Opinion

Sheil v. Horton

2018 Ohio 1720

Court: Ohio Court of Claims
Filed: Apr 16, 2018
Status: Published
On the bench: Clark
Cited by: 4 cases
Authority: More cited than 53.5%

The opinion

[Cite as Sheil v. Horton, 2018-Ohio-1720.]

WILLIAM B. SHEIL Case No. 2017-00772PQ

Requester Special Master Jeffery W. Clark

v. REPORT AND RECOMMENDATION

JOHN HORTON

Respondent

{¶1} The Cuyahoga Community College Foundation is a tax-exempt, nonprofit

entity incorporated in 1973 to solicit, receive, and hold public contributions for the

benefit of the Cuyahoga Community College (Tri-C). (Court’s Exh.1 at 19-23, Articles of

Incorporation.) Tri-C Foundation manages large sums of money in endowments and

other accounts, and periodically transfers funds to Tri-C for distribution as scholarships

and for other purposes. (Response, Exh. 1 Affidavit of Megan O’Bryan (O’Bryan Aff. I)

at ¶ 5-6, 9-10; Sur-reply Affidavit of Megan O’Bryan (O’Bryan Aff. II) at ¶ 7.) The

financial and administrative relationships between Tri-C and Tri-C Foundation are

detailed in the Articles of Incorporation, the O’Bryan Affidavits, the Tri-C Basic Financial

Statements For the Fiscal Years Ended June 30, 2017 and 2016, Note 17 – Discretely

Presented Component Unit (Court’s Exh. at p. 314-325.), and the Tri-C Foundation

Audit for 2017/2016. (Court’s Exh. at p. 30-59.)

{¶2} In June 2017, Tri-C Foundation engaged actress Octavia Spencer to speak

at the annual Presidential Scholarship Luncheon fundraiser. (O’Bryan Aff. I at ¶ 13.) On

August 21, 2017, requester William Sheil, a reporter for WJW-TV, sent an email to

respondent John Horton, Media Relations Manager, Tri-C Integrated Communications

Department, confirming “we made a request for the contract between Tri-C and

Octavia Spencer for her upcoming appearance at a Tri-C luncheon * * * under Ohio’s

1 The court had requester’s January 25, 2018 affidavit and attachments paginated for ease of

reference. The resulting document, filed on April 6, 2018, is referenced as “Court’s Exh.”

Case No. 2017-00772PQ -2- REPORT AND RECOMMENDATION

Open Records Act.” (Complaint at 2.) Horton responded that the contract was between

Tri-C Foundation and Ms. Spencer and, “[b]ased upon the advice of counsel, the

Foundation is unable to provide the contract. Ohio law establishes that the

Cuyahoga Community College Foundation is not the functional equivalent of a

public entity and is not subject to the Ohio Public Records Act.” (Id. at 4.) On

September 19, 2017, Sheil filed his complaint alleging denial of access to public records

in violation of R.C. 149.43(B). On November 22, 2017, Horton filed his response, adding

as a basis for denial that the contract constitutes a trade secret. Sheil filed a reply on

January 25, 2018 and Horton filed a sur-reply on February 26, 2018. Horton filed a copy

of the contract, under seal, on March 7, 2018.

{¶3} Ohio’s Public Records Act, R.C. 149.43, provides a remedy for production of

records under R.C. 2743.75 if the court of claims determines that a public office has

denied access to public records in violation of R.C. 149.43(B). The policy underlying the

Public Records Act is that “open government serves the public interest and our

democratic system.” State ex rel. Dann v. Taft, 109 Ohio St.3d 364, 2006-Ohio-1825,

848 N.E.2d 472, ¶ 20. Therefore, the Public Records Act “is construed liberally in favor

of broad access, and any doubt is resolved in favor of disclosure of public records.”

State ex rel. Cincinnati Enquirer v. Hamilton Cty., 75 Ohio St.3d 374, 376, 662 N.E.2d

334 (1996). Claims under R.C. 2743.75 are determined using the standard of clear and

convincing evidence. Hurt v. Liberty Twp., 5th Dist. Delaware No. 17CAI050031,

2017-Ohio-7820, ¶ 27-30.

{¶4} This case presents two issues: (1) whether Tri-C Foundation is subject to

the Public Records Act, and (2) if so, whether its contract with a speaker for a

fundraising event may be withheld as a trade secret. The evidence establishes (1) that

Tri-C Foundation is subject to the Public Records Act, and (2) the speaker contract

contains no material that falls under the definition of trade secret.

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Tri-C Foundation is a Public Institution, and Therefore a Public Office

{¶5} The Public Records Act applies to “records kept by any public office.”

R.C. 149.43(A)(1). As used in the Act,

“Public office” includes any state agency, public institution, political

subdivision, or any other organized body, office, agency, institution, or

entity established by the laws of this state for the exercise of any function

of government.

