FOR IMMEDIATE RELEASE
Ken Bunting, Executive Director
NATIONAL FREEDOM OF INFORMATION COALITION
101E Reynolds Journalism Institute
Columbia, MO 65211
San Francisco Superior Court ruling states that "[a]ssurances of confidentiality cannot convert public records into private records.”
COLUMBIA, Mo. (September 15, 2010) – A California judge, as a result of litigation backed by the Knight FOI Fund, has ordered the state’s pension fund to release records about a $100 million real estate investment loss.
Judge Charlotte W. Woolard of the San Franicsco Superior Court, in a six-page writ signed on Tuesday, September 14, ordered the California Public Employees' Retirement System (CalPERS) to release records regarding its investment in Page Mill Properties, a controversial East Palo Alto low-income housing development.
CalPERS, the largest public pension fund in the country, lost all of its $100 million stake in the development, but refused to disclose records regarding its investment or the business arrangement surrounding it.
The First Amendment Coalition (FAC), a California-based member organization of the National Freedom of Information Coalition (NFOIC), sued CalPERS in July and was awarded a $3,200 Knight Fund grant by NFOIC to help with its legal expenses in that suit.
"I am happy that Knight Fund could help the First Amendment Coalition press ahead with this important action,” said Kenneth F. Bunting, executive director of the NFOIC. "But I’m especially happy that the state pension administrators didn’t get away with hiding their dealings from citizens in the state of California.”
The NFOIC, a nonpartisan coalition of open government groups and advocates headquartered at the Missouri School of Journalism, administers the Knight FOI Fund. It is part of a $2 million, three-year grant from the John S. and James L. Knight Foundation announced in January.
The Knight FOI Fund does not pay attorney fees. But it is set up to fuel and assist the pursuit of important FOI cases by helping to defray upfront costs such as filing fees, depositions, court costs and other expenses associated with legal actions. The Knight Fund only seeks reimbursement if resulting awards in the cases cover fees and costs for which the Knight Fund money was spent.
Peter Scheer, executive director of FAC, which sued over the pension fund’s refusal to release records about the soured investment, said the case was about understanding how CalPERS "made such a big and bad investment.”
Scheer said he intends to make the documents available to news organizations as soon as CalPERS releases them. He said he hopes to be able to make them available to those news organizations electronically. It is estimated that more than 600 pages of documents will be made public as a result of the disclosures ordered by Judge Woolard’s ruling.
Not only was CalPERS investment in Page Mill a financial disaster, it was also controversial because of the development's alleged strategy of displacing low-income tenants in rent-regulated apartments in order to raise rents to market levels.
CalPERS had argued that, in refusing to turn over the requested records, it was protecting "trade secrets.” It also tried to use a provision in state law that restricts access to details concerning public investments in hedge funds and with venture capitalists.
But Woolard ruled that the law didn't apply to traditional real estate investments like the Page Mill development.
"The Court rejects CalPERS’ claim that it can withhold ‘documents that were agreed to be confidential.’ Assurances of confidentiality cannot convert public records into private records,” the ruling stated.
Scheer said Judge Woolard’s ruling has potential ramifications nationally because CalPERS' investment policies tend to be followed by the government pension systems of other big states.
Judge Woolard’s order represents the sixth court ruling in favor of disclosure or access in cases supported by the Knight Fund since its inception in January. A number of Knight Fund-supported cases are still being adjudicated.
For more information on the Knight FOI Fund, including the selection process for grants and how to apply, see http://www.nfoic.org/knight-foi-fund.
The John S. and James L. Knight Foundation advances journalism in the digital age and invests in the vitality of communities where the Knight brothers owned newspapers. Since 1950, the Foundation has granted more than $400 million to advance quality journalism and freedom of expression. Knight Foundation focuses on projects that promote community engagement and lead to transformational change. For more, visit http://www.knightfdn.org/.
The First Amendment Coalition (FAC) is a section 501(C)(3) nonprofit dedicated to freedom of speech and government transparency and accountability at the local and national levels. FAC initiates test-case litigation and files amicus briefs in key appeals; provides free legal help and information to journalists of all kinds; and, through widely published Op-Eds, educational programs and other means, is an outspoken public advocate for the First Amendment and the public’s right to know. Based in San Rafael, CA, FAC is supported by individuals, media firms and foundations. For more, visit http://www.firstamendmentcoalition.org/.
The National Freedom of Information Coalition is a national network of state freedom of information advocates, citizen-driven nonprofit freedom of information organizations, academic and First Amendment centers, journalistic societies and attorneys. Its mission is to foster government transparency at the state and local level. A unit of the Missouri School of Journalism, the NFOIC is an affiliate of the Donald W. Reynolds Journalism Institute. NFOIC is based at the University of Missouri, home to the nation’s oldest Freedom of Information Center. For more, visit http://www.nfoic.org/.