Editorials

Yesterday (Thursday) I got an urgent message from Terry Francke of Californians Aware, the Sacramento group which tracks transparency in California government, or more often the lack thereof.

His subject line:

“ALERT: Hancock's gut & amend bill would classify refinery repair work as trade secrets; ASSEMBLY LABOR COMMITTEE HEARING THIS AFTERNOON. This from two Berkeley liberals!”

His message:

“This bill [SB1300, coauthored by Berkeley’s Sacramento representatives Senator Loni Hancock and Assemblymember Nancy Skinner] would allow refineries to claim as trade secrets all the information they file with the state concerning periodic repair “turnarounds”, and would also allow the refineries, if there were a CPRA [California Public Records Act] request for this information, to effectively sue the requester in Superior Court seeking a judicial declaration that the information is indeed a trade secret. The requester would either have to appear and defend the request or accept a default judgment. This from two Berkeley liberals!” 

Terry forwarded an email he'd gotten from Jim Ewert, who keeps an eye on open government issues as general counsel for the California Newspaper Publishers’ Association, which spelled out what’s wrong with this bill as recently amended from the freedom of information perspective [emphasis added] : 

 

“This bill was gut-amended last Friday: [August 22]: I have been trying to negotiate w/Hancock’s staff amendments that would narrow the definition of trade secret and fix the problem for CPRA requesters . . . “Our objections to SB 1300 are twofold:

1. Our primary objection is that the bill allows the oil companies to control DIR’s [the California Department of Industrial Resources’] duty to disclose information under the Public Records Act (CPRA). Section (b) of the bill requires DIR to notify a refiner when information is requested and permits the refiner to go to court to seek injunctive relief. Nothing in the bill requires the court to apply the principles of the CPRA when it makes that determination. This would lead to the following scenario: A member of the public submits a CPRA request to DIR for information that she believes is disclosable. DIR notifies the refiner that a request for the refiner’s information has been received. The refiner goes to court files an action vs. DIR for injunctive relief to prevent the disclosure of the information. The person who requested the information will be named as a defendant in the lawsuit filed by the refiner. This result is fundamentally unfair for the requester who may or may not have been willing to go to court to enforce her rights under the CPRA but now finds that she is an unwilling defendant in a lawsuit and must now pay her own expenses for a lawyer and the costs associated with the action. This is fundamentally unfair. To top it off she could also have to pay the attorney’s fees and costs of the oil refiner if the refiner is the prevailing party. This is a perversion of the public’s role in government oversight and eviscerates the notion of due process.

"2. The definition of trade secret ... will be significantly broader than existing law. It would ... allow refiners to stamp just about anything a trade secret, whether or not it meets the criteria in the bill and the public would have no ability [to] challenge whether the refiner’s assertion was proper under this bill. The public would have no ability to monitor DIR to determine whether it is effective in overseeing this powerful industry or if it is ineffective because of a cozy relationship with the industry or some other reason.”

Terry added: 

 

 

“There are dozens, if not scores, of laws requiring regulated professions and industries to file periodic operational reports with state regulators. The CPRA already makes some of these reports confidential, without classifying the information as a trade secret. But the difference here is that the information in question may or may not qualify as a trade secret, but if someone puts in a CPRA request for it to the regulatory agency, the refinery owner can sue them for asking—seeking a court to confirm the trade secret protection. The requester then has to either defend the request in court or stay away and accept a default judgment against it.”

In other words, the Hancock-Skinner bill would force anyone seeking information about what Chevron and et al were doing during a “turnaround” (which is defined as "a planned, periodic shutdown of a refinery process unit or plant to perform maintenance, overhaul, and repair operations and to inspect, test, and replace process materials and equipment" in the legislative counsel’s digest of the bill's language) to prove that what they wanted to know was not a trade secret. It would let Chevron et al sue the regulatory agency, members of the press and other citizens who sought such information, and if the people with the questions didn’t (or couldn’t) defend themselves in court they’d just lose. Period. 

 

When the bill was introduced in February its stated purpose was to promote safety by requiring refineries to report on their turnaround schedule and activities. But the recent amendment which Francke and Ewert are protesting uses what’s called in the trade a “gut & amend” trick—adding just a small change, but one which makes a big difference in the effect of a bill. 

