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Sacramento County Employees' Retirement System v. the Superior Court of Sacramento County

May 11, 2011

SACRAMENTO COUNTY EMPLOYEES' RETIREMENT SYSTEM, PETITIONER,
v.
THE SUPERIOR COURT OF SACRAMENTO COUNTY, RESPONDENT; SACRAMENTO BEE ET AL., REAL PARTIES IN INTEREST.



(Super. Ct. No. 34201080000514) ORIGINAL PROCEEDINGS in mandate. Allen H. Sumner, Judge. Petition denied.

The opinion of the court was delivered by: Duarte ,j.

CERTIFIED FOR PUBLICATION

Ram & Olson, Karl Olson, for Real Parties in Interest.

Trevor A. Grimm, Jonathan M. Coupal and Timothy A. Bittle for Howard Jarvis Taxpayers Association, as amicus curiae on behalf of Real Parties in Interest.

Meriem L. Hubbard and Harold E. Johnson, for Pacific Legal Foundation and Fullerton Association of Concerned Taxpayers, as amicus curiae on behalf of Real Parties in Interest.

Davis Wright Tremaine, Thomas R. Burke, Duffy Carolan, and Jeff Glasser, for California Newspaper Publishers Association, Los Angeles Times Communications LLC, The Associate Press, California Newspapers Partnership, The Record, Hearst Corporation, The New York Times Company, The Press-Enterprise, The Bakersfield Californian, Eagle Newspapers, Daily Republic and Capitol Weekly, as amicus curiae on behalf of Real Parties in Interest.

In this original writ proceeding we discuss the California Public Records Act (Public Records Act) and the County Employees Retirement Law of 1937 (Retirement Law). (Gov. Code, §§ 6251, et seq., 31450, et seq.)*fn1

The Public Records Act generally requires public agencies to disclose public records, subject to exemptions. (See International Federation of Professional & Technical Engineers, Local 21, AFL-CIO v. Superior Court (2007) 42 Cal.4th 319, 328-329 (International Federation).) Part of the Retirement Law provides: "Sworn statements and individual records of members shall be confidential and shall not be disclosed to anyone except insofar as may be necessary for the administration of this chapter or upon order of a court of competent jurisdiction, or upon written authorization by the member." (§ 31532.)

After much public outcry about government pensions, The Sacramento Bee and the First Amendment Coalition (collectively, the Bee) filed a petition for writ of mandate to compel the Sacramento County Employees' Retirement System (SCERS) to reveal the pension benefits of named retirees. The trial court concluded the amounts of pension benefits were not part of the "individual records of members" (§ 31532) and ordered SCERS to disclose the requested information.

SCERS promptly petitioned this court for a writ of mandate to overturn the disclosure order. (See § 6259, subd. (c).) We stayed that order, and issued an order to show cause. For the reasons detailed below, we shall deny the writ petition.

The California Supreme Court has held that the public has a general right to know the names and salaries of public officials and employees under the Public Records Act. (See International Federation, supra, 42 Cal.4th at pp. 328-340.) The Attorney General, in an opinion cited with approval by the California Supreme Court, has reached a similar conclusion regarding the Retirement Law, finding that the phrase "individual records of members" protected by section 31532 does not embrace the pension amounts of named county retirees. (County Payroll Records as Public Records, 60 Ops.Cal.Atty.Gen. 110 (1977) (County Payroll Records); see International Federation, supra, 42 Cal.4th at p. 331; Commission on Peace Officer Standards & Training v. Superior Court (2007) 42 Cal.4th 278, 296 (POST).)

In this case, we first reject SCERS's claim that a prior suit collaterally estops the Bee from relitigating the scope of section 31532. As we will explain, the law has materially changed since that litigation concluded, and in any event the public interest exception to collateral estoppel applies in this case.

Next, addressing the merits, because exemptions from the general rule of disclosure are construed narrowly, we conclude that pension amounts are not part of the "individual records of members" protected by section 31532. Based on the legislative history of section 31532 and analogous retirement board statutes, we construe that phrase narrowly to mean data filed with SCERS by a member or on a member's behalf, not broadly to encompass all data held by SCERS that pertains to a member. We also conclude that SCERS has not shown the privacy interest served by nondisclosure "clearly outweighs the public interest served by disclosure[.]" (§ 6255, subd. (a).) Nor, for reasons we shall explain, is there cause to remand to the trial court for a hearing on whether each individual's pension benefits should be kept confidential, as suggested by some amici curiae.

Therefore, SCERS must disclose names and corresponding pension benefit amounts of its members. This does not include the members' home or e-mail addresses, telephone numbers or social security numbers.

Much of the briefing by SCERS and its allied amici curiae argues disclosure is bad policy that will expose its members--many of whom are elderly--to unwelcome attention, obloquy, and financial predation. "However, this court does not legislate. [SCERS's] remedy properly lies 'on the other side of Tenth Street, in the halls of the Legislature.'" (Williams v. California Physicians' Service (1999) 72 Cal.App.4th 722, 731.)

