### T E X A S C O U R T O F A P P E A L S , T H I R D D I S T R I C T , A T A U S T I N

NO. 03-14-00594- CV

Ke n Paxt on, Attorney G eneral of the State of Texas, Appellan t

v. Texas Depart m ent of State Health Service s, Appellee

F ROM TH E DISTRI CT COURT O F TRAVIS CO UNTY, 353 RD JUDICI AL DISTRICT NO. D-1 -GN-1 2-0 0232 2, H ONO RAB LE LO RA J. LI VINGSTO N, JUDGE P RESIDING

O P I N I O N

The Att o rn ey Gene ral appea ls from a summary judgme nt g rante d to the Texas Depa

rtment of State Hea lth Service s i n a d eclaratory action under the Texas Public I nformation Act (PI A). The Depa rtment sued the Attorney Gene ral afte r his Open Records Division 1 reje cted the D epar

tment’s reque st to withhold infor mation c ollected by

the Off ice of the I nspector Gene ral (OI G) during an investigation into employ ee misco n d u ct b y two Depa rtment employ ees. The Depa

rtment had soug ht to withhold the information under a Gover nment C o d e p ro v ision that makes information and materia ls “compiled by t h e [ OIG] in connec tion with an audit

or investiga

tion” confide ntial a

nd not subje ct to disc losure under the PI A. The Attorney Gene ral, 2 noting this provision is found in the OI G’s enabling provis i o n s reg arding fra ud and abuse in the

See ge nerally Tex. Gov’t Code §§ 552.001–.353 (provisions of PI A). 1 See Tex. Gov’t Code § 531.1021(g ). 2provision of health and human servic es , d etermined in a letter ruling that the confide ntiality

e xc e p ti o n did not apply beca use the underlying OI G investigation did not conce rn “Medic aid or othe r health and human service s fra ud, abuse, or overc harg es.” On cross motions for summary judgme nt, 3 the district court ag ree d with the Depa rtment’s interpre tation of the scope of the exception to disclosure cre ated by this statutory g rant of confide ntiality and g rante d summary judgme nt in favor of the Depa

rtment. Ba sed on our deter mination that the scope is narr ower than that urg ed by the Depa rtment, we w ill reverse the district court’s summar y judgme nt. Background The underlying fac t s of this case , althoug h vag ue in the rec ord befor e us, are straig htforwa

rd and undisputed. I ris, a Depa rtment employ ee, filed a complaint ag ainst Ang el, another Depa rtment employ ee. T he OI G investig ated the c omplaint but found that the alleg ations of misconduct ag ainst Ang el could not be substantiated. Both I ris and Angel fi led open-r ecor ds reque sts with the Depar

tment seeking information and mate rials from the O I G’s investig ation. Be lieving the information was confide ntial beca us e i t h ad been “compiled by the [OI G] in connec tion with an . . . investigation,” the Department declined to rele ase the reque sted 4 informat i o n an d instead sought a letter ruling from the Attorney Gene ral reg arding its obliga tions

Tex. Att’y

Gen. OR2012-10072, at 2. 3 Tex. Gov’t Code § 531.1021(g ) (“A ll information and materia ls subpoenae d or compiled 4 by t h e [ OI G] in connec tion with an audit or investigation

. . . are confide ntial and not subject to disclosure unde r [the PI A.]”). 2under t h e PI A. The Attorney Gene ral’s Open Record’ s Division deter mined, rele vant here , that 5 beca use the reque sted information was not “re lated to Medica id or other health and human service s fra ud, abuse, or overc harg es,” it was not confide ntial under section 531.1021(g ) and, thus, the Depa rtment was r equire d to disclose it under the PI A. 6 Disag ree ing with the Attorney Gene ral’s deter mination, the Depa

rtment filed suit in Travis County District C o u rt , seeking decla ratory judgme nt that the reque sted information was confide ntial under section 531.1021(g ) and relief from compliance with t he Attorney Gene ral’s decision. Both parties then filed cross motions for summary judgme nt, eac h ag ree ing o n t h e

7 following stipulations:

• “The information at issue was not subpoenae d or compiled by the OI G in connec tion with a Medica id fraud inve stiga tion.”

