entities are asked to enter identifying information and the facts surrounding the animal's death, and a necropsy report prepared by staff of the Livestock Disease Diagnostic Center. Portions of the intake form are extracted, and appear on the necropsy report. It is our opinion that the intake form at issue here is analogous to the application form at issue in Hoy v. Kentucky Industrial Revitalization Authority, above, and qualifies as a record confidentially disclosed to the Center. In Hoy, General Electric was required to enter certain financial information on an application provided by KIRA in order to qualify for tax credits. Here, the farmer or breeder is required to enter certain identifying information on an intake form provided by the Center in order to secure diagnostic services. Because that identifying information is, in our view, generally recognized as confidential, and if openly disclosed would permit an unfair commercial advantage to the farm's competitors, we conclude that it satisfies each of the requirements of KRS 61.878(1)(c)1. However, to the extent that the intake sheet contains nonidentifying information concerning the circumstances surrounding the foal deaths that forms, in part, the basis of the pathologist's case summary on the necropsy report, that is not generally recognized as confidential, and that would not permit an unfair advantage to competing farms, we believe that the nonidentifying information must be disclosed.
The necropsy report, on the other hand, is analogous to the financial and operational records at issue in 97-ORD-66, and the minutes of agency meetings at issue in 01-ORD-87. It is a record generated by the Center in the ordinary course of business, and therefore does not qualify for exclusion under KRS 61.878(1)(c)1. Simply stated, it is the Center's own record, and not a record confidentially disclosed to it. However, to the extent that the report contains the identifying information confidentially disclosed on the intake form, generally recognized as confidential, and the disclosure of which would permit an unfair commercial advantage to competing farms, we believe that the identifying information on the report may be redacted.
In sum, we find that the University of Kentucky's reliance on KRS 61.878(1)(c)1. was partially misplaced, and that consistent with the position stated above, it is obligated to disclose the "History" portion of the intake form that includes: history, duration of illness, number of animals in affected group, number sick, number dead, vaccination history, nutrition, case history, treatment, euthanasia, clinical diagnosis, and specimens submitted. The University is also obligated to disclose the "Pathologist's Case Summary" that appears on the necropsy report, with the exception of the Animal ID. Conversely, we find that the University properly relied on KRS 61.878(1)(c)1. in denying those portions of the intake form and necropsy report that contain identifying information, including that portion designated "Information Required for Insurance Cases and Equine Cases." As noted above, in so holding we attempt to strike a fair balance between the public's right to know what the ongoing research efforts at the Center have yielded, and the private farm owner's right to voluntarily cooperate in the research efforts without compromising their competitive status. In a larger sense, we seek to promote the goals of scientific research at the university level in an environment that recognizes the importance of public agency accountability without impeding private cooperation and candor. It is for this purpose that we believe KRS 61.878 (1)(b) was enacted, and that it would also have been available to the University of Kentucky as a basis for denying The Lexington Herald-Leader's request.
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 proceedings.
Footnotes
Footnotes
1 In addition, Ms. Carfagno requested individual surveys submitted to the Gluck Equine Research relating to Mare Reproductive Loss Syndrome, records relating to discussions thereof, and records underlying the College of Agriculture's 1981 memorandum entitled "Report on Early Fetal Losses." The University also denied those requests, but The Herald-Leader does not challenge these denials.
2 The Herald Leader's original request was destroyed by a fire at the University, necessitating resubmission of the request on May 18. This accounts for the University's apparent delay in responding to the request.
3 In the letter of appeal, Hanly A. Ingram, an attorney representing The Herald-Leader, challenged the University's position, arguing that the requested records could not properly be characterized as preliminary drafts, recommendations, or memoranda in which opinions are expressed, and citing numerous opinions of this office supporting the newspaper's position.
4 Mr. Blanton assumed the duties of official records custodian for the University on July 1, 2001.
5 Our review of the necropsy reports discloses that they are, in fact, marked "Final Report."
6 Mr. Blanton's first line of defense was based on a characterization of Ms. Carfagno's request as a request for information, rather than records, which the University had no obligation to honor. While we agree that Ms. Carfagno identified certain data elements in her letter of request, we believe her request was properly framed as a request for records, and the data elements were included as a means of limiting the scope of that request.
7 We note that on surveys relating to mare reproductive loss syndrome that have been disseminated tofarm owners since The Herald-Leader commenced its appeal, the University has included a confidentiality agreement that reads as follows:
Survey information from horse farms has been provided to the University of Kentucky with the express understanding that any and all such information shall be considered records confidentially disclosed to an agency and compiled and maintained for scientific research, and shall be exempt from disclosure pursuant to KRS 61.878(1)(b).
8 The pertinent portion of the Principles ofVeterinary Medical Ethics provides as follows:
VII. MEDICAL RECORDS
A. Veterinary medical records are an integral part of veterinary care. The records must comply with the standards established by state and federal law.
B. Medical Records are the property of the practice and the practice owner. The original records must be retained by the practice for the period required by statute.
C. Ethically, the information within veterinary medical records is considered privileged and confidential. It must not be released except by court order or consent of the owner of the patient.
D. Veterinarians are obligated to provide copies or summaries of medical records when requested by the client. Veterinarians should secure a written release to document that request.
E. Without the express permission of the practice owner, it is unethical for a veterinarian to remove, copy, or use the medical records or any part of any record.
9 Mr. Ingram was advised of this office's receipt of Mr. Switzer's and Dr. Murphy's letter on July 12 and August 2, furnished with copies of these letters, and afforded an opportunity to respond. Having received no response, we must assume that he elected not to do so.
10 We note that the University has disclosed the identities of some farms, and their owners or managers, on its College of Agriculture Mare Reproductive Loss Syndrome website. In a link designated "Field Reports from Farm Managers, May 25," some twelve farms, and their owners or managers, are identified and interviewed. Their comments concerning the syndrome, as it has affected their farms, appear on the site.
11 201 KAR 15:010 Section 23 states that "[a] veterinarian shall maintain a confidential relationship with his clients, except as otherwise provided by law, or required by consideration related to public health or animal health."
12 Principle VII, C. states that "the information within veterinary medical records is considered privileged and confidential. "