¶ 1 In this appeal, we apply the Public Records Act (PRA)
¶ 2 Because Cedar Grove had a personal stake in the outcome of this action, it had standing to sue under the PRA. Under the exceptional facts of this case, the records prepared by a contractor acting as the functional equivalent of a city employee were public records for purposes of the PRA. Because the record establishes that Marysville violated the PRA by wrongfully withholding these and other public records, we affirm the trial court's PRA decisions. And because the court did not abuse its discretion in assessing penalties, striking Marysville's declarations or reducing Cedar Grove's fee request, we affirm the court's award of costs and attorney fees and denial of reconsideration.
¶ 3 In Maple Valley and Everett, Washington, Cedar Grove operates two of the largest commercial composting operations in Washington and among the largest in the United States. The Everett facility is just over half a mile from the city limits of Marysville. The City received a number of complaints about odors attributed to Cedar Grove. The Puget Sound Clean Air Agency (PSCAA) issued notices of violation and imposed fines against Cedar Grove, though the Pollution Control Hearings Board reduced some fines in 2011 after finding that Cedar Grove had made efforts in odor mitigation.
¶ 5 On November 1, 2011, Kris Cappel, of the Seabold Group, e-mailed a PRA request to Amy Hess, deputy clerk and public records officer for the City of Marysville.
¶ 6 In her e-mail, Cappel did not identify Cedar Grove as a client or otherwise indicate her representative capacity. A November 2, 2011, e-mail among Strategies employees, however, indicates that Marysville Chief Administrative Officer Gloria Hirashima knew that Cappel made the requests on behalf of Cedar Grove. According to this e-mail, the day Cappel submitted the PRA request, Hirashima called Strategies Senior Vice President Al Aldrich to "give [Strategies] a heads up that after a quiet period, Cedar Grove has picked up their activity level.... [Hirashima] thought they might try to bootstrap a Records Request into our emails."
¶ 7 Hess's initial queries identified over 10,000 documents potentially responsive to Cappel's request. The City provided a first installment of "easily available" records on November 30, 2011, and a second installment on December 29, 2011. A portion of the documents produced were reproductions of Cedar Grove's own documents or documents from other agencies. These installments did not include responsive e-mail, which the City did not produce for several months.
¶ 8 On February 2, 2012, the City produced several e-mail messages between Kristin Dizon of Strategies and Grant Weed, Marysville city attorney. The City completely redacted the content of the e-mail, explaining in an exemption/redaction log that the redaction was for "Attorney Client Privilege/Work Product." The City produced additional installments of records on March 8, 2012, and April 5, 2012. Redaction logs for these installments claimed additional exemptions for "Attorney Client Privilege/Work Product."
¶ 9 In June 2012, Cappel asked Hess whether e-mail communications "to and among Strategies 360 representatives" had been "inadvertently redacted" under attorney-client privilege. Hess replied that the redacted e-mail were privileged:
¶ 10 Two weeks later, Hess received a letter from a different attorney, Michael Moore, challenging the City's attorney-client privilege/work product claim. The letter requested that the City produce "all of the communications" by July 13, 2012, "[t]o avoid the costs of litigation and penalties for the improper withholding of the documents at issue."
¶ 11 On August 2, 2012, the City produced unredacted versions of the e-mail it withheld from the fifth installment, stating in a cover letter that it did not waive the attorney-client privilege or work product doctrine exemption beyond those specific records. In several of these e-mail, Dizon asked Weed to forward e-mailed information to Hirashima and Marysville Mayor Jon Nehring. Dizon explained in one e-mail that she was asking Weed to forward her e-mail, rather than sending it directly to Hirashima, "so it comes as privileged information from you," and said in a later e-mail, "I definitely do not want Cedar Grove to see the trail on this." Weed forwarded the e-mail as Dizon requested.
