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Pennsylvania Liquor Control Board v. Beh

Commonwealth Court of Pennsylvania

July 17, 2019

Pennsylvania Liquor Control Board, Petitioner
Lazlo Beh, Respondent Lazlo Beh, for Philadelphia Legal Assistance, Petitioner
Pennsylvania Liquor Control Board, Respondent

          Argued: November 15, 2018




         In these cross-petitions for review, the Pennsylvania Liquor Control Board (PLCB) and Lazlo Beh (Requester) seek review of the Final Determination of the Office of Open Records (OOR) granting in part and denying in part Requester's appeal of the PLCB's partial denial of his request under the Right-to- Know Law (RTKL)[1] for liquor license applications and renewals for various licensees submitted to the PLCB pursuant to the Liquor Code.[2] We affirm in part, and reverse in part.

         On August 1, 2017, Requester requested the following records from the Open Records Officer (ORO) of the PLCB:

[T]he names of all individuals, officers, and managers associated with each of the following License Names and LIDs, the dates of original application and, if applicable, renewal, for each, as well as copies of each such application and renewal request:
2074 E. Clearfield Street, Inc., LID 50412;
Zheng Beer Distributor Inc., LID 54531;
Linda's Beer Distributor Inc., LID 56061;
C and H Beer Distributor Inc., LID 60267;
Phin Inc., LID 61561;
CSSO Distributors LLC, LID 69255;
L & C Clearfield Inc., LID 71013;
3V Beer Distributors Inc., LID 65791.

         Reproduced Record (R.R.) at 1a.

         After extending its time to respond, the PLCB granted the request in part and denied it in part. The PLCB provided over 250 pages of documents, see R.R. at 213a-488a, but redacted the following information as exempt from disclosure: (1) home, cellular, or personal telephone numbers; (2) home addresses; (3) personal email addresses; (4) sales tax numbers; (5) bank account numbers; (6) social security numbers; (7) personal financial information; (8) employee numbers; and/or (9) other confidential personal identification numbers. Id. at 5a-6a.

         On September 26, 2017, Requester appealed to OOR the PLCB's redaction of home addresses, length of residency information, and personal financial information from the records that were provided. R.R. at 18a-20a. Requester contested the redaction of home addresses and length of residency as exempt under Section 708(b)(1)(ii)[3] because "there has been no suggestion that providing the home addresses . . . "would be reasonably likely" to result in any physical harm or other risk to the personal security of the individual's whose name [is] included in [P]LCB's response." Id. at 19a. Requester also contested the redaction of the names/addresses of investors/sources of funds, the amounts invested/contributed, the source from which the monies were received, the private and commercial lenders, and the amount of loans that were listed on the Individual Financial Disclosure Affidavits, PLCB Form 1842 (IFDAs) submitted to the PLCB with the applications under Section 708(b)(6)(i)(A).[4] Id. at 19a-20a.[5]

         The parties submitted position statements to OOR. The PLCB asserted, inter alia, that Requester was improperly attempting to modify his request on appeal to include home addresses because they were not specifically asked for in the initial request that was submitted. The PLCB also argued that the disclosure of home addresses and length of residency also violated the right to privacy guaranteed by Article 1, Section 1 of the Pennsylvania Constitution.[6] The PLCB further claimed that the IFDAs were exempt from disclosure under Section 708(b)(17)(ii) of the RTKL because they related to the noncriminal investigation of a licensee's eligibility for a license or a permit.[7]

         On December 22, 2017, OOR issued a Final Determination granting Requester's appeal in part and denying it in part. R.R. at 149a-164a. Initially, OOR determined that Requester did not modify his request on appeal by seeking the home addresses or length of residency of the licensees. OOR noted that while the request did not specifically ask for this information, it sought copies of the applications and permit renewals, which contain this information. OOR also found that the PLCB did not present any evidence that Requester did not seek this information in his request or that he waived his right to challenge these redactions on appeal. Id. at 153a.

         Next, OOR considered whether the disclosure of home addresses or length of residency would threaten personal security to be exempt under Section 708(b)(1)(ii). To establish the exemption applies, the PLCB was required to show: (1) a "reasonable likelihood" of (2) a "substantial and demonstrable risk" to a person's security. Delaware County v. Schaefer, 45 A.3d 1149 (Pa. Cmwlth. 2012). "More than mere conjecture is needed" to establish that the exemption applies. Lutz v. City of Philadelphia, 6 A.3d 669, 676 (Pa. Cmwlth. 2010). OOR found that neither the PLCB nor the interested third parties presented evidence in support of the argument that disclosure of the home addresses would threaten personal security so they did not meet their burden that the information is exempt under Section 708(b)(1)(ii).[8] R.R. at 154a.

