WYRICK (MITZI D.) VS. DEPARTMENT OF REVENUE, FINANCE & ADMINISTRATION CABINET , ET AL. REVERSING IN PART, VACATING IN PART, AND REMANDING KELLER (PRESIDING JUDGE) THOMPSON (CONCURS) AND GRAVES (CONCURS)
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RENDERED: MAY 30, 2008; 10:00 A.M.
TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
NO. 2007-CA-000089-MR
MITZI D. WYRICK
v.
APPELLANT
APPEAL FROM FRANKLIN CIRCUIT COURT
HONORABLE SAM G. MCNAMARA, JUDGE
ACTION NO. 06-CI-00381
DEPARTMENT OF REVENUE, FINANCE
AND ADMINISTRATION CABINET,
COMMONWEALTH OF KENTUCKY; AND
MARIAN DAVIS, IN HER OFFICIAL
CAPACITY AS COMMISSIONER OF THE
DEPARTMENT OF REVENUE
APPELLEES
OPINION
REVERSING IN PART, VACATING IN PART,
AND REMANDING
** ** ** ** **
BEFORE: KELLER AND THOMPSON, JUDGES; GRAVES, SENIOR
JUDGE.
KELLER, JUDGE: In this Open Records action, Mitzi D. Wyrick has appealed
from an order of the Franklin Circuit Court denying her request to inspect four
categories of records held by the Department of Revenue (the DOR). Having
determined that the DOR incorrectly applied the applicable law in denying Wyrick
access to the materials, we reverse in part, vacate in part, and remand this matter to
the circuit court for further proceedings.
FACTS
Wyrick is a practicing attorney who is representing the CourierJournal and Louisville Times Co. (the Courier-Journal) in a proceeding before the
Kentucky Board of Tax Appeals regarding the Courier-Journal’s taxpayer refund
claim.1 In the course of that administrative proceeding, the Courier-Journal sought
discovery from the DOR via Interrogatories and Requests for Production of
Documents seeking information concerning, for example, the DOR’s interpretation
or administration of tax laws, other taxpayers and the DOR’s resolution of their
matters, and the internal operations of the DOR. The DOR disputed the CourierJournal’s right to that information, arguing that the requested discovery was not
relevant to the matter before the Board of Tax Appeals. The DOR was successful
in its argument, and the Courier-Journal was not permitted to obtain the material in
discovery.
On September 1, 2005, the day after the Kentucky Board of Tax
Appeals sustained the DOR’s objection to the Courier-Journal’s discovery
requests, Wyrick filed an Open Records request with the DOR, seeking nine
categories of public records to inspect and copy (Request No. 1). Those public
records were:
1
Kentucky Board of Tax Appeals File No. K04-R-03.
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1. Any and all training manuals or guides from
1975 to 1994 used to instruct personnel to process, audit,
review, or otherwise handle unitary/combined audits
and/or tax returns of taxpayers.
2. Any and all policies or procedures regarding the
filing, auditing or review of tax returns under the unitary
method of reporting.
3. Any correspondence, questionnaires and similar
material sent to taxpayers seeking information about
unitary attributes and other matters pertaining to the
determination of a unitary group.
4. A copy of Revenue Cabinet policy 41P225, any
preceding policies related to the filing of
unitary/combined returns, and any subsequent policies
regarding the filing of unitary/combined returns.
5. All memos and drafts of memos regarding the
filing, auditing, review of tax returns under the unitary
method and how the unitary method should be applied in
Kentucky.
6. All files regarding unitary filings in Kentucky
and how unitary filings should be treated, reviewed,
audited, or processed.
7. All legal memos regarding the application,
interpretation, or analysis of unitary filing under Early &
Daniels, 682 S.W.2d [sic] (Ky. 1982); Armco, 748
S.W.2d 372 (Ky. 1988); V.E. Anderson, 87-SC-122-DG
(Nov. 5, 1987)(unpublished); or GTE v. Revenue
Cabinet, 889 S.W.2d 788 (Ky. 1994).
8. Any contracts, memorandums of agreement or
understanding, or similar documents in which the
Commonwealth of Kentucky or the Revenue Cabinet on
its behalf participated in the Joint Audit Program of the
Multistate Tax Commission.