¶ 12 On August 28, 2012, Cedar Grove filed suit under the PRA. In September, Cedar Grove subpoenaed documents directly from Strategies 360. The subpoena sought "communications, emails, or other documents sent to, received from or exchanged between Strategies 360 and any third party including the City of Marysville, the City of Seattle, the Tulalip Tribes, Mike Davis, Citizens for a Smell Free Marysville," among others, that "mention, reference, or relate" to Cedar Grove or the odor dispute. Comparison between Strategies' production and Marysville's earlier productions revealed 17 responsive e-mail between Marysville and Strategies that the City had not produced. The City also located two responsive e-mail on Mayor Nehring's personal computer. The City later stipulated that it initially withheld these 19 records.
¶ 13 In November 2012, Cedar Grove moved for partial summary judgment, alleging that Marysville wrongfully withheld 22 responsive records
¶ 14 After noticing references in the City's productions to two particular types of document, Cedar Grove became concerned that Marysville and Strategies had not yet produced all responsive records. First, certain e-mail referred to Strategies' work with Mike Davis, leader of a local anti-Cedar Grove citizens' group, but records produced up to that time contained no information about the nature of that work. Also, Marysville had not produced any records related to mailers Strategies created, though several e-mail referred to this work. In June 2013, Cedar Grove moved to compel Strategies to produce additional documents related to "the Mailers and Strategies 360's work with Mike Davis."
¶ 15 On July 2, 2013, the court entered its order on cross motions for summary judgment, in which it found that the City had violated the PRA by withholding 15 e-mail under an improper claim of attorney-client privilege and work product. On July 22, the parties stipulated that the City did not produce or disclose in an exemption log 19 more records responsive to Cappel's requests. And two days later, the court granted Cedar Grove's motion to compel, after which Strategies produced 173 responsive records, including 160 e-mail communications concerning Mike Davis and Strategies and 13 records relating to the mailers.
¶ 16 These e-mail indicate that Strategies worked closely with Davis and the City in the campaign against Cedar Grove. Strategies acted as a liaison between Marysville and Davis and relayed instructions to him for the City.
¶ 17 Certain e-mail indicate that Marysville sometimes worked directly with Davis.
¶ 18 Shortly after Strategies produced the 173 responsive records, Cedar Grove filed a motion for summary judgment for penalties. The trial court granted this motion on September 9, 2013, and imposed penalties of $70 a day for the 15 records improperly withheld as privileged, $40 a day for the 19 stipulation records, and $90 a day for the 173 Strategies records. The penalties against the City totaled $143,740.
¶ 19 The City moved for reconsideration. On October 30, 2013, the trial court entered three orders: a revised order granting summary judgment to Cedar Grove regarding penalties, an order granting costs and attorney fees to Cedar Grove, and an order denying the City's motion for reconsideration. The court also struck three declarations the City submitted in support of its motion for reconsideration. The court awarded $127,644.83 for costs and attorney fees, less than half of the roughly $283,000.00 Cedar Grove sought.
¶ 20 The City appeals. Cedar Grove cross appeals the court's award of fees and costs.
¶ 21 In 1972, Washington voters overwhelmingly approved Initiative 276,
¶ 22 This policy also requires that courts liberally construe the PRA in favor of disclosure.
¶ 23 Upon request, every government agency must produce for inspection and copying any public record unless it falls within a specific, enumerated exemption.
¶ 24 As a threshold matter, Marysville contends that Cedar Grove lacks standing to sue under the PRA because it did not make the requests at issue. A nonparty, Cappel, made them. We rejected a similar argument in Kleven v. City of Des Moines.
¶ 25 Marysville unpersuasively attempts to distinguish Kleven. It asserts that "the attorney disclosed that the request was made on the client's behalf." But Marysville misstates the case's facts. In Kleven, the same attorney who submitted his client's public records requests later filed the lawsuit, and "[t]he petition commencing this case, which [the attorney] signed, clearly alleges that [he] made the requests for records on behalf of Kleven."