I spent yesterday afternoon trying to reach someone in Hancock’s office. After I’d left my desk I got an email from her communications director, Larry Levin, which said in part: 

 

“SB 1300 leaves untouched existing law regarding access to public records concerning oil companies. If a member of the public has concerns about an oil company -- safety, procedures, explosions, pricing, management, unethical or illegal behavior, etc. -- this bill will not limit or affect existing access to that information.”

I ran his email past the two freedom of information mavens, and this is what they said: 

 

Jim Ewert: 

 

“He is wrong that the bill leaves the CPRA untouched. It creates a situation where a requester asking for any information about a refinery risks financial ruin if pulled into court because he or she made a request.”

Terry Francke: 

 

 

“I think it entirely ignores the part of the bill that allows refineries to sue those who make Public Records Act requests for turnaround information. The Evidence Code puts the burden of establishing that something is a trade secret on the party claiming that it is. This bill allows the submitted information to be classified as trade secret just because the owner says so, and if someone asks for it anyway, that person stands to be sued in the process of obtaining a court confirmation that the information really is a trade secret.

“The bill also swallows and codifies an expansion of the trade secret definition, because unless that definition is expanded to suit the desires of the proponents, much of the information would not qualify for the traditional trade secret protection.

"There is precedent for dealing with trade secret claims against Public Records Act exposure, and it involves no expansion of trade secret doctrine or jeopardy to the requester.”

SB1300 looks to me a lot like a Trojan horse: on the outside it appears to be a nice gift, but destructive forces are hidden inside. 

 

The added layer of secrecy it imposes would seriously impede the ability of the press and of environmental activists to monitor refinery safety, which in the case of Chevron has been a matter of great public concern in the last few years. 

Terry’s exclamation (This from two Berkeley liberals!) raises a good question. Just exactly who do self-styled progressives Hancock and Skinner think they’re serving with SB1300? Chevron, perhaps? 

The amended bill will be up for a final floor vote today. 

I've left another message in Loni Hancock's Sacramento office this morning to ask about the August 22 amendment. If anyone calls me back, I'll let you know. 

 

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UPDATE: After this was published, I talked to Larry Levin on the phone, and at my request he sent this email summarizing his points: 

 

 

"It was a pleasure talking to you this morning. I’m very sorry that Hans and Loni aren’t available, but as I mentioned, today is expected to be the last day of the legislative session and both of them are on the floor or in committees. "SB 1300 will give our regulators access to important new information about oil refineries for the first time. Without this bill, a member of the public would not be able to file a public records request for the information -- because there would be no information on turnarounds, as is the current situation. That is why this bill is necessary. Senator Hancock is concerned about how this is going to work, and she is committed to coming back and making adjustments as necessary. First and foremost, however, she believes that the state should be taking a proactive approach to preventing oil refinery disasters that can harm the public and the environment. If this bill passes, California will have the most robust refinery inspection program in the country.  

"SB 1300 adds a category to the definition of trade secret to include turnarounds. As you know, the concept of trade secrets is an accepted element of existing law. SB 1300 does not expand or extend the definition of trade secrets beyond turnarounds, so the bill is limited to this one procedure at California’s 14 oil refineries. It affects nothing else beyond that, and does not change or limit anything else in existing law regarding access to public records and freedom of information. The bill spells out a process for public record requests regarding the new turnaround information. That process is designed to work within the bill’s main intent of regulating oil refinery turnarounds, and to ensure that taxpayers would not have to pay legal costs for public records requests from competing oil companies, oil traders or speculators. 

"I hope this is helpful. 

"Larry Levin 

"Office of Senator Loni Hancock 

 

 

I'm not an expert in legislative language, but this letter doesn't change my perception of the pernicious effect of the August 22 amendment. I've forwarded it to Terry Francke and Jim Ewert so they can weigh in if they choose. We'll see if the bill passes this afternoon. 

UPDATE 2: Associated Press reports that SB1300 passed. No reports in any California paper I can find so far, but see it here: 

http://www.miamiherald.com/2014/08/29/4317558/refinery-inspection-bill-protects.html 

 

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