July 23, 2015
FOIL-AO-19284 OML O05459
FROM: Robert J. Freeman, Executive Director
The staff of the Committee on Open Government is authorized to issue advisory opinions. The ensuing staff advisory opinion is based solely upon the facts presented in your correspondence, expect as otherwise.
As you are aware, I have received your letter, and I hope that you will accept my apologies for the delay in response. You have requested an advisory opinion relating to “an open meetings question that has arisen in the Suffolk County Legislature.”
You wrote that the Suffolk County Code requires that the Ways and Means Committee of the County Legislature approve the settlement of any legal claim against the County that involves a payment in excess of $25,000. According to your letter, the County Attorney or his representative typically discusses cases and presents proposed settlements to the Committee in executive session. Following the closed session, the Chairman of the Committee informs the public in attendance of the name of the case and the vote of the Committee to approve the settlement. However, “at the request of the County Attorney’s office, the amount of the settlement is not disclosed.”
The County Attorney has contended that the action taken by the Ways and Means Committee is not final “and is subject to further approvals, including approval by the courts pursuant to NEW YORK GENERAL MUNICIPAL LAW § 6-n.” The concern is that “should a proposed settlement fall through…and the case proceeds to trial, the disclosure of the settlement amount could undermine the County’s position.”
Because the Ways and Means Committee “wishes to act in compliance with the Open Meetings Law”, you have asked whether, in my view, “the Committee must disclose the settlement at the time it places the vote on the proposed settlement on the record.” In this regard, I offer the following comments.
First, a public body, such as the Committee, may enter into executive session to discuss “proposed, pending or current litigation.” Based on that provision, it is clear that the Committee has a valid basis for discussing the settlement of litigation during an executive session. Further, when a public body has properly entered into executive session, it may take action during the closed session, so long as the action does not involve the appropriation of public monies. It is assumed that the Committee’s action, for purposes of this opinion, is not an appropriation.
Second, §106 of the Open Meetings Law pertains to minutes of meetings, and when action is taken during an executive session, minutes must be prepared and made available within one week that indicate the nature of the action taken, the date, and the vote of the members. The minutes of an executive session, however, need not include information that may be withheld pursuant to the Freedom of Information Law (FOIL). The question, therefore, is whether the amount of the proposed settlement may be withheld, or whether it must be disclosed, to comply with FOIL.
You informed me that the County Legislature does not consider the matter, and that the Ways and Means Committee is authorized to engage in and determine the amounts of proposed settlement agreements. Significantly, you indicated that the County Attorney or his representative confers with the Committee after meeting and reaching a “settlement number” with the plaintiff in the action.
Having reviewed §6-n of the General Municipal Law, subdivision (10) pertains to the approval of a proposed settlement by a court, which must find that the settlement “is just, reasonable and to the interest of the municipal corporation.”
In my opinion, that a court must approve a settlement or that the proposed settlement is not “final” is not the critical issue. The issue, from my perspective, is whether disclosure of the number prior to court approval would in some manner diminish the County’s ability to conclude the matter in a manner that is, in the words quoted above, “just, reasonable and in the interest of” the County and its residents, and whether the portion of a record indicating the amount of the proposed settlement falls within an exception to rights of access appearing in § 87(2) of FOIL.
As a general matter, FOIL is based on presumption of access. Stated differently, all records of an agency are available, except to the extent that records or portions thereof fall within one or more grounds for denial appearing in §87(2)(a) through (l) of the law.
The only ground for denial of relevance, in my view, is §87(2)(c), which enables agencies to withhold records to the extent that disclosure would "impair present or imminent contract awards or collective bargaining negotiations." From our perspective, the key word in the exception is "impair", and the question involves whether or the extent to which disclosure of the settlement amount would impair the County’s ability to reach an appropriate agreement.
In other contexts, it has been advised that §87(2)(c) is intended to ensure that government agencies are not placed at a disadvantage at the bargaining table and to ensure that there is a "level playing field." For instance, if a union whose members are County employees requested records from the County indicating the County’s collective bargaining strategy, the issues that it considers to be important or minor, or the parameters reflective of how much or little it would accept, disclosure would place the County at a disadvantage, and the negotiations would be unfair and unbalanced. In that kind of situation, it has been advised that disclosure would indeed impair collective negotiations and that the records may be withheld. Similarly, when an agency has sought to sell real property, it has been held that premature disclosure of the agency's appraisal of the property could be withheld under §87(2)(c) [see Murray v. Troy Urban Renewal Agency, 56 NY 2d 888 (1982)]. In that situation, if a potential buyer knew of the figure that an agency would be willing to accept, there would likely be little capacity on the part of the agency to negotiate effectively.
