Private parties now entitled to use competitive harm exception to PIA release; Sec. 552.014 no longer restricted to existing competitive bidding

THE BOEING COMPANY AND THE GREATER KELLY DEVELOPMENT AUTHORITY N/K/A THE PORT AUTHORITY OF SAN ANTONIO v. KEN PAXTON, ATTORNEY GENERAL OF TEXAS, 12-1007 (Tex. June 19, 2015).

This is a Public Information Act request lawsuit involving competitive information. The Texas Supreme Court reversed lower court rulings and the AG opinion and held Boeing’s information could be withheld.

The Port Authority of San Antonio is a separate entity created by the City of San Antonio to help facilitate brining Boeing to the former Kelly Air Force Base in the late 1990s. Later on a former Boeing employee submitted a Public Information Act request to the Port for various Boeing corporate information, including the lease agreement. Boeing submitted arguments to the Attorney General noting the information is competitively sensitive information regarding its overhead costs at Kelly that would give advantage to its competitors. According to Boeing, a competitor could take the detailed information in Boeing’s lease and determine Boeing’s physical plant costs at Kelly, allowing competitors to underbid Boeing on government contracts. Boeing provided information including the fact the information is so securely kept within its corporate structure that only a few employees have access to it.  The AG determined the information must be released and Boeing appealed. The trial court ruled against Boeing and the Court of Appeals affirmed.

Under §552.104, Boeing argued redaction of financial information is required if “information that, if released, would give advantage to a competitor or bidder.”  The AG argued that exception is not applicable to private parties but only the local government. The Court of Appeals adopted this reasoning. However, the AG’s interpretation did not harmonize the purposes of the Act so much as rewrite them. “Nothing in the Act bars private standing to prevent public disclosure generally and nothing in section 522.104 specifically limits its application to the government.” The Supreme Court noted the Court of Appeals was mistaken by interpreting the Port’s decision to allow Boeing to protect its own interest as an opposition to release. It was not and equates merely to letting Boeing protect itself. After analyzing the language of the statute it held the Legislature intended private parties and government parties alike whose “competitors” or rival “bidders” would be “advantaged” by disclosure have the right to raise the PIA exception.  Additionally, it is not limited to only “ongoing competitive bidding” as nothing in the text states that restriction. The evidence at trial demonstrated the intense competition that exists in the aerospace industry like those that sustain Boeing’s operations at Kelly and the release of the information sought would give an advantage to its competitors.  As a result, it must be withheld.

If you would like to read this opinion click here.  JUSTICEDEVINE delivered the opinion of the Court, in which CHIEF JUSTICE HECHT, JUSTICE GREEN, JUSTICE WILLETT, JUSTICE GUZMAN, JUSTICE LEHRMANN, and JUSTICE BROWN joined. JUSTICE BOYD filed a dissenting opinion. JUSTICE JOHNSON did not participate.  The docket page with attorney information is found here.