Opinion
Opinion By: Andy Beshear,Attorney General;Michelle D. Harrison,Assistant Attorney General
Open Records Decision
Dr. Lachin Hatemi initiated this appeal challenging the denial by the Kentucky Medical Services Foundation ("KMSF") of his June 9, 2016, request for "[a]ny Gap Commitments signed between KMSF and University of Kentucky regarding Good Samaritan Hospital" and "[a]ny agreements between KMSF and UK regarding purchase financing of Good Samaritan Hospital." In a timely written response, KMSF advised Dr. Hatemi that it did "not believe it would be inappropriate to provide to you if we had any responsive documents. However, we also could not locate documents responsive to your request for records." KMSF further maintained that it was not a "public agency" for purposes of the Open Records Act "or otherwise," a matter that "currently is in litigation[.]" In addition, KMSF advised that it would not provide information "protected by applicable law, information that would not be subjected to the Kentucky Open Records Act if we were a public agency. . . ." KMSF also noted that "it is our policy not to produce information that is more appropriately the subject of discovery in a pending lawsuit in which KMSF is a party. . . ." 1 Finally, KMSF observed that Dr. Hatemi made a "similar request to UK and that UK may have documents responsive to your request."
On appeal Dr. Hatemi maintained that KMSF was "directly involved in financing Good Samaritan Hospital acquisition based on my private sources." Upon receiving notification of Mr. Hatemi's appeal from this office, attorney Harry L. Dadds responded on behalf of KMSF. As in 16-ORD-057, 16-ORD-064, and 16-ORD-113, KMSF first argued that until its appeal of 15-ORD-205 (In re: Lachin Hatemi/Kentucky Medical Services Foundation, Inc., rendered November 6, 2015)(holding that KMSF is a "public agency" pursuant to KRS 61.870(1)(j) as it was "established, created, and controlled by a public agency" ) to Fayette Circuit Court has been resolved, its ORA status remains the same as it was prior to 15-ORD-205. See also 16-ORD-033. Here, as before, this office respectfully disagrees and must decline to hold the instant appeal in abeyance pending resolution of the pending lawsuit as requested. "Unless or until an appellate court issues a published opinion that is clearly contrary to our own, we will continue to adhere to the position reflected" in 15-ORD-205. 07-ORD-132, p. 7; 06-ORD-230; 08-ORD-049. The analysis contained in 15-ORD-205 remains controlling as to KMSF's first argument. 2
In the alternative, Mr. Dadds argued that even if KMSF was a "public agency" within the meaning of KRS 61.870(1), "there are no documents to be produced and no basis whatsoever to conclude that such documents are within KMSF's possession." Mr. Dadds attached the July 19, 2016, affidavit of KMSF President Dr. Marcus Randall which, in relevant part, advised that "KMSF searched for documents responsive to the request that is the subject of the Present Appeal. No responsive documents were located. " Also included with Mr. Dadds' appeal response was the July 11, 2016, affidavit of KMSF Executive Director Carrie A. Cassis, attesting that she "personally conducted a search for documents responsive to the Request and met with and supervised others at KMSF in the search for such responsive documents. The search conducted by myself and others at KMSF yielded no responsive documents." To the best of Ms. Cassis' knowledge, "KMSF does not have within its possession originals or copies of any Gap Commitments signed between KMSF and [UK] regarding Good Samaritan Hospital and/or any agreements between KMSF and UK regarding purchase financing of Good Samaritan Hospital." To the extent that copies of any such agreements exist, "upon information and belief, they may be within the possession of [UK]."
