Legal Insights

The Pennsylvania Supreme Court Grants Very Broad Public Access to the Pennsylvania Public Utility Commission's Investigative Documents

May 26, 2016
By: David B. MacGregor

On May 25, 2016, the Pennsylvania Supreme Court, in a four to two decision, reversed the unanimous Opinion of the Commonwealth Court of Pennsylvania that concluded that the investigative documents of the Pennsylvania Public Utility Commission’s (“PUC”) Bureau of Investigation and Enforcement (“I&E”) were exempt from disclosure under Section 335(d) of the Public Utility Code (the “Code”) and Section 708(b)(17) of the Right to Know Law (“RTKL”). See Pennsylvania Public Utility Commission v. Andrew Seder/The Times Leader and Scott Kraus/The Morning Call, Docket Nos. 52 MAP 2015 and 53 MAP 2015, __ Pa. __, __ A.3d __ (Pa. May 25, 2016). In reaching its decision, the Supreme Court concluded that Section 335(d) of the Code is a public disclosure law that is above and beyond what is required by the RTKL, and that all documents provided to the PUC during an investigation, formal or informal, are subject to disclosure under Section 335(d) unless they fall within one of the narrow exemptions set forth in Section 335(d). The result reached by the Supreme Court is a significant change in the public disclosure standards applicable to the PUC and all Pennsylvania public utilities.

This matter was initiated by RTKL requests that were submitted to the PUC’s Open Records Officer seeking the investigative materials and records of the I&E, which were generated as part of a pre-prosecutorial, informal investigation of an anonymous tip letter. The PUC’s Open Records Officer denied the RTKL requests on two separate grounds:  (1) the requested information was exempt under Section 335(d) of the Code because the Commissioners of the PUC Commissioners did not rely on the requested documents in taking official action to approve a proposed settlement between I&E and the utility; and (2) the requested information was exempt from disclosure under the non-criminal investigation exemption set forth in Section Section 708(b) of the RTKL. The PUC’s denial of the RTKL request was appealed to the Office of Open Records (“OOR”), which concluded that redacted versions of the requested information were subject to public disclosure pursuant to Section 335(d) of the Code, and that the exemptions under Section 708 of the RTKL were not applicable to the RTKL requests. The PUC appealed the OOR’s decision to the Commonwealth Court of Pennsylvania.

On December 3, 2014, the Commonwealth Court issued its unanimous Opinion, reversing the OOR. See Pennsylvania Public Utility Commission, Petitioner v. Andrew Seder/The Times Leader and Scott Kraus/The Morning Call, 106 A.3d 193 (Pa. Cmwlth. Dec. 3, 2014). The Commonwealth Court found that under Section 335(d) of the Code, the PUC must disclose documents related to an investigation if:  (1) the PUC has made a decision, entered into a settlement with a public utility, or taken any other official action under the Sunshine Act; and (2) the Commissioners of the PUC relied upon the documents in making their determination. The Commonwealth Court found that the first prerequisite to disclosure under Section 335(d) of the Code was satisfied when the Commissioners of the PUC approved a settlement between I&E and a public utility. However, the Commonwealth Court found that the second prerequisite to disclosure under Section 335(d) of the Code was not satisfied because the Commissioners of the PUC did not have access to the requested investigative materials that were not made part of the formal record and, therefore, did not rely upon the requested documents when they approved the settlement. The Commonwealth Court also found find that the requested documents were exempt from disclosure under the non-criminal investigation exemption set forth in Section 708(b)(17) of the RTKL.

In a four to two Opinion authored by Justice Baer, the Supreme Court reversed the Commonwealth Court and reinstated the determination of the OOR. Despite the fact that the matter was initiated through RTKL requests submitted to the PUC’s Open Records Officer, the majority for the Supreme Court analyzed the case under Section 335(d) of the Code rather than the RTKL. The majority found that Section 335(d) of the Code goes above and beyond the RTKL, and that Section 335(d) governs the disclosure of documents provided to the PUC. Under the majority’s conclusion, the exemptions from public disclosure enumerated in the RTKL will no longer apply to requests seeking documents related to PUC investigations.

In addition, the majority of the Supreme Court rejected the Commonwealth Court’s conclusion that the public disclosure requirement of Section 335(d) of the Code is triggered only when the Commissioners of the PUC relied on the investigative documents in taking official action. Even though the requested investigative documents were not part of the record and the Commissioners of the PUC did not have access to the documents when they approved the settlement, the majority concluded that the term “commission” in Section 335(d) of the Code meant the PUC in its entirety, and that any document used by the PUC in the course of an investigation must be publicly disclosed, regardless of who prepared or used the document. The majority of the Supreme Court found that “I&E’s investigative file by its very nature demonstrates that it consists of documents that the PUC used in the course of its investigation,” and that it was indisputable that the PUC relied upon the requested investigative documents when I&E determined to enter a settlement with a public utility.

In a Dissenting Opinion joined by Justice Dougherty, Chief Justice Saylor found that Section 335(d) requires the PUC to disclose documents related to a PUC investigation only if the PUC has taken official action under the Sunshine Act, and the Commissioners of the PUC relied upon the documents in making their determination. The Dissenting Opinion also disagreed with the majority that Section 335(d) overrides the exemptions from mandatory disclosure under the RTKL. According to the Dissenting Opinion, the RTKL remains fully applicable to PUC records that are not subject to the Section 335(d) disclosure of documents relied upon by the PUC in taking official action.

The interpretation of Section 335(d) announced by the majority of the Supreme Court may have significant impacts on both formal and informal PUC investigations. In particular, under this new interpretation, all documents provided to or produced by any employee of the PUC during the course of any formal or informal investigation must be publicly disclosed unless it fits within one of the narrow exemptions in Section 335(d) of the Code list below:

1. It contains trade secrets or proprietary information and has been determined by the PUC that harm to the person claiming the privilege would be substantial;
2. It contains identifying information that would operate to the prejudice or impairment of a person’s reputation or personal security;
3. It contains information that would lead to the disclosure of a confidential source;
4. Subjects a person to potential economic retaliation; or
5. It contains information that could be used for criminal or terroristic purposes.

As a result of the Supreme Court’s ruling, the decision of the OOR will be reinstated. The PUC will now be required to release the requested investigative documents, subject to redaction or exemption under Section 335(d). The facts of the case before the Supreme Court involved a settlement of an informal PUC investigation. It remains to be seen how the Supreme Court’s holding will be applied in other proceedings with different facts. Public utilities, customers, and other persons/entities that provide documents to any employee of the PUC should be cognizant of this new and broad public disclosure requirement announced by the Supreme Court.

This article was prepared by David B. MacGregor and Christopher T. Wright, Principals in the Energy & Utilities Practice Group at Post & Schell, P.C. If you have any questions or wish to discuss the subject of this article, please contact Mr. Wright at 717.612.6013 or cwright@postschell.com.