STATE OF NEW YORK SUPREME COURT COUNTY OF SCHENECTADY VERIFIED PETITION In the matter of the ONEIDA INDIAN NATION, Petitioner, vs. NEW YORK STATE GAMING COMMISSION, Index No.: Respondent. RJT No.: For a Judgment Pursuant to Article 78 of the Civil Hon. Practice Law and Rules. TO: SUPREME COURT OF THE STATE OF NEW YORK FOR THE COUNTY OF SCHENECTADY: ‘The Petition of the Oneida Indian Nation respectfully alleges and states as follows: INTRODUCTION 1, This proceeding challenges the wrongful withholding by the Respondent, the New York State Gaming Commission (“Gaming Commission”), of the reports on which the body responsible for evaluating and selecting casino applicants to apply to the Gaming Commission for a license, the New York Gaming Facility Location Board (“Location Board”), expressly relied as the basis for its agency determination. 2, The New York Freedom of Information Law (“FOIL”) expresses the State’s strong commitment to government transparency and accountability. “The people’s right to know the process of governmental decision-making and to review the documents and statistics leading ‘aisto determinations is basic to our society, Access to such information should not be thwarted by shrouding it with the cloak of secrecy or confidentiality.” N.Y. Pub. Off. Law § 84. 3. OnMarch 20, 2015, Petitioner, the Oneida Indian Nation (“Nation”), exercised its rights under FOIL by seeking from the Gaming Commission, public records pertaining to (i) the Location Board’s evaluation of applications to develop and operate a gaming facility in New York State and (ii) the Location Board’s selection of three proposed casinos to apply to the ‘Gaming Commission for a gaming facility license. 4. Specifically, the Nation sought analyses and projections expressly relied upon by the Location Board in the Report and Findings of the New York Gaming Facility Location. Board, dated February 27, 2015 (“Board Report”), the document in which the Location Board set forth its reasons for its selection of three proposed casinos to apply for a gaming license. 5. Ina perfunctory, conclusory response, the Gaming Commission denied the Nation’s request on March 26, 2015, claiming that the records sought by the Nation are exempt from disclosure under Public Officers Law Section 87(2)(g). ‘The Nation timely appealed the Gaming Commission’s denial to the Gaming Commission’s FOIL Appeals Officer on April 24, 2015. ‘That appeal was denied on May 5, 2015, on the grounds that: (a) analyses and projections prepared by experts retained by the Location Board are intra-agency materials exempt from, disclosure pursuant to Section 87(2)(g); and (b) analyses and projections prepared by applicants for a Gaming Commission license—to the extent they are not already publicly available—are trade secrets or materials that, if disclosed, would cause substantial injury to the competitive position of the applicant and, thus, are exempt from disclosure pursuant to Section 87(3)(d). 6. The Gaming Commission’s invocation of Section 87(2)(g)’s exemption for intra- agency materials to justify the withholding of analyses and projections relied upon by theLocation Board in its Board Report was erroneous. These materials fall (in whole or in part) squarely within three enumerated exceptions to the exemption and, thus, must be produced. They do not constitute the kind of pre-decisional, deliberative material that the intra-ageney exemption is intended to protect, 7. This Article 78 proceeding is timely filed and brought to reverse the determination of the FOIL Appeals Officer with respect to the analyses and projections prepared by Location Board experts and to compel the Gaming Commission to disclose those materials. PARTIES 8. Petitioner, the Nation, is a federally-recognized Indian nation that is located in the State of New York, 9, Respondent, the Gaming Commission, is an “agency” within the meaning of New ‘York Public Officers Law § 86(3). The Gaming Commission’s office and principal place of business is located at One Broadway Center, Schenectady, New York, 12305. JURISDICTION AND VENUE 10. This Court has jurisdiction over this matter pursuant to Article 78 of the New ‘York Civil Practice Law and Rules (“CPLR”) and New York Public Officers Law Section 89(4)(b). 11, Pursuant to CPLR §§ 506(b) and 7804(b), venue is proper in Schenectady County because it is the location of the principal office of the Gaming Commission. STATEMENT OF FACTS 12. In November 2013, New York voters approved a constitutional amendment to permit casino gaming,13. In anticipation of that approval, on July 30, 2013, Governor Andrew M, Cuomo signed into law the Upstate New York Gaming & Economic Development Act (“Gaming Act”) authorizing the award of up to a total of four destination casinos in three regions in upstate New York. 14. Pursuant to the Gaming Act, the Gaming Commission formed the Location Board for the purpose of soliciting, reviewing, and recommending applications for the three regions. 