         OOR also determined that the PLCB did not demonstrate that disclosure of home addresses or length of residency violates the right to privacy guaranteed under Article 1, Section 1. In Pennsylvania State Education Association v. Commonwealth, 148 A.3d 142, 158 (Pa. 2016) (PSEA), the Supreme Court held that an agency must consider an individual's constitutional right to privacy before granting access to information in a record under the RTKL. A balancing test is applied, "weighing the privacy interest and the extent to which [it] may be invaded against the public interest that would result from disclosure." Id. at 154-55 (citations omitted). The Court held that "'certain types of information,' including home addresses, by their very nature, implicate privacy concerns and require balancing." Id. at 156-57 (citation omitted).

         In Reese v. Pennsylvanians for Union Reform, 173 A.3d 1143, 1150 (Pa. 2017), Pennsylvanians for Union Reform (PFUR) sought a list of employees from the State Treasurer including names, dates of birth, and voting residences. The State Treasurer asserted that the PSEA balancing test should be applied prior to disclosure while PFUR argued that the information was accessible under Section 614(c) of the Administrative Code of 1929 (Administrative Code), [9] which states that the requested information, with the exception of voting residence, "shall be public information." The Supreme Court held that the exemptions in the RTKL did not apply because Section 614 of the Administrative Code states that the information is public information and Section 306 of the RTKL, 65 P.S. §67.306, provides that "[n]othing in this act shall supersede the public or nonpublic nature of a record or document established in . . . State law . . . ." Id. at 1158-59. Nevertheless, the Supreme Court held that "the PSEA balancing test is applicable to all government disclosures of personal information, including those not mandated by the RTKL or another statute" as a matter of constitutional law. Id. at 1159.

         OOR explained that, as in Reese, Section 473 of the Liquor Code provides that "[t]he names and addresses" of "[a]ny person having a pecuniary interest in the conduct of business on licensed premises" filed with the PLCB "shall be recorded by [the PLCB] and made available to the public as a public record." 47 P.S. §4-473. OOR also noted that Section 403 of the Liquor Code requires that "if the applicant is a natural person, his application must show that he . . . has been a resident of this Commonwealth for at least two years immediately preceding his application." 47 P.S. §4-403. The PLCB's Director stated that the PLCB collects applicants' home addresses "for purposes of investigating the reputation/backgrounds of those individuals" and collects the residency information for the sole purpose of determining whether an applicant meets the statutory requirements. R.R. at 158a, 160a. Requester asserted the "obvious public interest" in reviewing the information upon which the PLCB grants licenses and renewals and determining whether it has fulfilled its statutory duty prior to awarding or renewing the licenses. Id. at 158a.

         OOR concluded that "[w]ithout these addresses, the public would be prevented from scrutinizing the actions of [the PLCB] and restricted in its ability to hold [the PLCB] accountable for its decision(s) and that "[t]he powerful public interest in shedding light on [the PLCB]'s administration of the Liquor Code outweighs the privacy interest raised by [the PLCB] and intervenors." R.R. at 160a. OOR also concluded, "Because [the PLCB] has not demonstrated how the privacy interests in [the length of residency] outweighs the public's interest in ensuring that the applicants meet the residency requirements under the Liquor Code, the length of time the respective applicants were residents of Pennsylvania is subject to public access." Id.

         Finally, OOR determined that, based on Director Peifer's affidavit, the PLCB had demonstrated that the IFDAs relate to its noncriminal investigations of applicants "pursuant to its legislatively granted fact-finding powers to determine whether the respective applicants meet the requirements of the Liquor Code and [the PLCB's] regulations . . . ." R.R. at 163a. As a result, OOR found that the PLCB properly determined that the IFDAs are exempt from disclosure under Section 708(b)(17)(ii) of the RTKL. Id. Based on the foregoing, OOR directed the PLCB to provide Requester with the previously redacted information relating to applicants' home addresses and lengths of residency in Pennsylvania. The PLCB and Requester filed the instant cross-appeals of OOR's Final Determination.[10]


