Lyft, Inc. v. City of Seattle ( 2018 )

this opinion was filed for record
FIITE
IN CLERKS OFFICE
COURT.SIXIECFWMHMeTai
at on^Tu"X/^.^
I CIAT^ 3 1 20181
'[ILAaAaM SUSAN L. CARLSON
GHIB'JUSTKE
SUPREME COURT CLERK
IN THE SUPREME COURT OF THE STATE OF WASHINGTON
LYFT,INC. and RASTER,LLC,
Respondents,
NO. 94026-6
CITY OF SEATTLE,
EN BANC
Appellant,
And
Filed i^AY 3 1 2018
JEFF KIRK,
Defendant.
STEPHENS, J.—^This case is before the court on direct review of a King
County Superior Court order enjoining the release of records the trial court
concluded were trade secrets under the Uniform Trade Secrets Act (UTSA), ch.
19.108 RCW. We must decide whether records containing trade secrets are
categorically excluded from public disclosure under the Public Records Act(PRA),
ch. 42.56 RCW. We hold that they are not. Applying the injunction standard set
forth in RCW 42.56.540, such records may be enjoined from disclosure only if
Lyft, Inc. V. City ofSeattle, 94026-6
disclosure would clearly not be in the public interest, and would substantially and
irreparably damage a person or a vital government interest.
The superior court erred by applying the general injunction standard of Civil
Rule(CR)65 articulated in Tyler Pipe Industries,Inc. v. Department ofRevenue,96
Wn.2d 785, 792, 638 P.2d 1213 (1982), and by not adequately considering the
PRA's more stringent standard. We therefore reverse the decision below and
remand for the trial court to apply the proper standard under RCW 42.56.540.
BACKGROUND FACTS AND PROCEDURAL HISTORY
Respondents Lyft Inc. and Rasier LLC^ operate car-hailing or "transportation
networking companies"(TNC) in several locations, including the city of Seattle
(City). TNC mobile and Internet-based technology enables consumers to use their
smartphones to retain drivers for trips. Drivers connected to the network can access
real-time information to respond to consumer requests for rides and carpools.
Rasier, in a dominant position with 14,000 drivers in Seattle, competes with Lyft for
local market share.
After the City passed a 2014 ordinance that limited the number ofTNC drivers
active at any given time, respondents Lyft and Rasier (collectively L/R)organized a
coalition to overturn the ordinance through a voter referendum. In response to
^ Rasier LLC is a wholly owned subsidiary of Uber Technologies Inc.
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mediation among the City, L/R, and taxi and for-hire stakeholders in the ground
transportation industry,the referendum proposal was withdrawn. The parties agreed
that L/R would submit quarterly standardized reports to the City that include the total
number of rides, the percentage of rides completed in each zip code, pick-up and
drop-off zip codes, the percentage of rides requested but unfulfilled, collision data,
and the number ofrequested rides for accessible vehicles.^
In response to L/R concerns regarding data confidentiality, a mediation
provision stated that "'[t]he city will work to achieve the highest possible level of
confidentiality for information provided within the confines ofstate law.''" Clerk's
Papers(CP)at 2703-04(emphasis added)(alteration in original)(quoting Ex. 101).
The mediation terms, including acknowledgement that their ultimate adoption was
subject to city council approval, were subsequently enacted as Seattle Municipal
Code(SMC)6.310.540. The for-hire vehicle regulatory ordinance provides that"[i]f
a public records request is made ofthe City for documents that have been designated
by the providing party as confidential or proprietary, the City shall provide third
party notice to the providing party prior to disclosure." SMC 6.310.540(D).
Likewise, under a confidentiality agreement between the City and Rasier subject to
^ Other mediation outcomes included license and insurance requirements for drivers,
mandatory driver background checks, payment of TNG surcharges to offset wheelchair-
accessible taxi costs, and lifting the ceiling on the number of drivers.
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the requirements ofthe PRA,the City notifies Rasier upon receipt of a PRA request
implicating disclosure of Rasier-designated confidential records.^
L/R's zip code reports to the City are extracted through queries from L/R's
databases containing driver and passenger records collected using L/R's software
programs. In consultation with L/R, the City established a secure, encrypted file
transfer protocol (FTP) website for L/R submissions of required quarterly reports.
Access to this FTP site is controlled using log-in credentials, both externally and
within city government. The City limits access to L/R quarterly reports and
derivative public records to persons with a need to know this information within its
departments oftransportation, and financial and administrative services.
Besides using the L/R zip code reports for regulatoiy enforcement, the City
considers the records to analyze overall TNC impact on transportation systems and
infrastructure; enforcement staffing needs and allocation; vehicle-miles traveled and
traffic congestion; service levels for all sections of the city; and service disparities
such as redlining and discrimination based on impermissible factors, including race
and religion. The for-hire vehicle ordinance requires that City staff prepare an
annual report for the chair of the Taxi, For-hire, and Limousine Regulations
^ Lyft relies on the nonbinding mediation confidentiality terms that were supplanted
by the enactment of SMC 6.310.540. Resp't Lyft's Answering Br. at 27.
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Committee of the city council, summarizing TNC-reported public records. SMC
6.310.100(B). Although this city reporting requirement was not included in the
mediation terms, neither Lyft nor Rasier objected to this language in the proposed
ordinance. The City delayed circulation or release of the draft 2015 report to the
committee and city council, after L/R objected and threatened litigation.
L/R insist that their quarterly zip code reports to the City consist of trade
secrets protected under the UTSA. See Resp't Lyft's Answering Br. at 16; Resp't
Rasier LLC's Answering Br. at 1. L/R can consider data compilations and extracts
to assess demand for their services, new product launch targets, marketing and
pricing strategies, and market competition. While each L/R driver possesses
knowledge contained in the records corresponding to individual trips driven, L/R
limit employee access to the quarterly zip code reports submitted to the City. L/R
do not share their quarterly zip code reports with each other.
In January 2016, appellant Jeff Kirk, a resident of Texas, submitted a PRA
request to the City seeking L/R reports for the final two quarters of 2015. Kirk
obtains this information from Seattle taxi companies, and researchers examine this
information to detect evidence ofredlining in the provision of ground transportation
to the detriment ofpersons or communities ofcolor. Specifically, Kirk seeks release
of records submitted by L/R to the City as required by SMC 6.310.540, including
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the percentage and number ofrides picked up in each zip code, and the pick-up and
drop-offzip codes of each ride.
In response to his PRA request, the City advised Kirk that the subject reports
were labeled by L/R as confidential. The City provided notice ofthe request to L/R,
which then sought an injunction under the PRA to prevent disclosure of the
requested reports to Kirk. The King County Superior Court issued a temporary
injunction granting partial relief as to zip code records but denying injunctive relief
as to data indicating L/R's total number ofrides, total number ofrides requesting an
accessible vehicle, and crime reports. Following an evidentiary hearing in which the
court considered live and deposition testimony, the court granted L/R's request for
a permanent injunction preventing disclosure ofthe records, concluding that the zip
code reports are trade secrets under the UTSA and, therefore, exempt from
disclosure under the PRA. Kirk and the City sought direct review of the injunction
by this court, and we granted review."^
^ Following the permanent injunction, the court heard a motion for enforcement,
addressing zip code records postdating the time frame of the permanent injunction.
Although the trial court applied its injunction retroactively to zip code reports prior to
December 9, 2016, it declined to opine whether its injunction applied to future quarterly
zip code reports. See CP at 3877 (Order Granting in Part & Den. in Part Lyft & Rasier's
Mots, for Enforcement of J. at 2 (Jun. 14, 2017))("With regard to whether the Court's
factual finding that the zip code data is a trade secret should extend to post-December 16
data, the Court's interpretation of RAP 7.2 is that that request for relief needs to be made
to the appellate court, and the parties can raise with the appellate court the issue of whether
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ANALYSIS
Under the PRA,public records^ may be withheld only '"in accordance with a
statute that exempts or prohibits disclosure in whole or in part ofspecific information
or records.'" Progressive Animal Welfare Sac'y v. Univ. of Wash., 125 Wn.2d243,
251-52 884 P.2d 592 (1994)(PAWS) (plurality opinion) (quoting former RCW
42.17.340(1)(1992), recodified as RCW 42.56.550(1)). To determine whether the
records at issue in this case may be withheld from disclosure, we consider the
relevant provisions of both the PRA and the UTSA. While we conclude that L/R's
zip code records likely meet the definition of"trade secrets" under the UTSA, L/R
are not entitled to an injunction under the applicable PRA standard,RCW 42.56.540,
unless they can establish on remand that disclosure is clearly not in the public interest
and in fact poses substantial and irreparable harm.
the mjunction should extend beyond December 16,ifthe parties believe that it is necessary.
