THE REGENTS OF THE UNIVERSITY OF CALIFORNIA, Petitioner, v. THE SUPERIOR COURT OF ALAMEDA COUNTY, Respondent; REUTERS AMERICA LLC, Real Party in Interest.
No. A138136
Court of Appeal, First District, Division Two, California
Dec. 19, 2013
A petition for a rehearing was denied January 14, 2014
383
Crowell & Moring, J. Daniel Sharp; Michael R. Goldstein, Karen J. Petrulakis, Margaret L. Wu and Charles F. Robinson for Petitioner.
Caroline L. Fowler, City Attorney, for League of California Cities as Amicus Curiae on behalf of Petitioner.
No appearance for Respondent.
Ram, Olson, Cereghino & Kopczynski and Karl Olson for Real Party In Interest.
BRICK, J.*—The primary issue in this case is whether a public agency can be required under the California Public Records Act (
With respect to the first issue, the Regents concedes that the information sought relates to the public‘s business. Nonetheless, because it was not prepared, owned, used, or retained by the Regents, we hold that records reflecting such information in the hands of Kleiner Perkins and Sequoia are not “[p]ublic records” within the meaning of the CPRA,
BACKGROUND
As of October 2012, when this matter was initially heard in the trial court, the Regents owned investment assets of about $71.6 billion, which help pay for employee pensions, student scholarships, research, and other university operations. The Regents sets broad policies; management of the assets is entrusted to the office of the treasurer with assistance from the consulting firm Cambridge Associates and oversight from the Regents‘s committee on investments and a separate investment advisory committee.
Since 1979, about 2 percent of the Regents‘s multibillion dollar investment portfolio has been invested in “private equity,” which refers to limited partnerships formed and managed by private parties to invest in private
Until 2003, the Regents received from private equity firms, including Kleiner Perkins and Sequoia, information that enabled it to monitor its private equity investments. This information consisted of annual fund level information, which included information on portfolio companies, i.e., privately held companies in which the fund invested, the amounts of those investments, and other information the private equity firms regarded as confidential business information. Such information was provided to investors like the Regents in confidence.
In 2003, however, the Alameda County Superior Court decided Coalition of University Employees v. The Regents of the University of California (Super. Ct. Alameda County, 2003, No. RG03-089302) (CUE). In CUE, the Regents defended against a CPRA request for, among other things, the internal rate of return for 94 separate private equity funds, by arguing that the information should be treated as exempt from disclosure under the CPRA as trade secrets or as official information. The Regents also argued that pursuant to
Following the CUE decision Kleiner Perkins stopped providing the Regents with fund-specific information for its existing investments and stopped inviting the Regents to participate in new funds. Sequoia did the same until 2010 when it allowed the Regents to invest in Sequoia Capital 2010 LP.4 So far as the record shows, no further CPRA requests were sent to the Regents seeking alternative investment information until 2012, when the request that led to this litigation was sent.
The following year, the Legislature added an additional exemption specifically relating to alternative investments in which public investment funds invest to more than two dozen exemptions already set forth at
“(a) Notwithstanding any provision of this chapter or other law, the following records regarding alternative investments in which public investment funds invest shall not be subject to disclosure pursuant to this chapter, unless the information has already been publicly released by the keeper of the information:
“(1) Due diligence materials that are proprietary to the public investment fund or the alternative investment vehicle.
“(2) Quarterly and annual financial statements of alternative investment vehicles.
“(3) Meeting materials of alternative investment vehicles.
“(4) Records containing information regarding the portfolio positions in which alternative investment funds invest.
“(5) Capital call and distribution notices.
“(6) Alternative investment agreements and all related documents.
“(b) Notwithstanding subdivision (a), the following information contained in records described in subdivision (a) regarding alternative investments in which public investment funds invest shall be subject to disclosure pursuant to this chapter and shall not be considered a trade secret exempt from disclosure:
“(1) The name, address, and vintage year of each alternative investment vehicle.
“(2) The dollar amount of the commitment made to each alternative investment vehicle by the public investment fund since inception.
“(3) The dollar amount of cash contributions made by the public investment fund to each alternative investment vehicle since inception.
“(4) The dollar amount, on a fiscal yearend basis, of cash distributions received by the public investment fund from each alternative investment vehicle.