¶ 26 The City also cites McDonnell v. United States
¶ 27 The City points to WAC 44-14-030(4)
¶ 28 Finally, citing Burt v. Department of Corrections,
¶ 29 Here, by contrast, the party with a personal stake in the action, Cedar Grove, filed the lawsuit. Cappel's absence does not create the danger of a proceeding that is not "truly adversarial." In Burt, the inmate was a necessary party not because he was the requester but because he had the only adverse personal stake in the litigation. He would have had no less of an interest in the action had an agent made the PRA requests for him — a scenario the court did not address. Burt does not support the City's position. We hold that Cedar Grove had standing to sue.
15 Records: Improper Claim of Exemption for Attorney-Client Privilege
¶ 30 The City challenges the imposition of PRA penalties for 15 e-mail records withheld under an improper claim of attorney-client privilege. Marysville contends
¶ 31 We disagree. Our Supreme Court has held that "once a trial court finds an agency violated the PRA, daily penalties are mandatory."
¶ 32 At oral argument, Marysville cited a recent case from Division Two of this court, Hobbs v. Washington State Auditor's Office,
¶ 33 Here, unlike in Hobbs, the requester's first response to the City's production was not to file suit but to inquire of the City whether it had "inadvertently" redacted the records under an inappropriate claim of attorney-client privilege. The City then responded by reiterating its claim of exemption, thus denying the request. This constituted "final agency action" under RCW 42.56.520. Marysville violated the PRA by improperly claiming the attorney-client privilege exemption, and penalties are appropriate even though the City later produced the unredacted e-mail. No PRA provision or case law supports the City's claim that its prelitigation production of the 15 records somehow insulates it from all PRA penalties.
19 Records: Stipulation
¶ 34 The trial court also ruled that Marysville violated the PRA by withholding "19
¶ 35 In the July 22, 2013, stipulation, Marysville agreed that the 19 responsive records listed "were not released by either being produced to Cedar Grove or disclosed in an exemption log" and that "the briefing and argument for the hearing regarding assessment of penalties will address, among other things, the 19 documents listed above." A stipulation signed by the parties' attorneys is a contract, and contract principles govern its construction.
173 Strategies Documents Created by Strategies and "Used" by Marysville
¶ 36 Marysville challenges the trial court's decision that 173 documents created by Strategies and never possessed by Marysville are public records. The trial court found the records to be public records for two reasons. First, because of the intertwined relationship of Marysville and Strategies in which Strategies acted as the functional equivalent of a city employee, the records created by Strategies while acting as this functional equivalent were public records. Second, Marysville used the 173 records because Strategies created these documents for and applied them to a governmental purpose identified by Marysville, resolving odor issues allegedly caused by Cedar Grove. Marysville contends that the court's first reason reflects a misapplication of the law and that the second is not supported by the factual record. It describes the court's decision as "a massive expansion of the PRA far beyond the specific contours of the Act."
¶ 37 Marysville contends that because Strategies is not a "public agency,"
¶ 38 The PRA defines a "public record" as "any writing containing information relating to the conduct of government or the performance of any governmental or proprietary function prepared, owned, used, or retained by any state or local agency regardless of physical form or characteristics."
¶ 39 The City contends that the court's decision "conflates the two concepts" of attorney-client privilege and a public record and forces governments to make a "Hobbesian
¶ 40 But Marysville and WSAMA overstate the trial court's ruling. The trial court did not rule that all records of government contractors are public records. Instead, the court applied Washington precedent holding that a private entity acting as the functional equivalent of a public agency is subject to the PRA to an analogous situation: a private company acting as the functional equivalent of a public employee.
¶ 41 In Telford v. Thurston County Board of Commissioners,
¶ 42 Marysville necessarily conceded that Strategies was performing a governmental function when the City represented and the court accepted for purposes of asserting an attorney-client privilege its claim that Strategies acted as the functional equivalent of a city employee. Marysville makes no claim that a city employee would do work that was not performance of a government function.
