Campbell v. Marion County Hosp. Dist.

• Decision Date: 31 March 2003
• Docket Number: No. 3620.,3620.
• Citation: 354 S.C. 274,580 S.E.2d 163
• Parties: Dr. Treadwell CAMPBELL, Appellant, v. MARION COUNTY HOSPITAL DISTRICT, d/b/a the Mullins Hospital, Respondent.
• Court: South Carolina Court of Appeals

354 S.C. 274

580 S.E.2d 163

Dr. Treadwell CAMPBELL, Appellant, v. MARION COUNTY HOSPITAL DISTRICT, d/b/a the Mullins Hospital, Respondent.

No. 3620.

Court of Appeals of South Carolina.

Heard March 12, 2003.

Decided March 31, 2003.

Rehearing Denied May 21, 2003.

Brenda Reddix Smalls, of Columbia, for Appellant.

Ralph W. Barbier and Joseph M. Kahn, both of Columbia, for Respondent.

ANDERSON, J.

Dr. Treadwell Campbell (Dr. Campbell) sued Marion County Hospital District, d/b/a The Mullins Hospital (the Hospital), under the South Carolina Freedom of Information Act (FOIA) for information including, among other things, salaries, compensation, benefits, and bonuses offered to all physicians recruited by the Hospital, as well as the prices paid for physician practices purchased by the Hospital. The Circuit Court ordered the Hospital to disclose a portion of the requested information, but it further held that information regarding physicians' salaries, compensation, and purchase prices of practices were "trade secrets." We affirm in part, reverse in part, and remand.

FACTS/PROCEDURAL BACKGROUND

In relation to a pending lawsuit, Dr. Campbell requested that the Hospital produce certain information pursuant to the FOIA. Specifically, Dr. Campbell requested the Hospital provide information regarding: (1) the compensation, benefits, and bonuses offered to physicians recruited by the Hospital from 1988 to 1999; (2) the prices paid for the purchase of physician practices; (3) the salaries of physicians whose practices were purchased by the Hospital; (4) the salaries of specific physicians; (5) the amount of rent paid to physician practices since 1988; and (6) the purchase price and a copy of the invoice of purchase if the Hospital purchased the Marion Medical Group. The Hospital indicated it would provide the information regarding the amount of rent paid to any physician or physician practice since 1988, but Dr. Campbell would have to post a deposit of $1,500 to cover the expenses of researching and copying the information. The Hospital refused to provide any of the other information stating information regarding physicians recruited, but not employed, by the Hospital was incidental to proposed contractual arrangements and thus exempt from disclosure. The Hospital asserted the requested information regarding physicians' salaries and the purchase prices of physician practices constituted "trade secrets" which were exempt from disclosure under the FOIA.

Dr. Campbell sued the Hospital under the FOIA, requesting that the Circuit Court (1) deem the withheld information to be public information within the meaning of the FOIA; (2) enjoin the Hospital from withholding the information; and (3) award Dr. Campbell costs and attorney's fees. The Hospital denied the allegations of the complaint and maintained the allegations failed to state a claim upon which relief could be granted. With the exception of the amounts of physician lease fees, the Hospital averred the requested information was exempt from disclosure as "trade secrets." Both parties moved for summary judgment.

After hearing arguments from both parties, the Circuit Court judge issued an order: (1) finding the information regarding physicians recruited, but not actually hired, by the Hospital was exempt from disclosure; (2) requiring the Hospital to produce the information relating to physicians' salaries and the purchase price of practices, but barring Dr. Campbell from disclosing the information to third parties; (3) directing the Hospital to disclose information relating to the rents paid to physician practices; (4) compelling Dr. Campbell to pay a $500 deposit to cover the costs of providing the information; and (5) concluding Dr. Campbell was not entitled to attorney's fees. Dr. Campbell filed a Rule 59(e), SCRCP, motion for reconsideration, which was denied by the Circuit Court.

ISSUES

I. Did the Circuit Court err in holding that Dr. Campbell's request for disclosure of physicians' salaries, bonuses, compensation, and purchase prices of physician practices constituted "trade secrets" requiring a protective order?

II. Did the Circuit Court err in refusing to award attorney's fees and costs to Dr. Campbell where he prevailed and the court ordered the production of all the information requested from the Hospital?

STANDARD OF REVIEW

Although Dr. Campbell filed a motion for summary judgment, he actually requested the Circuit Court to declare whether the withheld information was exempt under the FOIA.

Declaratory judgments in and of themselves are neither legal nor equitable. See Felts v. Richland County, 303 S.C. 354, 400 S.E.2d 781 (1991); Wiedemann v. Town of Hilton Head Island, 344 S.C. 233, 542 S.E.2d 752 (Ct.App. 2001). The standard of review for a declaratory judgment action is therefore determined by the nature of the underlying issue. Doe v. South Carolina, Med. Malpractice Liab. Joint Underwriting Ass'n, 347 S.C. 642, 557 S.E.2d 670 (2001); Wiedemann, 344 S.C. at 236,542 S.E.2d at 753; see also Travelers Indem. Co. v. Auto World, 334 S.C. 137, 511 S.E.2d 692 (Ct.App.1999) (suit for declaratory judgment is neither legal nor equitable, but is determined by nature of underlying issue).