In both kinds of situations described above, there would be an inequality of knowledge. In the illustration concerning collective bargaining, the union would not know or have the right to know of the contents of the records indicating the County’s strategy in negotiations. In the appraisal situation, the person seeking that record would be unfamiliar with its contents and, as suggested above, premature disclosure would enable a potential purchaser to gain knowledge in a manner unfair to other bidders and possibly to the detriment of an agency and, therefore, the public. Disclosure in both instances would provide knowledge to the recipients that might effectively prevent an agency from engaging in an agreement that is most beneficial to taxpayers.
If there is no inequality of knowledge between or among the parties of a compromise or possible settlement, and if records have been shared or exchanged by the parties, it is questionable whether disclosure would impair the County’s ability to reach a reasonable agreement (see Community Board 7 of Borough of Manhattan v. Schaffer, 570 NYS 2d 769, affirmed 83 AD 2d 422; reversed on unrelated grounds, 84 NY 2d 148 ). In Community Board 7, the request involved materials exchanged between a New York City agency and the Trump organization in conjunction with negotiations between those two entities. The court rejected a contention that §87(2)(c) could be applied because there was "no bidding process involved where an edge could be unfairly given to one company" and "since the Trump organization is the only party involved these negotiations, there is no inequality of knowledge between the parties" (id., 771). Based on the holding in Community Board 7, it may be contended that since a copy of the proposed settlement agreement is maintained by both the County and the plaintiff, there is no inequality of knowledge regarding the content of that document and that, therefore, disclosure would not impair the County’s position.
Once a proposed settlement has been reached and both parties to the agreement have knowledge and possession of a record indicating the amount of the agreement, based on judicial precedent, it is doubtful that the record may justifiably be shielded or withheld after the Ways and Means Committee has given its approval. The facts, as I understand them, do not involve negotiation, attempts to settle or reach a compromise in which disclosure of an agency’s strategy would impair its ability to reach an appropriate or favorable outcome. On the contrary, the portion of the record at issue is known by both the County and the plaintiff; there is no inequality of knowledge of that number. That being so, again, I believe that demonstrating that disclosure would “impair” the capacity of the County to conclude the matter in a just and reasonable manner is highly questionable.
As you know, when a request for a record is denied, and the denial of access is challenged in a judicial proceeding brought pursuant to FOIL, §89(4)(b) requires that the agency meet the burden of proof and demonstrate to a court’s satisfaction that disclosure would result in the harm sought to be avoided by the exception, in this case, §87(2)(c). As stated by the Court of Appeals more than decade ago:
"To be sure, the balance is presumptively struck in favor of disclosure, but in eight specific, narrowly constructed instances where the governmental agency convincingly demonstrates its need, disclosure will not be ordered (Public Officers Law, section 87, subd 2). Thus, the agency does not have carte blanche to withhold any information it pleases. Rather, it is required to articulate particularized and specific justification and, if necessary, submit the requested materials to the courts for in camera inspection, to exempt its records from disclosure (see Church of Scientology of N.Y. v. State of New York, 46 NY 2d 906, 908). Only where the material requested falls squarely within the ambit of one of these statutory exemptions may disclosure be withheld" [Fink v. Lefkowitz, 47 NY 2d 567, 571 (1979)]."
In another decision rendered by the Court of Appeals, it was held that:
"Exemptions are to be narrowly construed to provide maximum access, and the agency seeking to prevent disclosure carries the burden of demonstrating that the requested material falls squarely within a FOIL exemption by articulating a particularized and specific justification for denying access" [Capital Newspapers v. Burns, 67 NY 2d 562, 566 (1986); see also, Farbman & Sons v. New York City, 62 NY 2d 75, 80 (1984); and Fink v. Lefkowitz, 47 NY 2d 567, 571 (1979)].
Moreover, in the same decision, in a statement regarding the intent and utility of the Freedom of Information Law, it was found that:
"The Freedom of Information Law expresses this State's strong commitment to open government and public accountability and imposes a broad standard of disclosure upon the State and its agencies (see, Matter of Farbman & Sons v New York City Health and Hosps. Corp., 62 NY 2d 75, 79). The statute, enacted in furtherance of the public's vested and inherent 'right to know', affords all citizens the means to obtain information concerning the day-to-day functioning of State and local government thus providing the electorate with sufficient information 'to make intelligent, informed choices with respect to both the direction and scope of governmental activities' and with an effective tool for exposing waste, negligence and abuse on the part of government officers" (id., 565-566).
In a more recent decision by the Court of Appeals involving the obligation of agency to meet the burden of defending a denial of access, it was determined that “speculation” regarding occurrence of harm described in the language of an exception to rights of access is insufficient to justify a denial [Markowitz v. Serio, 11 N.Y.3d 833 (2008)].
I hope that I have been of assistance. Should additional questions arise, please feel free to contact me.
Robert J. Freeman