New Jersey Sports & Exposition Authority Must Reveal Financial Terms of Contracts for Perfomances at IZOD Center

Newark Morning Ledger Co. v. New Jersey Sports & Exposition Authority, 423 N.J. Super. 140 (App. Div. 2011).   The Newark Star-Ledger filed a request under the Open Public Records Act, N.J.S.A. 47:1A-1 to -13 (“OPRA”), seeking to obtain from the New Jersey Sports & Exposition Authority copies of contracts between the Authority and event promoters for performances held at the IZOD Center.  The Authority released the contracts but redacted their financial terms, claiming that disclosure of those terms would reveal proprietary information or trade secrets, or create a competitive disadvantage.  The Star-Ledger went to court and persuaded the Law Division to order release of the unredacted contracts.  The Authority appealed, but the Appellate Division, speaking through Judge Lihotz, affirmed and found that OPRA required full disclosure.

The first issue was a procedural one.  The Authority asserted that the Star-Ledger’s suit was time-barred, since it was filed after the 45-day limitations period provided by OPRA.  Judge Lihotz disagreed.  “Plaintiff’s complaint was filed immediately after a brief period utilized for good faith settlement efforts, but six-days beyond the forty-five day limitations period.  The delay was neither tactical nor designed to prejudice defendant, who was acutely aware of plaintiff’s intention to press its claims in court.”  The panel affirmed the action of the Law Division in extending the limitations period in the interest of justice, as authoritzed by Rule 4:69-6(c), since there were “important public rather than private interests, which require adjudication or clarification.”

Turning to the merits of the OPRA issues, Judge Lihotz observed that the standard of review in OPRA cases is de novo.  The panel noted that “contracts” are among the documents listed in N.J.S.A. 47:1A-5(e) to which “[i]mmediate access ordinarily shall be granted.”  The purposes of OPRA to ensure that the citizenry is informed about government actions, which Judge Lihotz discussed at some length, reinforced the presumption that the contracts were to be disclosed in full.

The panel recognized, however, that the Authority was asserting the applicability of OPRA exemptions for “trade secret and proprietary commercial or financial information,” as well as the exemption for “information which, if disclosed, would give an advantage to competitors or bidders.”  The Authority was required to make a “clear showing” that one of these exemptions applied.  Judge Lihotz found that the Authority had not done so.

All but one of the many contracts at issue contained no restriction on disclosure of its terms and made no statement that those contracts contained confidential information.  On the contrary, at least one of the contracts expressly recognized that OPRA might require its disclosure.  Furthermore, there was evidence that “the terms and conditions for the use of the IZOD Center are widely known among promoters, artists, ticket agents, and possibly other arenas.”  Promoters routinely compare venues for the best terms before booking performers there.  Thus, Judge Lihotz found no basis for the Authority’s confidentiality, trade secret, or competitive disadvantage arguments. 

The panel did state, however, that “specific information regarding an artist’s accommodations during a performance are confidential because these details may contain security arrangements or include individual needs that reflect medical or dietary restrictions or account for other personal concerns unrelated to the business arrangement between defendant and the promoter, which in fact have a privacy interest attached.”  “[T]he only public interest in the personal habits or needs of performers is curiosity.”

Essentially for the same reasons, Judge Lihotz rejected the Authority’s claim that the unredacted contracts were exempt from disclosure under the common law.  The balancing test of the common law favored disclosure.

Judge Lihotz also did not accept the Authority’s argument that the Law Division had improperly restricted discovery.  Discovery rulings are discretionary, and they will not be reversed unless “manifestly unjust.”  The Law Division rightly found that the Authority’s discovery demands at issue were irrelevant to the Authority’s ability to establish the claimed OPRA exemptions.  Besides, under N.J.S.A. 47:1A-6, OPRA cases are to proceed “in a summary or expedited manner.”  Thus, “discovery is limited.”

Finally, the panel upheld the award of attorneys’ fees to the Star-Ledger.  The newspaper was a prevailing party under OPRA and the amount of fees awarded was reasonable.

The case is a victory for OPRA and for public access.  Especially since the financial information in question was generally known in the industry, the panel rightly concluded that the public was entitled to know it as well.