“(5) The dollar amount, on a fiscal yearend basis, of cash distributions received by the public investment fund plus remaining value of partnership assets attributable to the public investment fund‘s investment in each alternative investment vehicle.
“(6) The net internal rate of return of each alternative investment vehicle since inception.
“(7) The investment multiple of each alternative investment vehicle since inception.
“(8) The dollar amount of the total management fees and costs paid on an annual fiscal yearend basis, by the public investment fund to each alternative investment vehicle.
“(9) The dollar amount of cash profit received by public investment funds from each alternative investment vehicle on a fiscal year-end basis.
“(c) For purposes of this section, the following definitions shall apply:
“(1) ‘Alternative investment’ means an investment in a private equity fund, venture fund, hedge fund, or absolute return fund.
“(2) ‘Alternative investment vehicle’ means the limited partnership, limited liability company, or similar legal structure through which the public investment fund invests in portfolio companies.
“(3) ‘Portfolio positions’ means individual portfolio investments made by the alternative investment vehicles.
“(4) ‘Public investment fund’ means any public pension or retirement system, and any public endowment or foundation.”
PROCEDURAL HISTORY
Reuters filed its original petition in the Superior Court for Alameda County on January 23, 2012. On March 26, 2012, Reuters filed a first amended petition, which became the operative pleading in the trial court. In addition to repeating its request for fund-specific information reflected in its first CPRA request, Reuters attached a March 14, 2012 second CPRA request for other information. That request was resolved by the trial court and is not pertinent to this proceeding.
The first amended petition also attached the information described above from the Regents‘s treasurer‘s Web site with information on alternative investments on a fund-by-fund basis, where available, as of June 30, 2011. The summary table provided shows that the Regents had investments with Kleiner Perkins in five funds; each investment involved a commitment made between 1992 and 2000 of $15 million or $20 million. Rates of return on those investments (albeit not fully closed out) ranged from a high of 286.6 percent for Kleiner Perkins‘s 1996 Fund VIII to a low of -17.5 percent for its 2000 Fund X-A LP. The Regents also had investments with Sequoia, four of
The parties filed extensive briefs and declarations in the trial court. On September 10, 2012, the Regents filed a motion pursuant to California Rules of Court, rule 2.551, to seal certain documents lodged by Reuters. It filed a second motion to seal on September 14, 2012. The Regents requested that certain documents it had lodged in support of its opposition to Reuters‘s motion be sealed. It filed a third motion to seal on October 12, 2012, regarding documents lodged by Reuters in support of its reply papers.
On October 19, 2012, the trial court provided the parties, but not the public, with a tentative ruling on Reuters‘s petition and the Regents‘s motions to seal. The court heard argument, portions of which were made out of the presence of the public. The parties were directed to meet and confer with respect to the court‘s proposed treatment of the conditionally sealed documents and to consider whether the tentative ruling would be filed in the register of actions.7 Supplemental briefing addressed primarily to the pending motions to seal was allowed and received. The Regents filed a fourth motion to seal on December 3, 2012.
Per the agreed-upon schedule, the parties returned for further argument on the petition and the motions to seal on December 7, 2012. At the hearing, the Regents referred the court to rule 2.551(b)(6) of the California Rules of Court, and explained that when the trial court denies a motion to seal, the moving party decides whether to file a document to avoid public disclosure. The court responded that the present situation was unusual because the court was granting the motion in part and denying it in part but it understood both the Regents‘s position and “what the rule says on its face.”
On February 4, 2013, the court filed its 35-page order. As is pertinent here, the court granted in part Reuters‘s writ petition with respect to individual fund level information and denied in part the Regents‘s motions to seal. With respect to individual fund information, the court found on the evidence before it that the Regents “does not directly ‘own’ or ‘retain’ post-2003 Fund Level Information concerning investments with Sequoia and Kleiner Perkins. . . . [[] The Regents has demonstrated that it has not ‘used’ Fund Level Information directly. . . . [[] The Regents has not, however, demonstrated that the
The order also addressed the motions to seal and stated that the court had applied “the [CPRA] framework for [sic] when deciding whether to seal filed documents under [California Rules of Court, rule] 2.550 without regard to whether the documents or information are the subject of the [CPRA] claims.” The court applied that framework to a detailed review of redacted portions of the parties’ briefs and declarations, as well as to documents the Regents had provided to Reuters during discovery, or with the moving papers, pursuant to a stipulated order regarding confidentiality. With the exception of those documents identified in exhibit B to its order that the court determined were exempt from disclosure under the CPRA, the court ruled that “[t]he Regents must file public versions of all documents now conditionally under seal with exclusions or redactions only as permitted by” the court‘s order.