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9. The audit files related to all audits conducted by
the Multistate Tax Commission’s Joint Audit Program on
behalf of the Revenue Cabinet.
The DOR sent a preliminary response to Wyrick on September 8th, noting that it
was working diligently to locate the requested information, but that it would need
additional time through October 14th pursuant to KRS 61.872(5) and (6) to
determine whether it had any of the materials in its possession that were not
exempt from disclosure. In response, Wyrick sent a letter to the DOR on
September 27, 2005, in which she stated her disagreement with the DOR’s delayed
response. In the same correspondence, Wyrick also submitted a second Open
Records request (Request No. 2): “All documents produced by the Revenue
Cabinet in the Johnson Controls litigation in the Franklin Circuit Court, Civil
Action No. 00-CI-00661.”
The DOR responded to Request No. 2 in a letter dated September 30,
2005, stating that no records existed, as the DOR did not keep or maintain any
copies of the documents the plaintiffs in the Johnson Controls litigation inspected,
and its files did not contain any of the documents. The DOR then stated that even
if it did maintain the requested records, the material would be exempt from
disclosure. By letters dated October 11 and 21, 2005, Wyrick sought clarification
from the DOR concerning the Johnson Controls litigation documents, and
requested that the DOR more thoroughly search for these records. The DOR
responded to Wyrick’s two letters on October 25, 2005, again stating that the
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requested records did not exist and that such records would have been excluded
from application of the Open Records Act.
The DOR responded to Request No. 1 on October 18, 2005. It
provided Wyrick with a copy of Revenue Policy 41P225, but denied the remainder
of her request, both in the aggregate (pursuant to the application of KRS 61.878(1))
and as to each of the nine categories (pursuant to one of the fourteen listed
exclusions).
On November 21, 2005, Wyrick initiated an appeal with the Attorney
General, seeking enforcement of the Open Records Act for both of her requests. In
a lengthy order dated February 13, 2006,2 the Attorney General upheld the DOR’s
denial of five of the nine requests for records in Request No. 1, but determined that
the DOR’s denial of the remaining four categories of records was improper. The
Attorney General also determined that the DOR improperly denied Request No. 2.
The Attorney General specifically did not address whether the party litigation
limitation in KRS 61.878(1) provided a defense for the DOR, as that issue was not
raised in the DOR’s response.
The DOR sought review of the Attorney General’s decision pursuant
to KRS 61.880(5)(a) by filing an appeal with the Franklin Circuit Court on March
15, 2006. In the appeal, the DOR asserted that Wyrick’s review to the Attorney
General was untimely, that inspection was prohibited as beyond pretrial discovery
pursuant to KRS 61.878(1), and that each of the categories for which the Attorney
2
06-ORD-032.
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General authorized inspection was barred from inspection by a listed exclusion. In
her answer, Wyrick put forth defenses based upon the DOR’s failure to state a
claim upon which relief could be granted as well as based upon estoppel. Wyrick
requested a declaration that the records would be available for review, and also
requested penalties and costs.
Soon thereafter, the parties engaged in a dispute concerning
discovery. In an order entered July 17, 2006, the circuit court ruled on the
discovery dispute and held that in a de novo appeal, such as this, evidence not
introduced below may not be introduced before it. In the same order, the circuit
court ordered the parties to brief the issue of whether the action was properly
before the circuit court pursuant to KRS 61.878(1) based upon the party litigation
limitation. After the parties filed their respective briefs, the circuit court entered an
Opinion and Order on December 11, 2006, solely addressing that issue. The
circuit court ultimately held that the party litigation limitation applied to bar
inspection by Wyrick of the subject documents, as Wyrick had made the Open
Records request on behalf of a party (the Courier-Journal) that was involved in
legal proceedings against the Commonwealth after a determination had been made
that the documents were not discoverable. The circuit court made the December
11th Opinion and Order final and appealable pursuant to CR 54.02, and this appeal
followed.
STANDARD OF REVIEW
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Our standard of review in Open Records actions is set forth in Medley
v. Board of Educ., Shelby County, 168 S.W.3d 398, 402 (Ky. App. 2004), as
follows:
[T]he circuit court’s review of an Attorney General’s
opinion is de novo. As such, we review the circuit
court’s opinion as we would the decision of a trial court.
