Petition to AG on PURMIT, after Ducks demand $267 for dick docs

3/22/2016: Sorry, long story.

After HLGR lost the Bowl of Dicks case, a UO communications person told a student reporter that UO was fully insured for the ~$1.5M Bowl of Dicks damages and legal fees to HLGR and the plaintiff’s attorneys and that no university funds would be used.

I was skeptical of this, given that UO was covered by PURMIT, which is a risk sharing pool with the other Oregon public universities with some re-insurance for large claims. That would typically mean that at least some and probably most of the ~$1.5M costs are paid by UO and the other Oregon publics in proportion to their contributions to the pool.

UO’s Public Records Office wanted $267 to release the documents that would show this. So I made the request to PURMIT. They eventually posted the past year of meeting material on their website at no charge, but with all the good stuff redacted. Their lawyer argued this was justified by the “trade secrets” exemption:

If PURMIT’s competitors are able to see how PURMIT sets it rates, projects its losses, and structures its excess insurance (including price and coverage specifics), it puts PURMIT at a competitive disadvantage to its competition which has no such obligation.

Wow, what a thing to admit. I’m petitioning Attorney General Rosenblum to order PURMIT to post unredacted documents, arguing that:

In a nutshell, PURMIT’s attorney is arguing that PURMIT, an agent of the state, should be allowed to use a “trade secrets” exemption so that it can restrict competition and charge public universities more for insurance than private competitors would. Allowing this exemption for this purpose is not in the public interest, to put it mildly.

The full letter from PURMIT’s lawyer and my petition to AG Rosenblum are below. The law gives her office a week to rule on the petition.

Subject: Petition for redacted PURMIT public records
Date: March 22, 2016 at 12:27:27 AM EDT
To: publicrecordsorder@doj.state.or.us
Cc: Kron Michael C <michael.c.kron@doj.state.or.us>

Dear Attorney General Rosenblum:

This is a petition asking you to order Oregon’s Public Universities Risk Management and Insurance Trust, a.k.a PURMIT, to provide unredacted documents in response to my public records request to them on Jan 25.

In a nutshell, PURMIT’s attorney is arguing that PURMIT, an agent of the state, should be allowed to use a “trade secrets” exemption so that it can restrict competition and charge public universities more for insurance than private competitors would. Allowing this exemption for this purpose is not in the public interest, to put it mildly.

My Jan 25 email to PURMIT said:

This is a public records request for copies of the meetings materials and minutes for all PURMIT meetings from 1/1/2015 to the present, and for a copy of the schedule for future meetings to the extent this exists.

These public records are only haphazardly posted on the publicly accessible PURMIT website at http://www.wou.edu/wp/purmit/, despite Oregon law requiring public notice of meetings, etc.

I ask for a fee waiver on the basis of public interest, as demonstrated by PURMIT’s collection of public funds, and the public interest in how those funds are spent.

As you can see from the email trail below, PURMIT’s atorney eventually responded by posting some of the requested material to their website, at no charge. However PURMIT redacted large amounts of information. Their attorney’s catch-all explanation for these redactions is this:

Pursuant to ORS 192.501(2), PURMIT has redacted or withheld documents containing trade secrets. The documents that were withheld contain PURMIT’s trade secrets such as fee schedules and price lists provided in response to requests for proposals, projections of loss trends, target loss ratios rates, and/or actuarial data.

There is also some additional commentary from their lawyer, who helpfully clarifies PURMIT’s business model, which involves PURMIT competition with private insurance providers for public university business. He adds:

If PURMIT’s competitors are able to see how PURMIT sets it rates, projects its losses, and structures its excess insurance (including price and coverage specifics), it puts PURMIT at a competitive disadvantage to its competition which has no such obligation.

This is an astonishing admission.

There is a high bar for redacting information from RFP’s sent to or from a public agency and the responses. For example, most RFP’s from state agencies are posted online, include careful documentation of expected costs, and are intentionally distributed to potential bidders as widely as possible. Bidders can often ask clarifying questions of the agency, and those questions and the responses are generally also posted online, with the agency’s responses. The RFP’s and these responses often include as much information about expected cost as can be provided. After an award is made the bids received by public agencies are generally released with only minor redactions in response to PR requests from competitors. For an example of the many such requests see the University of Oregon’s public records log at http://publicrecords.uoregon.edu/requests.

I also believe, on the basis of what I can tell from the documents that are posted on the PURMIT site and the redactions that at least some of the redacted documents have already been provided both to all the public universities in PURMIT (and UO, which is leaving but still has pending claims and representation on the board) and to potential private bidders for PURMIT business. This would argue against the relevance of PURMIT attorney Parker’s statements about the concern that releasing these documents to the general public would somehow leave PURMIT with a competitive disadvantage in competing with private insurance companies for private business. Indeed, PURMIT seems have done nothing to prevent any public university from giving the documents it has received via PURMIT to private insurers, as part of efforts to shop around for a better deal. In fact I can see an argument that any university that has not done this has not performed due diligence in attempting to reduce its costs.