After receiving Reuters‘s proposed judgment and writ, the Regents‘s objections, and Reuters‘s response, on February 19, 2013, the court filed its judgment and order on the judgment and writ, and motions to seal. With respect to the documents subject to the motions to seal, the court denied the Regents‘s request to have the clerk return the unredacted documents lodged by the Regents and not place them in the file. The court stated: “[California Rules of Court], rule 2.551(b)(6) implicitly presumes that a party can obtain the return of a lodged document before the court or the trier of fact considers the document. . . . In this case, however, the Regents is seeking the right to retrieve its lodged documents after the court has considered the documents in resolving the merits of the Petition. [][] The court will not permit the Regents to seek the return of documents that the court has considered in resolving the merits of the petition. The court relied on all the information submitted by the Regents in opposing the petition. Having submitted evidence to the court and obtained a resolution of the motion on its merits, the Regents is judicially estopped from retrieving evidence from the court file. A party would interfere with ‘the orderly administration of justice and regard for the dignity of judicial proceedings’ if it submitted evidence, obtained a decision based on that evidence, and then sought to remove the evidence from the court file. ([The] Swahn Group, Inc. v. Segal (2010) 183 Cal.App.4th 831, 841 [108 Cal.Rptr.3d 651].)” (Fn. omitted.)
On March 6, 2013, the Regents filed a notice of appeal from the February 4, 2013 order. On March 21, 2013, the Regents filed a petition for writ of mandate in this court and requested a stay.8 We granted a temporary stay. In April, the Regents filed its exhibits, and filed some exhibits under seal
DISCUSSION
I. The Records Reuters Seeks Are Not “Public Records” Under the CPRA
At the outset it is important to understand what we are and are not deciding. Initially, we are not deciding whether it is wise for the Regents to diversify its portfolio by investing about 2 percent of its assets in alternative investments, including venture capital funds. Nor are we deciding whether the Regents receives sufficient information from the VCs with which it seeks to invest, including Kleiner Perkins and Sequoia, to perform its fiduciary obligation of monitoring its venture capital investments.9 Nor are we deciding whether it is reasonable for Kleiner Perkins and Sequoia, unlike many other venture fund operators, to refuse to do additional business with the Regents, or to limit the information they provide to the Regents with respect to its existing investments, because of the Regents‘s CPRA obligation to respond appropriately to requests for public records pertaining to investments made with those companies. It is undisputed that Kleiner Perkins and Sequoia are private companies, not public agencies engaged in the public‘s business.
What we are deciding in this case is whether the individual fund information which the trial court has ordered the Regents to make objectively reasonable efforts to obtain from Kleiner Perkins and Sequoia constitutes “public records” within the meaning of the Act. The trial court found that the Act requires the Regents to produce records pertaining to the public‘s business which may be in its constructive possession. The Regents contends that this interpretation is incorrect and contrary to the plain words of the statute.
Since the issue in this writ is the correct interpretation of the Act, we are guided in this endeavor by established rules of statutory interpretation as recently restated and applied in the context of the CPRA by our Supreme Court: “When we interpret a statute, ‘[o]ur fundamental task is to
“In this case, our usual approach to statutory construction is supplemented by a rule of interpretation that is specific to the issue before us. In 2004, California voters approved Proposition 59, which amended the state Constitution to provide a right of access to public records. . . . [A]rticle I, section 3, subdivision (b)(1) provides: ‘The people have the right of access to information concerning the conduct of the people‘s business, and therefore, the meetings of public bodies and the writings of public officials and agencies shall be open to public scrutiny.’ Subdivision (b)(2) provides guidance on the proper construction of statutes affecting this right of access: ‘A statute, court rule, or other authority, including those in effect on the effective date of this subdivision, shall be broadly construed if it furthers the people‘s right of access, and narrowly construed if it limits the right of access. . . .’ In addition, subdivision (b)(5) provides: ‘This subdivision does not repeal or nullify, expressly or by implication, any constitutional or statutory exception to the right of access to public records or meetings of public bodies that is in effect on the effective date of this subdivision, including, but not limited to, any statute protecting the confidentiality of law enforcement and prosecution records.’ (Cal. Const., art. I, § 3, subd. (b).)” (Sierra Club, supra, 57 Cal.4th at p. 166.)
