XJGB and Australian Information Commissioner (Freedom of Information)
[2024] AATA 763
•17 April 2024
XJGB and Australian Information Commissioner (Freedom of Information) [2024] AATA 763 (17 April 2024)
Division:FREEDOM OF INFORMATION DIVISION
File Number(s): 2022/0097
Re:XJGB
APPLICANT
AndAustralian Information Commissioner
RESPONDENT
AndResolve Software Group Pty Ltd
OTHER PARTY
DECISION
Tribunal:Deputy President Britten-Jones
Date:17 April 2024
Place:Melbourne
The decision under review is affirmed
............................[sgd]............................................
Deputy President Britten-Jones
Catchwords
FREEDOM OF INFORMATION - review of decision to refuse access to a document - document exempt under sections 45 and 47(1)(b) of the Freedom of Information Act 1982 - decision under review affirmed
Legislation
Freedom of Information Act 1982 (Cth)
Cases
Asylum Seeker Resource Centre and Department of Home Affairs [2020] AICmr 7
Secondary Material
Office of the Australian Information Commissioner, Guidelines issued by the Australian Information Commissioner under s 93A of the Freedom of Information Act 1982, FOI Guidelines, version 1.4, December 2016REASONS FOR DECISION
Deputy President Britten-Jones
17 April 2024
The applicant is seeking access to a document under the Freedom of Information Act1982 (FOI Act). The respondent refuses access under ss 45, 47 and s 47G of the FOI Act. The other party, Resolve Software Group Pty Ltd (Resolve), is the author of the document and supports the respondent’s refusal to give access of the document to the applicant.
The applicant’s request for access was made on 29 August 2021. The respondent identified and refused access to one document within the scope of the request, namely a Resolve Enterprise Report Writer Guide v1.8 (12 October 2018) (the Report Writer Guide). On internal review, a delegate of the respondent refused access under s 45 and s 47(1)(b) of the FOI Act.
Resolve is a software company that creates, markets and licences or sells software products to customers.
Ms Wendy Barker is the General Counsel for the parent company of Resolve. She provided a witness statement and oral evidence to the Tribunal. She said in her statement that the Report Writer Guide is a confidential document drafted by Resolve that contains secret and highly sensitive information including intellectual property. The document is marked on each page with “Commercial in Confidence”. Ms Barker says that the Report Writer Guide:
includes intricate details of Resolve’s software including its technical capabilities, functions and features as well as associated graphical depictions (such as the associated user interfaces) and thorough explanations on how the software works and its specific outputs.
I have had access to the Report Writer Guide and I agree with Ms Barker’s description of it.
A customer who purchases a Resolve software package will enter into a comprehensive contractual agreement (Customer Agreement) which includes obligations of confidence. As part of the package a customer will be given access to the Report Writer Guide via a log in to a secure portal.
Freedom of Information Act 1982
The High Court considered the legislative framework of the FOI Act in Kline v Official Secretary to the Governor-General:[1]
…The statutory scheme is complex in achieving a balance between the exposure of some government processes and activities to increased public participation and scrutiny, by making information freely available to persons on request, and exempting other government processes and activities from public participation and scrutiny, in order to secure a competing or conflicting public interest in non-disclosure.
[1] Kline v Official Secretary to the Governor-General [2013] HCA 52; (2013) 249 CLR 645, 661 at [37].
The general objects of the FOI Act are set out in s 3 as follows:
(1)The objects of this Act are to give the Australian community access to information held by the Government of the Commonwealth, by:
(a)requiring agencies to publish the information; and
(b)providing for a right of access to documents.
(2)The Parliament intends, by these objects, to promote Australia’s representative democracy by contributing towards the following:
(a)increasing public participation in Government processes, with a view to promoting better-informed decision-making;
(b)increasing scrutiny, discussion, comment and review of the Government’s activities.
(3)The Parliament also intends, by these objects, to increase recognition that information held by the Government is to be managed for public purposes, and is a national resource.