But the Court is here to enforce its order entered on December 16 and it related to data
preexisting and disclosed to the City prior to December 9 of 2016."); see also Report of
Proceedings (RP)(June 2, 2017) at 11 ("[I]t was inevitable that more [PRA disclosure]
requests were going to come in....'You're going to keep getting requests.'... This is not
going to end."). We disagree with the superior court's view of its limited authority under
the appellate rules. On remand, the court may consider future records requests, as well as
whether backward looking data snapshots in time that are ruled trade secrets remain so in
perpetuity, and whether L/R meet their burden for an injunction under RCW 42.56.540.
^ A "'public record'" "includes any writing containing information relating to the
conduct of government or the performance of any governmental or proprietary function
prepared, owned, used, or retained by any state or local agency regardless of physical form
or characteristics.'' RCW 42.56.010(3).
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A. The PRA and "Other Statute" Exemptions
The PRA "begins with a mandate of full disclosure of public records; that
\,
mandate is then limited only by the precise, specific, and limited exemptions which
the Act provides." PAWS,125 Wn.2dat258. The PRA requires that"[e]ach agency,
in accordance with published rules, shall make available for public inspection and
copjdng all public records, unless the record falls within the specific exemptions of
subsection (8) of this section, this chapter, or other statute which exempts or
prohibits disclosure of specific information or records."^ RCW 42.56.070(1)
(emphasis added). "The 'other statutes' exemption incorporates into the Act other
statutes which exempt or prohibit disclosure of specific information or records.
[Former] RCW 42.17.260(1)[(1992), recodified as RCW 42.56.070(1)]. In other
^"RCW 42.56.070 expressly incorporates into the PRA other statutes such as RCW
43.70.050(2) [health records] that either exempt or prohibit disclosure of specific
information or records. The 'other statute' exemption avoids any inconsistency and allows
other state statutes and federal regulations to supplement the PRA's exemptions." Planned
Parenthood ofGreat Nw. v. Bloedow, 187 Wn.App. 606,619,350 P.3d 660(2015).(citing
AmeriquestMortg. Co. v. Office ofAtt'y Gen., 170 Wn.2d418,440,241 P.3d 1245(2010)).
See also Fisher Broad.—Seattle TV LLC v. City ofSeattle, 180 Wn.2d 515, 525-28, 326
P.3d 688 (2014) (holding that RCW 9.73.090(l)(c) of Washington's privacy act is an
"other statute" prohibiting disclosure of video recordings made by police that "relate to
actual, pending litigation"); Ameriquest, 170 Wn.2d at 424, 440 (holding that a federal
statute "requiring financial institutions to 'respect the privacy ofits customers' and 'protect
the security and confidentiality of those customers' nonpublic personal information,'"
"together with the [Federal Trade Commission] rule enforcing it" qualifies as an "other
statute"(quoting 15 U.S.C. § 6801(a)); Hangartner v. City ofSeattle, 151 Wn.2d 439,453,
90 P.3d 26(2004)(holding the attomey-client privilege as codified at RCW 5.60.060(2)(a)
is an "other statute").
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words, if such other statutes mesh with the Act, they operate to supplement it.
However,in the event ofa conflict between the Act and other statutes,the provisions
of the [PRA] govern." PAWS, 125 Wn.2d at 261-62 (footnote omitted);^ see RCW
42.56.030 ("In the event of conflict between the provisions of this chapter and any
other act, the provisions of this chapter shall govern."). The PRA is "liberally
construed and its exemptions narrowly construed to promote this public policy [to
keep Washington residents informed and in control over the instruments they have
created] and to assure that the public interest will be fully protected." RCW
42.56.030. "The language ofthe [PRA] does not authorize us to imply exemptions
but only allows specific exemptions to stand." Brouillet v. Cowles Publ'g Co., 114
Wn.2d 788, 800, 791 P.2d 526(1990).
"[T]o determine if a law applies as an 'other statute' under the PRA,the law
must be individually reviewed." WASH. State Bar Ass'n, Public Records Act
Deskbook: Washington's Public Disclosure and Open Public Meetings
Laws § 15.2 at 15-3 (2d ed. 2014). When the PRA injunction statute is invoked,
this court has described the analysis as follows:
^ Although the dissent(Gonzalez, J.) at 5 correctly points out that the other statute
here resides outside of the four comers of the PRA, once the "other statute" exemption is
invoked by seeking an injunction from disclosure, the other statute is incorporated into and
supplements the PRA. It operates just as an exemption expressly set out in the PRA.
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[W]e start with the proposition that the[PRA]establishes an affirmative duty
to disclose public records unless the records fall within specific statutory
exemptions or prohibitions. It follows that in an action brought pursuant to
the injunction statute ([former] RCW 42.17.330 [(1975),] [recodified as
RCW 42.56.540]), the initial determination will ordinarily be whether the
information involved is in fact within one of the act's exemptions or within
some other statute which exempts or prohibits disclosure of specific
information or records. Ifit is not so exempted or prohibited,then the records
are to be released subject to the agency's right in certain situations to delete
identifying details from the record, in accordance with another specific
provision ofthe act. If it is exempted or prohibited, then thejudicial inquiry
commences.
Spokane Police Guild v. Liquor ControlBd., 112 Wn.2d 30,36,769 P.2d 283(1989)
(emphasis added)(footnotes omitted). In sum, when a PRA request is made and a
third party asserts an "other statute" exemption, the court first looks at whether the
other statute exempts disclosure in the particular context. If the court finds the
information is exempt under the "other statute," then "judicial inquiry commences"
with the court applying the PRA injunction standard. Id.B. L/R Zip Code Reports Qualify as Trade Secrets under the UTSA, Which Is
Incorporated as an "Other Statute" under the PRA
It is undisputed that no provision of the PRA exempts trade secrets from
disclosure, so any exemption would need to be pursuant to an "other statute." Trade
secrets are addressed in the UTSA, which was enacted to subsume claims of civil
liability for misappropriation of trade secrets. See RCW 19.108.900(1) ("This
chapter displaces conflicting tort, restitutionary, and other law ofthis state pertaining
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Lyfi, Inc. V. City ofSeattle, 94026-6
to civil liability for misappropriation of a trade secret."). The UTSA contains no
specific exemption of trade secrets from public disclosure laws. Recognizing this,
Lyft cites several narrowly focused statutes outside the UTSA for the proposition
that the protection oftrade secrets enjoys broad policy support.^ However, none of
these statutes provides a relevant disclosure exemption in this case.
In PAWS, we concluded the UTSA may qualify as a PRA "other statute" in
some contexts. 125 Wn.2d at 262("Two state statutes [including the UTSA]qualify
as 'other statutes' in the present context, although neither justifies withholding the
grant proposal in its entirety."). PAWS requires that courts determine whether the
UTSA is an "other statute" based on individual review—^in this case, in regard to the
L/R zip code reports. Under the UTSA, a "trade secret" consists of"information,
including a formula, pattern, compilation, program, device, method, technique, or
® See Lyft's Answer to Br. of Amicus Curiae Wash. State Ass'n of Mun. Att'ys at
2-3 (citing RCW 17.24.061 (regarding insect and plant diseases); RCW 48.130.070
(regarding interstate insurance regulation compact); RCW 49.17.200 (regarding Industrial
Safety and Health Act); RCW 39.10.470 (regarding altemative public works contracting
procedures); RCW 31.45.030, .077, .090 (regarding small loan endorsement); RCW
80.04.095 (regarding public utilities); PAWS, 125 Wn.2d at 262-63 (citing LAWS OF 1994,
ch. 42, § 1, regarding product liability and hazardous substance claims)). Notably, these
statutes identify isolated instances of protected records and lack the broad sweep of the
PRA policy in favor of disclosure. See RCW 42.56.030 ("This chapter shall be liberally
construed and its exemptions narrowly construed to promote this public policy and to
assure that the public interest will be fully protected. In the event of conflict between the
provisions ofthis chapter and any other act, the provisions ofthis chapter shall govem.").