(Emphasis added.) R.C. 149.011(A). The mere fact that it is a private, non-profit

corporation does not preclude an entity from being a public office. State ex rel. Freedom

Communications, Inc. v. Elida Community Fire Co., 82 Ohio St.3d 578, 579, 697 N.E.2d

210 (1998). A private entity is a public institution under R.C. 149.011(A), and thus a

public office for purposes of the Public Records Act, when it serves as the “functional

equivalent of a public office.” State ex rel. Oriana House, Inc. v. Montgomery, 110 Ohio

St.3d 456, 2006-Ohio-4854, 854 N.E.2d 193, ¶ 21-26. Under the functional equivalence

test, the court must analyze all pertinent factors, including but not limited to:

(1) whether the entity performs a governmental function,

(2) the level of government funding,

(3) the extent of government involvement or regulation, and

(4) whether the entity was created by the government or to avoid the

requirements of the Public Records Act.

Id. at ¶ 25. The analysis begins with the presumption that private entities are not subject

to the Public Records Act absent a showing by clear and convincing evidence that the

private entity is the functional equivalent of a public office. Id. at ¶ 26. No single factor

is dispositive – all pertinent factors must be weighed and balanced in each case,

mindful of the policy of openness that underlies the Public Records Act. Id. at ¶ 23;

State ex rel. Repository v. Nova Behavioral Health, Inc., 112 Ohio St.3d 338, 2006-

Ohio-6713, 859 N.E.2d 936, ¶ 24, 38-39.

Case No. 2017-00772PQ -4- REPORT AND RECOMMENDATION

Application of Functional Equivalency Test to Tri-C Foundation:

A. Performance of Governmental Function

{¶6} This factor asks whether the entity performs a traditionally governmental

function. Oriana House at ¶ 28. “Governmental function” includes the provision of a

system of public education. R.C. 2744.01(C)(2)(c). Public institutions of higher learning

such as Tri-C and its component units are part of this traditional function, including their

receipt of funding from the state and other sources. R.C. 3358.08(C); R.C. 3358.09;

Ohio Constitution, Article VIII, Section 2(e), (f). “The receipt and solicitation of gifts * * *

is an indispensable function of any institution of higher learning.” State ex rel. Toledo

Blade Co. v. Univ. of Toledo Found., 65 Ohio St.3d 258, 262, 602 N.E.2d 1159 (1992).

{¶7} Tri-C Foundation solicits and receives public donations, to be distributed as

scholarships to persons attending Tri-C and for other purposes benefiting Tri-C.

(O’Brien Aff. I at ¶ 5; Court’s Exh. at 41.) The Tri-C Foundation thus performs an

indispensable sub-function within Tri-C’s traditional governmental education function.

This factor weighs strongly in favor of Tri-C Foundation’s status as the functional

equivalent of a public office.

B. Level of Government Funding

{¶8} Courts have expressed the level of government funding as the percentage

of an entity’s total revenues that come from public sources. See Oriana House at ¶ 32;

Nova Behavioral at ¶ 32. Respondent asserts that Tri-C Foundation received $227,268

of contributed services from Tri-C in fiscal year 2017 for “administrative, general, and

fundraising expenses.” (Response at 6; O’Bryan Aff. I at ¶ 32.) Respondent applies this

value against the $9.2 million that Tri-C Foundation collected in contributions, grants,

and special events revenue, and claims that government funding was only 2.47 percent.

(Response at 6; O’Bryan Aff. I at ¶ 33.)

{¶9} While contributions, grants and special event receipts are “revenue” as an

accounting concept, almost all such revenue collected by Tri-C Foundation is destined

Case No. 2017-00772PQ -5- REPORT AND RECOMMENDATION

for Tri-C. These moneys no more “fund” the Foundation than if they were artworks or

real estate physically collected and transferred, intact, to Tri-C. A more meaningful

measure of government funding of a fund-raising entity is the percentage of its

operational expenses that come from public sources. The Foundation’s Statement of

Activities for fiscal year 2017 shows expenses for Administration and General $193,027,

Special Events $72,628, and Fundraising $447,328, for a total of $712,983. (Court’s

Exh. at 38.) Applying the $227,268 received from Tri-C against this figure, the

government funded portion of Tri-C Foundation’s operating expenses is a more

substantial 32 percent.

{¶10} Moreover, even using the broad concept of “revenue” as all moneys

received, Tri-C Foundation revenues consist mostly or entirely of public money. “Public

money” is defined by R.C. 117.01(C) to mean “any money received, collected by, or due

a public official under color of office, as well as any money collected by any individual

on behalf of a public office or as a purported representative or agent of the public

office.” (Emphasis added.) “Public money” includes money raised by a nonprofit

corporation for a public office. 2016 Ohio Atty. Gen. Ops. No. 2016-013 at *68-70.