With respect to fund level information “relating to the conduct of the public‘s business,” the Regents has not contended in the trial court or in this court that such information does not relate to the public‘s business. Indeed,
We agree with the Regents. The statute unambiguously states that “[p]ublic records” include “any writing containing information relating to the conduct of the public‘s business prepared, owned, used, or retained by any state or local agency regardless of physical form or characteristics.” (
Although we need not go any further because the language of the statute is clear and unambiguous (see, e.g., Lungren v. Deukmejian (1988) 45 Cal.3d 727, 735 [248 Cal.Rptr. 115, 755 P.2d 299]), we note that the plain meaning of the statute is supported by public policy and is in harmony with other provisions in the CPRA. The purpose of the CPRA is to ensure public access to vital information about the government‘s conduct of its business. (
Furthermore, the definition of public records in
To qualify as an “agency record” subject to FOIA disclosure rules, “an agency must ‘either create or obtain’ the requested materials . . . ,” and “the agency must be in control of [them] at the time the FOIA request is made.” (Department of Justice v. Tax Analysts, supra, 429 U.S. at pp. 144-145; see Forsham v. Harris (1980) 445 U.S. 169, 177 [63 L.Ed.2d 293, 100 S.Ct. 977].) The fact that an agency has access to data produced by its grantee does not mean that production of the data is required under the FOIA. (Forsham, at pp. 177-178 [information generated by a privately controlled organization, which has received grant funds from an agency, does not constitute agency records under the FOIA when the agency has not at any time obtained this information].) Similarly to the FOIA, no language in the CPRA creates an obligation to create or obtain a particular record when the document is not prepared, owned, used, or retained by the public agency.
When interpreting the meaning of public records, the trial court correctly pointed out that under
Further, the trial court‘s reliance on Consolidated Irrigation Dist. v. Superior Court (2012) 205 Cal.App.4th 697, 710 [140 Cal.Rptr.3d 622] (Consolidated Irrigation) for the proposition that “possession” as used in
The court in Consolidated Irrigation specified that it was insufficient to show that the files were public records; to prevail under
The trial court also cited, and Reuters relies upon, Commission on Peace Officer Standards & Training v. Superior Court (2007) 42 Cal.4th 278 [64 Cal.Rptr.3d 661, 165 P.3d 462] (CPOST) for the proposition that “the location in which [the document] is stored” does not matter. (Id. at pp. 288, fn. 3, 291.) However, CPOST did not involve the question of what constitutes a public record. Rather, in CPOST, the Supreme Court was presented with a decision of the Court of Appeal reversing a trial court judgment compelling CPOST to provide, for certain peace officers, the names, dates of appointment and termination, and names of appointing agencies to the Los Angeles Times, which was investigating the incidence of LAPD (Los Angeles Police Department) officers leaving that police force to join others. (Id. at p. 287.) The Court of Appeal reversed that judgment on the ground that such information was exempt from disclosure under the CPRA because of the special treatment provided for peace officer personnel records in Penal Code sections 832.7 and 832.8. (CPOST, at pp. 287-288.) The Supreme Court reversed, holding that the requested records were not obtained by the commission from confidential personnel records within the meaning of Penal Code sections 832.7 and 832.8, and that even assuming they could be characterized as personnel or similar files within the meaning of
The recent decision of Division Five of this court in Board of Pilot Commissioners v. Superior Court (2013) 218 Cal.App.4th 577 [160 Cal.Rptr.3d 285] (Board of Pilot Commissioners), brought to our attention after briefing was completed and cited by both sides during argument, is not to the contrary. In that case the trial court had granted a CPRA request of the Pacific Merchant Shipping Association (PMSA) for pilot logs prepared by the San Francisco Bar Pilots, a private organization, and not used or maintained by a public agency, the Board of Pilot Commissioners for the Bays of San Francisco, San Pablo and Suisun (the Board). There was no dispute that the logs related to “an undeniable public interest in safe navigation of vessels in our waterways.” (Board of Pilot Commissioners, at p. 596.) The case was complicated by the fact that Captain Bruce Horton served both as port agent of the Board, and “is, for at least certain purposes, a public officer” (id. at p. 581) and as president of the San Francisco Bar Pilots. Division Five granted the writ petitions of the Board and the San Francisco Bar Pilots and ordered the trial court to deny the CPRA petition.