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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." RCW 19.108,010(4). "The parties seeking to prevent disclosure ... bear
the burden ofproof." Confederated Tribes ofChehalis Reservation v. Johnson, 135
Wn.2d 734, 744, 958 P.2d 260 (1998). We review interpretation of the UTSA de
novo as a question of law, while we review whether specific information satisfies
the statute's definition of a "trade secret" in any given case as a question of fact. Ed
Nowogroski Ins., Inc. v. Rucker, 137 Wn.2d 427, 436-37, 971 P.2d 936 (1999).
Although it is a close question,the trial court sustainably found that the L/R zip code
records meet the standards for trade secret protection under the UTSA.
The City contends that the trial court neglected to make concrete findings on
the required UTSA elements. RCW 19.108.010(4). First, the City argues that the
court failed to specifically find, based on the facts, that the L/R zip code reports
constitute a compilation under the UTSA. Opening Br. of Appellant City at 38-39.
Because the UTSA provides no definition for the term "compilation," we look to its
usual and ordinary dictionary definition. Fraternal Order ofEagles, Tenino Aerie
No. 564 V. Grand Aerie ofFraternal Order ofEagles, 148 Wn.2d 224,239, 59 P.3d
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Lyft, Inc. V. City ofSeattle, 94026-6
655 (2002). Webster's defines "compilation" as "something that is a product ofthe
putting together of two or more items: as . . . an accumulation of many things,
elements, or influences." Webster's TfflRD New International Dictionary at
464(1981).
Lyft argues that its zip code reports constitute an "'accumulation' of all zip
code data for each and every Lyft ride [documented] on the quarterly reports, ...
contain[ing] the entire universe of zip code data for Lyft for any given quarter."
Resp't Lyft's Answering Br. at 17-18. L/R zip code reports are distinguishable from
the discrete reports for which the superior court denied injunctive relief. CP at 266
(Order Granting in Part & Den. in Part Pis.' Mot. for Prelim. Inj. at 3 (Mar. 21,
2016)). The trial court inferred that zip code report queries that extract data equate
to an ability to compile information. CP at 2705. The facts demonstrate these L/R
zip code reports consist of extracts from larger, more granular L/R database
compilations. We conclude that substantial evidence supports the superior court's
factual determination that the zip code reports constitute a compilation of
information consistent with the UTSA.
Next, the City argues that the superior court failed to make concrete findings
regarding the effort and expense L/R undertook in extracting quarterly zip code
records using the City's reporting template, that neither Lyft nor Rasier met its
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burden to demonstrate the zip code reports have independent economic value
because little or no effort or expense was incurred in producing these reports, and
that the real value resides in other L/R data not reported to the City. Opening Br. of
Appellant City at 40-42. It notes that "neither [Lyft nor Rasier] attempted to
'quantify in any meaningful way the competitive advantage' the other'would enjoy'
if the information was released." Id. at 42. Information possesses independent
economic value under the UTSA when effort and expense were incurred to develop
the information. McCallum v. Allstate Prop. & Gas. Ins. Co., 149 Wn. App. 412,
424, 204 P.3d 944 (2009); Nowogroski Ins., 137 Wn.2d at 438. The information
must not be readily ascertainable from another source. Spokane Research & Def.
Fund V. City ofSpokane, 96 Wn. App. 568, 577-78,983 P.2d 676(1999).
The trial court found value in the zip code reports as a spatial indicator ofL/R
revenue generation and as a strategic indicator for marketing new products. CP at
2705. The court also found that both L/R are interested in obtaining the other's zip
code reports, though this was hotly debatable. Id. The superior court found the zip
code reports are not readily ascertainable by competitors by proper means. CP at
2717. While it is a close call, the record sufficiently demonstrates the independent
economic value ofthe data reflected by the zip code reports,including as an indicator
for potential routes for launching new ride pool and sharing products, and markets
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for subscription services. Substantial evidence supports the superior court's finding
ofindependent economic value in the zip code reports.
Finally, the City argues that every L/R driver accesses company data, even
when also driving for the competitor TNG,and thus the zip code data is not a trade
secret that is the "subject of efforts that are reasonable under the circumstances to
maintain its secrecy." RCW 19.108.010(4)(b); see also Opening Br. of Appellant
City at 47. Respondents reply that although the driver may have access to the
beginning and ending zip codes for each trip driven, the driver lacks access to other
records in the quarterly zip code report. Resp't Rasier LLC's Answering Br. at 28.
The superior court found that the respondents L/R do not share the zip code reports
between each other because ofthe perceived competitive disadvantages of doing so.
CP at 2705-06. L/R restrict access to the zip code reports internally within their
companies, with corresponding policies and procedures. CP at 2706. The limited
data drivers have is not the same data L/R protect. Substantial evidence supports the
superior court's finding that L/R make reasonable efforts under the circumstances to
maintain the secrecy ofthe zip code reports.
In sum, while the evidence is mixed and the question is not beyond debate,
the superior court sustainably concluded that L/R's zip code reports are "trade
secrets" within the meaning of the UTSA. For this reason, the UTSA is properly
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regarded as an applicable "other statute" in this context. See PAWS, 25 Wn.2d at
261-62. Concluding that L/R records contain trade secrets does not end the inquiry,
however. As noted, there is no categorical exemption for trade secrets under the
PRA,and we must therefore determine whether L/R are entitled to an injunction to
prevent the City from disclosing the records in response to a public records request.
C. Whether L/R Are Entitled to an Injunction Preventing the City from
Disclosing Zip Code Records Turns on Application of the PRA Injunction
Standard in RCW 42.56.540
The central question concerning L/R's motions for injunctive relief is which
injunction standard applies. L/R argue that trade secrets must be protected from
disclosure under the UTSA without regard to the PRA injunction standard.
Injunctive relief for trade secrets under the UTSA follows the general standard of
CR 65. Specifically,'"one who seeks relief by temporary or permanent injunction
must show (1) that he has a clear legal or equitable right,(2) that he has a well-
grounded fear of immediate invasion of that right, and (3)that the acts complained
ofare either resulting in or will result in actual and substantial injury to him'". Tyler
Pipe Indus., 96 Wn.2d at 792 (quoting Port ofSeattle v. Int'l Longshoremen's &
Warehousemen's Union, 52 Wn.2d 317, 319, 324 P.2d 1099(1958)).
The City counters that the PRA injunction standard applies rather than the
UTSA standard because L/R seek to enjoin the City from complying with its duty to
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disclose records under the PRA. The City criticizes the superior court for "failing
to apply the proper injunction standard under the PRA, opting instead to apply the
lesser standard governing injunctions under CR 65." Consol. Reply Br. of Appellant
City at 5("The trial court failed to make the requisite findings to support injunctive
relief under the PRA, and this error was not harmless. Reversal is required on this
ground alone.").
For the reasons explained below, we agree with the City that the PRA
injunction standard must apply. Under this standard,L/R are entitled to a permanent
injunction only if the public records disclosure would clearly not be in the public
interest, and would substantially and irreparably damage any person or would
substantially and irreparably damage vital government functions. RCW 42.56.540.
1. Status as "Trade Secrets" Does not categorically exempt Records from
Disclosure; The PRA Injunction Statute Governs Whether Exempt
Records can Be Withheld from Disclosure.
The superior court held that because L/R records constitute trade secrets under
the UTSA,they are categorically exempt from disclosure under the PRA. See CP at
2718("Because Lyfl and Rasier proved that the Zip Code Data are trade secrets, the
data is exempt from disclosure under RCW 42.56.070(1).)";see also CP at 2715("If
the City's position were correct, then there could be instances in which one could
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use the PRA to acquire knowledge of a trade secret.").^ In so holding, the court
collapsed two separate inquiries: (1) whether records are subject to an exemption
under the PRA and(2) whether their disclosure may be enjoined. This was error.