Under this definition, it appears that 100 percent of Tri-C Foundation’s total revenues

come from public sources.

{¶11} Regardless, there is no threshold amount of government funding for an

entity to be considered the functional equivalent of a public office. In this case, most or

all of Tri-C Foundation’s operating expenses are funded by a combination of direct

government contributions from Tri-C, and a portion of the public moneys it has

collected. Despite any ambiguity as to whether receipt of “public moneys” equates with

“public sources,” I find that this factor weighs moderately to strongly in favor of the

foundation’s status as the functional equivalent of a public office.

Case No. 2017-00772PQ -6- REPORT AND RECOMMENDATION

Extent of Government Involvement or Regulation

{¶12} While Tri-C does not control the day to day activities of Tri-C Foundation,

the two are closely intertwined. Tri-C Foundation is co-located with Tri-C in Tri-C

facilities, where it is administratively involved with Tri-C by using contributed Tri-C staff

time, technological services, office services, and office equipment. (O’Bryan Aff. I at ¶

25-32.) Tri-C Foundation is listed on the Tri-C web site as a Tri-C Administrative

Department.2 In Tri-C’s Organizational Chart, Tri-C Foundation and the Vice President

of Development compose a unit directly under the President of the College. (Court’s

Exh. at 226.3) Tri-C Foundation uses Tri-C email addresses through Tri-C servers. The

Tri-C Foundation web presence is entirely on the Tri-C web site.4 Tri-C Foundation

apparently has no paid employees of its own. (Court’s Exh. at 85; O’Bryan Aff. I at

¶ 30-32; O’Bryan Aff. II at ¶ 10.)

{¶13} Tri-C Foundation is so fiscally intertwined with Tri-C that it must be reported

as “a component unit of” Tri-C in its audit filings. (Court’s Exh. at 202, 236). As

explained in Tri-C’s Basic Financial Statements, Fiscal Years 2017 and 2016, Note 1 –

Summary of Significant Accounting Policies:

Component units are legally separate organizations for which the College

is financially accountable or for which the nature and significance of their

relationship with the College are such that exclusion would cause the

College’s financials to be misleading. GASB Statement No. 39.

Determining Whether Certain Organizations Are Component Units,

requires the College to reflect the [Tri-C Foundation] as a discretely

presented component unit in the financial statements based on the

significance of the relationship with the College. * * *

The economic resources received or held by the Foundation that the

College is entitled to or has the ability to access are significant to the

College.

2 http://www.tri-c.edu/administrative-departments/index.html. (Accessed April 16, 2018.)

3 Tri-C FY 2018 Approved Budget Book, p. 13. http://www.tri-c.edu/about/documents/budget-

book.pdf (Accessed April 16, 2018.)

4 http://www.tri-c.edu/give/index.html. (Accessed April 16, 2018.)

Case No. 2017-00772PQ -7- REPORT AND RECOMMENDATION

(Court’s Exh. at 261.) The economic resources that Tri-C “is entitled to or has the ability

to access” are received and held pursuant to the purpose stated in Tri-C Foundation’s

articles of incorporation: “To receive, hold, invest, and administer property of any kind,

including money” for distribution to, or for the benefit of, Tri-C. (Id. at 20.) The court is

not persuaded by respondent’s contrary statement that “[t]he Foundation does not hold

funds for the College or in the College’s name. (O’Bryan Aff. I at ¶ 8.) In addition to

outside donors in 2017, Tri-C Foundation recognized $870,874 from Tri-C itself in the

form of contributions and special events revenue, e.g., external parking revenue and

funds for special events sponsorships. (O’Bryan Aff. II at ¶ 9.) The majority of all

Tri-C Foundation revenue ultimately becomes available to Tri-C for scholarships and

other purposes, in annual amounts determined by Tri-C Foundation. (O’Bryan Aff. I at

¶ 5, 9-12; O’Bryan Aff. II at ¶ 7.)

{¶14} These entities are involved in other ways. Although respondent asserts that

Tri-C Foundation does not currently exercise all of its available corporate functions

(Sur-reply at 4; O’Bryan Aff. II at ¶ 6.), the purposes established in the Articles of

Incorporation include (in addition to fundraising):

1. To make expenditures for charitable, scientific, literary or education

purposes for the benefit of Tri-C, including to make expenditures for

any normally accepted function of colleges,

2. To acquire, construct, equip, furnish, repair, remodel, renovate,

enlarge, improve, maintain and operate buildings, structures, and

facilities, and to acquire real estate in conjunction therewith for the use

of Tri-C, its staff, faculty, students, or any organization thereof or

related or affiliated thereto,

3. To establish and maintain programs for the purpose of financially

assisting, directly or indirectly, by gift, loan, guaranty, or otherwise

students attending Tri-C,

4. To engage in and conduct special activities on behalf of Tri-C, its staff,

faculty, students, or any organization thereof or related or affiliated

thereto.

