What should a Florida school board do when a vendor claims requested records are trade secrets?

Plain-English summary

The School Board of Osceola County sought guidance about information Adventist claimed as trade secrets. The board's attorney asked whether the records qualified under section 812.081(1)(c), Florida Statutes, and what the board should do if they did not.

Senior Assistant Attorney General Gerry Hammond responded informally. The AG's office could not determine whether specific records qualify as trade secrets, because that is a mixed question of law and fact reserved for the judiciary. The letter then walked through the statutory definition, the First District Court of Appeal decision in Sepro Corporation v. Florida Department of Environmental Protection, and a practical procedure: if the material does not appear to meet the statutory test or was not marked or otherwise specified in writing as a trade secret when delivered, the school board should tell the vendor that it has received a public records request, intends to release the records, and will allow the vendor to seek a protective order.

Currency note

This opinion was issued in 2016. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

The letter applies the statutes and decisions as they stood in 2016. Check current law before relying on its procedure.

Common questions

Q: What did the AG's office actually say about whether Adventist's records were trade secrets?
A: Nothing definitive. The AG declined to apply the statute to the specific facts, because a trade-secret determination requires fact-finding and that is the judiciary's job. The letter only described the legal framework the board should use.

Q: What is the Sepro rule?
A: The First District Court of Appeal's 2003 Sepro decision held that a person who hands a trade secret to a state agency without labeling it as a trade secret, or otherwise specifying in writing on delivery that it is confidential and exempt from public records, has not taken reasonable measures to maintain secrecy. The records lose their statutory exemption.

Q: What did the letter advise if vendor records did not qualify as trade secrets?
A: Per the AG's informal guidance, the custodian should look at whether the materials were marked or otherwise specified as confidential at the time of delivery, and whether they appear to meet the statutory definition. If the materials do not appear to meet that definition or were not protected as in Sepro, the school board should tell the vendor it has received a request and will release the records, allowing the vendor to seek a protective order.

Q: Does the vendor get more than one chance to mark records as confidential?
A: The letter's footnote describes Cubic Transportation Systems: the company once tried to assert confidentiality by telling county staff, then failed to mark the documents for about 30 days. The court held that those actions did not adequately protect its claimed trade secret.

Q: What did the letter say about a protective order?
A: It advised the board to allow Adventist to seek one if the board planned to release records that appeared not to meet the trade-secret test or had not been protected under Sepro. A footnote compares Allstate Floridian Insurance Company, where Allstate was required to seek a circuit-court order identifying the documents it claimed were privileged.

Background and statutory framework

The letter says the Legislature created exemptions to the Public Records Law for trade secrets. Section 812.081(1)(c) defines a trade secret as the whole or any portion of a formula, pattern, device, combination of devices, or compilation of information used in the operation of a business that gives the business an advantage over those who do not know it. The definition then enumerates four attributes (secret, of value, in use, providing an advantage) and conditions trade-secret status on the owner taking measures to prevent the information from becoming available to anyone other than people the owner has authorized.

The letter also quotes section 688.002(4)(b)'s requirement that a trade secret be "the subject of efforts that are reasonable under the circumstances to maintain its secrecy."

The letter quotes the First District Court of Appeal's Sepro decision: a trade-secret owner who delivers material to a state agency without labeling it as a trade secret or specifying in writing that it is confidential and exempt has not taken reasonable measures to maintain secrecy.

For the records at issue, the letter says the board should notify Adventist of the request and intended release if the material does not appear to satisfy the statutory test or was not protected as in Sepro. It leaves Adventist the opportunity to seek a protective order.

Citations and references

Statutes:

• § 812.081(1)(c), Fla. Stat. (theft of trade secrets; definition)
• § 688.002(4)(b), Fla. Stat. (reasonable efforts to maintain secrecy)

Cases:

• Sepro Corporation v. Florida Department of Environmental Protection, 839 So. 2d 781, 785 (Fla. 1st DCA 2003) (failure to label or specify in writing at delivery defeats the trade-secret claim).
• James, Hoyer, Newcomer, Smiljanich, & Yanchunis, P.A. v. Rodale, Inc., 41 So. 3d 386 (Fla. 1st DCA 2010) (trade-secret status is a fact question).
• Cubic Transportation Systems, Inc. v. Miami-Dade County, 899 So. 2d 453, 454 (Fla. 3d DCA 2005) (the company told staff of a confidentiality claim but left documents unmarked for about 30 days).
• Allstate Floridian Insurance Company v. Office of Insurance Regulation, 981 So. 2d 617 (Fla. 1st DCA 2008) (in that case Allstate had to seek a protective order identifying the records it claimed were privileged).