A declaratory judgment action under the FOIA to determine whether certain information should be disclosed is an action at law. See South Carolina Tax Comm'n v. Gaston Copper Recycling Corp., 316 S.C. 163, 447 S.E.2d 843 (1994). In an action at law tried without a jury, the appellate court standard of review extends only to the correction of errors of law. Crary v. Djebelli, 329 S.C. 385, 496 S.E.2d 21 (1998); Townes Assocs., Ltd. v. City of Greenville, 266 S.C. 81, 221 S.E.2d 773 (1976); Okatie River v. Southeastern Site Prep, 353 S.C. 327, 577 S.E.2d 468 (App.2003). Thus, the trial court's factual findings will not be disturbed on appeal unless a review of the record discloses that there is no evidence which reasonably supports the judge's findings. Harkins v. Greenville County, 340 S.C. 606, 533 S.E.2d 886 (2000); Townes, 266 S.C. at 86, 221 S.E.2d at 775; Barnacle Broad., Inc. v. Baker Broad., Inc., 343 S.C. 140, 538 S.E.2d 672 (Ct.App.2000).

LAW/ANALYSIS

I. The Freedom of Information Act (FOIA)

The South Carolina Freedom of Information Act is codified as sections 30-4-10 to -165 in the South Carolina Code. See S.C.Code Ann. §§ 30-4-10 to -165 (1991 & Supp.2002). The FOIA provides:

The General Assembly finds that it is vital in a democratic society that public business be performed in an open and public manner so that citizens shall be advised of the performance of public officials and of the decisions that are reached in public activity and in the formulation of public policy. Toward this end, provisions of this chapter must be construed so as to make it possible for citizens, or their representatives, to learn and report fully the activities of their public officials at a minimum cost or delay to the persons seeking access to public documents or meetings.

S.C.Code Ann. § 30-4-15 (1991).

The essential purpose of the FOIA is to protect the public from secret government activity. Wiedemann v. Town of Hilton Head Island, 330 S.C. 532, 500 S.E.2d 783 (1998); South Carolina Tax Comm'n v. Gaston Copper Recycling Corp., 316 S.C. 163, 447 S.E.2d 843 (1994); Bellamy v. Brown, 305 S.C. 291, 295, 408 S.E.2d 219, 221 (1991); see also Quality Towing, Inc. v. City of Myrtle Beach, 345 S.C. 156, 547 S.E.2d 862 (2001) (the FOIA was enacted to prevent the government from acting in secret). "South Carolina's FOIA was designed to guarantee the public reasonable access to certain activities of the government." Fowler v. Beasley, 322 S.C. 463, 468, 472 S.E.2d 630, 633 (1996). The FOIA is remedial in nature and should be liberally construed to carry out the purpose mandated by the legislature. Quality Towing, Inc. v. City of Myrtle Beach, 345 S.C. 156, 547 S.E.2d 862 (2001); South Carolina Dep't of Mental Health v. Hanna, 270 S.C. 210, 241 S.E.2d 563 (1978).

Section 30-4-30(a) of the South Carolina Code provides: "Any person has a right to inspect or copy any public record of a public body, except as otherwise provided by § 30-4-40, in accordance with reasonable rules concerning time and place of access." S.C.Code Ann. § 30-4-30(a) (1991). The Hospital falls within the definition of "public body" as set forth in § 30-4-20(a), so as to render the FOIA applicable. See S.C.Code Ann. § 30-4-20(a) (1991) (defining "public body").

The FOIA meets "`the demand for open government while preserving workable confidentiality in governmental decisionmaking.' " Bellamy v. Brown, 305 S.C. 291, 295, 408 S.E.2d 219, 221 (1991) (quoting Chrysler Corp. v. Brown, 441 U.S. 281, 292, 99 S.Ct. 1705, 60 L.Ed.2d 208 (1979)). The FOIA creates an affirmative duty on the part of public bodies to disclose information. Bellamy, 305 S.C. at 295, 408 S.E.2d at 221. The purpose of the Act is to protect the public by providing for the disclosure of information. Id. However, the exemptions from disclosure contained in §§ 30-4-40 and 30-4-70 do not create a duty of nondisclosure. Id. These exemptions, at most, simply allow the public agency the discretion to withhold exempted materials from public disclosure. Id.

II. Trade Secrets

Dr. Campbell contends the Circuit Court erred in finding information relating to physicians' salaries, compensation, and the purchase price of physician practices amounted to "trade secrets" necessitating protection from disclosure.¹ We agree.

At trial, the Hospital argued that physicians' salaries and prices paid for practices constituted "trade secrets" because, as a rural county hospital, it needed to keep the information private in order to attract qualified physicians and to compete with wealthier, urban areas. At the summary judgment hearing, Dr. Campbell submitted affidavits from Irance Collins, M.D., and Lewis W. Mustard, Ph.D., regarding the different factors physicians...