5. To attempt to influence legislation.

Case No. 2017-00772PQ -8- REPORT AND RECOMMENDATION

(Court’s Exh. at 20-22.) Tri-C and Tri-C Foundation thus have additional, significant

areas of mutual involvement available at their discretion. For example, Tri-C Foundation

spent $100,000 to $200,000 supporting lobbying efforts on behalf of Tri-C in each of

fiscal years 2014-2016. (Court’s Exh. at 100-102, 137-140, 172-175.)

{¶15} Finally, Tri-C is guaranteed substantial involvement in the governance of

Tri-C Foundation through four ex officio positions for Tri-C officers on the

Tri-C Foundation Board of Directors. (O’Bryan Aff. I, Exh. A.)

{¶16} This factor weighs moderately in favor of Tri-C Foundation’s status as the

functional equivalent of a public office.

C. Whether Entity was Created by the Government or to Avoid the

Requirements of the Public Records Act

{¶17} In August 1973, Tri-C’s then-Vice President of Finance, Dante Biello,

incorporated the Tri-C Foundation. (Court’s Exh. at 19-23, Articles of Incorporation.)

Biello also signed as the agent for statutory service, giving as the service address,

“Cuyahoga Community College District, 2214 East 14th Street.” (Id. at 24.) See State ex

rel. Luken v. Corp. for Findlay Mkt. of Cincinnati, 2012-Ohio-2074, 972 N.E.2d 607, ¶ 25

(1st Dist.) (“Because the city requested the creation of a nonprofit corporation to

manage and operate Findlay Market, we * * * find that the city created CFMC.”). There

is no evidence that the foundation was created to avoid the Public Records Act.

{¶18} The broad purposes of the Foundation are exclusively for the benefit of the

Board of Trustees of the Cuyahoga Community College District. (Court’s Exh. at 19-23.)

The articles provide that “[u]pon any dissolution of the corporation all of the

corporation’s property of every nature and description shall be paid over and transferred

to the Board of Trustees of the Cuyahoga Community College District * * *.” (Id. at

22-23.) Thus, in its birth, its life, and even in its death, the Tri-C Foundation was created

solely to serve Tri-C.

{¶19} This factor weighs strongly in favor of Tri-C Foundation’s status as the

functional equivalent of a public office.

Case No. 2017-00772PQ -9- REPORT AND RECOMMENDATION

Weighing of Factors

{¶20} The four primary Oriana House factors all weigh in favor of the Tri-C

Foundation as the functional equivalent of a public office. The foundation was created to

perform the governmental function recognized in Toledo Foundation, supra, and

performs that function with substantial or complete governmental funding. Tri-C is

closely involved with Tri-C Foundation in its housing, personnel, technical and other

administrative operations, auditing, and governance. By the terms of its incorporation,

Tri-C Foundation could not exist apart from Tri-C. In purpose and practice it is an alter

ego of Tri-C. Weighing and balancing these factors, I find clear and convincing evidence

that Tri-C Foundation is the functional equivalent of a public office.

Functional Equivalence – Additional Factors

{¶21} The Oriana House list of factors is non-exhaustive, and the court may

consider additional pertinent information. Oriana House at ¶ 22-25. The following

additional information reinforces Tri-C Foundation’s status as the functional equivalent

of a public institution:

Tri-C Foundation is Treated as a Public Office by the Auditor of State

{¶22} R.C. 117.10(A) provides that “the auditor of state shall audit all public

offices as provided in this chapter.”5 R.C. 117.11 then details the timing, scope, and

manner of public office audits. The language defining “public office” in R.C. 117.01(D) is

identical to that in R.C. 149.011(A). Only public offices are audited under R.C. 117.11.

{¶23} In 2016, the Ohio Auditor of State (AOS) requested an opinion from the

Attorney General as to whether private nonprofit corporations acting as major

gift-receiving and soliciting arms of public colleges and universities were subject to audit

as “public offices.” 2016 Ohio Atty. Gen. Ops. No. 2016-013. The Auditor’s request

explained that nearly all state colleges and universities in Ohio are now supported by

5 R.C. 117.10 separately provides for audits of certain private entities.

Case No. 2017-00772PQ -10- REPORT AND RECOMMENDATION

foundations established as private nonprofit corporations under R.C. Chapter 1702.6

While cautioning that the determination of whether a public college or university

foundation is a “public office” is fact-dependent, the Attorney General advised the AOS

that

a public college or university foundation established as a private nonprofit

corporation under R.C. Chapter 1702, the primary purpose of which is to

solicit and receive, on behalf of a state college or university, gifts,

donations, and bequests made for the benefit or use of the state college or

university, and which is responsible for keeping records of donations for

the state college or university,7 is an entity established by the laws of this

state for the exercise of a function of government, and is, therefore, a

public office under R.C. 117.01(D).