Because the trial court properly ordered disclosure of the requested records, we deny SCERS's writ petition in this court, and vacate the stay we previously issued.

BACKGROUND

On April 15, 2010, the Bee filed a petition for writ of mandate under the Public Records Act. (See § 6258.) The Bee contended that on May 6, 2009, it asked SCERS for a list of retirees who received over $100,000 annually, seeking the name of each retiree, the gross amount received, the department from which he or she retired, the last position held, and the date of retirement.

Ten days later, SCERS advised the Bee that it had prepared a list of 221 "retiree amounts" exceeding $8,333 per month "along with the information regarding employing Departments." The list did not include the names, dates of retirement or last employed position of those retirees. SCERS stated it was withholding the latter information under the authority of section 31532. (See § 6253, subd. (c) [agency normally has 10 days to respond to request].)

In the ensuing months, the Bee made further requests, expanded to include all SCERS members, not just those receiving more than $100,000 per year. Although SCERS provided additional details, including the years of service, dates of retirement and some departmental information about its retirees, SCERS refused to provide the "names or personal identifiers" of members.

The Bee submitted declarations from journalists describing rising public interest in public pensions. According to the declarations, the names of members are sought in order to investigate issues such as cashing out of vacation time or working overtime in the last year of employment, either of which can result in so-called "pension spiking," instances of "double dipping," where a person receives a pension and salary, instances of "triple dipping," where a person receives a pension, salary and unemployment benefits in one year, and other controversial pension practices. The trial court overruled SCERS's objections to these declarations.

The Bee submitted copies of other trial court decisions mandating disclosure of such information,*fn2 and documents showing that some county retirement boards provide such information. The trial court overruled SCERS's objections to this material, but found it lacked evidentiary or precedential value.

The Bee also provided copies of a prior Sacramento County Superior Court decision, McClatchy Co. v. County of Sacramento (Super.Ct. Sacramento Co., 2005, No. 04CS01398) (the McClatchy case.) SCERS did not object to judicial notice of the McClatchy case, and sought judicial notice of a memorandum the County of Sacramento had filed in that case.

In opposition to the Bee's request for names, SCERS asserted "the names or personal identifiers" of members were confidential, "constitutionally protected, private financial information[.]" SCERS also asserted the Bee was collaterally estopped from arguing that member names should be disclosed.

SCERS's Chief Executive Officer declared that SCERS "maintains individual records for members, including such personal information as compensation, years of service, age, amount of retirement allowance, addresses, telephone numbers, social security numbers, marital status, and information pertaining to beneficiaries, including spouses and children." SCERS always interpreted section 31532 as requiring it to keep this information confidential. About 70 percent of the money that pays county pensions comes from investment returns, 20 percent comes from public employer contributions and 10 percent comes from member contributions. The average SCERS retiree is over 68, and SCERS provides retirees information on elder abuse. The trial court overruled the Bee's evidentiary objections to this evidence, but stated it disregarded legal conclusions and argument contained therein.

At oral argument in the trial court, SCERS conceded public pensions were backed by public money, in the event investment returns declined. In a supplemental declaration filed over the Bee's objection, SCERS attached a Public Records Act request from an individual seeking the names of deceased members with a lump sum due of at least $20,000, and the names of their beneficiaries.*fn3

The trial court granted the Bee's writ petition, and ordered SCERS to disclose the records requested by the Bee in a letter dated February 11, 2010, namely, "the pension benefits retirees received from SCERS in calendar year 2009," including the name of each recipient, the date of retirement, the department retired from, last position held, years of service, base allowance, cost of living adjustment, total health allowance and monthly benefit. We will refer to this information collectively as the "individual pension." SCERS promptly filed a petition for writ of mandate in this court and sought a stay, which we granted.

We previously granted SCERS's motion for judicial notice of legislative materials. We now grant the Bee's motion and SCERS's supplemental motion for judicial notice of further legislative materials. But, as we have cautioned before, taking judicial notice of legislative materials does not mean they will be helpful in resolving a given interpretive question. (Kaufman & Broad Communities, Inc. v. Performance Plastering, Inc. (2005) 133 Cal.App.4th 26, 29-30 (Kaufman).)

We deny the motion by amicus curiae California Newspaper Publishers Association and allied media for judicial notice of newspaper articles about public pensions, and the Bee's two motions for judicial notice of similar material, as well as purported budget information. The Bee's motions were procedurally improper, because they were buried in footnotes in responses to amicus briefs. (See Chinn v. KMR Property Management (2008) 166 Cal.App.4th 175, 180, fn. 3; Canal Ins. Co. v. Tackett (2004) 117 Cal.App.4th 239, 243.) Further, the materials contained in all three of these motions were not before the trial court, and are cumulative to material in the record. Finally, SCERS does not deny that there is now great public interest in public employee pensions.