• “The information at issue was subpoenae d or compiled by the OI G i n connec tion with an audit or investig ation.” They joined issue, howeve r, on whe ther sec tion 531.1021(g ) make s the information and ma terials g ather ed from ever

y OI G audit and investiga tion confide nt i al , including those not rela ted to Medica id fra

ud or other health-a

nd-human-se rvice s fra

ud, or if subsection (g ) makes confide ntial

o n l y the information and materia ls g ather ed in OI G audits and investigations into Medica id fra ud and other health and human service s. The district c ourt impliedly deter mined that it wa s the

See id. § 552.301(a) (PI A provision direc ting g overnme ntal body seeking to withh o l d 5 information to reque st Attorney Gene ral ruling ). Tex. Att’y

Gen. OR2012-10072, at 2. 6 See Tex. Gov’t Code § 552.324 (authorizing de clar atory -judg ment suit). 7 3former , decla ring “in formation rela ting to a specifie d investigation of alleg ed misconduct of a named D[epartment] employ ee is excepted from disclosure under [t he PI A] in conjunction with [section] 531.1021, and [t he Depa rtment] must not disclose this information to the reque stors,” and g rante d summary

judgme nt in favor of

the Depa rtment. The Attorne y

Gene ral a

ppeals. Analysis The Attorney Gene ral’s sole issue on appea l is that the d i s t ri ct court err ed in concluding that the OI G investigatory exclusion to disclosure cre ated by sectio n 5 3 1

. 1 0 2 1 ( g ) e xte n ds
to information and materia ls g ather ed from an OI G audit and investigation into any subject. I nstead, the Attorney Gene ral asser ts, section 531.1021(g ) makes confide ntial only information a n d ma te rials g ather ed by the OI G in an audit or investigation involving “fr aud, waste, and abuse in the provision and deliver

y of all hea lth and human servic es in the state.” We ag ree . 8 9 We beg in our analy sis of this issue, as we often do i n ca s es i n v olving the PI A, with a g ener al revie w of the statute’s provisions and policies. Unlike m o s t statutes, the PI A includes explicit rationale and instructions to g uide our unde rstanding and construc tion of i t. The PI A emphasizes that it is intended as an expression of a fundame ntal poli cy o f t h i s S t ate that

Id. § 531.102(a) (OI G re sponsibili ties). 8 Beca use summary -judg ment standards are well established and not at issue here , we 9 note them briefly for ref

ere nce. We reviewsummary judgme nts de novo. Valence Operating Co. v. Dorsett , 164 S.W .3d 656, 661 (Tex. 2005). Summary judgme nt is proper when there are no disputed issues of materia l fac t and the movant is entitled to judgme nt a s a matter of law. Tex. R. Civ. P. 166a(c ). Where both pa rties move for summary

judgme nt and the district cour t g rants one motion and denies the other, we revie w the summary -judg ment evidenc e pre sented by both sides, deter

mine all questions prese nted, and rende r the judgme nt that the d i s trict court should have rende red. Texas W

orkers’ Comp. Comm’n v. Patient Advoc ates of Tex ., 136 S.W .3d 643, 648 (Tex. 2004). 4“g overnme nt is the s er v an t and not the master of the people,” and that the people of Texas, “in

deleg ating authority , do not g ive their public serva nts the rig ht to decide what is g ood for the people
to know and what is not g ood for them to know,” but “insist on rema ining informed so that they may reta in control over the instruments they have c reated,” therefor e, Tex ans are entitl ed “to c omplete information about the aff

airs of g overnme nt and the officia l acts of public off ic ia ls and employ ees.” 1 0 To advanc e these policy g oals, the L eg islature has direc ted that courts “libera lly construe” the PI A in favor of