As noted above, our case law interpreting the PRA injunction statute makes
clear that finding an exemption applies under the PRA does not ipso facto support
issuing an injunction. See Spokane Police Guild, 112 Wn.2d at 36(noting that once
records are exempt, the "judicial inquiry" must commence); accord Soter v. Cowles
Publ'g Co., 162 Wn.2d 716, 757, 174 P.3d 60 (2007) (plurality opinion)("[T]o
impose the injunction contemplated by RCW 42.56.540,the trial court must find that
a specific exemption applies and that disclosure would not be in the public interest
and would substantially and irreparably damage a person or a vital government
interest."); Morgan v. City ofFederal Way, 166 Wn.2d 747, 756-57, 213 P.3d 596(2009)(same); Belo Mgmt. Servs., Inc. v. Click! Network, 184 Wn. App. 649, 661,
343 P.3d 370(2014)(even ifthe party seeking an injunction proves that it possesses
^ The dissent (Gonzalez, J.) at 2 offers Boeing Co. v. Sierracin Corp. for the
proposition that a trade secret might not lose its confidential status when submitted to the
Federal Aviation Administration. 108 Wn.2d 38, 52, 738 P.2d 665(1987)(citing Air Line
Pilots Ass'n, Int'l v. Fed. Aviation Admin.,552 F. Supp. 811,814(D.D.C. 1982)). Sierracin
is distinguishable because it involved misappropriation of trade secrets by a private
contractor with a duty of confidentiality. In contrast, the City owed no similar duty, and
therefore misappropriation is absent. Because the UTSA injunction standard requires a
showing of actual or threatened misappropriation, it remains inapplicable in this case.
RCW 19.108.020. Further, Sierracin did not involve application ofthe PRA.
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a trade secret under an "other statute," it still must "prove the requirements for an
injunction under RCW 42.56.540"); see also Public Records Act Deskbook
§ 17.3, at 17-11 ("the party seeking to prevent disclosure bears the burden ofproving
both that a specific exemption applies, and that the additional RCW 42.56.540
injunction elements are satisfied" (citation omitted)). As this court explained in
Soter,"[i]t may be that in most cases where a specific exemption applies, disclosure
would also irreparably harm a person or a vital government interest. But if we
assume that the additional findings contemplated by RCW 42.56.540 are
unnecessary, then a significant portion of the statute is rendered superfluous." 162
Wn.2d at 756-57.'®
In addition the UTSA authorizes an injunction as a remedy only when there
has been an actual or threatened misappropriation of trade secrets. RCW
19.108.020. "'Misappropriation' means: ... [djisclosure or use of a trade secret of
another without express or implied consent by a person who:...(B)acquired under
circumstances giving rise to a duty to maintain its secrecy or limit its use, or (C)
This court in Soter rejected the view of the Court of Appeals that "if a specific
exemption applies, the trial court can ignore the remaining requirements of RCW
42.56.540." 162 Wn.2d at 756. The lower court had reasoned that by creating an
exemption, the legislature presumably "'determined that harm to the agency would
outweigh the benefit to the requester,'" making additional findings unnecessary. Id.(quoting V. Cowles Publ'g Co., 131 Wn. App. 882, 902, 130 P.3d 840(2006)).
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Lyft, Inc. V. City ofSeattle, 94026-6
derived from or through a person who owed a duty to the person seeking relief to
maintain its secrecy or limit its use." RCW 19.108.010(2)(b)(ii)." Here, the City
owed no legal duty to maintain the confidentiality of public records and had no
authority to make promises of confidentiality inconsistent with the PRA. See WAG
44-14-06002(1)("Any agency contract regarding the disclosure of records should
recite that the [PRA] controls."); see also Spokane Police Guild, 112 Wn.2d at 40)
('"[Pjromises cannot override the requirements of the disclosure law.'" (quoting
Hearst Corp. v. Hoppe,90 Wn.2d 123,137, 580 P.2d 246(1978)); PUBLIC Records
Act Deskbook 13.5, at 13-17 ("any such contractual promise will not prevent
disclosure in response to a PRA request"). Because the City's PRA duty of
transparency does not yield to confidentiality promises, the City had no "duty" to
Curiously, the dissent never applies this statutory test for misappropriation, even
though a finding of actual or threatened misappropriation is required for an injunction
under the UTSA. Doubly curiously, the dissent goes on to apply the UTSA injunction
standard anyway, without a finding of actual or threatened misappropriation. See
(Gonzalez, J.) at 8. Because the City owes no duty of confidentiality, of course no
misappropriation is threatened. Still avoiding the statutory test for misappropriation, the
dissent also applies the test for determining whether a record is a trade secret. Id. In so
doing, the dissent makes the same mistakes as the trial court by assuming a categorical
exemption from disclosure for trade secrets and collapsing two independent inquiries: (1)
whether records are subject to an exemption under the PRA, and (2) whether their
disclosure may be enjoined.
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Lyft, Inc. V. City ofSeattle, 94026-6
support an argument of misappropriation." And, absent any misappropriation, the
UTSA does not authorize an injunction.
Justice Gordon McCloud's dissent at 1-2 suggests that the trade secrets at issue
here constitute property that is protected from takings under the Fifth Amendment to the
United States Constitution and article I, section 16 of the Washington Constitution, even
though none of the parties neither briefed nor argued this issue. The dissent cites for
authority Ruckelshaus v. Monsanto Co., 467 U.S. 986, 104 S. Ct. 2862, 81 L. Ed. 2d 815(1984), but it provides no support. Rather than categorically deeming trade secrets as
property protected from takings, the Court cautioned that "[t]he inquiry into whether a
taking has occurred is essentially an 'ad hoc, factual' inquiry." Id. at 1005 (citing Kaiser
Aetna v. UnUedStates, 444 U.S. 164, 175, 100 S. Ct. 383, 62 L. Ed. 2d 332(1979)). The
Court elaborated that the "Trade Secrets Act is not a guarantee of confidentiality to
submitters of data, and, absent an express promise, Monsanto had no reasonable,
investment-backed expectation that its information would remain inviolate in the hands of
[federal Environmental Protection Agency]." Id. at 1008; see Asarco Inc. v. Dep't of
Ecology, 145 Wn.2d 750, 761, 43 P.3d 471 (2002)("ad hoc, factually specific analysis"
includes "the extent to which the regulation interferes with the claimant's reasonable
investment-backed expectations"). In this case, the City made no promise of
confidentiality, but merely stated in mediation terms that "[t]he city will work to achieve
the highest possible level of confidentiality for information provided within the confines
of state law." CP at 156 (PL Ex. 101 (Deck of Kiersten Grove), App. A at 3); see CP at
155 ("Property rights remain subject to any and all City regulations. The City assumes no
liability for devaluation ofthe property interest due to regulatory action or market forces.").
Because state law prohibits the City from agreeing to limit public records disclosure, any
reliance by L/R is not reasonable nor enforceable. See Ruckelshaus, 467 U.S. at 1005("A
'reasonable investment-backed expectation' must be more than a 'unilateral expectation or
an abstract need.'"(quoting Webb's Fabulous Pharm., Inc. v. Beckwith,449 U.S. 155, 161,
101 S. Ct. 446,66 L. Ed. 2d 358 (1980))).
Moreover, any speculation that the parties demonstrated an interest in a takings
claim is unsupported by their testimony at trial. L/R's valuation of the public records at
issue scarcely established a required valuation showing for trade secrets, and certainly falls
short of establishing a putative valuation loss under a takings analysis. See RP (Oct. 10,
2016) at 106 (Rasier considers competitor zip code data as "having a ton of value");
Opening Br. ofAppellant City of Seattle at 41 ("[H]e testified that Lyft spent 'millions and
millions' building its App,'millions and millions' maintaining its App, and 'millions and
millions, untold millions' acquiring drivers and passengers in Seattle" (quoting RP (Oct.
11, 2016) at 80)), 41 n.l5 ("^en asked how much Lyft would pay for Uber's 'zip code
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Lyft, Inc. V. City ofSeattle, 94026-6
The superior court erred, relying solely on PAWS, by accepting L/R's
argument that the court there carved out trade secrets from application of the PRA.
CP at 2713 ("the confidentiality of trade secret information is be protected and
unnecessary disclosure prevented"); see also PAWS, 125 Wn.2d at 262("The Public
Records Act is simply an improper means to acquire knowledge of a trade secret.").
This reads too much into PAWS. The court in PAWS did not consider whether an
injunction under any standard would be appropriate to protect trade secrets, as no
injunction was at issue. PAWS is also distinguishable because the university is held
to strict confidentiality standards that govern the research funding proposals at issue.