DISCUSSION

Because SCERS's collateral estoppel claim--if successful--would obviate the need to reach the merits, we address that claim first. In Part I, we conclude two settled exceptions to collateral estoppel apply. First, the applicable law has materially changed; second, this case raises an issue of public interest regarding the statutory duties of a public agency.

In Part II, after outlining the Public Records Act generally, we reach the merits and consider and reject SCERS's contention that section 31523 provides an explicit statutory exemption from disclosure of individual pensions. Based on the history of section 31532 and analogous statutes, we construe section 31532 narrowly to protect data filed with SCERS by a member or on a member's behalf, not broadly to encompass all data held by SCERS that pertains to a member. We also conclude that SCERS has not shown the privacy interest served by nondisclosure "clearly outweighs the public interest served by disclosure[.]" (§ 6255, subd. (a).) Finally, we explain why individual county retirees are not entitled to notice and a hearing before their individual pensions are disclosed, as suggested by amici curiae.

I Collateral Estoppel

In the McClatchy case, The McClatchy Company, doing business as The Sacramento Bee, sued the County of Sacramento (County) under the Public Records Act, seeking disclosure of retiree pension information. The County had access to the information "by virtue of the County's role as the payroll agent for SCERS" and SCERS, although not a party, had represented to the court that it would "collaborate with the County" to provide the information.

At that time (2005), two published cases had found that public employees had a right of privacy in their salary information. (Teamsters Local 856 v. Priceless, LLC (2003) 112 Cal.App.4th 1500, 1511-1523 (Priceless) [upholding preliminary injunction barring release of information]; City of Los Angeles v. Superior Court (2003) 111 Cal.App.4th 883, 890-892 (Los Angeles) [peace officer salary part of protected personnel file].) Relying largely on those two cases and section 31532, the trial court ordered the County to disclose some pension information, but not individual pensions. No appellate review of the disclosure order was sought.

SCERS now contends the Bee is collaterally estopped from litigating the scope of section 31532. Collateral estoppel precludes relitigation of issues decided in a prior lawsuit if several requirements are met, including that the party against whom preclusion is sought is "the same as, or in privity with, the party to the former proceeding." (Lucido v. Superior Court (1990) 51 Cal.3d 335, 341.) The Bee contends collateral estoppel should not be applied because the First Amendment Coalition, a party herein, was not a party in the McClatchy case, and therefore privity is absent. The Bee also contends there has been a material change in the law since the McClatchy case.

Some amici curiae generally allied with SCERS ask us to reach the merits, to avoid further county-by-county litigation. SCERS, too, states in its petition in this court that "the varying interpretations by Superior Courts support the importance of the Court of Appeal taking this case and deciding the issue."

We need not address the question of privity, nor whether SCERS's inconsistent positions result in a forfeiture of the estoppel claim. The trial court correctly overruled the claim.

First, collateral estoppel will not be applied where there has been a material change in the law. (See United States Golf Assn. v. Arroyo Software Corp. (1999) 69 Cal.App.4th 607, 615-617.) In the McClatchy case, the trial court was bound to follow then-extant precedent, namely, Priceless, supra, 112 Cal.App.4th 1500 and Los Angeles, supra, 111 Cal.App.4th 883. However, our Supreme Court later concluded the salaries of public employees were not confidential, declined to follow Priceless, and disapproved of Los Angeles. (International Federation, supra, 42 Cal.4th at pp. 335-336, 345.) This shows a sufficient material change in the law to preclude collateral estoppel.

Second, as we have said before, collateral estoppel will not be applied "to foreclose the relitigation of an issue of law covering a public agency's ongoing obligation to administer a statute enacted for the public benefit and affecting members of the public not before the court." (California Optometric Assn. v. Lackner (1976) 60 Cal.App.3d 500, 505; see People v. Union Pacific Railroad Co. (2006) 141 Cal.App.4th 1228, 1244-1245.)

Whether or not section 31532 bars disclosure of individual pensions is a matter of public interest. Further, applying collateral estoppel ultimately would be futile, because if we concluded the Bee were estopped, any newspaper or even any private citizen could request the same information tomorrow and litigate SCERS's refusal to disclose it. (Accord, Times Mirror Co. v. Superior Court (1991) 53 Cal.3d 1325, 1336 (Times Mirror) ["judicial economy and the significance of the questions presented militate in favor of a decision sooner rather than later"].) Moreover, the amici curiae, representing another county retirement board, several associations of county retirees (including SCERS retirees), media, and public interest groups, have great interest in the decision in this case.

Accordingly, because the law has materially changed since the McClatchy case was decided, and because this lawsuit tenders an issue of public importance regarding a county retirement board's duties under the Public Records Act and the Retirement Law, we conclude that collateral estoppel should not be applied.

II Public Records Act

The Public Records Act was adopted in 1968, replacing "a hodgepodge of statutes and court decisions relating to disclosure of public records." (Times Mirror, supra, 53 Cal.3d at p. 1338; see ...


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