disclosing r equeste d information. 1 1 I n keeping with its fundame ntal purpose of promoting transpar ency in g overnme nt, the PI A’s key provisions obliga te the g overn m en t , stated g ener ally , to make public information

rea sonably available to whomever proper ly makes a reque st. Only if t h e re q u ested public 1 2 information falls under one of the PI A exceptions to disclosure or if the public information is

m ad e co n fi dential by law does this obliga tion to make public information available chang e. 1 3 Her e, t he Depa

rtment invoked the confide ntial-by -law exception, asser ting that, under the plain lang uag e of Gover

nment Code section 531.1021(g ), the re q u es t ed information is excepted from disclosure beca

use “it is information considered to be confide ntial by law, either constitutional,

Tex. Gov’t Code § 552.001(a) ; see Ja ck s o n v. State Office of Admin. Hearings , 1 0 351 S.W .3d 290, 293 (Tex. 2011).

See Tex. Gov’t Code § 552.001 (“This cha pter shall be liberally construed in favor of 1 1 g ranting a re quest for infor mation.”). See Austin Bul l d

o g v. Leffingw ell , 490 S.W .3d 240, 244–45 (Tex. App.—Austin 2016, 1 2 no pet.) (de scribing PI A proc ess).

Id. 1 3 5statutory , or by judicial decision.” Resolving this issue, then, prese nts us with a matter of statutory 1 4 construction. 1 5 As t h e T ex as Supreme Court has emphasized many times, our “primar y objective” in statutory construction “is to deter mine the L eg islature’s intent which, when possible,

we discern from t h e p l ain meaning of the words chosen.” We must rea d words and phrase s “in 1 6 context” and construe them “ac cording to the rules of g rammar and common usag e.” “The import 1 7 of lang uag e, plain or not, must be draw n from the surrounding context, particula rly when construing

ever y day words and phrase s that are inordinately context-sensitive.” “Given the power of context 1 8
to transfor

m the meaning of lang uag e, courts should resist ruling s anchor ed in hy per- technica l

rea dings of isolated words or phrase s, or forc ed rea di ng s that are exagg erated or, at the other extreme, constra ined.” 1 9

Tex. Gov’t Code § 552.101. 1 4 Statutory cons t ru ction is a question of law we revie w de novo. State v. Shumake , 1 5 199 S.W .3d 279, 284 (Tex. 2006). Traxler v. Entergy Gulf

States, Inc. , 376 S.W .3d 742, 747 (Tex. 2012); see, e.g. , Southwest 1 6 Royalties, Inc. v. Hegar , __S.W .3d__, No. 14-0743, 2016 WL 3382151, at *3 (Tex. J une 17, 2016) (“O ur primary objective is to g ive eff ec t t o t he L eg islature’s intent, which we asce rtain from the plain meaning of the wo rd s u s ed in the statute, if possible.”); TGS-NOPEC Geophy sical Co. v. Combs , 340 S.W .3d 432, 439 (Tex. 2011) (“When construing a statute, our primary objective is to asce rtain and g ive eff

ect to the L eg islature’s intent.

. . . To discern that intent, we beg in with the statute’s words.” ). Tex. Gov’t Code § 311.011(a)

. 1 7 City of Rockwall v. Hughes , 246 S.W .3d 621, 632 (Tex. 2008) (Will ett, J ., dissenting) 1 8 (citing Tex. Gov’t Code § 311.011(a) ).

