A unanimous Georgia Supreme Court on Thursday ruled that a dispute between Northside Hospital and a lawyer seeking its records under the Open Records Act must go back to the trial court that dismissed the case.
The opinion reverses two prior rulings holding that Northside’s records were off-limits, even though its main facility is leased from a public entity, the Hospital Authority of Fulton County.
Northside leased its main hospital and assets to the newly formed, private, nonprofit Northside Hospital Inc. in 1999, but the company has since “become massive, with considerable assets in surrounding counties,” wrote Justice Nels Peterson for the court.
Peterson’s ruling noted that, while many of Northside’s activities have nothing to do with the authority, determining “which of Northside’s actions qualify as ‘on behalf of’ the Authority may be a trickier question” than simply looking at prior cases in which the involvement of public interests meant its records were subject to the act.
“Although the Authority may not be involved in the day-to-day operations of the hospital system it leases to Northside, Northside remains accountable to the Authority,” Peterson wrote.
“How closely the transactions at issue are tied to operating the leased facilities will determine whether documents are ‘public records,’” he said.
The court remanded the case to Fulton County Superior Court Judge Gail Tusan “to consider in the first instance whether the records in question are sufficiently connected to the operation of the leased facilities to constitute public records” and, if so, “whether the records may nevertheless be withheld pursuant to a statutory exemption.”
In a concurring opinion, Justice Harold Melton said he wrote to emphasize that the Fulton authority “has so blurred the lines between its public functions and those that it has seemingly delegated to Northside that it cannot be credibly stated that Northside is so completely separated from the Authority that none of the records sought in this case could even possibly be classified as ‘public records.’”
The case began in 2015, when Jones Day partner E. Kendrick Smith sued Northside under Georgia’s Open Records Act, seeking records relating to Northside’s acquisition of four large physician practice groups between 2011 and 2013.
Smith has not revealed who is behind the bid seeking access to the records, but Northside argued that an unidentified competitor—speculated in an appellate brief filed by one of the practices at issue to be Northside rival Emory Healthcare—is hoping to gain a business advantage by accessing the “highly confidential” information.
Smith argued that the records are covered under the ORA because Northside’s parent company, although a private entity, is operating under the aegis of a public entity, the Fulton County Hospital Authority.
Northside countered that, in addition to offering a potential business rivals a competitive advantage, disclosure of the records would violate confidentiality agreements hospital and authority officials signed.
Fulton County Superior Court Chief Judge Gail Tusan dismissed the case in 2015 after a three-day bench trial. Last year, in a 5-to-2 decision, the Court of Appeals affirmed Tusan’s ruling.
In briefs and oral arguments before the justices in April, Smith’s attorney and fellow Jones Day partner Peter Canfield argued that longstanding interpretation of the Open Records Act mandated that, once a public hospital authority cedes control of its facilities to a private entity, the records of the private company become public.
Northside’s counsel includes Dentons partners Thurbert Baker, a former Georgia attorney general, and J. Randoph Evans, who was recently nominated as U.S. ambassador to Luxembourg; as well as James Rawls and Derek Bauer, both of Baker Hostetler.
On Thursday, Evans said he was gratified that the justices, like the lower courts, “have finally put to rest any notion that Northside is always subject to the Open Records Act just because it leased its facilities from the authority.”
“The common denominator in all three courts is the outright rejection of that argument, and that it requires an intensive inquiry that should be decided on a case-by-case basis,” Evans said.
Canfield on Friday morning issued this statement: “From day one Northside has claimed it is not subject to the Open Records Act. It sold that bill of goods to the trial court and the Court of Appeals. The Supreme Court has unanimously said no. If Northside wants to claim that records like those we’ve requested are not subject to the act, it has to prove that the records are not connected with its public mission. We’re confident they will not be able to do so.”
Richard T. Griffiths of the Georgia First Amendment Foundation said it was “great news that the justices have followed precedent and held that Northside is fundamentally bound by the principles of open government and transparency.”
Such transparency, Griffiths said, “is the best way to maintain accountability for the taxpayers who paid for Northside and who still effectively own the hospital.”