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2003-29

- Final Decision
- Findings and Recommendations of the Acting Executive Director

Final Decision

Joseph Belth,
Complainant
v.
N.J. Department of Banking and Insurance,
Custodian of Record

Complaint No. 2003-29
Decision Issued: February 27 2004
Decision Effective: March 8, 2004

At its February 27, 2004 public meeting, the Government Records Council ("Council") considered the February 23, 2004 Findings and Recommendations of Executive Director and all related documentation submitted by the parties. The Council voted to adopt the entirety of said Findings and Recommendations. The Council dismissed the complaint finding that:

  1. DOBI has met its burden of showing that the requested documentation is exempt from disclosure under the "proprietary commercial or financial information," and "advantage to competitors" sections of OPRA. N.J.S.A. 47:1A-1.1.
  2. DOBI has met its burden of showing that the requested information is exempt pursuant to laws that include, but are not necessarily limited to, N.J.S.A. 17:23-24f; N.J.S.A. 17:27A-6. See N.J.S.A. 47:1A-9.

Vincent P. Maltese, Chairman
Government Records Council

I attest the foregoing is a true and accurate record of the Government Records Council.

Virginia Hook, Secretary
Government Records Council

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Findings and Recommendations of the Acting Executive Director

Joseph Belth                                                      GRC Complaint No.  2003-29
Complainant
          v.
New Jersey Department of
Banking and Insurance ("DOBI")
Custodian of Records

Relevant Records Requested: Copy of the request by Clarendon National Insurance Co. for permission to pay interest on outstanding surplus notes, and a copy of DOBI's denial of this request.
Custodian: Gary Vogler
Request Made: January 10, 2003
Response Made:   January 21, 2003
GRC Complaint filed: March 17, 2003

Recommendations of Acting Executive Director

This complainant requested a copy of the request by Clarendon National Insurance Co. for permission to pay interest on outstanding surplus notes, and a copy of DOBI's denial of this request.  In his March 17, 2003 complaint, he alleges that DOBI wrongfully denied access to view information.

DOBI denied this request in its entirety, based upon the Open Public Records Act ("OPRA") exemptions for "proprietary commercial or financial information obtained from any source" and "information, which, if disclosed, would give an advantage to competitors."

The requestor also argues that DOBI should have supplied copies of the requested documents, with confidential information redacted.  However, DOBI reasonably contends that the documents are entirely confidential and cannot be redacted

The Acting Executive Director respectfully recommends that the Council dismiss this complaint because:

  1. DOBI has met its burden of showing that the requested documentation is exempt from disclosure under the “proprietary commercial or financial information,” and “advantage to competitors” sections of OPRA. N.J.S.A. 47:1A-1.1.
  2. DOBI has met its burden of showing that the requested information is exempt pursuant to laws that include, but are not necessarily limited to, N.J.S.A. 17:23-24f; N.J.S.A. 17:27A-6. N.J.S.A. 47:1A-9.
Legal Analysis
The Denial of Access Complaint challenges the denial by the Department of Banking and Insurance (DOBI) of the following request:

Copy of the request by Clarendon National Insurance Co. for permission to pay interest on outstanding surplus notes, and a copy of DOBI's denial of this request.

DOBI denied this request in its entirety, based upon the OPRA exemptions for "proprietary commercial or financial information obtained from any source" and "information which, if disclosed, would give an advantage to competitors."

DOBI submitted a certification by George Dytyniak, of its Office of Solvency Regulation, in support of the confidentiality exemptions cited.  The certification states:

The day when a request is filed for permission to pay interest and/or principal on a surplus note, as well as the amount sough to be repaid, reveals information about the financial condition of a company such as Clarendon.  That financial information is extremely sensitive and proprietary to the insurer.

Moreover, a request by an insurer to pay interest on a surplus note requires Department review of the company's financial condition, in order to determine whether the funds sought to be repaid should be utilized for that (or another) purpose.  This analysis, and the ultimate decision reached by the Department on the request, contain proprietary information about the financial condition of the company.