Id. 1 9 6The Depa rtment maintains that, on its fac e, the tex t o f s ec t i on 531.1021(g ) place s

no limi t s o n o r require ments for the subject matter of an OI G audit or investigation to which confide ntiality attache s. We cannot disag ree that an initial, isolated rea ding of section 531.1021(g ) does sug g est that it applies to any audit or investigation by the OI G. But such an interpre tation fails when the provision is considere d, as it must be, in the contex t o f t h e OI G’s enabling provisions. When considere d in its proper context, it become s ap pare nt that the L eg islature intended for confide ntiality to extend only to those OI G audits and investigations conce rning “fr aud, waste, and abuse in the pr ovision and delivery of all hea lth and human servic es in the state.” 2 0 The OI G, a division of t he Health and Human Services Com mission (HHSC), was

cre at ed to “per form fra ud and abuse investigation and enfor ceme nt functions as provided by Subchapter C and other law.” Subchapte r C, titled “Medic aid and Other Hea lth and Human 2 1 Service s Fr aud, Abuse, or Over char g es,” i s direc ted at, as its title sug g ests, eliminating fra ud and ab u se in the provision of Medica id and other health and human service s. For example, on e 2 2 provision authorizes monetary awa rds for repor

tin g M ed icaid fra

ud and another require s frauddetec tion training for contra ctors and state ag enc i es . Additionally , and signific antly , section 2 3 531.102 desig nates the O I G as the e ntity responsible for

car ry ing out Subcha

pter C’s purpose s:

Tex. Gov’t Code § 531.102(a) 2 0 Id. § 531.008(c) (2). Although the Depa rtment can point to no specific l ang uag e 2 1 authorizing such internal investigations of employ ee misconduct, it asser ts that s u ch “o t her law” exis ts. See id. §§ 531.101–.1203 (provisions of Subchapte r C).

2 2 See id. §§ 531.101(a) (establishing awa rd), .105 ( fra

ud-dete ction training ). 2 3 7The commission’s office o f inspector g ener al is responsible for the preve ntion,

detec tion, audit, inspection, review, and investigation of fra ud, waste, a

nd abuse in the provision and delivery of all health and human service s in the state, i n cludi ng service s throug h any state-a dminist ere d health or human service s prog ram that is wholly or partly fede rally funded, and the enfor ceme nt of s t at e law rela ting to the provision of those servic es. 2 4

Section 531.102 instructs the OI G to conduct its investigations indepe n d en t l y of HHSC but also to coordina te with the HHSC executive commissioner and HHSC p rog rams in perf orming “func tions rela ting to the preve ntion of fra ud, waste, and abuse in the delivery of health and human service s,” and to rely on that coordina tion to “knowledg eably and eff ectively perf

orm[] [i ts] duties under this section and any other law.” The OI G’s em p h as i s and g oals, acc ording to 2 5

s ec t ion 531.102, should be on rec overing money , focusing on the strong est case s, and ref erri n g Medica id fra

ud case s to the Attorney Gene ral. And finally , to car ry out these responsibilities and 2 6 g oals, Subchapter C a

uthorizes the OI G to issue witness and production subpoenas “in connec tion with an investigation,” althoug h, as noted and at issue here , “informa tion and materia ls subpoenae d 2 7

o r co m p i l ed b y the office in connec tion with an audit or investigation” are confide ntial and not subject to disclosure unde r the PI A. 2 8

Id. § 531.102(a)

. 2 4 Id. § 531.102(a- 5), (a -6). 2 5 Id. § 531.102(b). 2 6 Id. § 531.1021(a)

. 2 7 Id. § 531.1021(g ). 2 8 8I n s u m, the subject matter of Subchapter C—its purpose, essentially , and the

context for considering section 531.1021(g )’s g rant of confide ntia l i ty —is the investigation and preve ntion of abus e and fra ud rela ted to the provision of health and human service s. The OI G’s statutory responsibility , at least with respe ct to Subchapter C, is to car ry out Subchapter C’s purpose by conducting audits and investigations into fra ud and abuse in t h e p ro v i s i o n of Medica id and other health service s. For that rea son, “audit or investigation” can only be fairly rea d to ref er to an OI G audit or investig ation “of f raud or abuse in the pr ovision of health and human se rvice s.” This interpre tation is supported in a larg er context as well. I n section 531.008, which dir ec t s t h e HHSC executive direc tor to cre ate the OI G and other divisions of the HHSC, the OI G’s purpose is define d in terms of “fr aud and abuse investigation,” not simply “investig ation.” 2 9 When used, as they are h er e, i n t h e context of health service s, the words “fr aud” and “abuse ” are arg uably term s of art intended to ref er specific ally to Medica id fra ud and rela ted problems. Fur ther, 3 0 HH S C h as d ef

ined “abuse ” as a “pra ctice by a provider that is inconsistent with sound fiscal, business, or medical prac tices

