FIRST for a Reason: The Courts Giveth; The Courts Taketh Away


North Carolina’s appellate courts have been relatively active in the open government and libel space in recent months.  The open government outcomes have been favorable, but in an odd move involving unusual procedural rulings, the N.C. Supreme Court erased an earlier success at the Court of Appeals.

Good News from the Court of Appeals

The Court of Appeals issued two very favorable opinions on open government.  In the first case, NC Citizens for Transparent Government and Kevin Drum vs. The Village of Pinehurst, the court clarified that the 45-day statute of limitations that is embedded in a subsection of the Open Meetings Law only applies if the plaintiff in a case is seeking to have the court overturn an action that was taken in an allegedly illegal meeting.  Otherwise, the very short limitations does not apply.  In other words, if a public body takes some action in an illegal meeting – voting on a contract for the construction of a new school, for example – then the action stands unless it is challenged within 45 days. This makes sense from a public policy standpoint, because you wouldn’t want the losing contractor to bring a challenge two years later, when the school already had been built.  On the other hand, if the plaintiff in an Open Meetings Lawsuit seeks only a declaration that a meeting was illegal or an injunction to stop future illegal meetings from happening, that lawsuit can be brought within a three-year statute of limitations. This ruling is not likely to affect many lawsuits from media covering governmental bodies.  Given the nature of the news and the importance of timing, most media plaintiffs in fact bring claims relatively quickly when violations occur, but there could be occasions in which time is needed to evaluate and decide whether to bring a claim. This case answers that you do not forfeit your rights by taking that time to deliberate.

The more recent case decided by the Court of Appeals is likely to have significant importance to both the public at large and media across the state.  In Gray Media Grp., Inc. v. City of Charlotte, the court made significant rulings about the public records law.  In Gray Media, the court considered whether records held by a third party were subject to the Public Records Law. The City of Charlotte contracted with Ernst & Young to, among other things, develop and implement a survey “focused on transformative leadership and high-performing council topics for the City Council members.”  EY sent emails to council members’ work email addresses and included links for the council members to complete the survey through a portal. The City’s contract with EY specified that the City retained ownership of the work product generated by EY, but when WBTV  requested copies of the survey and survey responses, the City of Charlotte refused to provide the records, saying "[w]e are not in possession of those surveys and EY used those surveys solely for the purpose of developing their recommendations." After WBTV filed a public records lawsuit, the City sent a subpoena to EY demanding production of the records in connection with the lawsuit, and then the City said the lawsuit was moot, because the records had been produced.

The Court of Appeals made a couple important rulings.  The fact that WBTV received the records through discovery in the lawsuit did not mean the case was moot, because one of the things WBTV sought in the lawsuit was a determination about whether the City was right or wrong in withholding the records in the first place.  The opinion does not stop there, though.  The court framed up the question as

[C]an a government agency place public records solely in the possession of a third party or otherwise ensure that only the third party has immediate access to what would undoubtedly be public records if in the possession of the government agency and then assert that the documents are not subject to disclosure under the Public Records Act? We hold that it cannot.

The opinion notes that the parties agree the records at issue are not physical documents but instead are purely electronic records and finds that this in no way affects their status as potential public records.  The court rejected the City’s argument that because they did not have possession of the requested records they were not the legal custodian.  “The Public Records Act provides a procedure to inspect, review or copy documents in the custodian's custody by requesting access from the custodian of the public records. … Notably, the phrase ‘actual possession’ does not appear in the section.” The court wrote that when there is a dispute over custody of a record, it is the role of the court “to ensure that public records are properly shared with the public—it is not the role of the state agencies to self-regulate compliance with the Public Records Act.” In this case, the contract between the City and EY clearly vested custody in the City, and the records had to be provided.  Finally, the court wrote:

Records created or received by a government entity, even when stored or held by a third party, are subject to disclosure under the Public Records Act and the government agency must exercise its right to possession of the records to allow the requestor to inspect or examine the records.

Bad News from the Supreme Court

Many moons ago, we wrote here about a significant libel case decided by the Court of Appeals. In Walker v. Wake Cnty. Sheriff's Dep't, the Court of Appeals found that WTVD was not liable for having broadcast inaccurate criminal information that had been provided by the Wake County Sheriff’s PIO.  The court applied the fair report privilege more broadly than before, and the Supreme Court agreed to review the case. While the case was pending before the Supreme Court, the parties settled.  The court dismissed the appeal and, in an unusual move, vacated the decision of the court of appeals. Although not unprecedented, the vacation of the decision was controversial, leading to three dissenting opinions.  A lot has been written about the majority decision and the political undercurrents of the other opinions written by the justices. Most importantly for those of us in the news world, however, is the loss of a great case on the fair report privilege.  We still have LaComb v. Jacksonville Daily News, which was the case first establishing the privilege, but LaComb left a few questions that were answered by the Walker case.  Now we are back to not knowing, for example, the role that actual malice might play when a news organization publishes information from official sources. That’s a shame.