         In its appeal, the PLCB first argues that OOR incorrectly applied the PSEA constitutional balancing test and erred in requiring the disclosure of home addresses and length of residency information of applicants and/or licensees. The PLCB claims that OOR erred in relying on Section 708(a) of the RTKL to place the burden of proving, by a preponderance of the evidence, that the right to privacy outweighs the public benefit of disclosure under the constitutional balancing test required by PSEA because under PSEA and Reese, the constitutional right to privacy in home addresses and other personal information exists independently of the RTKL and the presumptions and burdens of the RTKL do not apply. The PLCB contends, rather, that under the constitutional balancing test, the requester seeking protected information must demonstrate a significant public interest warranting the infringement of those privacy rights under Reese, 173 A.3d at 1159, and PSEA, 148 A.3d at 151-158. The PLCB submits that the requester must also show that there is no alternate reasonable method of lesser intrusiveness to accomplish the governmental purpose. See, e.g., Denoncourt v. State Ethics Commission, 470 A.2d 945, 949 (Pa. 1983) (plurality) ("[The] government's intrusion into a person's private affairs is constitutionally justified when the government interest is significant and there is no alternate reasonable method of lesser intrusiveness to accomplish the governmental purpose.") (footnote omitted).

         In contrast, in his cross-appeal, Requester contends that the PLCB incorrectly argues that the burden is on the requester to demonstrate that the public interest outweighs the privacy interest. Section 708(a) of the RTKL places the burden on the agency to show exemption from disclosure and Section 473 of the Liquor Code makes the addresses of all license holders and those with a pecuniary interest a matter of public record. Further, the PLCB fails to establish that there is any meaningful privacy interest in the length of residency in Pennsylvania.

         Requester further argues that, in this case, in ordering disclosure, OOR gave proper deference to the General Assembly's determination that there is a public benefit to disclosure as Section 473 of the Liquor Code declares that the information is a public record. Requester identified the public interests in disclosure of this information whereas none were advanced in the PSEA line of cases. Specifically, Requester contends that by its terms, Section 473 requires disclosure of the licensee's home address and not the licensed premises address as asserted by the PLCB, and that by "enacting [Section] 473 the legislature must have deemed it to be in the public's benefit to have access to information about those individuals that were entrusted to sell alcohol to the public," and that "in cases such as this, there may be a lesser privacy interest for individuals who have applied to distribute alcohol[.]" R.R. at 144a.[11] The use of "residence address" in Section 504(a)(1) does not compel a different conclusion because examination of all sections of the Liquor Code show that "residence," "residence address," and "address" all refer to an applicant or individual and not the licensed premises. See Sections 436, 437, 504 of the Liquor Code, 47 P.S. §§4-436, 4-437, 5-504. As a result, Requester asserts, OOR properly applied the PSEA balancing test and properly concluded that the public interest outweighs the privacy interest in the disclosure of a licensee's home address and length of residence.

         Initially, we find that, pursuant to Section 708(a)(1) of the RTKL, OOR properly placed the burden on the PLCB to demonstrate that the requested addresses were not a public record subject to disclosure. As this Court has recently explained with respect to a similar provision relating to applications for medical marijuana grower/processor or dispensary permits submitted pursuant to Section 302(b) of the Medical Marijuana Act (Act)[12]:

Records in an agency's possession are presumed public unless exempt under an exception in the RTKL, a privilege, or another law. Section 305(a) of the RTKL, 65 P.S. §67.305(a). Also, the RTKL does not supersede the public nature of a record established by statute or regulation. Section 306 of the RTKL, 65 P.S. §67.306.
The Act expressly provides permit applications "are public records and subject to the [RTKL]." Section 302(b) of the Act, 35 P.S. §10231.302(b) (emphasis added). We agree with OOR that the phrase "subject to" renders the Applications public except when any RTKL exceptions or other exceptions apply. [OOR's jurisdiction to assess statutory and regulatory exemptions pursuant to Section 305(a)(3) of the RTKL, 65 P.S. §67.305(a)(3), is well-established. Department of Labor and Industry v. Heltzel, 90 A.3d 823, 834 (Pa. Cmwlth. 2014)].

Mission Pennsylvania, LLC v. McKelvey, ___ A.3d ___ (Pa. Cmwlth., Nos. 185 C.D. 2018, 186 C.D. 2018, 187 C.D. 2018, 188 C.D. 2018, 189 C.D. 2018, 190 C.D. 2018, filed June 4, 2019) (Mission Pennsylvania, LLC), slip op. at 15.

