State Records Committee Appeal Decision 2020-14

BEFORE THE STATE RECORDS COMMITTEE OF THE STATE OF UTAH

JOHN G. BLOOM, Petitioner, v.

UTAH DIVISION OF OIL, GAS, and MINING, Respondent.

DECISION AND ORDER

Case No. 20-14

By this appeal, Petitioner, John G. Bloom seeks access to records held by Respondent, the Utah Division of Oil, Gas, and Mining.

FACTS

On or about August 27, 2019, Mr. Bloom filed a request for records pursuant to the Government Records Access and Management Act (“GRAMA”). Mr. Bloom requested from the Utah Division of Oil, Gas, and Mining (“Division”) two reports: (1) The May 2008 “Western Energy Hub Project Area, Structural Interpretation” prepared by Serra GeoConsulting LLC for Magnum Energy LLC; and (2) The August 2016 “Location and Character of Faults in the Vicinity of the Magnum Energy Facility” by author Steven Schamel. On August 29, 2019, the records officer for the Division denied Mr. Bloom’s request finding that the records had been classified as restricted access pursuant to Utah Code §§ 63G-2-201(3) & -201(6). The denial notice stated the entity that submitted the records complied with Utah Code § 63G-2-309 to designate the records as confidential.

Mr. Bloom filed an appeal with the Director of the Division, arguing that he did not believe “two scientific investigations of a geologic nature should be classified as protected…” Mr. Bloom stated that the information was needed “to determine the response of the salt dome and caverns to a major earthquake.” In a letter dated November 1, 2019, John R. Baza, Director of the Division, upheld the records officer’s denial. On November 29, 2019, Mr. Bloom filed an appeal with the State Records Committee (“Committee”). On February 21, 2020, the Committee held a hearing regarding the appeal, and after carefully considering the requested relief of the parties, the Committee issues the following Decision and Order.

STATEMENT OF REASONS FOR DECISION

GRAMA specifies that “all records are public unless otherwise expressly provided by statute.” Utah Code § 63G-2-201(2). Records that are classified as private, protected, or controlled pursuant to Utah Code §§ 63G-2-302, -303, -304 and -305, are not public records pursuant to Utah Code § 63G-2-301(3)(a).
Trade secrets as defined in Utah Code § 13-24-2 are protected records if properly classified by a governmental entity if the person submitting the trade secret has provided the governmental entity with the information specified in Utah Code § 63G-2-309.

Commercial information obtained from a person in a record is protected if: (1) Disclosure of the information could reasonably be expected to result in unfair competitive injury to the person submitting the information or would impair the ability of the governmental entity to obtain necessary information in the future; (2) The person submitting the information has a greater interest in prohibiting access than the public in obtaining access; and (3) The person submitting the information has provided the governmental entity with the information specified in Utah Code § 63G-2-309.

In the present case, counsel for the Division argued that the public’s interest in disclosure is outweighed by the interest in restricting access because the reports contain trade secret information. The Division stated that Sawtooth Caverns LLC (“Sawtooth Caverns”), which is a subsidiary of Magnum Energy LLC, asserted in their confidentiality letter that the information contained in the reports “derives independent economic value as it sets forth information critical to the design of the cavern well field and individual storage caverns.” Counsel contended that if the information is disclosed, it would allow another entity to use the data to build a competing facility. Stewart Peay, legal counsel for Sawtooth Caverns, who made an appearance at the hearing as a third party intervenor, argued that disclosure of the reports would cause undue financial loss and unfair competitive injury to Sawtooth Caverns.

After having considered the written and oral arguments of the parties and reviewing the records in camera, the Committee finds that the requested records were properly classified as protected records pursuant to Utah Code §§ 63G-2-305(1) and/or -305(2). The Committee is persuaded by the arguments presented by the Division and Sawtooth Caverns that the requested records contain trade secrets and that Sawtooth Caverns complied with the requirements of Utah Code § 63G-2-309. The Committee further finds that disclosure of the information within the records could reasonably be expected to result in unfair competitive injury to Sawtooth Caverns, impair the ability for the Division to obtain similar necessary information in the future, and that Sawtooth Caverns has a greater interest in prohibiting access than the public in obtaining access.

ORDER

THEREFORE, IT IS ORDERED THAT the appeal of Petitioner, Jack Bloom is hereby DENIED.

RIGHT TO APPEAL

A party to a proceeding before the Committee may seek judicial review in District Court of a Committee's Order by filing a petition for review of the Committee Order as provided in Utah Code § 63G-2-404. Utah Code § 63G-2-403(14). A petition for judicial review of a Committee Order "shall be filed no later than 30 days" after the date of the Committee Order. Utah Code § 63G-2-404(1)(a). The petition for judicial review must be a complaint which is governed by the Utah Rules of Civil Procedure and include the Committee as a necessary party and contain the required information listed in Subsection -404(2). Utah Code § 63G-2-404(1) & (2). The court shall make its decision de novo but shall allow introduction of evidence presented to the Committee, determine all questions of fact and law without a jury, and decide the issue at the earliest practical opportunity. Utah Code § 63G-2-404(6). In order to protect parties’ rights on appeal, a party may wish to seek advice from an attorney.

PENALTY NOTICE

Pursuant to Utah Code § 63G-2-403(15)(c), if the Committee orders the governmental entity to produce a record and no appeal is filed, the government entity herein shall comply with the order of the Committee and shall: (1) Produce the record; and (2) File a notice of compliance with the Committee. If the governmental entity ordered to produce a record fails to file a notice of compliance or a notice of intent to appeal, the Committee may do either or both of the following: (1) Impose a civil penalty of up to $500 for each day of continuing noncompliance; or (2) Send written notice of the entity's noncompliance to the Governor. Utah Code § 63G-2-403(15)(d)(i)(B). In imposing a civil penalty, the Committee shall consider the gravity and circumstances of the violation, including whether the failure to comply was due to neglect or was willful or intentional. Utah Code § 63G-2-403(15)(d)(ii).

Entered this 3rd day of March 2020

BY THE STATE RECORDS COMMITTEE

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PATRICIA SMITH-MANSFIELD, Chairperson
State Records Committee