Id. at *5. The Attorney General found the language of R.C. 117.01(D) identical to

that in 149.011(A), and referred to public records cases in reaching his opinion. While

the Attorney General’s determination that particular entities are public offices under

R.C. 117.01(D) is not determinative of the question of whether the entities are public

offices under R.C. 149.011(A), the reasoning of the opinion is persuasive.

{¶24} In 2017 the AOS reviewed the Independent Auditor’s Report of the

Tri-C Foundation for fiscal year 2017 and advised Tri-C Foundation that, “[b]ased

upon this review, we have accepted these reports in lieu of the audit required by

Section 117.11, Revised Code.” (Court’s Exh. at 193.) The AOS treatment of

Tri-C Foundation as a public office subject to audit under R.C. 117.11, using a definition

of “public office” identical to that in public records law, supports the finding that it is the

functional equivalent of a public office. See State ex rel. Dist. 1199 v. Lawrence Cty.

Gen. Hosp., 83 Ohio St.3d 351, 353, 699 N.E.2d 1281 (1998) (pre-Oriana House case

6 R.C. Chapter 1702 Nonprofit Corporation Law. Tri-C Foundation was incorporated “under the

Non-Profit Corporation Law of the State of Ohio.” (Court’s Exh. at 20.)

7 This phrase is an apparent reference to the holding in Toledo Found. at 263 that “the solicitation

and receipt of donations for the [University], and keeping records of that activity, are government

functions.” Tri-C Foundation keeps records of its activity in the solicitation and receipt of donations for

Tri-C.

Case No. 2017-00772PQ -11- REPORT AND RECOMMENDATION

finding “this conclusion, that the [entity] is a ‘public office’ subject to R.C. 149.43, is

supported by the other uncontroverted evidence here, [including] treatment by the

State Auditor of the [entity] as a public office for purposes of R.C. 117.11.”).

{¶25} I find that the Attorney General’s analysis of college and university

foundation status as public offices under statutory language identical to R.C.

149.011(A), and the Auditor’s specific finding that Tri-C Foundation is a public office

under that language, both weigh strongly in favor of Tri-C Foundation’s status as the

functional equivalent of a public office.

Toledo Blade v. University of Toledo Foundation

{¶26} Horton seeks to distinguish this case from State ex rel. Toledo Blade Co. v.

Univ. of Toledo Found., 65 Ohio St.3d 258, 263, 602 N.E.2d 1159 (1992). (Sur-reply

at 9-10.) Although a pre-Oriana House case, the factors considered in Toledo

Foundation were not overruled. Instead, the Court noted that it had “considered factors

similar to the factors in the functional-equivalency test in making the determination” in

cases including Toledo Foundation. Oriana House at ¶ 24. The Court summarized the

pertinent factors in Toledo Foundation as: “A private nonprofit corporation that acts as a

major gift-receiving and soliciting arm of a public university and receives support from

public taxation is a ‘public office’ pursuant to R.C. 149.011(A).” Id. It is thus significant

that there is no material distinction between the facts here and those in

Toledo Foundation.

{¶27} The University of Toledo Foundation (UT Foundation) articles of

incorporation provided that its sole purpose was “to receive, hold, invest and administer

property and to spend funds for the benefit of the university.” Toledo Foundation at 261.

UT Foundation “employed and paid its own staff, paid rent to the university for its office

space, and was supported by private donations.” Id. Two predecessor foundations had

operated out of university office space without paying rent, and the university had paid

the wages and benefits of their employees. Id. After consolidation of the two into the

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UT Foundation, the university continued to pay retirement system benefits on behalf of

foundation employees who had previously been university employees. Id. at 262. The

new foundation held $17 million in endowed funds in the name of the university, and

$23 million in its own name. Id. The conclusion drawn from these facts was that “the

foundation is not a mere supplementary benefactor of the university. It is a major gift-

receiving and soliciting entity of the university, and its transaction records do document

its activities.” Id.

{¶28} The Tri-C Foundation articles of incorporation also include the purpose to

receive, hold, invest and administer funds for Tri-C. Unlike the UT Foundation,

Tri-C Foundation does not pay rent for office space in Tri-C property, or pay for Tri-C

staff time, office services, or office equipment, which is accounted for only by an internal

charge-back (described as “consideration for the Foundation’s fundraising and donor

engagement”). (O’Bryan Aff. I at ¶ 25, 28, 31.) The contributed services of Tri-C staff

necessarily include all benefits they receive, including retirement benefits. Notably, the

UT Foundation had no members of the University of Toledo on its staff, and had no

members of the university on its board of trustees. Toledo Foundation at 267 (Holmes,

J. dissenting). In contrast, Tri-C is guaranteed four ex officio seats on the

Tri-C Foundation Board of Directors, and Tri-C Foundation uses the contributed time of

Tri-C employees as its staff, including that of the current president of the

Tri-C Foundation, Tri-C Vice President of Development Megan O’Bryan. (O’Bryan Aff. I

at ¶ 2.) As a pertinent factor in making a functional equivalence determination, the

Oriana House Court noted that “[a]t least one court has factored in whether the entity’s

officers and employees are government officials or government employees.” (Citation

omitted.) Oriana House at ¶ 22. If anything, the facts regarding Tri-C Foundation are

stronger than those in Toledo Foundation in favor of functional equivalence.