See 125 Wn.2d at 249("The peer review process is highly confidential, and breach
ofthe standards applicable to that review and its participants may result in scientific
misconduct charges being filed. Moreover,the scientific community as a whole,and
data,' Mr. Kelsay provided no number, testifying only that '[fit would be worth every
penny.'"(quoting RP (Oct. 11, 2016) at 97)). Further, no party has argued that using zip
code data to detect and enforce redlining and discrimination in the provision of public
ground-transportation accommodations is not a legitimate public purpose. While noting
that this issue is not properly before the court, the dissent offers no reason why authentic
property deprivations may not be considered by a court in the substantial and irreparable
harm balancing under the PRA injunction standard. RCW 42.56.540. Because this issue
is not properly before us, and lacking the requisite factual record considered against the
applicable legal standards, we need not dwell further on the merits of the dissent's
suggestion. RAP 13.7(b); Schreiner Farms, Inc., v. Smitch, 87 Wn. App. 27, 32-33, 940
P.2d 274(1997)(citing Guimont v. Clarke, 121 Wn.2d 586, 604, 854 P.2d 1 (1993), cert,
denied, 510 U.S. 1176 (1994))).
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Lyfi, Inc. V. City ofSeattle, 94026-6
other universities, private and public, do not disclose information contained in
unfunded grant proposals." (citation omitted)). That duty of confidentiality is
lacking here. Finally, in rejecting an argument that the PRA injunction statute itself
operated as an exemption, the court fully recognized the two-step inquiry required
when PRA exemptions are at issue, noting that the PRA injunction statute "governs
access to a remedy" when records are found to fall within an exemption. Id. at 258;
see also Soter, 162 Wn.2d at 756-57 (rejecting view that PRA exemption alone
allows the withholding of records without regard to injunction standard in RCW
42.56.540); PUBLIC Records Act Deskbook § 13.5, at 13-18 ("The only way to
[prevent disclosure] is to seek injunctive relief pursuant to RCW 42.56.540, which
'governs access to the injunctive remedy' to prevent disclosure of a public record.")
(quoting PAWS,125 Wn.2d at 257-58)." The two-step inquiry applies regardless of
The Public Records ActDeskbook misquotes PA WS here;the actual language was
"govems access to a remedy." PAWS, 125 Wn.2d at 258. The dissent critieizes the
Deskbook for misquoting PA WSand eoncludes that our reference in that ease to "a remedy"
rather than "the remedy" suggests courts need not apply RCW 42.56.540 to enjoin the
disclosure of trade secrets. See (Gonzalez, J.) at 6-7 (citing PUBLIC RECORDS ACT
Deskbook § 13.5 at 13-1). Notwithstanding the Deskbook's misquote, this is not a
reasonable reading ofPAWS, which clearly identified the PRA. injunction standard as the
relevant remedy provision, in distinction from any relevant exemption provisions of the
PRA. 125 Wn.2d at 257-58. Any doubt about this was subsequently resolved in Soter,
when we explained that the existence ofa specific exemption does not mean "the trial court
can ignore the remaining requirements of RCW 42.56.540." 162 Wn.2d at 756. Instead,
we clarified that "the trial court must find that a specific exemption applies and that
disclosure would not be in the public interest and would substantially and irreparably
damage a person or a vital government interest." Id. at 757.
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Lyft, Inc. V. City ofSeattle, 94026-6
whether the exemption at issue is expressly set out in the PRA or incorporated via
an "other statute." PAWS, 125 Wn.2d at 258; see also Spokane Police Guild, 112
Wn.2d at 36, 39 (noting that if a record is exempt under the PRA or an "other
statute," then the court can consider an injunctive remedy under the PRA).
Consistent with PA WS and Soter, we recognize that the PRA injunction statute
provides the governing standard for considering whether trade secrets may be
withheld from disclosure. Given the broad range of"other statutes" courts consider
in connection with the PRA, consistent application of the PRA requires the
consistent procedural operation of the PRA injunction standard regardless of the
exemption or "other statute" asserted. After all, PRA exemptions are recognized
through operation of the PRA, not outside it. The UTSA may not be invoked to
carve out trade secrets from application ofPRA procedural provisions. As is clear
from the fact that L/R initially sought injunctive relief under RCW 42.56.540, this
is a PRA case and not a trade secrets case.^"^
Our holding today reinforces our prior precedent adhering to a two-step
inquiry under the PRA when an injunction is sought. First,the court must determine
whether the records are exempt under the PRA or an "other statute" that provides an
We reject the City's suggestion that there is a eonflict between the PRA and the
UTSA. As interpreted here, the statutes are compatible.
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Lyft, Inc. V. City ofSeattle, 94026-6
exemption in the individual case. Second, it must determine whether the PRA
injunction standard is met.
Having set forth the required analysis, we turn now to its application in this
case. The court below incorrectly applied the lesser injunction standard of CR 65,
on the misapprehension that recognition ofL/R records as trade secrets renders them
categorically exempt from public disclosure. At the same time, the court indicated
that "it does not matter in this case [which injunction standard applies] because Lyft
and Rasier have established an entitlement to an injunction under both the UTSA
and RCW 42.56.540." CP at 2716. We do not find this statement to be dispositive.
Notwithstanding the superior court's nod to the PRA injunction standard, in
application the court's findings failed to address that standard. As explained below,
there are factual disputes to be resolved, and we must remand the case to the trial
court to determine whether L/R have demonstrated an entitlement to injunctive relief
under RCW 42.56.540. To provide guidance, we outline what RCW 42.56.540
requires and why the existing findings and conclusions fail to address the statutory
standard.
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Lyfi, Inc. V. City ofSeattle, 94026-6
2. Under RCW 42.56.540, L/R Are Not Entitled to an Injunction Unless the
Trial Court Finds That Disclosure Would Clearly Not Be in the Public
Interest and Would Cause Substantial and Irreparable Harm
"If one of the PRA's exemptions applies, a court can enjoin the release of a
public record only ifdisclosure 'would clearly not be in the public interest and would
substantially and irreparably damage any person, or . . . vital governmental
functions.'" Morgan, 166 Wn.2d at 756-57 (alteration in original)(quoting RCW
42.56.540 and citing Soter, 162 Wn.2d at 757). The injunction standard requires a
showing on both elements. See Soter, 162 Wn.2d at 757. "In a proceeding brought
under this injunction statute, the party seeking to prevent disclosure has the burden
ofproof." Spokane Police Guild, 112 Wn.2d at 35. A decision granting or denying
an injunction under the PRA is reviewed de novo. Serv. Emps. Int7 Union Local
925 V. Freedom Found., 197 Wn. App. 203, 212, 389 P.3d 641 (2016); RCW
42.56.550(3). However, findings of fact based on the testimonial record are
reviewed for substantial evidence. Zinkv. City ofMesa, 140 Wn. App. 328,336-37,
166 P.3d 738 (2007).
The superior court's bare-bones conclusion that "Lyft and Rasier are entitled
to an injunction under RCW 42.56.540," CP at 2720, did not follow adequate
consideration ofthe public interest and irreparable harm elements ofthe statute. As
to the public interest, the court below merely referenced statutes cited by L/R that
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Lyfi, Inc. V. City ofSeattle, 94026-6
protect specific information in specific qontexts, and cited the holding in PAWS. CP
at 2713-15. But a fmding that the protection ofcertain trade secrets furthers a public
interest does not amount to a finding that public disclosure of the specific L/R zip
code records collected by the City is "clearly not in the public interest." Nor would
such a finding logically follow, given the public interest in analyzing zip code
records, including the interest in discerning discriminatory conduct.
L/R emphasize the general policy underlying the UTSA to protect trade
secrets and prevent misappropriation. As noted above,however,the UTSA does not
itself support an injunction here, and the statutes L/R cite express a policy of
protecting specific information in specific contexts, not a categorical legislative
declaration that trade secrets should not be subject to public disclosure laws." The
UTSA addresses misappropriation, threatened misappropriation, and related tort
claims and contemplates unfair competition among private actors; it does not address
For this same reason, the dissent's policy argument is unavailing. Dissent
(Gonzalez, J.) at 1, 9; see supra note 8. Although the dissent expresses a need to balance
disclosure with trade secrets protection, dissent(Gonzalez,J.) at 10,it provides no rationale
why the PRA injunction standard is inadequate at addressing the required balancing
declared by the legislature. See RCW 42.56.030("The people insist on remaining informed
so that they may maintain control over the instruments that they have created. This chapter
shall be liberally construed and its exemptions narrowly construed to promote this public
policy and to assure that the public interest will be fully protected. In the event of conflict
between the provisions ofthis chapter and any other act,the provisions ofthis chapter shall
govem."). We therefore remand for trial court performance of the required balancing test
in RCW 42.56.540.