¶ 43 Marysville cites no authority to support its assertion that a government may claim that a contractor is the functional equivalent of an employee in order to assert attorney-client privilege, while simultaneously claiming that documents generated by these de facto employees in the scope of their de facto public employment are not public records for purposes of the PRA. Marysville's unsupported statement that attorney-client privilege is "necessarily broad," while "[t]he definition of a public record is necessarily
¶ 44 Marysville paid Strategies for at least the majority of the work at issue. The trial court found, and the record shows, that Marysville was heavily involved in the work performed by Strategies. Strategies took a number of significant actions after direct consultation with Marysville or at Marysville's direction. Strategies and Marysville appear to have taken conscious steps to have records created by Strategies rather than Marysville with the express goal of avoiding the PRA.
¶ 45 Although the fourth factor is not satisfied, a balancing of all four factors leads to the conclusion that Strategies acted as the functional equivalent of a public employee performing a governmental function. Its activities served a public function, were paid in large part with public funds, and were directed and approved by Marysville. The evidence before the trial court shows that city officials and employees repeatedly took affirmative steps to avoid creating records they would normally create during the course of their work. Members of city government, together with Strategies personnel, pursued a deliberate policy to conceal the City's role in the campaign against Cedar Grove. They accomplished this by directing and delegating activities to Strategies and then disavowing knowledge of those activities, with the express object of avoiding the reach of the PRA.
¶ 46 Given the purposes of the PRA and Initiative 276, the trial court correctly determined that the records created by Strategies while performing these functions were public records. In response to Marysville's floodgate argument, we emphasize that Strategies records not relating to its actions as the functional equivalent of a city employee are not subject to PRA requests.
¶ 47 Marysville also argues that the 173 Strategies documents were not public records because the City did not "use" them. Our decision does not require us to address this argument. We nonetheless conclude that Washington case law supports the trial court's ruling that Marysville "used" the records in the meaning of the PRA.
¶ 48 In Concerned Ratepayers Ass'n v. Public Utility District No. 1 of Clark County,
¶ 49 Marysville emphasizes that "the City never received the documents or in any way possessed them; it obviously could not `use' documents it never had." But the court in Concerned Ratepayers concluded that the agency did not have to possess a document to "use" it for purposes of the PRA, agreeing with the Court of Appeals that "possession of information is not determinative of the issue."
¶ 50 Marysville also argues that unlike the court in Concerned Ratepayers, the trial court here did not specifically explain how the City applied the documents to any governmental decision, and "[t]hus, there is no essential nexus to governmental decisionmaking." Here, the trial court did not make a finding like the finding in Concerned Ratepayers that the agency "carefully evaluated" any specific Strategies document. But the trial court identified specific actions Strategies employees took and memorialized in e-mail that "clearly furthered the interests of Marysville." For example, the court noted that documents Strategies generated on behalf of Marysville, such as communications Mike Davis issued to media outlets, "were made instrumental to Marysville's governmental ends or purposes" in the campaign against Cedar Grove.
¶ 51 Marysville also cites West v. Thurston County
¶ 52 We distinguish West. Unlike the extraneous invoices in that case, the Strategies records at issue, including communications with third parties, directly related to activities Strategies performed "at the behest of Marysville" to further the City's interests. One of the challenged Strategies e-mail particularly supports this conclusion. Although not addressed to the City, it contains the subject line "Cedar Grove" and directly refers to "Gloria and [the] Marysville folks" and the need to give them "`plausible deniability'" about materials Strategies created for the campaign against Cedar Grove. These communications, considered together with evidence that the City suspected from the day of Cappel's first request that Cedar Grove might pursue access to Strategies' records, establish a nexus between the 173 Strategies documents and Marysville's decision-making process. They show that Marysville used the Strategies documents within the meaning of the PRA.
¶ 53 The trial court found that "Marysville knew what Strategies was doing, paid them for those activities, was generally aware that there were documents in Strategies' possession created during those activities, and discussed the contents of some of those documents with Strategies." Contrary to the City's assertion at oral argument that it was "utterly oblivious" to the existence of these documents, the record before us shows that nine months before Cedar Grove filed suit, Marysville knew about them and knew further that Cedar Grove might attempt to obtain these records with a PRA request.
¶ 54 Marysville violated the PRA when it failed to disclose these records.