{¶29} The other factor mentioned in Toledo Foundation was that it received

support from public taxation. As its basis for finding in the affirmative, the Court noted

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only that rent-free use of public buildings supported by public taxation constitutes

support by public taxation, citing State ex rel. Fostoria Daily Review Co. v. Fostoria

Hosp. Assn., 40 Ohio St.3d 10, 12, 531 N.E.2d 313 (1988). Toledo Foundation at 261.

See generally State ex rel. Dist. 1199 v. Lawrence Cty. Gen. Hosp., 83 Ohio St.3d 351,

699 N.E.2d 1281 (1998). Neither party describes how the Tri-C host facility was funded,

but to the extent taxpayer money was involved, for example by the retirement of bond

issues through public taxation, Tri-C Foundation has been supported by public taxation.

Id. Similarly, the contributed use of the email system and server; technology support;

and the time of six Tri-C resource development staff, the Tri-C Executive Director for

Accounting and Financial Operations, and Ms. O’Bryan, also constitute “government

funding,” whether from taxpayer moneys or other public college funds. (O’Brien Aff. I at

¶ 25-32; O’Bryan Aff. II at ¶ 10.)

{¶30} This additional pertinent information weighs moderately to strongly in favor

of Tri-C Foundation’s status as the functional equivalent of a public office.

Requirement of Liberal Interpretation in Favor of Disclosure

{¶31} Even were this question closer, the court must construe R.C. 149.43

liberally in favor of broad access in weighing the factors. Oriana House at ¶ 35.

In addition, “doubts as to the ‘public’ status of any entity should be

resolved in favor of finding it subject to the disclosure statute.”

(Citation omitted.) State ex rel. Strothers v. Wertheim, 80 Ohio St.3d 155, 156, 684

N.E.2d 1239 (1997). The Supreme Court has explained that:

We adopted the functional-equivalency test in Oriana House because it is

best suited to the overriding purpose of the Public Records Act, which is

“to allow public scrutiny of public offices, not of all entities that receive

funds that at one time were controlled by the government.” Id. at P 36. By

homing in on the functional realities of a particular contractual

arrangement, the functional-equivalency test provides greater protection

against unintended public disclosures while affording a more suitable

framework for determining the extent to which an entity has actually

assumed the role of a governmental body.

Case No. 2017-00772PQ -14- REPORT AND RECOMMENDATION

State ex rel. Repository v. Nova Behavioral Health, Inc., 112 Ohio St.3d 338, 2006-

Ohio-6713, 859 N.E.2d 936, ¶ 24. This is not a case where Tri-C Foundation merely

received funds that at one time were controlled by the government. Providing public

access to this contract, which represents a substantial expenditure of public moneys by

a major gift-receiving and soliciting entity for a government function, clearly serves the

policy of openness that underlies the Public Records Act.

Tri-C Foundation as a “Person Responsible for Public Records” of Tri-C

{¶32} A private entity that is not the functional equivalent of a public office may

still be subject to the same responsibility, as a “person responsible for public records.”

R.C. 149.43(B)(1) and (C)(1) require either “a public office or the person responsible for

public records” to produce requested records. “This language ‘manifests an intent to

afford access to public records, even when a private entity is responsible for the

records.’” State ex rel. Cincinnati Enquirer v. Krings, 93 Ohio St.3d 654, 657, 758

N.E.2d 1135 (2001). A separate, private entity is “a person responsible for public

records” under the Public Records Act where:

(1) the private entity prepares records in order to carry out a public

office’s responsibilities;

(2) the public office is able to monitor the private entity’s performance,

and

(3) the public office has access to the records for this purpose.

State ex rel. Carr v. Akron, 112 Ohio St.3d 351, 2006-Ohio-6714, 859 N.E.2d 948, ¶ 36.

A private entity may be a person responsible for public records regardless of whether it

is acting as the public office’s agent. State ex rel. Mazzaro v. Ferguson, 49 Ohio St.3d

37, 39, 550 N.E.2d 464 (1990).

Prepares Records to Carry Out Public Office’s Responsibilities

{¶33} As noted above, the receipt and solicitation of gifts is an indispensable

function, and therefore an accepted responsibility of any institution of higher learning.