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Lyft, Inc. V. City ofSeattle, 94026-6
public disclosure laws. Once records that comprise trade secrets are deemed
important enough to warrant collection by agencies for public purposes, additional
considerations of public interest pertain. Stated differently, the UTSA policy of
restraining company X from wrongfully misappropriating company Y's trade secrets
does not necessarily translate into a policy ofpreventing public inspection ofrecords
important to government purposes. The more stringent injunction standards of the
PRA reflect the importance ofpublic oversight over public records, in contrast to the
lesser UTSA standard that applies in disputes involving misappropriation of trade
secrets by private parties.
The records at issue in this case arguably involve matters of public interest,
and there is no trial court finding to the contrary. The City collects zip code data
from taxi companies, and it uses the data from those companies and the TNCs to
evaluate traffic and infrastructure concerns, determine future needs, and assess
claims of discriminatory redlining. Appellant Kirk notes that TNG redlining in
Seattle has been detected through academic research studies. Kirk's Statement of
Groimds for Direct Review at 2." While the superior court acknowledged the public
interest in data that might evidence redlining, it erroneously concluded that the
See Mark Scott, Study Finds Some Uber and Lyft Drivers Racially Discriminate,
N.Y. Times, Oct. 31, 2016, https://www.nytimes.eom/2016/ll/01/ technology/uber-lyft-
racial-discrimination.html?smid=tw-share (last visited May 23, 2018).
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Lyft, Inc. V. City ofSeattle, 94026-6
public could trust the City to adequately police redlining using the zip code reports,
obviating the need for public disclosure. See CP at 2719 ("But the City is able to
analyze the data to ensure no red-lining is occurring and city witnesses testified at
trial that they had no evidence of any such practice occurring at either [Lyft or
Rasier].")." This conclusion ignores the core policy underlying the PRA, under
which "[t]he people of this state do not yield their sovereignty to the agencies that
serve them." RCW 42.56.030. Further consideration ofthe public interest element
is required, and we remand to the trial court to evaluate all ofthe facts in light ofthe
PRA's requirement that disclosure "may be enjoined" when "clearly not... in the
public interest." RCW 42.56.540.
As to the harm element, the City insists that L/R have not established "that
disclosure would cause actual and substantial injury [under the CR 65 test], let alone
'irreparable and substantial damage' under the PRA." Opening Br. of Appellant
City at 33. It dismisses the proffered evidence as too speculative and conclusory to
provide a basis for measuring whether substantial and irreparable damage could
The trial court also suggested that city staff could advise the city council without
disclosing the zip code reports, and that Kirk and other researchers would be satisfied with
manipulated heat maps or disintegrated data depictions, without regard to data integrity for
research purposes. It is not enough for the court to proclaim that other available records
might serve the public's or a requester's needs. The question under the PRA is whether
city compliance with the specific PRA request is clearly not in the public interest.
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Lyfi, Inc. V. City ofSeattle, 94026-6
occur through PRA disclosure. Id. at 31. Unlike in the customer database cases L/R
rely on, the City argues it is not collecting and disclosing customer identifying data
in the quarterly reports that would allow L/R to poach customers from each other.
See Resp't Rasier LLC's Answering Br. at 26;see also NowogroskiIns., 137 Wn.2d
at 440-41 ("a manufacturer's customer list had potential economic value and was
protectable under the California Uniform Trade Secrets Act[, Cal. Crv. CODE
§§ 3426-3426.11,] because it allowed competitors like the defendant to direct their
sales efforts at specific potential customers" (citing MAI Sys. Corp. v. Peak
Computer, Inc., 991 F.2d 511, 521 (9th Cir. 1993))).
The superior court acknowledged that "the PRA would require Lyft and
Rasier to meet a higher burden of proof: that disclosure 'would clearly not be in the
public interest' and disclosure would cause 'substantial and irreparable damage.'"
CP at 2714(quoting RCW 42.56.540). However, based apparently on its legal error
that trade secrets are categorically exempt from disclosure, the court reached the
circular conclusion that "public disclosure oftrade secrets under the Public Records
Act constitutes irreparable harm because such disclosure 'destroys the information's
status as a trade secret.'" CP at 2718. The trial court's additional findings relating
to harm failed to consider the heightened PRA standard. In its injunction analysis
under Tyler Pipe Industries,the court concluded that disclosure will cause actual and
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Lyft, Inc. V. City ofSeattle, 94026-6
substantial injury because L/R "will be able to gain an unfair competitive advantage
against each other with the disclosure of this data." Id. And, albeit without
attribution to the record, the court accepted the assertion that "disclosure of Lyft's
trade secret Zip Code Data presents the company with an existential threat." CP at
2720." If true, then disclosure might result in substantial and irreparable damage,
but the trial court never considered the facts in light ofthis standard.
We remand for the court to consider its findings reached under the CR 65
standard in light ofthe "substantial and irreparable" harm standard ofthe PRA. L/R
bear the burden of showing sufficient harm, in addition to meeting the "clearly not
in the public interest" element, in order to justify injunctive relief under RCW
42.56.540. See Spokane Police Guild 112 Wn.2d at 35 (noting the party seeking
PRA injunction bears the burden of proof). Meaningful assessment against PRA
The superior court found that "Lyft's market share is a firaction of Uber's market
share. Because Uber has such a dominant position in the TNG market, it could use Lyft's
data to squeeze Lyft out ofthe Seattle market, giving Uber a monopoly in the TNG market.
Such an occurrence is not in the public's interest." GP at 2720. Even if the court's
conclusions might be sufficient to prevent disclosure ofLyft's zip code reports,the analysis
regarding disclosure of Rasier's zip code records is missing for both elements: whether
disclosure(1)"would clearly not be in the public interest" and(2)"would substantially and
irreparably damage any person, or ... vital governmental functions." RGW 42.56.540. In
this regard,because the dissent(Gonzalez,J.)at 2 n.3 lumps together Lyft, Uber,and Rasier
under the moniker "Lyft," it shields Rasier from any scrutiny under the injunction test and
thereby neglects to fully adjudicate the issues before us. The dissent thus repeats a mistake
of the trial court by failing to apply the required injunction test independently to each of
the respondents. See GP at 2720.
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Lyft, Inc. V. City ofSeattle, 94026-6
standards is required in order to grant an injunction preventing disclosure under the
PRA. This assessment involves the resolution of disputed facts. We recognize that
it might be possible to conclude from the lack of adequate findings under the PRA
that the heightened standard for injunctive relief is not met. However,for this court
to reach such a conclusion seems heavy-handed considering the proceedings below,
which were largely shaped by the trial court's legal error in applying the Tyler Pipe
Industries injunction standard. We believe a remand is an appropriate and cautious
remedy to ensure that all facts have been fully considered and assessed under the
proper injunction standard.
CONCLUSION
The PRA injunction standard applies to public records that constitute trade
secrets under the UTSA,just as it applies to other records encompassed by any PRA
exemption. In line with our prior cases interpreting the PRA injunction standard, we
recognize the two-step analysis courts must engage in when considering injunctive
relief: (1) whether the public record is subject to an exemption under any PRA
provision or an applicable "other statute," and(2)whether the party seeking to enjoin
disclosure has shown that disclosure is clearly not in the public interest, and would
result in substantial and irreparable harm to any person or vital government interest.
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Lyft, Inc. V. City ofSeattle, 94026-6
We reverse the superior court's order granting injunctive relief and reject
application of the Tyler Pipe Industries injunction standard for public records
constituting trade secrets. Such records are not categorically exempt from disclosure
or removed from the purview ofRCW 42.56.540 when an injunction is sought. We
remand for the superior court to make the fact-based determination of whether L/R
are entitled to injunctive relief under the PRA to prevent the City from disclosing
the requested L/R zip code records.
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Lyft, Inc. V. City ofSeattle, 94026-6
WE CONCUR:
34
Lyft, Inc., et al. v. City ofSeattle, et al.
No. 94026-6
Gonzalez,J.(concurring in part and dissenting in part)—^Ultimately, this
case is about competing interests: our legislature's recognition that trade secrets
should not be unnecessarily disclosed versus the robust disclosure mechanism
contemplated by the Public Records Act(PRA), ch. 42.56 RCW. The majority
concludes that trade secret protection yields to PRA disclosure. I write separately
because I am not convinced that this is the inevitable outcome based on our case
law, nor that it is good policy.
Although the PRA generally requires disclosure of public records, Hearst
Corp. V. Hoppe,90 Wn.2d 123, 127, 580 P.2d 246(1978); Amren v. City of
Kalama, 131 Wn.2d 25, 31,929 P.2d 389(1997), the mandate is not "absolute."