¶ 55 Marysville argues that even if the City violated the PRA, the penalties totaling $143,740 that the court imposed were "unreasonable and excessive." Once the trial court finds that an agency violated the PRA, daily penalties are mandatory, and the court must consider the entire statutory penalty range.
¶ 56 In Yousoufian v. Office of Ron Sims,
On the other hand, aggravating factors may support an increased penalty:
Our Supreme Court emphasized that these factors "may overlap, are offered only as guidance, may not apply equally or at all in every case, and are not an exclusive list of appropriate considerations."
¶ 58 With respect to the 173 Strategies documents, the court found negligent, reckless, bad faith, or intentional noncompliance with the PRA. Specifically, the court found, "Marysville's explanation regarding these documents — that they were not allegedly within the possession or control of Marysville — was a situation only created to intentionally provide Marysville with `plausible deniability' of Strategies' activities and to attempt to insulate the documents created during those activities from production." The court stated that it did not find dishonesty but did find "strategic planning on Marysville's part to avoid or delay the production of the documents in Strategies' possession." The court found that the issue is "extremely important," both because of the odor issue in the region and because of Marysville's attempts to avoid the reach of the PRA: "Simply put, `plausible deniability' of the law should not be a part of our government." With respect to economic loss to the requester, the court found that "Marysville's conduct has had a significant impact on Cedar Grove." Finally, the court found that a penalty was necessary to deter future misconduct.
¶ 59 The City contends that the trial court abused its discretion by considering only the Yousoufian aggravating factors without explicitly considering the mitigating factors. But our Supreme Court's discussion in Yousoufian V emphasizes the trial court's discretion in applying the factors. Moreover, as Cedar Grove points out in its brief, several of the aggravating factors are mirror images of the mitigating factors. Therefore, it is fair to say that when the trial court found, for example, a delayed response by the agency, it implicitly also found the lack of a prompt response.
¶ 60 Marysville also argues that its search and compliance were reasonable and that despite producing thousands of documents, the trial court "pilloried" the City for withholding a small number of "inconsequential" documents as well as documents it never had or used. In a statement of additional authorities, Marysville cites Andrews v. Washington State Patrol
¶ 61 But Andrews does not support Marysville's position. Here, although the process the City's public records officer used complied
¶ 62 In its discretion, the trial court considered the entire statutory penalty range and made findings on the aggravating Yousoufian factors. Especially given that the trial court found most of the aggravating factors to be present, it did not abuse its "considerable" discretion in assessing penalties.
Marysville's Motion for Reconsideration
¶ 63 In denying Marysville's motion for reconsideration, the court excluded declarations the City submitted from Gloria Hirashima, Al Aldrich, and Tulalip Tribes Manager Martin Napeahi. Citing Sligar v. Odell,
¶ 64 CR 59(a)(4) permits a trial court to grant reconsideration if the moving party introduces "[n]ewly discovered evidence, material for the party making the application, which he could not with reasonable diligence have discovered and produced at the trial." This court reviews a trial court's order on reconsideration, including its admission or exclusion of additional evidence, for manifest abuse of discretion.
¶ 65 Marysville argues that the court should have admitted the declarations because they show "why the Court's findings are in error" and because "it is obvious the trial court's decision was predicated upon a visceral reaction to the `plausible deniability' comment and a lack of understanding of the relationship of Strategies with the Tulalip Tribe[s]." But the three declarations do little more than reargue disputed issues, and the City offers no reason why it could not have presented this evidence earlier. We affirm the trial court's exclusion of the declarations and denial of Marysville's motion for reconsideration.
Cedar Grove's Cross Appeal: Attorney Fees
¶ 66 Cedar Grove cross appeals the trial court's attorney fee award. Although conceding that the court had discretion to reduce the hourly rates or time billed, Cedar Grove asserts that the court's additional 40 percent reduction of billable hours was a "manifestly unreasonable" abuse of discretion.
¶ 67 A prevailing party in a PRA action "shall be awarded all costs, including reasonable attorney fees, incurred in connection with such legal action."