Reuters argues that Board of Pilot Commissioners stands for the proposition that “possession” within the meaning of
“As to the Port Agent, the argument reaches too far. Under PMSA‘s theory, any and all records held or maintained by a private organization would become public record simply because one of its officers concurrently held a position performing public functions. Whether the record is in the actual or constructive possession of a public official, the requirement is still that the record be required by law to be kept by that official, or that it be ‘necessary or convenient to the discharge of his official duty.’ ” (San Gabriel Tribune[ v. Superior Court], supra, 143 Cal.App.3d at p. 774 . . . .)
“As to the Board, to prevail PMSA must establish that the files (1) qualify as public records and (2) were in the possession of the Board. [Citation.] ‘Possession’ in this context has been interpreted to mean both actual and constructive possession. ‘[A]n agency has constructive possession of records if it has the right to control the records, either directly or through another person. [Citation.]’ [Consolidated Irrigation, supra, 205 Cal.App.4th at pp. 709, 710.]” (Board of Pilot Commissioners, supra, 218 Cal.App.4th at p. 598.)
Board of Pilot Commissioners found it to be dispositive that Captain Horton had never used the pilot logs in the performance of his duties as port agent: “The evidentiary record before us does not support a finding that the Pilot Log data is, or ever has been, used by the Port Agent in the performance of his official duty in assignment of bar pilots and is consequently a public record. If the data itself is not a public record, the fact that the Board could theoretically request it from Bar Pilots does not make it so.” (Board of Pilot Commissioners, supra, 218 Cal.App.4th at p. 600.)
Board of Pilot Commissioners is entirely consistent with our analysis: “public records” under the CPRA are those records included in the definition set forth in
Reuters also argues that the Legislature‘s adoption of
Nothing in the language of
Reuters emphasizes that years earlier when Kleiner Perkins and Sequoia provided the Regents with the same type of information now being requested, the Regents disclosed it under the CPRA. Additionally, the Regents currently receives and discloses this same information for other venture capital investments. Reuters argues that excluding constructive possession from the definition of public records will impermissibly permit the Regents to transform public records into private ones by refusing to obtain them or improperly giving the control of disclosure to the venture capitalists. Reuters stresses that
Reuters‘s argument is unpersuasive: The documents now being requested (unlike those which the Regents used and retained prior to 2003) were never public records under the CPRA. Thus, they are not documents “otherwise subject to disclosure.” (
Implicit in Reuters‘s argument is the notion that refusing to add constructive possession to the definition of public records will result in the Regents‘s circumventing its duty to release information under the Act by simply avoiding the receipt of specific information. We do not believe that refusing to add constructive possession into the definition of public records will frustrate the Act‘s purpose of enhancing governmental accountability through a general policy of access to information. If the Regents determines that it needs particular information to perform its fiduciary obligation of prudently investing and monitoring its investments, nothing in this record suggests it will avoid receiving that information or violate its fiduciary duty in order to shield itself from its obligations to disclose under the CPRA. Here, the Regents garnered a considerable amount of information that it deemed sufficient to make and monitor its investment decisions, much of which is specifically exempt from disclosure under
Under the express and plain language of
II. The Trial Court Must Comply with California Rules of Court, Rule 2.551(b)(6)
In the present case, the Regents is not challenging the trial court‘s ruling pursuant to California Rules of Court, rule 2.550, regarding which documents the court deemed public and which records it determined should be sealed.17 Rather, the Regents objects to the trial court‘s refusal to return to the Regents those documents deemed public to permit the Regents to choose whether to refile unredacted versions of the documents. In the trial court and in this
Rule 2.551 sets forth the procedural requirements for moving to seal trial records. In the present case, the Regents filed its four motions to seal pursuant to rule 2.551(b)(4). This rule provides: “The party requesting that a record be filed under seal must lodge it with the court . . . when the motion or application is made . . . . Pending the determination of the motion or application, the lodged record will be conditionally under seal.” Rule 2.551(b)(6) states: “If the court denies the motion or application to seal, the clerk must return the lodged record to the submitting party and must not place it in the case file unless that party notifies the clerk in writing within 10 days after the order denying the motion or application that the record is to be filed.”
