Mountain States Telephone & Telegraph Co. v. Department of Public Service Regulation

634 P.2d 181, 194 Mont. 277, 1981 Mont. LEXIS 837
Montana Supreme Court·Decided September 8, 1981·No. No. 80-448·Published·Cited by 26 cases

Opinion

JUSTICE SHEEHY

delivered the Opinion of the Court.

This appeal arises out of the denial by the District Court, First Judicial District, Lewis and Clark County, of a petition for declaratory judgment by Mountain States Telephone and Telegraph Company (Mountain Bell) that the Public Service Commission (PSC) issue a protective order preserving the confidentiality of certain trade secrets claimed by Mountain Bell to be a valuable property right.

Mountain Bell is a public utility incorporated in Colorado, offering regulated telephone services, and other services in the State of Montana. The Public Service Commission is the arm of state government charged with the duty of regulating public utihties. The Montana Consumer Counsel (MCC), working with the Consumer Committee (both provided for in Title 5, Ch. 15, MCA) is given the statutory authority to appear at public hearings conducted by the PSC as the representative of the consuming public in all matters which in any way affect the consuming public. Section 69-2-201, MCA.

Mountain Bell filed an application for a rate increase for its regulated services before the PSC. MCC and the other defendants-respondents appeared before the PSC in opposition to the application [280] for increases. During the course of discovery, MCC served upon Mountain Bell certain data requests. Mountain Bell filed objections to the data requests contending that the requested information consisted of trade secrets, and proprietary and confidential business information. Mountain Bell offered to make the information available to the commission and the MCC subject to the commission’s entry of a proposed protective order.

The PSC denied Mountain Bell’s motion for a protective order on the grounds that a corporation is not entitled to the protection of the individual privacy exception under 1972 Mont. Const., Art. II § 9, and that parties of record should be able to examine any and all documents in a rate increase proceeding before the PSC.

After final denial by the PSC of the motion for a protective order, Mountain Bell filed an action for judicial review and declaratory relief in the District Court. The facts were stipulated to for the purpose of submitting pure legal issues to the District Court for summary judgment. Leave to intervene was granted the plaintiff-intervenors who also join as appellants in this cause.

Mountain Bell and intervenors filed motions for summary judgment. The District Court denied the motions for summary judgment, and ordered that general judgment be entered in the cause for all the defendants. From this summary disposition of the cause appeal was duly perfected.

Mountain Bell states the issue presented to us for review in this paragraph:

“Whether certain identified provisions of Montana Constitutional and statutory law, which mandate public disclosure and dissemination of regulated utility trade secret property whenever such information is necessary to a rate determination of the Public Service Commission, are in fatal contravention to other Montana Constitutional guarantees and the protections and guarantees of the Fifth and Fourteenth Amendments to and the equal protection and interstate commerce clauses of the United States Constitution.”

On July 9,1981, we issued an interlocutory order in this cause, in effect requiring the issuance of a protective order regarding Mountain Bell’s trade secret property. A copy of that interlocutory order is attached hereto. We undertake in this opinion to explain the reasons for our interlocutory order, and to issue a declaratory judgment in favor of Mountain Bell.

There is no doubt raised by any party to these proceedings that the trade secret information is essential to the PSC to make a [281] determination on Mountain Bell’s application for revenue increases, and that Mountain Bell relies on the trade secret information in support of its application for revenue increases. The dispute centers solely around Mountain Bell’s contention that in submitting the information requested upon discovery, it is entitled to a protective order preserving the confidentiality of the trade secret information from Mountain Bell’s unregulated competitors.

Mountain Bell contends that the trade secret information is property which should be protected against compelled public disclosure to competitors, and asserts five grounds why certain Montana statutes and provisions of the 1972 Montana Constitution are unconstitutional, facially and as applied. The intervenors assert unconstitutionality under the Fourth and Fifth Amendments of the United States Constitution.

We refer first to the state constitutional section and the statutes which Mountain Bell contends are unconstitutional on their face and as applied here. The 1972 Mont. Const., Art II, § 9 (the citizens “right to know”) provides the right in all persons to examine documents or to observe the deliberations of all public bodies “except in cases in which the demand of individual privacy clearly exceeds the merits of public disclosure” Section 69-3-105, MCA (the citizens right to inspect), makes all records in the possession of the PSC open to the public at reasonable times subject to withholding only in the interest of the public for a period not exceeding 90 days. Section 2-6-102, MCA (the citizens right to inspect and copy records), opens the records of all public bodies in this state to inspection and copying, except as otherwise provided by statute, and gives any citizen the right to a certified copy of any such document upon payment of legal fees.

Basically, the principal legal reason given by the PSC for its denial of a protective order was that Mountain Bell was not entitled to the individual privacy provided for in the exception clause of the 1972 Mont. Const., Art. II, § 9. The PSC concluded that the constitutional section did not guarantee individual privacy to corporations. The District Court examined in detail the order of the PSC, and outlined for itself the issues to be decided by it in this cause in the following fashion:

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Mountain States Telephone & Telegraph Co. v. Department of Public Service Regulation, 634 P.2d 181, 194 Mont. 277, 1981 Mont. LEXIS 837 (Mo. 1981).

634 P.2d 181 (Mountain States Telephone & Telegraph Co. v. Department of Public Service Regulation) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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