Similarly, if this information helps private companies offer universities insurance at lower insurance costs than PURMIT can it is a net public benefit to Oregon higher education. Most economists would argue from theory and the empirical evidence that this does happen in general, either by lowering costs through a bidding process, or by encouraging efficiencies and cost reductions by management out of a desire to stay employed.

Of course I am not a lawyer, and I have not seen the unredacted documents. I expect that there will be other arguments that I’ve missed that will be apparent to DOJ attorneys who can examine the unredacted documents and have more familiarity with the law.

To summarize, PURMIT’s attorney argues that PURMIT, an agent of the state, should be allowed to use a “trade secrets” exemption to redact a broad swath of documents, with the stated intent of restricting private competition so that PURMIT can charge public universities more than private competitors would. I think it’s unlikely this exemption applies to all the redactions if any, and I think that allowing PURMIT to use the exemption to jack up how much universities have to pay for insurance is not in the public interest.

I hope that this petition will result in the Attorney General acting in this instance to enforce the general principle of disclosure that is the focus of Oregon’s public records law.

Thank you for considering this petition,

Bill Harbaugh
http://harbaugh.org

The email from PURMIT’s lawyer referenced above:

On Monday Mar 21, 2016, at 12:34 PM, Parker, James <JamesParker@dwt.com> wrote:

Mr. Harbaugh-

I understand that you sent this email requesting the redacted information before realizing that I had already sent you the following reasoning for the redactions in response to your request:

Pursuant to ORS 192.501(2), PURMIT has redacted or withheld documents containing trade secrets. The documents that were withheld contain PURMIT’s trade secrets such as fee schedules and price lists provided in response to requests for proposals, projections of loss trends, target loss ratios rates, and/or actuarial data.

You have cited to a portion of the Attorney General’s Public Records and Meetings Manual addressing the exact situation we have here. It appears there is some confusion about what PURMIT does, which has impacted your view on the applicability of trade secret protection for PURMIT’s sensitive competitive information. I’d like to clear that up for you.

You mention that PURMIT’s redactions, if public, would not have a competitive impact. That is not the case. In fact, PURMIT must compete with the commercial insurance marketplace to retain its members. For example, the University of Oregon left PURMIT last year to purchase insurance from other providers. If PURMIT’s competitors are able to see how PURMIT sets it rates, projects its losses, and structures its excess insurance (including price and coverage specifics), it puts PURMIT at a competitive disadvantage to its competition which has no such obligation. Additionally, PURMIT purchases excess insurance or reinsurance from the commercial excess marketplace. Releasing rates, loss projections, pricing, and coverage could have a negative impact on PURMIT’s ability to secure the most competitive quotes from those placements in the future.

Therefore, PURMIT declines your request to publish the redacted portions you have requested. However, I take from your requests that your concern is the financial strength of the program as a whole, since the information that is redacted addresses loss projections and loss costs in the aggregate. Therefore, I would recommend that you start with the audited financial statements, which reflect PURMIT’s current financial position and include the ultimate loss projection estimates across all lines and members. Additionally, I’ll note that PURMIT has a statutory minimum surplus requirement, which it continues to meet or exceed.

If you have a different concern or have something specific you’d like to better understand about PURMIT, let me know. I may be able to direct you to the portion of the documents that PURMIT has already published covering your concern or locate additional documents that may be responsive to your concern. I will note that PURMIT reserves the right to charge fees on those additional requests, if appropriate and necessary, to offset PURMIT’s costs to comply with your requests.

Best,

James

James G. Parker
Davis Wright Tremaine LLP
Office: (503) 778-5471 | Cell: (503) 728-8702
Email: jamesparker@dwt.com
Admitted: California and Oregon

3/2/2016: Back in October, UO spokesperson Julie Brown told the UO student Daily Emerald newspaper that the entire cost of the Bowl of Dicks lawsuit would  be paid by insurance.

That would be unusual. So I asked UO’s Public Records Office to show the docs. They wanted me to pay $267.07 for docs supporting Ms Brown’s public claim:

From: “Thornton, Lisa” <pubrec@uoregon.edu>

Date: December 17, 2015 at 4:48:47 PM PST

Subject: Public Records Request 2016-PRR-135

12/17/2015

Dear Mr. Harbaugh: 

The University of Oregon has received your public records request for “…the meeting materials distributed for PURMIT meetings from 7/1/2014 to the present, and for an email address and other contact information for Ryan Britz.” on 11/18/2015, attached. The office has at least some documents responsive to your request.  With this email, the office is providing you with an estimate to respond to your request. 

