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Direct Energy Says NY ALJs' Ruling Would Expose ESCOs' Pricing, Other Confidential Info to Freedom of Information Law Disclosure

March 22, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

Stating that a ruling, as clarified by an email last week, by two New York Administrative Law Judges, concerning confidential protection for ESCOs' data responses made during the New York PSC's evidentiary review of the mass market, would, "expose competitively sensitive pricing information and other confidential business records of Direct Energy and other ESCOs to disclosure under New York’s Freedom of Information Law ('FOIL')," Direct Energy Services, LLC petitioned the PSC for an interlocutory review of the ALJs' ruling

In a February ruling, the ALJs had said that various state agencies are receiving the ESCOs' Protected Information only by virtue of being parties in these proceedings. The ALJs said that state agencies are required to treat Protected Information as confidential pursuant to POL §74(3)(c) and protect the information from public disclosure pending the administrative law judges’ determination regarding the confidentiality claim pursuant to FOIL. "State agencies receiving requests for disclosure pursuant to FOIL will be restricted to find that Protected Information provided to that agency in connection with these proceedings is exempt from disclosure pursuant to POL §§74(3)(c) and 87(2)(a); there is no need for an independent determination regarding the status of the information as exempt from disclosure under any other subsection of POL §87(2) because the State parties are precluded from disclosing the information under these statutes," the ALJs had said

In the ALJs' recent email clarification, the ALJs, Direct Energy said, made clear that parties submitting confidential data to state agencies could not insist on providing such information to the agency’s records access officer (RAO), which would keep the protected information separate from the agency's other records. "It is up to a state agency party to make the determination that it wishes confidential information to be shepherded through its records access officer ... As such, unless and until a state agency party requests that Protected Information be delivered to its records access officer, the information should be provided directly to counsel," the ALJs' email stated

However, Direct Energy said that, "the ALJs’ conclusion that they have adequately protected this information from disclosure under FOIL simply by designating it as 'confidential' under the Protective Order established in this proceeding directly conflicts with the decisions of the courts of New York State applying and enforcing FOIL."

Direct Energy further said that the ALJs' ruling, "prohibit[s] Direct Energy from submitting such information ... through the only mechanism available under FOIL for the protection of such confidential business records from public access."

Direct Energy said that to qualify for an exemption from public access, POL § 89.5 requires that the confidential information, "be maintained apart by the agency from all other records."

As the ALJs are not requiring the information to be received by the RAO, Direct Energy said, "Because information provided to DPS Staff will no longer be 'maintained apart by [the Commission] from all other records,' Direct Energy is concerned that such information may no longer be exempted from disclosure under FOIL."

"[T]he failure to keep such materials separate from other Department records creates a serious risk that such materials would be found by a court to be subject to public access under FOIL," Direct Energy said

"This is particularly true in the case of a FOIL request submitted to a state agency other than the Department of Public Service that obtained such information solely by virtue of its participation in these proceedings and to which no valid request for exemption from disclosure under FOIL would therefore have been made," Direct Energy said

Direct Energy said that while the ALJs are correct that POL § 74(3)(c) prohibits state employees from disclosing information that has been properly designated as 'confidential' in a protective order adopted under the Commission’s Procedural Rules, "nothing in either POL § 74 or in the PSL purports to establish a statutory exemption from disclosure under FOIL for such materials."

"And the Court of Appeals has expressly rejected the contention that the limits on disclosure of information in civil litigation established in Article 31 of the CPLR also apply to requests for access to such information under FOIL," Direct Energy said, citing precedent

"In light of New York’s long-standing policy of construing the disclosure requirements of FOIL broadly and of narrowly limiting the scope of exemptions from FOIL, the Commission must reject the ALJs’ conclusion that POL § 74(3)(c) creates a broad exemption from public access under FOIL to documents classified by the Commission as confidential, not only in the case of documents provided directly to DPS Staff, but also in the case of documents provided to other state agencies participating in these proceedings. In this regard, Direct Energy would note that nothing in FOIL purports to allow the Commission to determine the extent to which materials provided to any other state agency are or are not subject to disclosure under FOIL," Direct Energy said

Direct Energy asked the PSC to stay the ALJs' ruling and that such stay remain in effect until 15 days after its interlocutory appeal has been fully determined and for such further time as ordered by a court of competent jurisdiction.

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