(4)The Parliament also intends that functions and powers given by this Act are to be performed and exercised, as far as possible, to facilitate and promote public access to information, promptly and at the lowest reasonable cost.
To promote the objects in s 3(1)(b), s 11(1) provides that:
Subject to this Act, every person has a legally enforceable right to obtain access in accordance with this Act to:
(a) a document of an agency, other than an exempt document; or
(b) an official document of a Minister, other than an exempt document.
Section 11A(3) provides that where a person makes a request in accordance with s 15(2) to an agency or Minister for access to a document and pays the required charge, the agency or Minister must give the person access to the document in accordance with the FOI Act ‘subject to this section’.
Section 11A(4) provides that the agency or Minister is not required to give the person access to the document if the document is an exempt document.
The term ‘exempt document’ is defined in s 4(1) to include: ‘a document that is exempt for the purposes of Part IV (exempt documents) (see section 31B)’. Section 31B provides that:
A document is exempt for the purposes of this Part if:
(a) it is an exempt document under Division 2; or
(b) it is conditionally exempt under Division 3, and access to the document would, on balance, be contrary to the public interest for the purposes of subsection 11A(5).
…
If a document is exempt, the agency is not required to provide the document.
Section 45 – documents containing material obtained in confidence
Section 45(1) provides:
A document is an exempt document if its disclosure under this Act would found an action, by a person (other than an agency or the Commonwealth), for breach of confidence.
The Office of the Australian Information Commissioner has issued Guidelines (the Guidelines) under s 93A which requires the Tribunal to have regard to the Guidelines in making its decision. With respect to a breach of confidence, the Guidelines say:
5.158. A breach of confidence is the failure of a recipient to keep confidential, information which has been communicated in circumstances giving rise to an obligation of confidence. The FOI Act expressly preserves confidentiality where that confidentiality would be actionable at common law or in equity.
5.159. To found an action for breach of confidence (which means s 45 would apply), the following five criteria must be satisfied in relation to the information:
• it must be specifically identified
• it must have the necessary quality of confidentiality
• it must have been communicated and received on the basis of a mutual understanding of confidence
• it must have been disclosed or threatened to be disclosed, without authority
• unauthorised disclosure of the information has or will cause detriment.
The respondent and Resolve rely upon the obligation of confidence expressed in the terms of the Customer Agreement.
I turn now to the five criteria referred to in paragraph 5.159 of the Guidelines.
Can the information be identified with specificity?
The information in question is contained in the Report Writer Guide. It follows that the information can be identified by reference to that document. The applicant contended that the respondent was making a blanket claim without the necessary specificity of information because the claim was directed to the Report Writer Guide as opposed to specific information within it. I reject that contention because in this case all of the information in the document in issue is an appropriate subject of the claim.
Does the information have the necessary quality of confidentiality?
The applicant contended that the information in the Report Writer Guide was of a trivial and procedural nature and did not have the necessary quality of confidence. For the reasons below I reject that contention.
Ms Barker gave evidence about how Resolve takes proactive steps to ensure its commercially sensitive and secret information contained in the Report Writer Guide is not accessed, used, disclosed or distributed outside of its business except by agreement with its customers. Employees and contractors engaged by Resolve pursuant to employment and contractor agreements are obliged to keep the Report Writer Guide confidential because it comes within the definition of confidential information and intellectual property in those agreements. Resolve has written policies to ensure that its employees do not attempt to access the Report Writer Guide when not authorised to do so. With respect to the use of and access to the Report Writer Guide by customers, it is limited to staff of the customer authorised by Resolve to log in to the customer access portal and access is subject to the confidentiality obligations in the Customer Agreement.
