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Smith ex rel. Smith Butz, LLC v. Pennsylvania Department of Environmental Protection

Commonwealth Court of Pennsylvania

May 8, 2017

Kendra Smith on behalf of Smith Butz, LLC, Petitioner
v.
Pennsylvania Department of Environmental Protection, Respondent

          Argued: April 6, 2017

          BEFORE: HONORABLE ROBERT SIMPSON, Judge, HONORABLE JULIA K. HEARTHWAY, Judge HONORABLE DAN PELLEGRINI, Senior Judge

          OPINION

          DAN PELLEGRINI, Senior Judge

         Kendra Smith, on behalf of Smith Butz, LLC (Requester), petitions for review of a Final Determination of the Office of Open Records (OOR) denying in part her request to the Pennsylvania Department of Environmental Protection (DEP) for access to records relating to Core Laboratories d/b/a ProTechnics, division of Core Laboratories, LP (ProTechnics), under the Pennsylvania Right-to-Know Law (RTKL).[1]

         I.

         On February 1, 2016, Requester submitted a RTKL request, later amended, [2] for all records held by the DEP relating to ProTechnics, a business that performs drilling diagnostics using radioactive tracers. The request sought records related to ProTechnics' activities at all drill sites throughout the Commonwealth, including:

[Item 1] Any and all approvals, permits, licenses/licensures, applications for permits and/or licenses, reciprocity letters, reciprocity licenses, reciprocity agreements and/or reciprocity arrangements, including, but not limited to all licenses issued by the [DEP to Protechnics] for use, storage and possession of radioactive materials and/or other licensed material. Additionally, this request seeks any and all investigation reports, Notices of Violation(s), Consent Order and Agreement(s) issued to Protechnics by the PA DEP and/or between Protechnics and the PA DEP for any and all work or services performed by Protechnics at any natural gas well site in the Commonwealth of Pennsylvania. Included in this request is a request for copies of all Notices of Violation issued by the PA DEP to Protechnics, including but not limited to Notices of Violation dated 06/15/10, 1/28/10, 11/26/13, 09/13/13 and 10/14/13, Violation Numbers 677913, 677915, 677914, 682834, 682833, 682829, 682835 and all corresponding inspection reports, field notes and other related writings. Further, this request seeks any and all Consent Order and Agreements between the PA DEP and Protechnics, including, but not limited to, Consent Orders and Agreements dated November 2, 2013 and November 2, 2010.
[Item 2] Additionally, this request includes a request for copies of all enforcement activity taken by the PA DEP against Protechnics, including but not limited to Enforcement ID Number 305057, 259202 and 263973, as well as all inspection reports completed by the PA DEP regarding Protechnics, including, but not limited to, Inspection ID Numbers 1891418, 1919964, 2147772, 2204156 and 2221258.
[Item 3] This request further seeks any and all Radioactive Tracer Well Site Agreements made between Protechnics and any well site operator(s) for each and every well traced in the Commonwealth of Pennsylvania that is or was submitted to the PA DEP, including, but not limited to, the April 7, 2013, Radioactive Tracer Well Site Agreement between Protechnics and a well operator.
[Item 4] In addition to the above, this request seeks any and all notifications submitted to the PA DEP by Protechnics or the associated operator or subcontractor regarding Protechnics['] confirmation that licensed material, including, but not limited to, radioactive material, was returned to the surface at any well site in which Protechnics operated/performed work or services in the Commonwealth of Pennsylvania.
[Item 5] Additionally, this request seeks any and all documents, correspondence, e-mails and any other communication(s) between Protechnics and the PA DEP and/or Range Resources and the PA DEP regarding Protechnics and any and all work/services performed in the Commonwealth of Pennsylvania by Protechnics.
[Item 6] Further, this request seeks any and all MSDS/SDS (material data safety sheets and safety data sheets) in the possession of the PA DEP regarding any and all products utilized by Protechnics at any well site in Pennsylvania, including, but not limited to, all MSDS/SDS for Protechnics Radioactive Tracer Products, as well as any and all Chemical Frac Tracer ("CFT") products, including, but not limited to, CFT 1000, CFT 1100, CFT 1200, CFT 1300, CFT 2000, CFT 2100, CFT 1900, CFT 1700.