In reply, Dr. Hatemi argued that KMSF "is misleading the OAG" as to possessing no responsive documents. Dr. Hatemi provided this office with a copy of two documents entitled, "Resolution Revising Original Authorization for Approval of Purchase of Accounts Receivable of Samaritan Hospital and Certain Other Actions," and "Resolution Approving Borrowing for Gap Expenses of Samaritan Hospital Pending Sale of Its Assets to the University of Kentucky," 3 respectively, both of which, in his view, "clearly indicate[] that KMSF is withholding documents[.]" KMSF did "not dispute the authenticity of the resolutions" that Dr. Hatemi provided for consideration, but emphasized that said transactions "occurred approximately nine years ago, no personnel involved in the same are still employed at KMSF and KMSF performed a thorough search for such agreements and was unable to locate any responsive documents." In support of its position, KMSF attached the July 21, 2016, affidavit of Ms. Cassis in which Ms. Cassis acknowledged that "[t]he corporate resolutions tendered by Dr. Hatemi appear to be genuine copies of KMSF corporate documents, the originals of which are in the possession of KMSF." Ms. Cassis further attested that "[n]o one that was significantly involved in such matters remains employed at KMSF. Any responsive documents consummated as a result of those resolutions or otherwise could no longer be located in KMSF's corporate and business records even after a thorough search of such records was made. " 4
Dr. Hatemi subsequently acknowledged that "people who signed the resolutions are not KMSF employees anymore" but argued that "records of a $ 10,000,000 transaction" should exist nevertheless. Most of the directors of KMSF remain unchanged, according to Dr. Hatemi, and Mr. Dadds also "has intimate knowledge of the Good Samaritan [t]ransaction" by virtue of his past employment at Central Kentucky Management Services and UK in addition to his firm's representation of KMSF. Attorney Dana L. Howard replied that Dr. Hatemi's "e-mail contains unwarranted speculation and false assertions regarding KMSF's knowledge of the existence and location of agreements between [UK] and KMSF regarding certain transactions described in corporate resolutions that were made about nine years ago." Ms. Dadds noted that prior to November 6, 2015, when 15-ORD-205 was rendered, KMSF had "no belief or understanding" that it was a public agency for purposes of the Open Records Act; rather, when the referenced corporate resolutions were created, OAG 82-216 (holding that KMSF was not subject to the Act) was deemed controlling on that issue. 5 KMSF reiterated that a "thorough search" was made for the requested agreements. "Having located no written agreements and having no knowledge that such written agreements ever existed," Ms. Howard maintained, "KMSF properly directed Dr. Hatemi to [UK] who KMSP reasonably believes would be the appropriate custodian of any such written agreements, if they exist." KMSF maintained that in so doing it complied with KRS 61.872(4). 6 "Neither KMSF nor its attorneys have withheld knowledge or records from Dr. Hatemi or the Attorney General," Ms. Howard emphasized.
The current dispute "is factual, and not legal, in nature." 06-ORD-266, p. 6; 12-ORD-165. Although the resolutions that Dr. Hatemi tendered on appeal, the authenticity of which is not in dispute, "strongly suggest" that responsive agreements exist, and that KMSF would retain copies of those agreements (if not originals), the absence of such agreements in the possession of KMSF "is, simply stated, not actionable in an Open Records Appeal." 12-ORD-130, p. 5; 12-ORD-065 (appellant reasonably assumed that a "resignation letter" existed in light of statement by public official but relied on what could "generally be described as conjecture or assumption which, however logical, does not constitute proof"); 14-ORD-049 (Attorney General "is not empowered to resolve a 'swearing contest' between the parties"). KMSF cannot produce that which it does not have nor is the agency required to "prove a negative" in order to refute a claim that certain records exist in the absence of a prima facie showing by the requester. See
Bowling v. Lexington Fayette Urban County Government, 172 S.W.3d 333, 340-341 (Ky. 2005); 07-ORD-188; compare
Eplion v. Burchett, 354 S.W.3d 598, 604 (Ky. App. 2011) (declaring that "when it is determined that an agency's records do not exist, the person requesting the records is entitled to a written explanation for their nonexistence"); ; 11-ORD-074; 12-ORD-195. A public agency violates KRS 61.880(1) "if it fails to advise the requesting party whether the" records exist, but discharges its duty under the Act in advising that records being sought do not exist following a reasonable search, and explaining why, if appropriate. 98-ORD-154, p. 2 (citation omitted); 14-ORD-204. Although the intent of the Open Records Act has been statutorily linked to the intent of KRS Chapter 171, pertaining to management of public records (KRS 61.8715), the Act only applies to records that are "prepared, owned, used, in the possession of or retained by a public agency. " 7 KRS 61.870(2).