The applicant contended that the obligation of confidence on customers with respect to the Report Writer Guide was not established because the Customer Agreement was not exhibited to the witness statement of Ms Barker and there was no other evidence from customers to corroborate the evidence from Ms Barker as to confidentiality. Ms Barker explained in her oral evidence on re-examination that the reason for not providing an example of a Customer Agreement was because they are confidential to the customer. I accept that Resolve could have provided a Customer Agreement to the Tribunal on a confidential basis with the consent of the customer, but it was not obliged to do so and the evidence as to obligations of confidence is not diminished by not having done so. I reject the applicant’s contention and I accept the evidence of Ms Barker as being sufficiently probative to establish the quality of confidentiality because her evidence is consistent with the document being marked as “Commercial in Confidence” and other references in the Report Writer Guide expressing that the document is provided in confidence and may not be distributed or copied to anyone in any way without Resolve’s prior authorisation. Further, the nature of the information as including intricate details of software including its technical capabilities, functions and features and graphical depictions is such that one would expect obligations of confidentiality to exist. This information is not common knowledge and is not in the public domain. Contrary to the contention of the applicant, the information in the Report Writer Guide is not provided on the Resolve website nor is it disclosed in any marketing activities undertaken by Resolve.
Was there a mutual understanding of confidence?
The mutual understanding of confidence derives from the obligations of confidence in the terms of the Customer Agreement and the references to confidentiality in the document itself as set out above. Ms Barker said in her statement with respect to the duty of confidence:
[28] Given the commercial arrangements described above, and the nature of the Document as highly confidential, with specific and limited accessibility and subject to any confidentiality obligations in the Customer Agreement, Resolve expects the Document to be treated by customers with the utmost confidence and secrecy.
[29] The Document is provided to customers to enable use of the Resolve software package, and cannot be used for any other purpose. The Document remains the intellectual property of Resolve at all times and no Customer Agreement would ever vest, waive or condone the transfer or improper use of, the intellectual property to the customer or any third party. To do so would undermine systems in place to protect the Document.
I find that the information in the Report Writer Guide was communicated and received on the basis of a mutual understanding of confidence.
Unauthorised disclosure or threatened disclosure
It is apparent from the terms of the Customer Agreement and the references to confidentiality in the document itself as set out above that any disclosure would be unauthorised. Resolve has participated in this application because it does not authorise the disclosure of the Report Writer Guide.
Detriment
Ms Barker says in her statement that the Report Writer Guide contains graphic step-by-step depictions of the Resolve software package, which could be used by a third party to:
(a)gain internal insights into the operation of the software; and
(b)develop a copycat product that appears to look and act identical to the Resolve software package or use information obtained from the Report Writer Guide, either to develop an alternative product or for the purpose of performing a malicious cyber-attack on Resolve or its clients.
Ms Barker considers that disclosure would risk financial and commercial detriment to Resolve if a competitor gained access to confidential information about its products which would lead to a reduced ability for Resolve to successfully win work. I accept that the unauthorised disclosure of the Report Writer Guide would likely cause financial detriment to Resolve as it would provide competitors with detailed information about the capability of the Resolve system such that competitors would then have an unfair advantage in competing for business.
Conclusion on s 45
I conclude that the Report Writer Guide is an exempt document under s 45 because its disclosure would found an action for breach of confidence.
Section 47 – trade secrets and commercial value
Relevant principles
Section 47 of the FOI Act relevantly provides:
Documents disclosing trade secrets or commercially valuable information
(1) A document is an exempt document if its disclosure under this Act would disclose:
(a) trade secrets; or
(b) any other information having a commercial value that would be, or could reasonably be expected to be, destroyed or diminished if the information were disclosed.
With respect to information having a commercial value, the Guidelines say:
Information having a commercial value
5.204 To be exempt under s 47(1)(b) a document must satisfy two criteria:
·the document must contain information that has a commercial value either to an agency or to another person or body, and
·the commercial value of the information would be, or could reasonably be expected to be, destroyed or diminished if it were disclosed.