(Reproduced Record (R.R.) at 3a-4a.)

         Because the request was statewide in scope, the DEP tasked its Central Office as well as its Southeast, Northeast, Southcentral, Northcentral, Southwest and Northwest Regional offices to gather those documents that responded to the request. On February 8, 2016, the DEP invoked a 30-day extension. See Section 902(b) of the RTKL, 65 P.S. § 67.902(b). On March 9, 2016, [3] the DEP partially denied the RTKL request.

         On March 28, 2016, Requester appealed to the OOR, challenging the DEP's denial and giving reasons why the records should be released. The OOR then directed the DEP to notify any third parties that may be affected by the release of the documents of their right to participate in the appeal. See Section 1101(c) of the RTKL, 65 P.S. § 67.1101(c). Soon thereafter, ProTechnics requested to participate in this appeal, and the OOR granted the request. The OOR then invited all parties to supplement the record.

         The DEP then submitted a position statement along with ten affidavits[4] and privilege logs.[5] The DEP's position statement contended that it was partially denying the RTKL request because the records were exempt under the Radiation Protection Act (RPA)[6] exception, the attorney-client privilege and/or the attorney work product doctrine, [7] as well as certain RTKL exceptions.[8]

         ProTechnics submitted a position statement contending that certain records were exempt from disclosure because they contain trade secrets and/or confidential proprietary information. See Section 708(b)(11) of the RTKL, 65 P.S. §67.708(b)(11). In support thereof, ProTechnics attached the sworn affidavit of Will Williams, the Director of U.S. Operations for ProTechnics.

         On July 27, 2016, after reviewing the submissions of the parties, the OOR issued its final determination partially denying Requester's appeal. The net effect is that the DEP was not required to release "all of the identified records in its privilege logs except for a small subset of records regarding ProTechnics' license information and limited information regarding gas well pads." (DEP's Brief at 8.)[9]Requester then filed this appeal in which she contends that the OOR erred in not releasing the requested records for a number of reasons.[10]

         II.

         Requester contends that under the DEP's RPA regulation, she is entitled to its investigation reports for three separate incidents regarding well sites[11]where ProTechnics used radioactive tracers.

         The RTKL exempts from disclosure any records relating to an agency investigation. Under its regulations promulgated under the RPA, [12] the DEP exempts from disclosure only "[a] report of investigation, not pertaining to safety and health in industrial plants, which would disclose the institution, progress or results of an investigation undertaken by the Department." 25 Pa. Code § 215.14 (emphasis added).[13] Requestor contends that since the regulation does not exempt from disclosure any records of investigation "pertaining to safety and health in industrial plants, " those records should be disclosed. The DEP contends that the records need not be released because a "well site" is not an "industrial plant."

         The term "industrial plant" or its component words are not defined in the RPA or its regulations. When terms in a statute are not defined, "[w]ords and phrases shall be construed according to rules of grammar and according to their common and approved usage. . . ." See 1 Pa.C.S. § 1903(a).[14] Because both parties agree that what takes place on a well pad is industrial in nature, the question is does a "well site" fall within the definition of "plant."

         Webster's Ninth New Collegiate Dictionary 899 (1989) defines "plant" as:

a. the land, buildings, machinery, apparatus, and fixtures employed in carrying on a trade or an industrial business;
b. a factory or workshop for the manufacture of a particular product;
c. the total facilities available for production or service; or
d. the buildings and other physical equipment of an institution.

Id. (Emphases added.)

         The DEP contends that a well site is not a "plant" within that definition as a well site is not a "factory or workshop" because to fall within those terms the activity must take place in a building. Because a well site is not enclosed in a building, it contends that a well site is not a plant. The DEP also contends that its interpretation of what is a "plant" should be given deference because it is charged with enforcing the regulation at issue.

         For its part, Requester contends that a well site is a "plant" because all the drilling apparatus, holding tanks and other machinery that produce natural gas fall within the definition of "plant" as that term is commonly understood to mean "the land, buildings, machinery, apparatus, and fixtures employed in carrying on a trade or an industrial business." Id.