Questions of law are reviewed anew by this Court. When
there are questions of fact, or mixed questions of law and
fact, we review the circuit court’s decision pursuant to
the clearly erroneous standard. [Footnotes omitted.]
The issue raised in this appeal deals with a question of law; namely, the
interpretation of a statute. Accordingly, our review is de novo.
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ANALYSIS
Before we are able to reach the merits of this appeal, we must first
address several issues that may have some bearing on our scope of review.
We shall first address the DOR’s contention that Wyrick’s appeal to
the Attorney General seeking review was untimely. The DOR relies upon KRS
Chapter 13B to urge this Court to imply a 30-day time period in which a denial of
an Open Records request must be appealed to the Attorney General. Here, the
DOR denied Request No. 1 on October 18, 2005, and it denied Request No. 2 on
September 30, 2005. Wyrick did not seek review by the Attorney General until
November 21, 2005. Wyrick argues in her reply brief that the Open Records Act
does not contain a timeframe for challenging an agency’s denial to the Attorney
General. We agree with Wyrick’s position.
In KRS 61.880, the General Assembly described the role of the
Attorney General in actions to seek enforcement of the Open Records Act. Under
KRS 61.880(2)(a), a complaining party who wishes to seek review of a public
agency’s denial of an open records request simply must “forward to the Attorney
General a copy of the written request and a copy of the written response denying
inspection.” The General Assembly chose not to attach a time limitation on a
complaining party’s decision to appeal to the Attorney General, as it did on the
Attorney General’s time to issue a decision and on a party’s time to appeal the
Attorney General’s decision to the circuit court. See KRS 61.880(2)(a) and (b);
KRS 61.880(5)(a). Furthermore, we note that the General Assembly has provided
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for such time limitations elsewhere. In KRS 197.025(3), the General Assembly
specifically provided that “all persons confined in a penal facility shall challenge
any denial of an open record with the Attorney General by mailing or otherwise
sending the appropriate documents to the Attorney General within twenty (20)
days of the denial . . . .” As we recognized in Hahn v. University of Louisville, 80
S.W.3d 771, 774 (Ky. App. 2001), citing Beckham v. Board of Educ. of Jefferson
County, 873 S.W.2d 575, 577 (Ky. 1994), “‘[w]e are not at liberty to add or
subtract from the legislative enactment nor discover meaning not reasonably
ascertainable from the language used.’” Accordingly, we decline the DOR’s
request that we infer a 30-day time limitation for seeking review before the
Attorney General and hold that pursuant to the plain language of the statute,
Wyrick’s appeal to the Attorney General would have been timely whenever she
chose to file it.
Next, we shall address the DOR’s argument concerning what issues
are properly before this Court on appeal. This contention was specifically
addressed in the DOR’s motion to strike and limit Wyrick’s appellate brief and in
Wyrick’s response to that motion.3 In her brief, Wyrick included an argument that
the circuit court improperly foreclosed discovery in its July 17, 2006, order. The
DOR contends that the only ruling capable of being appealed to this Court is the
December 11, 2006, Opinion and Order, in which the circuit court only addressed
Request No. 1. The circuit court chose to make that particular Opinion and Order
A three-judge panel denied the DOR’s motion in an interlocutory order entered November 19,
2007.
3
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final and appealable by including the appropriate CR 54.02 language, as it had not
ruled on any other pending issues, such as the merits of Request No. 2 or whether
the materials Wyrick requested fell under any of the enumerated exclusions. The
DOR also pointed out that the circuit court did not choose to make the July 17,
2006, discovery order final and appealable.
Wyrick, in her response to the DOR’s motion, stated that Request No.
2 was an attempt to narrow the scope of Request No. 1, meaning that the circuit
court had in fact ruled on both requests. Although that statement might be true, the
record does not support Wyrick’s statement. In her September 27, 2005, letter,
Wyrick stated as follows:
In the interim, however, we are submitting this, a second
request, which is extremely limited in nature and cannot
possibly present any of the perceived timely concerns
raised by the Department previously. . . .
....