Here, the Regents did not notify the clerk that the records could be filed. To the contrary, the Regents made it clear to the court that it wished the documents to be returned to it. At the hearing on December 7, 2012, counsel for the Regents asked the court whether it intended to order the clerk to return all the material lodged under seal to permit the parties to refile the materials consistent with the court‘s rulings. Counsel referred the court to rule 2.551(b)(6) and explained that after the court denies a motion to seal, the rule requires the court to return those documents to the moving party to permit that party to decide whether or not to file to avoid public disclosure. The court answered: “I‘m going to have to think about it, to tell you the truth, because I had not—I had not really thought about how that rule interacts with a motion that‘s granted in part and denied in part. When I‘ve seen sealing motions before, quite frankly, it‘s been a grant or deny. I‘ve not had one with this—that‘s been this complex.”
Counsel for the Regents asked the court whether it understood the Regents‘s position. The court responded: “Right. You want—if I deny the motion as to any document, you want it returned. I think that‘s what the rule says on its face. So I think that‘s what the court will do, [and] just return the documents submitted by either party as to which the motion was denied, and then you can do what you want with it.” The court added: “And I won‘t have to, you know, sanction anything the [Regents] or Reuters [is] doing, which is not in the statute. I will just follow the statute and give you the documents back, and if you want to resubmit them, you can do it.”
On February 19, 2013, the court filed its order on the judgment and writ, and motions to seal. The court found that the Regents is judicially estopped from requesting the return of the documents because it agreed that the court should consider this evidence in evaluating the merits of Reuters‘s petition. The Regents contends that the trial court erred in making this ruling. We agree.
” ’ “Judicial estoppel precludes a party from gaining an advantage by taking one position, and then seeking a second advantage by taking an incompatible position. . . .” ’ . . . The doctrine [most appropriately] applies when: ‘(1) the same party has taken two positions; (2) the positions were taken in judicial or quasi-judicial administrative proceedings; (3) the party was successful in asserting the first position (i.e., the tribunal adopted the position or accepted it as true); (4) the two positions are totally inconsistent; and (5) the first position was not taken as a result of ignorance, fraud, or mistake.’ [][] ’ “The doctrine‘s dual goals are to maintain the integrity of the judicial system and to protect parties from opponents’ unfair strategies. . . . Consistent with these purposes, numerous decisions have made clear that judicial estoppel is an equitable doctrine, and its application, even where all necessary elements are present, is discretionary.’ [Citation.] ‘The determination of whether judicial estoppel can apply to the facts is a question of law reviewed de novo, i.e., independently [citations], but the findings of fact upon which the application of judicial estoppel is based are reviewed under the substantial evidence standard of review. [Citations.] [[] Even if the necessary elements of judicial estoppel are found, because judicial estoppel is an equitable doctrine [citations], whether it should be applied is a matter within the discretion of the trial court. [Citations.] The exercise of discretion for an equitable determination is reviewed under an abuse of discretion standard.’ [Citation.]” (Miller v. Bank of America, N.A. (2013) 213 Cal.App.4th 1, 9-10 [152 Cal.Rptr.3d 190]; see The Swahn Group, Inc. v. Segal, supra, 183 Cal.App.4th at p. 841.)