Resident Action Council v. Seattle Hons. Auth, 111 Wn.2d 417, 432, 327 P.3d 600(2013). Among other things, trade secrets are protected:
The legislature ... recognizes that protection of trade secrets .. . promotes
business activity and prevents unfair competition. Therefore, the legislature
declares it a matter of public policy that the confidentiality of such
information be protected and its unnecessary disclosure be prevented.
Lyft, Inc., et al. v. City ofSeattle, et al. No. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
Progressive Animal Welfare Sac., v. Univ. of Wash., 125 Wn.2d 243, 263, 884 P.2d
592(1994)(PAWS)(plurality opinion)(first alteration in original)(emphasis
omitted)(quoting Laws of 1994, eh. 42, § 1). A trade seeret does not lose its
confidential status when it is submitted to a public agency. Boeing Co. v. Sierracin
Corp., 108 Wn.2d 38, 52, 738 P.2d 665 (1987).' And we have repeatedly
maintained that the PRA "may not be used to acquire knowledge of a trade secret."
Confederated Tribes ofChehalis Reservation v. Johnson, 135 Wn.2d 734, 748, 958
P.2d 260(1998)(citing PAWS, 125 Wn.2d at 262("[T]he Public Records Act is
simply an improper means to acquire knowledge of a trade secret.")); John Doe A
V. Wash. State Patrol, 185 Wn.2d 363, 394, 374 P.3d 63 (2016).
The majority properly holds that the exemption comes from RCW
42.56.070, which states that a record is exempt "unless the record falls within the
specifie exemptions of...[an] other statute which exempts or prohibits disclosure
of specific information or records."^ This court has said the Uniform Trade Secrets
Act(UTSA), ch. 19.108 RCW,qualifies as an "other statute" and exempts certain
public record disclosure. PAWS, 125 Wn.2d at 262. Based on the "other statute"
'There is no dispute that the City of Seattle agreed to treat the zip code data as confidential. The
city of Seattle signed a confidentiality agreement regarding the data and set up encrypted file
transfer protocol sites so the data could he securely transmitted. Clerk's Papers at 2706-07, 2717;
see also SEATTLE MUNICIPAL CODE 6.310.540(D).
^ The parties in this case agree that no PRA provision exempts the zip code data in question.
Lyft, Inc., etal. v. City ofSeattle, etal.,lSo. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
language, Lyft^ urges us to apply the UTSA's CR 65 injunction standard,'^ and
conversely, the city of Seattle contends the PRA's injunction provision, RCW
42.56.540,^ applies.
This is the central question to be decided, whether the PRA or the UTSA
applies to enjoin the release of public records that are also trade secrets. The
majority asserts that "the PRA injunction standard must apply" because prior
precedent requires it. Majority at 17. While this court has acknowledged that an
agency's promise of confidentiality does not override the requirements ofthe
disclosure law, Hearst Corp., 90 Wn.2d at 137, we have never concluded that the
PRA overcomes the UTSA's trade secret protection, or that trade secret disclosure
can be properly enjoined under RCW 42.56.540. Indeed, as noted above, we have
explicitly held otherwise. See, e.g., Confederated Tribes ofChehalis Reservation,
135 Wn.2d at 748(PRA "may not be used to acquire knowledge of a trade secret").
^ I refer to Respondents Lyft, Uber, and Rasier collectively as "Lyft."
CR 65 requires one seeking relief by temporary or permanent injunction show that(1)they
have a "clear legal or equitable right,"(2)they have a "well-grounded fear of immediate invasion
of that right, and (3)the acts complained of are either resulting in or will result in actual and
substantial injury" to that individual. Tyler Pipe Indus., Inc. v. Dep 't ofRevenue, 96 Wn.2d 785,
792,638 P.2d 1213 (1982)(internal quotation marks omitted){cycLOtmg Port ofSeattle v. Int'l
Longshoremen's & Warehousemen's Union, 52 Wn.2d 317, 319, 324 P.2d 1099(1958)).
^ RCW 42.56.540 provides in relevant part:
The examination of any specific public record may be enjoined if. .. the superior court
for the county in which the movant resides or in which the record is maintained, finds
that such examination would clearly not be in the public interest and would substantially
and iiTeparably damage any person, or would substantially and irreparably damage vital
governmental functions.
Lyft, Inc., et al. v. City ofSeattle, et al. No. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
By concluding RCW 42.56.540 applies, the majority assumes the answer to the
very question before the court.
Moreover, the cases the majority relies on do not require application of
RCW 42.56.540. In Spokane Police Guild v. Liquor Control Bd., 112 Wn.2d 30,
36,769 P.2d 283 (1989), we explained that for an action
brought pursuant to the injunction statute(ROW 42.17.330)[, recodified as
RCW 42.56.540], the initial determination will ordinarily be whether the
information involved is in fact within one of the act's exemptions or within
some other statute which exempts or prohibits disclosure of specific
information or records.... If it is exempted or prohibited, then the judicial
inquiry commences.
The majority relies in part on this case to state that when a record is "exempt under
the 'other statute,' then the 'judicial inquiry commences' with the court applying
the PRA injunction standard." Majority at 11 (quoting Spokane Police Guild, 112
Wn.2d at 36). It is certainly possible to read this sentence as endorsing the use of
RCW 42.56.540. But such a reading is not inevitable. Unlike the instant case,
Spokane Police Guild did not consider trade secrets, and the quoted language
explains only that a judicial inquiry "commences" once a public record is found to
be exempt; we did not opine on what this subsequent inquiry entails or, more
importantly, which injunction standard applies. 112 Wn.2d at 36.
Soter V. Cowles Publishing Co. also does not require RCW 42.56.540's
application. 162 Wn.2d 716,757, 174 P.3d 60(2007)(plurality opinion). The
Soter decision discusses the means of enjoining public records, noting that to
Lyft, Inc., et al. v. City ofSeattle, etal.,No. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
impose "the injunction [standard] contemplated by RCW 42.56.540, the trial court
must find that a specific exemption applies and that disclosure would not be in the
public interest." Id.(emphasis added and omitted). Like Spokane Police Guild,
Soter did not concern trade secrets. And, by its language, the case concerns only
injunctions contemplated under the PRA. Soter does not sustainably guide our
determination of whether the PRA or the UTSA applies to public records that are
also trade secrets. Contrary to the majority's assertion, it is not a fait accompli that
the PRA governs the injunction at issue here.
The procedural pathway through which we review the injunction is
instructive on this point. The PRA itself does not provide an exemption to the zip
code data, but it provides for additional exemptions through the "other statute"
language ofthe PRA,RCW 42.56.070. In this case, the UTSA is an "other statute"
and exempts disclosure of the data as a trade secret. See PA WS, 125 Wn.2d at 262.
The exemption itself, therefore, is not contained within the four comers ofthe
PRA. When viewed through this procedural lens, Soter provides little guidance—
let alone binding precedent—because the injunction contemplated here exists not
within the PRA but outside it, in the UTSA.
The majority dismisses the express and robustly protective trade secret
language in PA WS as inapposite because, ironically, like Spokane Police Guild and
Soter, that case did not consider disclosure oftrade secrets nor was an injunction at
Lyft, Inc., et al. v. City ofSeattle, et al. No. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
issue. Majority at 19-20; see also Belo Mgmt. Servs., Inc. v. Click! Network, 184
Wn. App. 649, 656, 343 P.2d 370(2014)(holding records were not trade secrets).
The majority cites PAWS and the Deskbook to clarify that "'[t]he only way to
[protect a trade secret] is to seek injunction relief pursuant to RCW 42.56.540,
which "governs access to the injunctive remedy.'" Majority at 23-24 (quoting
Wash.State Bar Ass'n,Public Records Act Deskbook: Washington's
PublicDisclosure AND Open Public Meetings Law § 13.5, at 13-18 (2d ed.
2014)(Deskbook)(quoting PAWS, 125 Wn.2d at 257-58)). On first blush, this
explanation gives us pause. If we have held, as the Deskbook quotes and the
majority suggests, that RCW 42.56.540 '"governs access to the injunctive
remedy,"' id. (internal quotation marks omitted)(quoting Deskbook § 13.5, at 13-
18), logically that standard must apply whenever a party seeks to enjoin disclosure,
regardless of how the exemption occurs.