1. All documents produced by the Revenue
Cabinet in the Johnson Controls litigation in the Franklin
Circuit Court, Civil Action No. 00-CI-00661.
....
Please know that this request does not supercede
[sic] our previous Open Records request and we expect
that documents responsive to [the] first request will be
available for inspection on or about October 14, 2005, as
promised by your attorney. . . .
There is nothing in Wyrick’s correspondence to allow us to determine what the
documents produced in the Johnson Controls litigation were, or any indication that
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those documents were part of the same documents she had previously requested in
Request No. 1. Additionally, the circuit court made it clear in the Opinion and
Order that it was entering a final judgment only as to the claims arising out of
Wyrick’s Request No. 1 and the DOR’s October 18, 2005, response to that request.
Accordingly, we agree with the DOR that the circuit court has not yet
ruled on all of the pending issues, meaning that Wyrick’s appeal must be limited to
any rulings that were made final and appealable. Therefore, the only ruling
properly before this Court on review is the December 11, 2006, Opinion and
Order, which only addresses the materials Wyrick requested in Request No. 1. We
shall decline to review Wyrick’s argument concerning the circuit court’s discovery
ruling. This holding shall in no way foreclose Wyrick’s right to appeal that
interlocutory order upon the entry of a judgment finally adjudicating all of the
claims, including Wyrick’s claims for penalties and costs, should the circuit court
be in the position to consider those claims.
Finally, Wyrick contends that the DOR failed to preserve its argument
under KRS 61.878(1), as it failed to argue this defense before the Attorney
General. The DOR argues that it raised that defense in its aggregate denial of
Wyrick’s Request No. 1, and that it was not required to rehash all of its possible
defenses in its brief to the Attorney General. It is axiomatic that before an issue
may be raised on appeal, “a trial court must first be given the opportunity to rule on
a question for which review is sought.” Taxpayer’s Action Group of Madison
County v. Madison County Board of Elections, 652 S.W.2d 666, 668 (Ky. App.
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1983). Failure to do so renders an argument unpreserved for appeal. Hoy v.
Kentucky Industrial Revitalization Authority, 907 S.W.2d 766, 769 (Ky. 1995).
Although we believe that the DOR probably should have raised this defense before
the Attorney General, we nevertheless hold that the DOR sufficiently preserved
this issue when it included the defense as an aggregate reason for denying
Wyrick’s request. Pursuant to KRS 61.880(2)(a), “[t]he Attorney General shall
review the request and denial . . . .” (Emphasis added.) Accordingly, the Attorney
General would have received the DOR’s October 18th response, despite the DOR’s
apparent failure to discuss this defense in its response to Wyrick’s letter of appeal.4
In our view, the DOR sufficiently preserved this issue for review before the circuit
court as well as this Court. Having determined that the DOR preserved this issue,
we shall now turn to the merits of this appeal.
“The Open Records Act5 requires public agencies6 to make all public
records7 open for inspection and copying by any person, except when specifically
exempted.” Kentucky Lottery Corp. v. Stewart, 41 S.W.3d 860, 862 (Ky. App.
2001). In Medley, this Court described the basic policy of the Open Records Act
The record does not contain Wyrick’s letter of appeal or the DOR’s response. Based upon the
Attorney General’s decision, we acknowledge that Wyrick challenged the DOR’s position
regarding the application of the party litigation limitation as stated in its October 18th response in
her letter of appeal, but the DOR did not address that particular issue in its own response.
Therefore, the Attorney General did not address Wyrick’s argument concerning the DOR’s
position on this issue.
4
5
KRS 61.870, et seq. (Footnote 4 in original.)
6
As defined by KRS 61.870(1). (Footnote 5 in original.)
7
As defined by KRS 61.870(2). (Footnote 6 in original.)
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“that ‘free and open examination of public records is in the public interest . . . .’”