Source

• Landing page: https://www.myfloridalegal.com/ag-opinions/trade-secrets-protective-orders
• Official print view: https://www.myfloridalegal.com/print/pdf/node/1519

Original opinion text

Mr. Usher L. Brown

Capital Plaza 1, Suite 500

201 East Pine Street

Orlando, Florida 32801-2718

Dear Mr. Brown:

As attorney for the School Board of Osceola County and on behalf of the members of the Board you have asked for assistance in determining whether certain information may constitute a trade secret pursuant to section 812.081(1)(c), Florida Statutes. In addition, you have requested guidance regarding the duty of the school board and its employees to deny an exemption when material does not appear to constitute a trade secret. Attorney General Bondi has asked me to respond to your letter.

Initially, I must advise you that this office cannot determine whether certain categories of information which have been claimed to be trade secret may, in fact, fall within the definition contained in section 812.081(1)(c), Florida Statutes, as such a determination requires application of the law to the particular facts. Resolution of mixed questions of law and fact are the exclusive province of the judiciary.[1] However, in an effort to be of some assistance, I offer the following informal comments.

The Legislature has created a number of statutory exemptions to the Public Records Law relating to trade secrets. Section 812.081(1)(c), defines "Trade secret" to mean:

"[T]he whole or any portion or phase of any formula, pattern, device, combination of devices, or compilation of information which is for use, or is used, in the operation of a business and which provides the business an advantage, or an opportunity to obtain an advantage, over those who do not know or use it. "Trade secret" includes any scientific, technical, or commercial information, including any design, process, procedure, list of suppliers, list of customers, business code, or improvement thereof. Irrespective of novelty, invention, patentability, the state of the prior art, and the level of skill in the business, art, or field to which the subject matter pertains, a trade secret is considered to be:

1. Secret;

2. Of value;

3. For use or in use by the business; and

4. Of advantage to the business, or providing an opportunity to obtain an advantage, over those who do not know or use it

when the owner thereof takes measures to prevent it from becoming available to persons other than those selected by the owner to have access thereto for limited purposes."[2]

Further, the First District Court of Appeal in Sepro Corporation v. Florida Department of Environmental Protection,[3] held that "[t]he trade secret owner who fails to label a trade secret as such, or otherwise to specify in writing upon delivery to a state agency that information which it contends is confidential and exempt under the public records law is not to be disclosed, has not taken measures or made efforts that are reasonable under the circumstances to maintain the information's secrecy" as required by section 812.081, Florida Statutes (and section 688.002, Florida Statutes).[4]

Employees of the School Board of Osceola County are prohibited from disclosing trade secrets received in carrying out their duties, to any unauthorized person, provided such trade secrets fall within the definition set forth in section 812.081(1)(c), Florida Statutes, and the owner of the trade secret has taken measures, as discussed in Sepro Corporation v. Florida Department of Environmental Protection, supra, to maintain the information's secrecy. If the material claimed by Adventist to be "trade secret" does not appear to meet the statutory test or has not been protected as in Sepro, the school board should advise Adventist that it has received a public records request and will release the records and allow Adventist to seek a protective order for those materials.[5]

I trust that these informal comments will be helpful to you in advising your client, the School Board of Osceola County.

Sincerely,

Gerry Hammond

Senior Assistant Attorney General

GH/tsh

________________

[1] See Department of Legal Affairs Statement of Policy Concerning Attorney General Opinions (Attorney General Opinions are intended to address only questions of law, not questions of fact, mixed questions of fact and law, or questions of executive, legislative, or administrative policy) and James, Hoyer, Newcomer, Smiljanich, & Yanchunis, P.A. v. Rodale, Inc., 41 So. 3d 386 (Fla. 1st DCA 2010) (whether information qualifies as a trade secret, so as to be exempt from disclosure under public records law, necessarily rests on factual determinations).

[2] And see s. 688.002(4), Fla. Stat., defining "Trade secret" as:

". . . [I]nformation, including a formula, pattern, compilation, program, device, method, technique, or process that:

(a) 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; and

(b) Is the subject of efforts that are reasonable under the circumstances to maintain its secrecy."

[3] 839 So. 2d 781, 785 (Fla. 1st DCA 2003), review denied sub nom., Crist v. Florida Department of Environmental Protection, 911 So. 2d 792 (Fla. 2005).

[4] 839 So. 2d at 784. See also s. 688.002(4)(b), Fla. Stat., which provides that a "[t]rade secret" must be "the subject of efforts that are reasonable under the circumstances to maintain its secrecy." And see Cubic Transportation Systems, Inc. v. Miami-Dade County, 899 So. 2d 453, 454 (Fla. 3d DCA 2005) (where a company supplied documents to an agency and failed to mark them as "confidential" and for some 30 days after it had once attempted to do so by so informing county staff," the company failed adequately to protect an alleged trade secret claim).

[5] Cf. Allstate Floridian Insurance Company v. Office of Insurance Regulation, 981 So. 2d 617 (Fla. 1st DCA 2008), review denied, 987 So. 2d 79 (Fla. 2008) (to the extent Allstate believed documents sought by the Office of Insurance Regulation were privileged as trade secrets, Allstate was required to timely seek a protective order in circuit court specifically identifying the requested documents it believed were privileged).