. . . .” Acc ording ly , when consid er ed in the context of the OI G’s 3 1 enabling provisions and in light of the aims o f t h o s e provisions, the subject matter of “audit and investiga tion” in se ction 531.1021(g ) of Subchapter C is limit ed to the subject matter of the OI G’s

Id. § 531.008(c) (2). 2 9 See id. § 3 1 1

. 0 1 1(b) (“Words and phrase s that have acquir ed a technica l or particula r 3 0 meaning , whether

by leg islative definition or otherwise , shall be construe d acc ording ly .”). 1 Tex. Admin. C ode § 371.1 (H HSC, P urpose a nd Scope) ( defining“abuse ”). 3 1 9responsibilities under Subchapter C g ener ally —preve nting, detec ting, auditing, and investiga ting “fr aud, waste, and abuse in the provision and delivery of all health and human service s in the state.” 3 2

The Depa rtment arg ues that its interpre tation does not take the provision out of
context. Specifica lly , it asser ts that there is nothing in Subchapter C, including the title, that limit s the OI G to Medica id fra ud investigations or to investigations under Subchapt er C and that HHSC’s executive commissioner, using his discretio n u n der sections 531.0055 and 531.008, has tasked the OI G with investigating employ ee mi s conduct at various HHSC ag encie s for quite

some time. To the ex tent that the Department i s sug g esting that the OI G i s authorized to conduct employ ee- misconduct investigations that do n o t i m p l icate fra ud and abuse “in the provision and delivery of all health and human service s in the state” and that, as a result, those investiga tions fall under the confide ntiality exception in Subchap t er C , we would note that the scope of the OI G’s investiga tory authority , including HHSC’s executive commissioner’s ability to modify it, is not befor e us. What is befor e us is the scope of the confide ntiality g rante d by section 531.1021(g ), and

we disag ree that the L eg islature intended the g rant to be limit less when the subchapte r in which the g rant is located is so plainly direc ted to “fr aud, waste, and abuse in the provision and delivery of all health and huma

n service s in the state.” The Depa rtment a ls o s u g g e s ts that not protec ting all OI G investiga tions would impair the OI G’s abi l i t y t o o btain sensitive information and car ry out its investigative responsibilities, and that persons and companies would fee l insecure in repor ting to the OI G. Wit h reg ard to this last asser tion, it seems that the Depa rtment may be confusing or confla ti n g an OI G investiga tion

Tex. Gov’t Code § 531.102(a)

. 3 2 10of fra

ud or abuse in the provision o f h ea l th and human service s with an audit or investigation that does not involve that subject matter. Of course , under our holding here , information collecte d in an OIG i n v estig ation conce rning the subject matter of Subchapter C would be confide ntial under section 531.1021(g ) and not subject to disclosure. And the other difficulties descr ibed by the Depa rtment are no differ ent than those experience d by all other g overnme ntal entities fa ced with public-informa tion reque sts. The L eg islature has deter mined that, unless the information reque sted is excepted from disclosure, g overnme ntal entities must compl y w it h r e q u e s ts f o r p u b li c information. The Depa rtment arg u es t h at i t s interpre tation would not deny the public acc ess to any information beca

use the OI G would be require d to issue a final repor t under section 531.102(k). The Depa

rtment is incorre ct. Section 531.102(k) require s final repor ts o n l y for “ea ch audit

or investigation conducte d under this section

. ” An audit or investigation conducte d under 3 3 section 531.102 is, as descr ibed above, one involvi n g “fr aud, waste, and abuse in the provision and delivery of all hea lth and human servic es in the st ate.” Thus, if we acce pt the Department’s 3 4 interpre tation of section 531.1021(g ), the only p u blic information from OI G investigations that would be subject to disclosure would be the final repor ts of investigations conce rning “fr aud, waste, and abuse in the provision and delivery of all health and human service s in the state,” while all other public information collecte d by the OI G would rema in hidden. This is something allowed by no other a g ency

and, more importantly , is contrar y to the spirit of the PI A.