         In deciding what is meant by the term "industrial plant, " initially, we point out that while we agree with the DEP that, normally, deference is given to an agency's interpretation of its own ambiguous regulation, giving deference here is "undoubtedly inappropriate . . . when it appears that the interpretation is nothing more than a 'convenient litigation position.'" Christopher v. SmithKline Beecham Corporation, 567 U.S. 142 (2012) (quoting Bowen v. Georgetown University Hospital, 488 U.S. 204, 213 (1988) (no deference given to an interpretation of a regulation contained in a court brief)).

         The only statute we have been able to find that defines this term is the Energy Policy and Conservation Act which defines "industrial plant" as "any fixed equipment or facility which is used in connection with, or as part of, any process or system for industrial production or output." 42 U.S.C. § 6326(5). We adopt that definition because it is in accord with the dictionary definitions listed above as well as common understanding of the word that does not require the facility to be enclosed in a building - e.g., concrete and asphalt plants. Accordingly, under the RPA regulations, investigative reports pertaining to well sites are public records unless the report contains trade secrets and/or confidential proprietary information which can be redacted.

         III.

         Requester next contends that the DEP failed to demonstrate certain records are protected by the attorney-client privilege and/or work-product doctrine.

         Section 102 of the RTKL defines "privilege" as "[t]he attorney work-product doctrine, the attorney-client privilege, the doctor-patient privilege, the speech and debate privilege or other privilege recognized by a court incorporating the laws of this Commonwealth." 65 P.S. § 67.102. The burden of proving a privilege rests on the party asserting it. Heavens, 65 A.3d at 1074.

         To establish the attorney-client privilege, the agency asserting it must demonstrate that: (1) the asserted holder of the privilege is or sought to become a client; (2) the person to whom the communication was made is a member of the bar of a court or his subordinate; (3) the communication relates to a fact of which the attorney was informed by his client, without the presence of strangers, for the purpose of securing either an opinion of law, legal services or assistance in a legal matter and not for the purpose of committing a crime or tort; and (4) the privilege has been claimed and is not waived by the client. Bagwell v. Department of Education, 103 A.3d 409, 420 n.12 (Pa. Cmwlth. 2014).

The work-product doctrine, while closely related to the attorney-client privilege, provides broader protection. Levy [v. Senate of Pennsylvania, 94 A.3d 436 (Pa. Cmwlth. 2014)]; Dages v. Carbon County, 44 A.3d 89 (Pa. Cmwlth. 2012). Confidential information flows from the client to the attorney, and vice versa, in the attorney-client relationship. Gillard v. AIG Insurance Co., 15 A.3d 44 (Pa. 2011). The attorney-client privilege protects such confidential communications. Id. By contrast, the work-product privilege only applies to "the mental impressions, theories, notes, strategies, research and the like created by an attorney in the course of his or her professional duties. . . ." Pennsylvania Public Utility Commission v. Seder, 106 A.3d 193, 201 (Pa. Cmwlth. 2014) (emphasis added) (citing Levy). Neither privilege protects mere facts. Commonwealth v. Vartan, 733 A.2d 1258 (Pa. 1999); Upjohn Co. v. United States, 449 U.S. 383 (1981).

Pennsylvania Department of Education v. Bagwell, 114 A.3d 1113, 1123-24 (Pa. Cmwlth. 2015).

         In support of its assertion that certain records are protected as privileged, the DEP supplies several affidavits[15] attesting that certain specified records sought legal advice regarding: the DEP's noncriminal investigations of ProTechnics; preparation for meetings with ProTechnics; enforcement actions against ProTechnics; and ProTechnics' applications, agreements and reporting obligations. Each affidavit specifies the DEP attorneys consulted and that they are admitted to the Pennsylvania Bar. Each affidavit also attests that these records contain the mental impressions, conclusions, opinions and written work-product created by the DEP counsel regarding the issues for which legal advice was sought. "At no time were the communications of DEP legal counsel made in the presence of a third party." (R.R. at 1959a.)

         Accordingly, because Requester has not provided evidence demonstrating waiver of privilege, [16] the OOR correctly determined that the DEP met its burden of proving that these records are protected by the ...


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