Toledo Foundation at 262. More broadly, responsibilities of any public office include

Case No. 2017-00772PQ -15- REPORT AND RECOMMENDATION

exercising management of financial resources, such as investment authority. State

ex rel. Toledo Blade Co. v. Ohio Bur. of Workers’ Comp., 106 Ohio St.3d 113,

2005-Ohio-3549, 832 N.E.2d 711, ¶ 21-22. The Presidential Scholarship Luncheon is a

long-standing and important fundraising event of Tri-C Foundation. (O’Bryan Aff. I at

¶ 11, 14; O’Bryan Aff. II at ¶ 8.) Tri-C Foundation creates records including the

speaker’s contract to document its general fundraising responsibility, and by extension

the responsibility of Tri-C to solicit and receive gifts for its education function.

Respondent’s statement that “[t]he Presidential Scholarship Luncheon is not a

responsibility of the Foundation or of the College” conflates the general responsibility to

document fundraising, with the responsibility to hold any particular event. (O’Bryan

Aff. II at ¶ 8.)

Public Office Able to Monitor Performance

{¶34} Tri-C occupies four ex officio seats on the Tri-C Foundation board.

Common purposes of ex officio seats for public offices include a guaranteed presence

to monitor activity. Since the Tri-C Foundation Board’s Directors have control over the

property and all the business and financial affairs of the Foundation (O’Bryan Aff. I at ¶

7.), the Tri-C officers’ ex officio seats provide it with regular opportunity to monitor

Tri-C Foundation’s performance. The accounting rules tying Tri-C Foundation to Tri-C

as its “component unit” provide additional monitoring of overall performance through

joint audit reports. While there is no evidence that Tri-C specifically monitored the

contract with Ms. Spencer (O’Bryan Aff. I at ¶ 36-52.), it was clearly aware through its

involved staff of the scheduling and planning of the Presidential Scholarship Luncheon.

Public Office has Access to the Records for this Purpose

{¶35} The records at issue are kept in a Tri-C facility, under lock in the office of

Tri-C Vice President Megan O’Bryan. (O’Bryan Aff. I at ¶ 50.) The amount of the

speaker fee is also presumably reflected in the check ledger and other accounting

entries in Tri-C Foundation’s financial books and records. According to its Form 990

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filings, these financial records are kept by Tri-C’s Executive Director, Accounting and

Financial Operations, who is not a director or officer of Tri-C Foundation. (Court’s Exh.

at 84, 122; O’Bryan Aff. II at ¶ 10.) Tri-C had access to the requested record, and

demonstrated access in Horton’s unquestioning response to the court’s order that the

Tri-C Foundation contract be filed under seal. See S/O ex rel. Am. Ctr. for Econ. Equal.

v. Jackson, 2015-Ohio-4981, 53 N.E.3d 788, 796, ¶ 33 (8th Dist.) (production of other

records of performing entity demonstrated public office’s access).

Horton’s Actions Consistent with “Person Responsible For” Records

{¶36} Sheil made his request for a contract “between Tri-C and Octavia Spencer”

to Tri-C Media Relations Manager John Horton. Instead of declining to accept the

request or forwarding it, Horton responded on behalf of Tri-C Foundation. (Complaint at

4.) Horton does not assert that he has separate employment with the Tri-C Foundation,

and has not disputed the jurisdiction of this court over him in connection with the

request. Horton’s actions were appropriate for a person acting on behalf of an

entire office and its subdivisions. State ex rel. Consumer News Servs. v.

Worthington City Bd. of Ed., 97 Ohio St.3d 58, 65, 2002-Ohio-5311, 776 N.E.2d 82,

¶ 23, 40. Were Tri-C Foundation an entirely separate office, Horton could have

forwarded the request and moved to be dismissed from this action. See State

ex rel. Keating v. Skeldon, 6th Dist. Lucas No. L-08-1414, 2009-Ohio-2052 (finding

assistant prosecutor and county public affairs liaison not “persons responsible” for

records of county dog warden).

{¶37} Tri-C Foundation President O’Bryan’s behavior also reflects the intertwining

of Tri-C and Tri-C Foundation. The Spencer contract identifies the “client” as “Ms.

Megan O’Bryan, Vice President, Development & Tri-C Foundation,” the italicized text

representing her position at Tri-C. The section of Background labeled “About the

Organization:” begins “From the Client:” and then describes only Tri-C history, statistics,

facilities, and programs, not those of Tri-C Foundation. In signing for

Case No. 2017-00772PQ -17- REPORT AND RECOMMENDATION

Tri-C Foundation, O’Bryan uses a combination of her college and foundation titles: “VP,

Cuyahoga County Community College Foundation.”