Here, nothing in the record supports a finding that the Regents took two inconsistent positions either with respect to the merits of Reuters‘s petition or with respect to its four motions to seal. To the contrary, the record establishes that the Regents consistently asserted that it was not obligated to obtain and
Rule 2.551(b)(6) is a procedural rule and the Regents must demonstrate prejudice. The Regents asserts that it submitted sensitive information in reliance on rule 2.551(b)(6), and that it would never have provided this information had it known that it would not be able to decide whether this information should be made public. We agree that it is inherently prejudicial when a party, at variance with the mandate of a rule of court, is deprived of the discretion to determine whether to file sensitive information that will be part of the public record.
We note that it is not unusual for a trial court to defer ruling on a motion to seal until after it has considered the merits of the underlying motion or petition. There are good reasons for this practice which in a particular case may include judicial efficiency and a desire to await ruling on a sealing motion until the court is better informed about the case through consideration of the underlying merits motion. However, rule 2.551(b)(6) is clear: when the court denies or denies in part the request to seal, and the submitting party elects not to have its provisionally sealed documents become a part of the record, the court must return the lodged documents as required by rule 2.551(b)(6). In such a situation, the court bears the risk that it may have to reevaluate the merits of the motion or petition if its decision was based on provisionally sealed material that the submitting party elects not to refile.
DISPOSITION
The petition filed in this court is granted. Let a peremptory writ of mandate issue directing the superior court to set aside and vacate its February 4, 2013 order and corresponding judgment and writ of mandate, and enter a new judgment (1) denying Reuters‘s petition for writ of mandate to compel the Regents to “make an objectively reasonable effort to obtain” records from Kleiner Perkins and Sequoia and (2) directing the clerk of the superior court
Kline, P. J., and Richman, J., concurred.
Notes
“The Legislature finds and declares that Section 2 of this act, which adds Section 6254.26 of the Government Code, imposes a limitation on the public‘s right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:
“(a) Access to information concerning the conduct of the people‘s business is a fundamental and necessary right of every person in this state pursuant to subdivision (b) of Section 3 of Article I of the California Constitution and Section 6250 of the Government Code. The public has a paramount interest in knowing how public money is spent and invested.
“(b) Public pension and retirement systems and public endowments and foundations have a fiduciary duty to invest the assets of these funds with care, skill, prudence, and diligence. This fiduciary duty includes diversifying the investment of assets in a manner so as to minimize the risk of loss and maximize the rate of return. Investment in high performing alternative investments is a component of diversifying the pension assets and maximizing the rate of return.
“(c) At the same time, a certain narrow class of public investments, alternative investments, involves some information that historically has been kept confidential because confidentiality is essential to their success. The disclosure of certain information pertaining to alternative investments could be harmful to generating sustainable and profitable rates of return for the investments of the pension or retirement system and of the public endowment or foundation. Public pension systems desire to invest a portion of their portfolio in alternative investments to boost return.
“(d) Following recent litigation seeking to require public pension funds and retirement systems and public endowments or foundations to disclose certain information about alternative investments, the funds risk being excluded from participation in certain alternative investments. Exclusion from investing pension or retirement system assets in alternative investments may impose substantial costs on state public pension funds and the public employees who are their beneficiaries.
“(e) It is the intent of this legislation to balance the public‘s right of access to information and the ability of public pension funds to continue to invest in alternative investment funds. It is also the intent of this legislation to allow the public to monitor the performance of public investments; for public bodies to avoid payment of excessive fees to private individuals or companies; and for the public to be able to know the principals involved in management of alternative investment funds in which public investment funds have invested so that conflicts of interest on the part of public officials can be avoided. This legislation is not intended to reverse the general presumption of access and openness of the California Public Records Act and subdivision (b) of Section 3 of Article I of the California Constitution.
“(f) It is not the intent of this legislation to overrule or invalidate any court orders in or stipulated resolutions of prior litigation relating to any public entity‘s obligation to disclose information about its alternative investments to narrow the information disclosed as a result of those decisions, or in any other way to apply retroactively. It is, rather, the intent of this legislation to establish predictability about what should and should not be disclosed regarding
Reuters also argues that the Regents had the burden of proving that the documents requested were not public records and the Regents counters that Reuters, as the petitioner, had the burden of proof (see
Here, we assume, without deciding, that the Regents has the burden since it was undisputed that the information sought relates to the public business. In any event, we have reviewed the public portion of the Regents‘s declarations and conclude that substantial evidence supported the trial court‘s finding that none of the four criteria in