However,PA WS is not so definitive. In fact, the Deskbook misquotes
PAWS. This case actually states that RCW 45.56.540 "is simply an injunction
statute. It is a procedural provision which allows a superior court to enjoin the
release ofspecific public records if they fall within specific exemptions found
elsewhere in the [PRA]. Stated another way,[RCW 45.56.540] governs access to a
remedy!' 125 Wn.2d at 257-58(some emphasis and boldface added). If this court
had already decided RCW 42.56.540 governs access to every public record
Lyft, Inc., et al. v. City ofSeattle, etal.,'Slo. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
injunction, we would have said the provision is "the" remedy, not "a" remedy.
Accord Spokane Police Guild, 112 Wn.2d at 36 (noting that if a record is exempt
under the PRA or an "other statute," then the court can consider an injunctive
remedy). Thus, aside from the majority's desire to apply RCW 42.56.540, nothing
in PA WS,Soter, Spokane Police Guild, or the PRA itself requires its application
for the purposes of enjoining trade secret disclosure.
Instead, we should apply the UTSA's injunction standard set out in CR 65.
Under this rule, a party must show (1)a clear legal or equitable right,(2)a well-
grounded fear of immediate invasion ofthat right, and (3)that the acts complained
of will result in actual or substantial injury. Tyler Pipe Indus., Inc. v. Dep't of
Revenue,96 Wn.2d 785, 792, 638 P.2d 1213 (1982).
The UTSA authorizes an injunction as a remedy when there has been an
actual or threatened misappropriation of trade secrets. RCW 19.108.020(1).
"'Misappropriation' means:... (b)Disclosure or use of a trade secret of another
without express or implied consent by a person who . . .(B)acquired under
circumstances giving rise to a duty to maintain its secrecy or limit its use, or(C)
derived from or through a person who owed a duty to the person seeking reliefto
maintain its secrecy or limit its use." RCW 19.108.010(2).
PAWS underscores that threatened misappropriation qualifies for injunction
under the UTSA:"Actual or even threatened misappropriation may be enjoined.
Lyft, Inc., et al. v. City ofSeattle, et al., No. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
Given the potential" for certain records to qualify as trade secrets, the "other
statute" provision ofthe PRA "operates as an independent limit on disclosure of
portions ofthe records at issue here that have even potential economic value." 125
Wn.2d at 262. The majority implies misappropriation is absent here, but Lyft
satisfies the "threatened misappropriation" standard discussed in PA WS. RCW
19.108.020(1)("Actual or threatened misappropriation may be enjoined."). The
zip code data constitutes trade secrets that, as the trial court found, have far more
than the potential for economic value, they derive economic value from not being
generally known to the competitors. See also Clerk's Papers(CP)at 3767-68.
Upon disclosure by the city of Seattle, the data would be used by Lyft and by its
competitors. Report ofProceedings(Oct. 11, 2016) at 97; Report ofProceedings
(Oct. 10, 2016) at 106(Uber would pay for its competitors' zip code data because
it "ha[s] a ton of value."); see generally Resp't Lyft, Inc.'s Answering Br. at 22-27
(noting extensive testimony in the record explaining how companies would utilize
zip code data).
The trial court properly found that Lyft met the CR 65 injunction standard.
As discussed above, the company established the first element of CR 65: that the
zip code data constitutes a trade secret that is legally protected by the UTSA. The
city of Seattle has not challenged the second element, that is, the finding of an
immediate invasion ofthat right. And Lyft has also demonstrated a well-grounded
Lyft, Inc., et al. v. City ofSeattle, etal.,^o. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
fear that its right to protect trade secrets will be invaded. See id. at 34-37(record
citations detailing the competitive harm companies would suffer from zip code
disclosure). Thus,"allowing , , , any member ofthe public to examine the Zip
Code Data . . , would clearly not be in the public interest and would substantially
and irreparably damage Lyft and Rasier," CP at 2720(emphasis added),
CR 65 is the better vehicle to examine whether trade secrets should be
enjoined because it balances the interests of protecting a company's trade secrets
with the injury their disclosure could cause. By requiring application ofthe PRA
injunction provision and thereby elevating the PRA over trade secrets in this
context, the majority has made it harder for businesses to protect their intellectual
property,^
Despite the PRA's broad disclosure mandate, it is not absolute. The PRA
contains numerous exemptions that protect certain information, and these
exemptions are provided solely to protect relevant privacy rights that sometimes
outweigh disclosure. Resident Action Council, 111 Wn,2d at 432(citing Limstrom
V. Ladenburg, 136 Wn,2d 595, 607,963 P,2d 869(1998)), Washington's
legislature has expressed its intent to protect trade secrets from unnecessary
disclosure. Laws OF 1994, ch, 42, § 1, In this case, disclosure ofthe zip code
^ The majority's rule will also encourage forum shopping. By requiring parties to satisfy a
higher burden to enjoin trade secret disclosure, parties will likely bring an injunction under
federal law. See 18 U.S.C. § 1836 (injunction standard for trade secrets in federal court).
Lyft, Inc., et al. v. City ofSeattle, etal.,'Ho. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
trade secrets was not only unnecessary, Lyft sufficiently demonstrated that
disclosure would immediately and irreparably harm its interests. While the PRA is
a strongly worded mandate for disclosure, exemptions exist that this court must
respect and effectuate. The case at hand is one in which we must balance this
mandate for disclosure with the legislature's express wish to protect trade secrets.
Because we have yet to determine the proper injunction provision applicable to
trade secrets that are also public records, I would balance these competing interests
by applying CR 65.
With these considerations in mind, I respectfully concur in part and dissent
in part.
10
Lyft, Inc., et al. v. City ofSeattle, et al. No. 94026-6
(Gonzalez, J., concurring in part and dissenting in part)
11
Lyft, Inc. V. City ofSeattle etal. No. 94026-6
(Gordon McCloud, J., concurring in concurrence/dissent)
No. 94026-6
GORDON McCLOUD,J.(concurring in concurrence/dissent)—^Trade secrets
are private property. Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1003-04, 104 S.
Ct. 2862,81 L.Ed.2d 815(1984). The constitutions ofboth this state and the United
States protect such private property from a government "taking" without just
compensation. M;U.S. Const, amend. V; Wash. Const, art. I, § 16.
It can certainly be difficult to determine whether government acquisition of
such protected private property for a legitimate government use constitutes a simple
regulatory law or a taking that triggers constitutional protections and just
compensation. Monsanto,467 U.S. at 1005; Home v. Dep 't ofAgric., 576 U.S. ,
135 S. Ct. 2419, 2429, 192 L. Ed. 2d 388 (2015). The parties do not mention this
issue at all in the instant case; maybe they believe that the facts of this case provide
no reason to be concerned about that constitutional protection. But the majority has
written a decision interpreting the Public Records Act(PRA), chapter 42.56 RCW,
to ignore that constitutional protection, even in cases where it clearly applies—^that
Lyft, Inc. V. City ofSeattle et al. No. 94026-6
(Gordon McCloud, J., concurring in concurrence/dissent)
is, cases where the owner of privately held trade secrets discloses them to the
government, at the government's request, for a government purpose, with a
legitimate expectation ofprivacy that the information will not be disclosed to private
parties.
Under United States Supreme Court precedent, such information enjoys
constitutional protection against a "taking" without just compensation under the
constitution. Monsanto, 467 U.S. at 1013-14. Under the majority's reasoning, I'm
not so sure.
The reason I'm not sure is that the majority interprets the PRA to permit such
a taking without any remedy to stop it and with no discussion ofjust compensation
to redress it. That interpretation would allow one corporation to gain trade secret
intellectual property submitted to state government for a legitimate regulatory
purpose by a competitor corporation just by asking.
But we interpret legislative enactments to avoid absurd results. Fraternal
Order ofEagles, Tenino Aerie No. 564 v. Grand Aerie ofFraternal Order ofEagles,
148 Wn.2d 224, 239, 59 P.3d 655 (2002)("This court. .. will avoid literal reading
of a statute which would result in unlikely, absurd, or strained consequences.") I
cannot believe that the legislature drafted the PRA to accomplish such a
constitutionally suspect result.
Lyft, Inc. V. City ofSeattle et al, No. 94026-6
(Gordon McCloud, J., concurring in concurrence/dissent)
I therefore agree completely with the concurrence/dissent. I agree with its
statutory analysis. I also believe that that is the only interpretation of the PRA that
the legislature could have intended.
Lyft, Inc. et al. v. City ofSeattle et al. No. 94026-6
(Gordon McCloud, J., concurring in concurrence/dissent)