{¶38} Fundamentally, “governmental entities cannot conceal information

concerning public duties by delegating these duties to a private entity.” Krings, 93 Ohio

St.3d 654, 659, 758 N.E.2d 1135 (2001). The public has a “right of access to public

records, regardless of where they are physically located, or in whose possession they

may be.” Mazzaro, 49 Ohio St.3d 37, 40, 550 N.E.2d 464 (1990). The Supreme Court

recognizes the significant public interest in, and right to know, from whom donations to

institutions of higher learning come, and how they are spent:

No one would dispute the significant legitimate public purpose served by

government in establishing and supporting institutions of higher education.

The University of Toledo is a public institution and the solicitation and

receipt of donations for the university, and keeping records of that activity,

are government functions. There is, moreover, significant public interest in

knowing from whom donations come and how that relates to where the

university, as a public institution, chooses to spend its money.

Nondisclosure by the foundation would obscure the sometimes significant

link between a gift and its eventual use.

State ex rel. Toledo Blade Co. v. Univ. of Toledo Found., 65 Ohio St.3d 258, 263, 602

N.E.2d 1159.

{¶39} Tri-C District created the Tri-C Foundation to delegate a responsibility to

fund scholarships and other student assistance. Tri-C monitors Tri-C Foundation

performance, and has demonstrated access to its records, making the foundation a

“person responsible for public records” in a relationship of quasi-agency. State ex rel.

ACLU v. Cuyahoga Cty. Bd. of Comm’rs, 128 Ohio St.3d 256, 2011-Ohio-625,

943 N.E.2d 553, ¶ 52-54.

Application of Claimed Exception

{¶40} Respondent asserts that even if Tri-C Foundation is determined to be

subject to the Public Records Act, the withheld contract is subject to protection as a

Case No. 2017-00772PQ -18- REPORT AND RECOMMENDATION

trade secret under the Ohio Uniform Trade Secrets Act,8 which is “a state law exempting

trade secrets from disclosure under R.C. 149.43.” State ex rel. Perrea v. Cincinnati Pub.

Sch., 123 Ohio St.3d 410, 2009-Ohio-4762, 916 N.E.2d 1049, ¶ 19. Respondent bears

the burden of proof to establish the applicability of the claimed exception:

Exceptions to disclosure under the Public Records Act, R.C. 149.43, are

strictly construed against the public-records custodian, and the custodian

has the burden to establish the applicability of an exception. * * *

A custodian does not meet this burden if it has not proven that the

requested records fall squarely within the exception.

State ex rel. Cincinnati Enquirer v. Jones-Kelley, 118 Ohio St.3d 81, 2008-Ohio-1770,

886 N.E.2d 206, ¶ 10.

Ohio Uniform Trade Secrets Act

R.C. 1333.61(D) provides that:

“Trade secret” means information, including the whole or any portion or

phase of any scientific or technical information, design, process,

procedure, formula, pattern, compilation, program, device, method,

technique, or improvement, or any business information or plans, financial

information, or listing of names, addresses, or telephone numbers, that

satisfies both of the following:

(1) It derives independent economic value, actual or potential, from not

being generally known to, and not being readily ascertainable by proper

means by, other persons who can obtain economic value from its

disclosure or use.

(2) It is the subject of efforts that are reasonable under the circumstances

to maintain its secrecy.

An in camera inspection is usually necessary to determine if a claim of trade secret has

merit. State ex rel. Besser v. Ohio State Univ., 87 Ohio St.3d 535, 541-542, 721 N.E.2d

1044 (2000) (“Besser I”).

8 Although Horton did not cite this exemption in his response to Sheil’s request, he is permitted to

raise it in defense of this litigation. “The explanation [provided when denying a request] shall not preclude

the public office * * * from relying upon additional reasons or legal authority in defending an action

commenced under division (C) of this section.” R.C. 149.43(B)(3).

Case No. 2017-00772PQ -19- REPORT AND RECOMMENDATION

The following factors are to be used in analyzing a trade secret claim:

(1) The extent to which the information is known outside the business;

(2) the extent to which it is known to those inside the business, i.e., by the

employees; (3) the precautions taken by the holder of the trade secret to

guard the secrecy of the information; (4) the savings effected and the

value to the holder in having the information as against competitors;

(5) the amount of effort or money expended in obtaining and developing

the information; and (6) the amount of time and expense it would take for

others to acquire and duplicate the information.

State ex rel. Besser v. Ohio State Univ., 89 Ohio St.3d 396, 732 N.E.2d 373, 399-400

(2000) (“Besser II”).

Contents of Contract

The contents of the contract between Tri-C Foundation and Ms. Spencer are set forth

under the following categories and topic titles:

Speaker BACKGROUND

Fees

Expenses About the Organization

Client Website

Event Name About the Event

Appearance Date Audience Profile

Location: Venue

Speech Title/Topic Hotel

Timetable Speaker’s Attire

Audience’s Attire

CONTRACT REQUIREMENTS Previous Speakers