In responding to Dr. Hatemi's request, and on several occasions following receipt of his appeal, KMSF has affirmatively denied having possession of any responsive agreements following a "thorough" search. KMSF now finds itself in the position of having to "prove a negative" in order to conclusively refute Dr. Hatemi's belief that such agreements not only should exist in the custody or possession of KMSF, but actually do. See 13-ORD-168. Although Dr. Hatemi provided "affirmative evidence, beyond mere assertions," that such agreements were created, a fact which KMSF does not deny, the fact remains that "we do not have a sufficient basis on which to dispute the [agency's] representation that no such records" exist in the possession of KMSF, particularly given the fact that KMSF historically operated under the assumption that it was not a "public agency" subject to provisions of the Open Records Act, including KRS 61.8715, or KRS Chapter 171, pertaining to management of public records. See 12-ORD-042.
Either party may appeal this decision by initiating action in the appropriate circuit court per 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.
Footnotes
Footnotes
1 In Kentucky Lottery Corporation v. Stewart, 41 S.W.3d 860, 864 (Ky. App. 2001)(expressly agreeing with decisions of the Attorney General holding that "an open records request should be evaluated independently of whether or not the requester is a party or potential party to litigation"), the Court of Appeals rejected this position. See 16-ORD-064.
2 As in 16-ORD-057 and 16-ORD-064, this office finds that KMSF has not presented "clear and convincing evidence" that Dr. Hatemi's request is unreasonably burdensome or made "for purposes of harassment," i.e. , intended to disrupt other essential functions of KMSF, as required to justify its denial on the basis of KRS 61.872(6), which it also invoked for the first time on appeal. See 16-ORD-057, pp. 4-5. KMSF relies on the fact that Dr. Hatemi has "persisted in his efforts to file serial, ongoing" requests following issuance of 15-ORD-205, "each of which requires KMSF to devote significant resources to research and respond." However, "the obvious fact that complying with an open records request will consume both time and manpower is, standing alone, not sufficiently clear and convincing evidence of an unreasonable burden." Commonwealth v. Chestnut, 250 S.W.3d 655, 665 (Ky. 2008).
3 The first Resolution, dated March 6, 2007, for example, indicates that KMSF, "in order to support the overall mission of [UK] and its healthcare system," joined UK in a "certain transaction to acquire the use or ownership of Samaritan Hospital and make certain purchases or loans in conjunction, therewith to a maximum amount of ten million dollars. . . ." The second resolution, dated June 11, 2007, refers to "the Sale Order and Agreed Order of Settlement by and among the Debtor, [UK], KMSF and others[.]"
4 The record lacks adequate information for this office to conclusively determine whether the search conducted was adequate under the standard of 95-ORD-96. "Absent proof that [KMSF] failed to use methods which could reasonably be expected to produce the records requested," this office has no basis upon which to question its good faith. 12-ORD-153, p. 4. This office trusts "that [KMSF] directed its search not only to the first and most obvious places where responsive records could be located but to all places that might yield responsive records." Id.
5 The logical implication of Ms. Howard's observation is that KMSF would not have conducted business according to statutory requirements applicable to public agencies, including, for example, schedules governing the retention and destruction of records, established under authority of KRS 171.420(3) by the Archives and Records Commission of the Kentucky Department for Libraries and Archives, which are promulgated into regulation at 725 KAR 1:061.
6 This provision also requires a public agency to provide the requester with "the name and location of the official custodian."
7 Our holding today should not be construed as departing from the line of authority recognizing that that lack of actual possession is not a legitimate basis for denying a request assuming the record is "prepared, owned, and used at the instance of" the public agency. 00-ORD-207; 05-ORD-015; 06-ORD-147; 08-ORD-206.