         In Mission Pennsylvania, LLC, in response to a claim for exemption from disclosure under Article 1, Section 1, "OOR determined that the street addresses may be redacted from the applications, but required disclosure of the cities, states, and zip codes of the residential addresses." Slip op. at 18. Accordingly, in that case, "residential addresses that reveal an individual's location [we]re not at issue," and this Court "only evaluat[ed] an individual's privacy right in the remainder of the residential address." Id.

         We ultimately determined that "[t]he record does not contain support for a reasonable subjective belief that residential addresses would be protected from disclosure [because] the application instructions d[id] not list 'residential addresses' as confidential information . . . ." Slip op. at 18. We also noted that "none of the parties submitted evidence supporting a subjective expectation in the privacy of residential addresses submitted in a voluntary application process." Id. at 18-19. Accordingly, we concluded that "OOR struck an appropriate balance in permitting partial redaction of addresses," and "we discern[ed] no error by OOR in analyzing the right to privacy." Id. at 19.

         Additionally, in Governor's Office of Administration v. Campbell, 202 A.3d 890 (Pa. Cmwlth. 2019) (GOA), the requester sought the full names, position/job titles, dates of birth, and counties of residence of all employees in the Governor's Office of Administration's (GOA) computerized database. GOA granted the request in part, directing the requester to a publicly accessible electronic database listing the names and job titles of Commonwealth employees, which includes salaries, compensation, and employing agency, subject to redaction under Section 708(b) of the RTKL. GOA denied the request in part, to the extent that it sought the employees' dates of birth and counties of residence.

         On the requester's appeal to OOR, GOA submitted the affidavit of the Commonwealth's Acting Director for the Human Resources Service Center (HR Director), which stated that: where an employee lives is a unique piece of data in his or her confidential personnel file, the use of which is related exclusively to the Commonwealth's role as employer; the Commonwealth only uses the address information to discern the particular benefits to which an employee is entitled as the benefits packages, programs, and requirements vary from county to county; and that information as to the sub-units of government of an employee's address (e.g., municipality or township) were also saved to provide tax information to the appropriate taxing authority. The HR Director indicated that "Commonwealth human resource professionals consider demographic information about an employee to be confidential," and "the confidential nature of demographic information is a well-accepted best practice in the human resource industry" that "is memorialized as a Commonwealth policy in Management Directive 505.18, Maintenance, Access, and Release of Employe Information," limiting "access to confidential employee information . . . to those who need to use the information for job-related purposes, the employee or persons explicitly permitted by the employee." Id. at 895 (footnote omitted).

         We also recognized the provisions of the Employment Records Law[13] "protecting employment records by creating an expectation that only those who have a legitimate need, or those explicitly authorized . . . will access the employee's records," and Section 731 of the Fiscal Code[14] that "treats information collected for tax purposes as confidential [and] for official use only." GOA, 202 A.3d at 895. We also noted that the requester therein "provided no countervailing public interest in support of disclosure." Id.

         Ultimately, we concluded:

On balance, we perceive no public benefit or interest in disclosing the requested counties of residence of Commonwealth employees and Requester has asserted none. The RTKL was "designed to promote access to official government information in order to prohibit secrets, scrutinize the actions of public officials, and make public officials accountable for their actions . . . ." Governor's Office of Administration v. Purcell, 35 A.3d 811, 820 (Pa. Cmwlth. 2011). The requested disclosure of information about the counties of residence of Commonwealth employees is not closely related to the official duties of the Commonwealth employees, and does not provide insight into their official actions. Indeed, "[t]he disclosure of personal information such as home addresses, reveals little, if anything about the workings of government[.]" PSEA, 148 A.3d at 145 (quoting Pennsylvania State Education Association ex rel. Wilson v. Department of Community and Economic Development, Office of Open Records, 981 A.2d 383, 386 (Pa. Cmwlth. 2009), aff'd, [2 A.3d 558 (Pa. 2010)]).
In rejecting a similar request for the home addresses of public school employees, our Supreme Court stated:
[N]othing in the RTKL suggests that it was ever intended to be used as a tool to procure personal information about private citizens or, in the worst sense, to be a generator of mailing lists. Public agencies are not clearinghouses of "bulk" personal information ...

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