¶ 68 The fee applicant has the burden to show that a fee is reasonable.
¶ 69 Here, the court made three separate reductions in Cedar Grove's fee request. First, the court reduced the requested hourly rates. Cedar Grove's counsel requested $375 per hour for the principal attorney's time, $275 per hour for associates' time, and $130 per hour for the paralegal's time. The court found that attorneys of comparable skill and experience in Snohomish County, including PRA specialists, do not charge more than $300 an hour. The court also found that this case involved a "relatively straightforward application of PRA law and the attorney-client privilege." Finally, the court noted that the fee was fixed, not contingent. The court reduced reasonable hourly rates to $300 per hour for the principal attorney's work, $200 per hour for associates' work, and $100 per hour for the paralegal's work.
¶ 70 Next, the court reduced the reasonable number of hours in two ways. First, the court considered the April summary judgment motion and determined that because the City wrongfully withheld only 15 of the 22 documents at issue, some of the 862.2 hours Cedar Grove billed were spent on unsuccessful theories. The court therefore reduced the number of hours proportionately for a reduction of 37.5 percent. Second, the court found that the total hours billed included "wasteful, duplicative hours" and warranted a reduction for that reason as well. The court noted in particular the "relatively straightforward nature of the case," the fact that the hours billed by Cedar Grove's counsel were double those billed by Marysville's counsel, and the large number of hours Cedar Grove billed after it prevailed on summary judgment and therefore knew it would receive an attorney fee award. The court reduced the total number of Cedar Grove's billable hours by 40.0 percent, resulting in a total fee award of $121,110.
¶ 71 Citing Sargent v. Seattle Police Department,
¶ 72 Cedar Grove also argues that the court's 40 percent reduction is manifestly unreasonable because of the procedural posture of the case and the City's intransigence. First, Cedar Grove argues that as the moving party, it had to file more briefs, as well as a motion to compel, that the defendant Marysville did not have to file. Cedar Grove contends that although "this case should have been relatively straightforward," Marysville's intransigence forced Cedar Grove's counsel to spend "hundreds of hours" pursuing the Strategies documents in particular. Cedar Grove also points out that while Marysville could reduce the hours the City billed for outside counsel by using the assistance of salaried city employees, Cedar Grove's counsel billed on an hourly basis for all its work on the case. These arguments do not establish that the trial court abused its discretion in reducing the fee request.
¶ 73 Finally, Cedar Grove argues that the court's 40 percent reduction "undermined the liberal purpose of the PRA," noting that this court has observed that the purpose of the fee-shifting provisions in remedial statutes is different from the purpose of similar provisions in other statutes. But our Supreme Court has recognized the trial court's discretion to adjust fee awards not only in cases involving private tort claims but also in cases involving remedial statutes such as the PRA and the Consumer Protection Act.
Fees and Costs on Appeal
¶ 74 Cedar Grove requests attorney fees on appeal under RAP 18.1 and RCW 42.56.550(4). A party may recover attorney fees only for work on successful issues.
¶ 75 We wish to be clear about what we are not doing in this opinion. We are not articulating a new standard that makes every record a government contractor creates during its engagement with an agency a public record subject to the PRA. Nor do we create a new duty on the part of a public agency to search the records of all its third-party contractors each time it receives a PRA request. Instead, we have applied established precedent about a private entity acting as the functional equivalent of a public agency to the analogous situation of a private entity acting as the functional equivalent of a public employee.
¶ 76 Because this record supports the trial court's decision that Strategies acted as the functional equivalent of a Marysville employee and that Marysville used the records Strategies created while acting in that capacity, the PRA applies to those records. We
WE CONCUR: SCHINDLER and BECKER, JJ.
(a) Any person wishing to inspect or copy public records of the (name of agency) should make the request in writing on the (name of agency's) request form, or by letter, fax, or e-mail addressed to the public records officer and including the following information:
• Name of requestor;
• Address of requestor;
• Other contact information, including telephone number and any e-mail address;
• The date and time of day of the request.