168 S.W.3d at 402. In KRS 61.878(1)(a) through (n) are listed the fourteen
separate categories of records that are excluded from application of the Open
Records Act. These categories are comprised of records including personal
information, confidential or proprietary information, test questions for
examinations, preliminary drafts or recommendations, and specifically described
law enforcement agency records, to name a few. The public agency bears the
burden of establishing that a requested record is exempt from release. Medley, 168
S.W.3d at 402. A more general exclusion regarding material pertaining to civil
litigation (the party litigation limitation) is contained in KRS 61.878(1), which
provides that:
The following public records are excluded from the
application of KRS 61.870 to 61.884 and shall be subject
to inspection only upon order of a court of competent
jurisdiction, except that no court shall authorize the
inspection by any party of any materials pertaining to
civil litigation beyond that which is provided by the
Rules of Civil Procedure governing pretrial discovery[.]
[Emphasis added.]
In analyzing the statutes under the Open Records Act, “we are guided by the
principle that ‘under general rules of statutory construction, we may not interpret a
statute at variance with its stated language.’” Hoy v. Kentucky Industrial
Revitalization Authority, 907 S.W.2d 766, 768 (Ky. 1995).
In Kentucky Lottery, the Court of Appeals explained the party
litigation limitation as follows:
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That statute does not exempt or exclude all records from
the open records disclosure, in favor of discovery in
litigation or anticipated litigation cases, but limits the
release of records specifically listed in KRS 61.878(1) to
those records which parties can obtain through a court
order. The gist of this wording is not to terminate a
person's right to use an open records request during
litigation, but to limit a court on an open records request
on excluded records, to those records that could be
authorized through a court order on a request for
discovery under the Rules of Civil Procedure governing
pretrial discovery. Any other interpretation would allow
a nonparty (like the press, which also made a request in
this case) to obtain records not exempted, while a party
before an administrative agency could not obtain these
same nonexempted records because administrative
agencies are generally not subject to pretrial discovery.8
This would bring about an absurd or unreasonable result
which cannot be fostered by the courts.9 “[T]he
Legislature clearly intended to grant any member of the
public as much right to access to information as the
next.” [Emphasis in original.]
Kentucky Lottery, 41 S.W.3d at 863. See also Zink v. Commonwealth, 902 S.W.2d
825, 828 (Ky. App. 1994). The Kentucky Lottery Court went on to state:
The Attorney General's Office has previously
taken the position that a party to litigation has the same
rights to disclosure as a nonparty:
Although there is litigation in the
background of the open records request
under review, the requester . . . stands in
relationship to the agency under the Open
Records Law as any other person. The fact
Starr v. Commissioner of Internal Revenue, 226 F.2d 721 (7th Cir. 1955), cert. denied, 350 U.S.
993, 76 S.Ct. 542, 100 L.Ed. 859 (1956). (Footnote 8 in original.)
8
Com., Cent. State Hospital v. Gray, Ky., 880 S.W.2d 557 (1994); George v. Alcoholic
Beverage Control Board, Ky., 421 S.W.2d 569 (1967); Commonwealth v. Anderson, Ky.App.,
694 S.W.2d 465 (1985). (Footnote 9 in original.)
9
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that he may have a special interest by reason
of the litigation provides no reason to grant
or deny his request to inspect the records.10
In a subsequent decision, the Attorney General addressed
not only contemplated litigation, but a request by parties
in litigation and opined:
Inspection of public records held by public
agencies under Open Records provisions is
provided for by statute, without regard to the
presence of litigation. There is no indication
in the Open Records provisions that
application of the rules therein are [sic]
suspended in the presence of litigation.
Requests under Open Records provisions, to
inspect records held by public agencies, are
founded upon a statutory basis independent
of the rules of discovery. Public agencies
must respond to requests made under the
Open Records provisions in accordance with
KRS 61.880.11
We agree with those Attorney General's Opinions
which opine that an open records request should be
evaluated independently of whether or not the requester
is a party or potential party to litigation, and we so hold.
Id. at 863-64.
Because of the confusion inherent in interpreting the party litigation
limitation, we shall set forth in clear terms the steps a circuit court must take in
reviewing an Open Records Act decision:
1) Determine whether the material requested falls under one of the fourteen listed
exclusions, without regard to whether the requester is a party (or a potential
party) to litigation;
10
11
OAG 82-169, p. 2. (Footnote 15 in original.)
OAG 89-65, p. 3. (Footnote 16 in original.)
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a) If it does not fall under one of the exclusions, the material is subject to
inspection, and the analysis ends.
b) If it does, see 2) below.