5.205 It is a question of fact whether information has commercial value, and whether disclosure would destroy or diminish that value. The commercial value may relate, for example, to the profitability or viability of a continuing business operation or commercial activity in which an agency or person is involved. The information need not necessarily have ‘exchange value’, in the sense that it can be sold as a trade secret or intellectual property. The following factors may assist in deciding in a particular case whether information has commercial value:
·whether the information is known only to the agency or person for whom it has value or, if it is known to others, to what extent that detracts from its intrinsic commercial value
·whether the information confers a competitive advantage on the agency or person to whom it relates — for example, if it lowers the cost of production or allows access to markets not available to competitors
·whether a genuine ‘arm’s-length’ buyer would be prepared to pay to obtain that information
·whether the information is still current or out of date (out of date information may no longer have any value)
·whether disclosing the information would reduce the value of a business operation or commercial activity — reflected, perhaps, in a lower share price.
5.206 The time and money invested in generating information will not necessarily mean that it has commercial value. Information that is costly to produce will not necessarily have intrinsic commercial value.
5.207 The second requirement of s 47(1)(b) — that it could reasonably be expected that disclosure of the information would destroy or diminish its value — must be established separately by satisfactory evidence. It should not be assumed that confidential commercial information will necessarily lose some of its value if it becomes more widely known. Nor is it sufficient to establish that an agency or person would be adversely affected by disclosure; for example, by encountering criticism or embarrassment. It must be established that the disclosure would destroy or diminish the commercial value of the information.
Is there commercially valuable information in the Report Writer Guide?
The Report Writer Guide is part of a software package sold to customers of Resolve for significant consideration. It is apparent on the face of the document that it has been developed by Resolve over time with numerous versions since 2013. The information in the Report Writer Guide is known only to Resolve and its customers who have limited access to it via a restricted portal. It is current information. The fact that customers are prepared to pay so as to have limited access to the information in the Report Writer Guide is evidence of its commercial value. If the information were disclosed outside of Resolve’s customers without any contractual restrictions on how it could be used, then the commercial value of the information would be diminished because it could be used by competitors to obtain an unfair advantage.
The applicant referred me to a decision of the Australian Information Commissioner in Asylum Seeker Resource Centre and Department of Home Affairs [2020] AICmr 7 in which access was granted to a policy and procedure manual. In that case, the Commissioner was not satisfied that Serco (the affected party) or the Department had identified the intrinsic commercial value of information in the documents, independently of the impact that disclosure would have on Serco’s business. In this case, commercial value has been established by evidence that the information in the Report Writer Guide includes confidential intellectual property of Resolve and because it is part of a package of software that is sold for consideration to customers in the open market. The policy and procedure manual was not part of a commercial offering sold to customers and therefore can be distinguished from the Report Writer Guide.
I find that the Report Writer Guide satisfies the two criteria under s 47(1)(b) and is therefore an exempt document. The information in the Report Writer Guide is commercially sensitive and its removal would leave only a skeleton of the document; accordingly, I refuse the applicant’s request for an edited copy under s 22 of the FOI Act.
CONCLUSION and DECISION
I have found that the Report Writer Guide is an exempt document under both ss 45 and 47(1)(b) of the FOI Act and therefore the applicant should be denied access to it. There is no need for the Tribunal to consider the s 47(1)(a) claim for exemption or the alternative claim under s 47G. The applicant no longer contends that the respondent failed to take all reasonable steps to identify documents within the scope of the request.
The decision under review is affirmed.
35. I certify that the preceding 34 (Thirty-four) paragraphs are a true copy of the reasons for the decision herein of Deputy President Britten-Jones
............................[sgd]............................................
Associate
Dated: 17 April 2024
Dates of hearing: 15 April 2024 Applicant: Self-represented Advocate for the Respondent: Sharon Sangha Solicitors for the Respondent: Mills Oakley Lawyers Advocate for the Other Party: Nicola McMahon Solicitors for the Other Party: McCullough Robertson Lawyers
Key Legal Topics
Areas of Law
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Administrative Law
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Statutory Interpretation
Legal Concepts
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Judicial Review
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Procedural Fairness
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Statutory Construction
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