Id. § 531.102(j) 3 3 Id. § 531.102(a)

. 3 4 11As a final point, the Depa rtment points o u t t h at previous Attorney Gene ral letter ruling s construed section 531.1021(g) t o gra n t confide ntiality to all OI G audits and investiga tions reg ardle ss of the subject matter . The De partment insists that we must pr esume that the L eg islature was awa

re of and adopted these letter ruling s beca use the L eg islature has amende d section 531.1021(g ) sever al times sin ce 2003. I n response , the Attorney Gene ral conce des that 3 5 he has applied this section differ ently in the past but maintains that his position since 2012 has been that section 531.1021(g ) does not apply when the underly ing OI G investi gat i o n “i s not rela ted to Medicaid or other health and human service s fra ud, abuse, or

overc harg es.” Acc ording ly , the

3 6 Attorney Gene ral emphasizes, the L eg islature has had the opportunity to chang e the law. We simply
note the aid to sta tutory construction on which the De partment re lies here presumes an underlying statute that is ambiguous. Section 531.1021(g ), as we have e x plained, is susceptible to only one 3 7

rea sonable interpr etation. 3 8

See Texas Dep’ t of

Protective & Regulatory Servs. v. Mega Child Care, Inc. , 145 S.W .3d 3 5 170, 176 (Tex. 2004) (“I f an ambig uous statute that has been interpre ted by a court of last resor t or g iven a longsta

nding construction by a proper administrative office r is re- enac ted wi th o ut s ubstantial chang e, the L egis l at u re is presumed to have been familiar with that interpre tation and to have adopted it.”)

.

S ee , e.g. , Tex. Att’y Gen. OR2012-10072; OR2012-19674; OR2013-02357; 3 6 O R2 0 1 3

- 0 2 7 3 2 ; O R2 0 1 3

- 0 4 5 4 5 ; O R2 0 1 3

- 0 5 2 2 4 ; O R2 0 1 3

- 0 6 2 6 4; O R2 0 1 3

- 0 8 0 6 6 ; O R2 0 1 3

- 1 1 5 5 2 ; O R2013- 1 2 1 1 9 ; O R2 0 1 3

- 1 4 9 7 3 ; O R2 0 1 4

- 0 6 0 6 3 ; O R2 0 1 4

- 0 7 7 1 1 ; O R2 0 1 4

- 1 3 1 0 8 ; O R2 0 1 4

- 1 5 0 0 4

. See Mega Child Care, Inc. , 145 S.W .3d at 176 (“I f an ambiguous statute

. . . .”) (empha sis 3 7 added)

. See, e.g. , Texas Bd. of Chiropractic Exam’ rs v . Texas Med. Ass’n , 375 S.W .3d 464, 475

3 8 (Tex. A pp.—Austin 2012, pet. denied) (noting “ambig uous” mea ns “susce ptible to more than one rea sonable interpr etation”)

. 12We hold that, with respe ct to the OI G, the confide ntiality cre ated b y

section 531.1021(g) is limit ed to audits and investi g ations conce rning “fr aud, waste, and abuse in the provision and deliver

y of all hea lth and human servic es in the state.” We sustain the Attorney

Gene ral’s issue.

Conclusion We revers e t he district court’s judgme nt and rende r judgme nt that the public information at issue in this case is not conf idential under G overnme nt Code Section 531.1021.

__________________________________________ J eff Rose, Chief J ustice Be fore Chief J ustice Rose, Jus tices Goodwin a nd Field Reverse d and Rende red Filed: Aug ust 31, 2016

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