The office estimates the actual cost of responding to your request to be $267.06. Upon receipt of a check made payable to the University of Oregon for that amount, the office will proceed to locate, copy, and provide the records you have requested that are not exempt from disclosure. Your check may be sent to the attention of Office of Public Records, 6207 University of Oregon, Eugene, OR 97403-6207.

You requested a waiver based on an assertion that release of these documents is in the public interest.  The office has performed the three-part analysis of your request, has determined that your request does not meet the public interest test, and has exercised its discretion to deny your request for a fee waiver.  …

Really? The UO administration is going to spend $~2M on this case, assert that insurance will make us whole, and then refuse to show the docs unless I pay them $267 up front? Let’s see what Attorney General Ellen Rosenblum has to say about that plan:

From: UO Matters <uomatters@gmail.com>

Subject: PURMIT public records petition

Date: March 1, 2016 at 3:20:15 PM PST

To: publicrecordsorder@doj.state.or.us

Dear Attorney General Rosenblum – 

As you can see from the email trail below, on Jan 25th I made a public records request to PURMIT’s attorney James Parker for:

“copies of the meetings materials and minutes for all PURMIT meetings from 1/1/2015 to the present, and for a copy of the schedule for future meetings to the extent this exists. 

I noted that:

These public records are only haphazardly posted on the publicly accessible PURMIT website at http://www.wou.edu/wp/purmit/, despite Oregon law requiring public notice of meetings, etc. 

I ask for a fee waiver on the basis of public interest, as demonstrated by PURMIT’s collection of public funds, and the public interest in how those funds are spent.

As further documentation of the public interest, I note that the UO told reporter Noah McGraw of the UO Daily Emerald last October, regarding the costs of the well publicized “Bowl of Dicks” trial, a.k.a Cleavenger v. McDermed at al., that 

“The University of Oregon has comprehensive insurance for situations involving University employees, officers and volunteers as well as the buildings, vehicles and other assets,” Julie Brown, the Campus Relations Director of Enterprise Risk Management, said. “The insurance program covers everything from earthquake damage to art collections.”

In the Cleavenger vs. UOPD trial, the insurance policy will cover 100 percent of the damages, with a $0 deductible for the university. (http://www.dailyemerald.com/2015/10/28/uo-charged-1-6-million-for-cleavenger-vs-uopd/)

The documents I am requesting will show the accuracy of this claim by UO, which is timely given yesterday’s reaffirmation of the Cleavenger decision, and the additional legal costs UO has accumulated during its remittitur plea. (http://www.oregonlive.com/education/index.ssf/2016/03/university_of_oregon_loses_755.html#incart_2box_education)

As further documentation of the public interest I note that these sorts of documents were generally posted publicly on the OUS website, before PURMIT took over responsibility for public university risk-sharing and re-insurance.

As you can see below it has now been more than 5 weeks since I requested these documents. It has been almost 2 weeks since Mr. Parker said he would contact PURMIT, and I’ve had no response.

I request that you treat this delay as a denial and petition you to order PURMIT to produce these documents, without a fee.

Thank your [sic] for your assistance, 

Bill Harbaugh

Sure enough, less than 8 hours later I get this response. The iron price is $0:

From: “Parker, James” <JamesParker@dwt.com>

Subject: RE: PURMIT public records petition

Date: March 1, 2016 at 11:03:21 PM PST

To: UO Matters <uomatters@gmail.com>

Cc: Kron Michael C <michael.c.kron@doj.state.or.us>, “publicrecordsorder@doj.state.or.us” <publicrecordsorder@doj.state.or.us>

Mr. Harbaugh-

Thank you for your note and your patience during my leave.  Work has been ongoing to gather and review the documents you requested.   The board materials will be posted on the PURMIT webpage without charge.  I expect that the review and web posting will be complete by March 8. 

 James G. Parker

Davis Wright Tremaine LLP

Email: jamesparker@dwt.com

Admitted: California and Oregon

Anchorage | Bellevue | Los Angeles | New York | Portland | San Francisco | Seattle | Shanghai | Washington, D.C.

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3 Responses to Petition to AG on PURMIT, after Ducks demand $267 for dick docs

  1. anonymous says:

    120 permutations of the 5 d-words in the title! A whistle to blow on offered for the wittiest.

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    Rating: 0 (from 0 votes)
  2. Not too late says:

    When the proctologists in town get upset with their medical group’s cancellation of football seats:
    Dick Docs for Ducks up demands

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    Rating: +3 (from 3 votes)
    • honest Uncle Bernie says:

      Uhhh, I don’t think a proctologist is the canonical Dick Doc, not even for Ducks with Dollars and Demands.

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      Rating: +1 (from 1 vote)

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