Boeing Co. v. Paxton

466 S.W.3d 831, 58 Tex. Sup. Ct. J. 1246, 2015 Tex. LEXIS 583, 2015 WL 3854264
CourtTexas Supreme Court
DecidedJune 19, 2015
DocketNo. 12-1007
StatusPublished
Cited by17 cases

This text of 466 S.W.3d 831 (Boeing Co. v. Paxton) is published on Counsel Stack Legal Research, covering Texas Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Boeing Co. v. Paxton, 466 S.W.3d 831, 58 Tex. Sup. Ct. J. 1246, 2015 Tex. LEXIS 583, 2015 WL 3854264 (Tex. 2015).

Opinions

Justice Devine

delivered the opinion of the Court,

in which Chief Justice Hecht, Justice Green, Justice Willett, Justice Guzman, Justice Lehrmann, and Justice Brown joined.

The Texas Public Information Act gives the public the right to access information the government collects. Tex. Gov’t Code § 552.221. Although most of this information is available on request, the Act itself enumerates about sixty exceptions. See generally id. §§ 552.101-.154. One of these exceptions is the focus of this appeal.

The exception at issue purports to protect information “that, if released, would give advantage to a competitor or bidder.” Id. § 552.104. The Attorney General, who is responsible for maintaining uniformity in the Act’s application, operation, and interpretation, id. § 552.011, has determined this exception protects the purchasing interests of a governmental body when conducting competitive bidding, but not those of a private party that competes in the process. The court of appeals has similarly concluded that the private party in this case lacked the right or standing to claim this exception because the exception is only for the government’s benefit. 412 S.W.3d 1, 18 (Tex.App.-Austin 2012). We find no such limitation in the Act’s text, however, and conclude that a private party may assert the exception to protect its competitively sensitive information. Concluding further that the information withheld will benefit the private party’s competitors and thus “give advantage to a competitor” of the private party asserting the exception, we reverse the court of appeals’ judgment and render judgment for theprivate party.

I

The Texas Public Information Act (PIA) “guarantees access to public information, subject to certain exceptions.” Tex. Dep’t of Pub. Safety v. Cox Tex. Newspapers, L.P., 343 S.W.3d 112, 114 (Tex.2011). Public information includes information that is collected, assembled, or maintained by or for a governmental body. Tex. Gov’t Code § 552.002(a). Such information is available by request unless an exception applies. In re City of Georgetown, 53 S.W.3d 328, 331 (Tex.2001).

Typically, a request for public information involves two parties, the governmental body holding the information and the citizen requesting it, and the governmental body must promptly ask the Attorney General for a ruling, if it believes an exception applies. Tex. Gov’t Code § 522.301. The government, however, gathers a great deal of information from people and companies doing business in Texas, and some requests may also implicate the privacy or property interests of third parties. When a citizen’s request involves this type of information, the PIA permits the third party to raise the issue and any applicable exception to the information’s disclosure with the Attorney General, or in district court, or both. See id. § 522.305(b) (permitting person whose privacy or property interests are implicated to appear in the Attorney General’s administrative determination of the request); id. § 552.325 (recognizing third party’s right to file suit seeking to withhold information from a requestor). The Boeing Company is such a third party here.

Boeing is the largest aerospace company in the world. About half of its business is building commercial jetliners, but it also competes for military contracts. As de[834]*834mand for new military aircraft has declined, this aspect of Boeing’s business has shifted to maintaining and overhauling older aircraft for the military.

In 1995, Boeing was performing this work in Tulsa, Oklahoma, but was about to lose the space it leased from American Airlines there and needed to find a new facility. It conducted a nationwide search and ultimately selected San Antonio’s Kelly Air Force Base as its new home. Kelly was scheduled for closure under the Department of Defense’s Base Realignment and Closure program and thus available to house Boeing’s commercial-refit facility for servicing heavy-lift military aircraft.

To facilitate Kelly’s transition to a private commercial hub, the City of San Antonio created the Greater Kelly Development Authority, later renamed the Port Authority of San Antonio. The Port is a tax-exempt, self-sustaining enterprise, incorporated by the city as a separate political jurisdiction. It continues to manage and redevelop the former air force base.

In 1998, Boeing signed a lease with the Port for 1.3 million square feet at Kelly Air Force Base for a term of twenty years.1 The selection of Kelly and subsequent lease negotiations involved a substantial commitment of Boeing’s time and resources. According to Boeing, the company devoted two years and a team of twelve employees and additional outside consultants to evaluate and negotiate a competitive agreement that would enable Boeing to compete for government aircraft contracts during the lease’s twenty-year term.

To induce Boeing’s relocation, the Port made improvements to the former air force base with funds borrowed from the city. Boeing’s decision to move to Kelly was an instrumental part of the base’s transformation. Upon signing the lease, Boeing became the Port’s largest tenant. It remains so today, employing about 1,500 personnel. Boeing’s relocation has also drawn other businesses to San Antonio, and its payments to the Port support the Port’s ability to repay its debt to the city.

Several years after signing the Kelly lease, a former Boeing employee, Robert Silvas, submitted a Public Information Act request to the Port for various Boeing corporate information, including the lease. The Port notified Boeing of the request and its right to seek relief from the Attorney General. Boeing provided a redacted version of the lease to Silvas and filed objections with the Attorney General as to the redacted parts. Boeing asserts that the information withheld is competitively sensitive information regarding its overhead costs at Kelly that would give advantage to it competitors.2

According to Boeing, a competitor could take the detailed information in Boeing’s lease and determine Boeing’s physical plant costs at Kelly, allowing the competitor to underbid Boeing on government contracts by enticing another landlord to offer a lower lease rental. Because of the competitive nature of the military-refit market, Boeing submits that it takes special care to safeguard certain information in the lease, including rental rates, share [835]*835of common maintenance costs, insurance coverage required by the Port, liquidated damages provisions,. and lease incentives. The information is not publicly available, and only about a dozen of Boeing’s 165,000 employees have access to it.

After considering Boeing’s objections, the Attorney General concluded in an Open-Records Letter Ruling that none of the withheld information was exempt from disclosure under the Act. Boeing promptly sought declaratory and injunctive relief from the ruling in the Travis County district court, joining the Attorney General and the Port Authority.3 The parties agreed to a temporary injunction, and the case was then tried to the court.

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Cite This Page — Counsel Stack

Bluebook (online)
466 S.W.3d 831, 58 Tex. Sup. Ct. J. 1246, 2015 Tex. LEXIS 583, 2015 WL 3854264, Counsel Stack Legal Research, https://law.counselstack.com/opinion/boeing-co-v-paxton-tex-2015.