If revealed, that financial analysis and information could provide an advantage to that company's competitors.  OPRA also deems confidential, and not subject to disclosure, information which, if disclosed, would give an advantage to competitors.

The briefs filed on behalf of DOBI with the GRC amplify that the Department's review of such a request requires an in-depth analysis of the company's financial condition.  DOBI's position is that if such information were to be disclosed, the company's competitors would be able to evaluate its financial strength or weakness, thereby giving competitors -- who have not similarly revealed their financial conditions -- an advantage.

Clarendon has filed with the GRC a letter from its counsel, which agrees with DOBI's position.  The company has also submitted a certification of its Treasurer, which states that disclosure of the information requested would be advantageous to competitors and harmful to Clarendon in the marketplace.

DOBI has met its burden of showing that the requested information is exempt under the "advantage to competitors" provision of OPRA.  It is undisputed that the agency's review of a request regarding interest on a surplus note requires submission and analysis of sensitive information pertaining to an insurer's financial condition.  It follows that disclosure of this information to Clarendon's competitors, who have not disclosed such information about them to Clarendon, would give competitors an advantage.  This conclusion is further supported by the certifications submitted by Clarendon and DOBI.  The requestor does not in any way contradict the certifications or DOBI's argument that the information in question would give competitors an advantage.  Since there is no genuine factual dispute, regarding the need for confidentiality, DOBI's denial of the request should be upheld.

The requestor also argues that DOBI should have supplied copies of the requested documents, with confidential information redacted.  However, DOBI reasonably contends that the documents are entirely confidential and cannot be redacted.  It points out that even knowing the date of the request gives a competitor the advantage of knowing when Clarendon was financially able to pay interest on the note.  The requestor does not dispute this, indeed, there is nothing in the record which suggests that there is information contained in the request that is not confidential.  The position that the entire document is confidential is consistent with the general policy of the insurance statutes, which provide confidentiality in a variety of instances to documents, not just information, submitted to DOBI.  See, e.g., N.J.S.A. 17:23-24f; N.J.S.A. 17:27A-6.
Based on the foregoing, it is recommended that the denial of the request be upheld.

Documents Reviewed

The following documents have been submitted to members of the Government Records Council concerning the case:

  • January 10, 2003 - Request for copy of Clarendon National Insurance Company outstanding surplus notes.
  • January 21, 2003 - Denial of request for Clarendon surplus notes, because they are considered confidential, pursuant to N.J.S.A. 47:1A-1.1
  • March 17, 2003 - Denial of Access Complaint Filed
  • March 26, 2003 - Agreement to Mediate (Complainant)
  • March 31, 2003 - Custodian Declines Mediation
  • April 29, 2003 - GRC request for Statement of Information from custodian.
  • May 7, 2003 - Submission of Statement of Information
  • May 9, 2003 - Certified statement of George Dytyniak of the NJ Dept. of Banking and Insurance, Office of Solvency Regulation.
  • May 9, 2003 - Correspondence stating that the information in the document is private from Wesley S. Caldwell, III, counsel for Clarendon.
  • June 12, 2003 - Certified statement of Anders Larsson who serves as Treasurer of Clarendon and stated that the information in the requested document is private.
  • June 25, 2003 - Complainants response to June 12, 2003 document.

Conclusion

The Executive Director respectfully recommends that the Council dismiss the complaint because:

  1. DOBI has met its burden of showing that the requested documentation is exempt from disclosure under the "proprietary commercial or financial information," and "advantage to competitors" sections of OPRA. N.J.S.A. 47:1A-1.1.
  2. DOBI has met its burden of showing that the requested information is exempt pursuant to laws that include, but are not necessarily limited to, N.J.S.A. 17:23-24f; N.J.S.A. 17:27A-6. N.J.S.A. 47:1A-9.

________________________

Paul F. Dice
Acting Executive Director
Government Records Council

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