California Court Brings Sunshine to Government Contracting

(Photo: Downtowngal / Wikimedia Commons)

To the Project On Government Oversight, an attack on governmental transparency anywhere in the country—even at the state and local level—is a matter of serious concern. That’s why we applaud a recent pro-transparency ruling by a California court in a case involving a county contract to purchase buses.

In 2013, the Los Angeles County Metropolitan Transportation Authority (L.A. Metro) awarded a $500 million contract to Canadian bus manufacturer New Flyer to purchase hundreds of compressed natural gas public transit buses. L.A. Metro’s decision was based in part on New Flyer’s promise to create hundreds of good-paying jobs both in L.A. County and elsewhere in the United States. To check if New Flyer kept its promise, Jobs to Move America (JMA)—a coalition of community, civil rights, and labor groups—filed a request under California’s public records law for information about New Flyer employee wages and benefits. New Flyer sought an injunction to prevent L.A. Metro from releasing this information, claiming it is “confidential, proprietary, and/or trade secret information.”

Two weeks ago, the Los Angeles County Superior Court denied the injunction and came out strongly in favor of transparency. The court ruled that New Flyer’s showing of potential competitive harm from the disclosure of specific, line-item employee wage and benefit data was “not particularly strong.” Additionally, the court found the public had a substantial interest in knowing this information, and that applying the trade secret privilege in this case would “work injustice.”

POGO and several other national public interest groups filed an amicus curiae (“friend of the court”) brief in support of JMA. We intervened because of the larger issues at stake. The role of private companies in performing government functions has grown dramatically. Companies like New Flyer are aggressively pursuing “reverse-FOIA” lawsuits—legal actions against government agencies to block public records requests—with the aim of expanding the definition of “trade secret” so that more and more information about their contracts will be kept from the public.

At the same time, government entities are abdicating their responsibilities under public records laws. In this case, L.A. Metro in its contract with New Flyer agreed to remain neutral in information disclosure litigation and to “[retain] the information until otherwise ordered to disclose such information by a court.” Such arrangements are an unfair burden on the public, requiring groups like JMA to resort to expensive and time-consuming litigation in order to compel the release of information the public has the right to see.

POGO supports the proactive disclosure of government information and improvements to the Freedom of Information Act in order to bolster the public’s trust in the federal government. However, public confidence in state and local governments is just as important, which is why we will continue following the New Flyer case.