2) If an exclusion applies, the circuit court must look to the party litigation
limitation.
a) If the material is pertaining to civil litigation and a party is the requester,
then the limitation applies and the circuit court CANNOT grant access to the
records in the Open Records action;
b) If the material is NOT pertaining to civil litigation (even if a party from a
civil litigation is the requester), then the circuit court MAY, within its
discretion, grant access to the excluded record as in any other Open Records
action.
Here, the circuit court opted to first decide the issue as to whether the
party litigation limitation applied in this case. After permitting the parties to brief
the issue, the circuit court decided that the materials requested were pertaining to
civil litigation and denied access to Wyrick. However, the circuit court never
determined whether the materials were subject to one of the fourteen exclusions
listed in the statute. We note that at that point in the proceedings, the Attorney
General had ordered the DOR to produce several categories of documents Wyrick
had requested, meaning that those materials were not subject to any of the fourteen
listed exclusions. In its Opinion and Order, the circuit court stated that it made
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no determination whether the documents described by
Categories 1, 2, 4, and 8 of the September 1 request were
(i) excluded from the application of the Open Records
Law under one of the 14 specific exceptions provided by
KRS 61.878(1), (ii) excepted under KRS 61.876, or (iii)
otherwise not subject to inspection on any other basis set
forth in the Revenue Department’s October 18, 2005
response.
Therefore, we must remand this case to the circuit court to make a determination as
to whether the materials Wyrick requested were specifically excluded under one or
more of the fourteen listed exclusions.
Furthermore, we hold that the circuit court incorrectly decided that the
party litigation limitation applied in this case. First, as pointed out by Wyrick, the
Kentucky Board of Tax Appeals action in which the Courier-Journal sought, but
was denied, the discovery of the material at issue, is an administrative, not a civil,
proceeding. Pursuant to the clear language of the statute, the exemption applies
only to civil litigation.
Second, assuming for the sake of this analysis that the underlying
action was civil litigation, the DOR cannot on the one hand argue, successfully,
that the material sought in the tax appeal case is irrelevant to that litigation to
defeat the discovery request, and then on the other hand argue in the Open Records
proceeding that it is pertaining to that litigation and therefore subject to the
limitation. The DOR is not “permitted to feed one can of worms” to the Board of
Tax Appeals and another to the circuit court in the Open Records action. Kennedy
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v. Commonwealth, 544 S.W.2d 219, 222 (Ky. 1976). See also Newell Enterprises,
Inc. v. Bowling, 158 S.W.3d 750, 755 (Ky. 2005).
We reject the DOR’s argument that just because a record requested in
discovery is deemed irrelevant, does not mean that it is not related to that litigation.
We agree with Wyrick’s response as well as the Attorney General’s decision
addressing this point. While we are “not bound by the opinions of the Attorney
General, ‘they have been considered highly persuasive.’” Medley, 168 S.W.3d at
402, quoting Palmer v. Driggers, 60 S.W.3d 591, 596 (Ky. App. 2001). In
addressing the amendment to the Open Records Act to include the party litigation
limitation in KRS 61.878(1), the Attorney General stated: “If, in fact, they have no
bearing on the action, the records do not fall within the language of the amendment
since they do not ‘pertain [] to [the] civil litigation’ to which the requester is a
party.” 95-ORD-18.
For the foregoing reasons, the December 18, 2006, Opinion and Order
of the Franklin Circuit Court is reversed in part as to the ruling that the party
litigation limitation applies and vacated in part as to the ruling denying Wyrick
access to the materials at issue. Finally, this matter is remanded to the Franklin
Circuit Court for further proceedings consistent with this opinion.
ALL CONCUR.
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BRIEFS FOR APPELLANT:
BRIEF FOR APPELLEES:
Deborah H. Patterson
Rania M. Basha
Louisville, Kentucky
Laura M. Ferguson
Frankfort, Kentucky
ORAL ARGUMENT FOR
APPELLANT:
Deborah H. Patterson
Louisville, Kentucky
C. Christopher Trower
Atlanta, Georgia
ORAL ARGUMENT FOR
APPELLEES:
C. Christopher Trower
Atlanta, Georgia
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