15. On March 31, 2014, the Location Board issued a Request for Applications (“RFA”) to develop and operate the destination casinos authorized by the Gaming Act. See Ex. 6 (Board Report Excerpt at 4).' On June 30, 2014, the Location Board received 17 applications in response to ils RFA. Id. After determining that one of the applications was substantially non- responsive to the RFA, the Location Board proceeded to evaluate the 16 applications that it determined to be responsive. Jd. 16, On December 17, 2014, the Location Board issued a decision announcing the selection of three proposed casinos to apply to the Gaming Commission for commercial gaming facility licenses. See Ex. 5 (Location Board Decision). In that decision, the Location Board stated that it had “directed expert analyses of revenue projections, potential cannibalization of existing gaming facilities, potential impact of competing new casinos within a single region and qualitative factors that might affect the attractiveness of the new gaming facility, including development and operating experience and project design.” Id. at 6 17. On February 27, 2015, the Location Board issued its Board Report, in which it detailed its evaluation of the applications it received and the reasons for its selection of three proposed casinos to apply for a license. See Ex. 6 (Board Report Excerpt). " An excerpt of the Board Report is attached to this petition as Exhibit 6. The full report is available at http://www.gaming ny.gov/pd/02.27.15.GFLBFinal Appendices WebSmall.pdf. 418, The Location Board stated in the Board Report that it “followed the statutory criteria of Racing, Pari-Mutuel Wagering and Breeding Law (“PML”) seetion 1320 . . . which requires the evaluation of economic activity and business development (70 percent weight), local impact and siting (20 percent weight) and workforce enhancement (10 percent weight).” Id. at 7. ‘The Location Board further stated that it did not create numerical scores based on these criteria but instead “reached its conclusions based on a qualitative judgment after careful consideration of all these factors.” Jd, at 8-9. 19, _ Inits Board Report, the Location Board went on to explain its consideration of the statutory factors and the rationale upon which it based its conclusions. Central to those conclusions were expert analyses and projections upon which the Location Board stated that it relied, but which it did not include in the Board Report or otherwise make publicly available. 20. By way of illustration: ‘The Location Board stated in the Board Report that it “considered” summaries of the applications that “included observations of experts retained on behalf of the Board,” as well as “analyses prepared by such experts at the direction of the Board, in making determinations and reaching conclusions” regarding the applicants’ ability to achieve the objectives of the Gaming Act. Ex. 6 (Board Report Excerpt at 8). The Location Board also stated that it “received expert analyses regarding the revenue-generating capabilities of the Applicants,” “directed expert analyses of revenue projections, potential cannibalization of existing gaming facilities, potential impact of competing new casinos within a single region and qualitative factors that might affect the attractiveness of the new gaming facility,” and, “[iJn particular... studied projections of gross gaming revenue and impacts to State revenue in various scenarios, accounting for potential cannibalization of revenue from existing video lottery gaming and Native American facilities and the potential impact of competing new casinos withinasingle region.” Id, at 9. In addition, the Location Board stated that its “experts .. . reviewed and commented upon aspects of the Applications within their . . . areas of expertise.” Jd. at 12. 21. On March 20, 2015, the Nation, through its attomeys and their agent, Westlaw CourExpress, submitted a Freedom of Information Law Request (“FOIL”) to the Gaming ‘Commission seeking the records referenced and relied upon in the Board Report. Ex. 1 (March 20, 2015 FOIL Request). Specifically, the Nation requested the following categories of documents: a. All expert analyses submitted to, prepared by, or reviewed by the {Location} Board (including those referred to on page 8 of the [Board] Report); b, All projections of gross gaming revenue or impacts to State revenue submitted to, prepared by, or considered by the [Location] Board (including those referred to on page 9 of the [Board] Report); c. All analyses of revenue projections, potential cannibalization of existing gaming facilities, potential impact of competing new casinos within a single region, or qualitative factors that might affect the attractiveness of any proposed gaming facility that were submitted to, prepared by, or considered by the [Location] Board (including those referred to on page 9 of the [Board] Report); and 4. All comparisons submitted to, prepared by, or reviewed by the [Location] Board of the applications it received. 22. On March 26, 2015, Michelle Barbetta, the Gaming Commission Records Access/FOIL Officer, denied the Nation’s FOIL request in its entirety. Ex. 2 (March 26, 2015 Gaming Commission FOIL Response). The Gaming Commission’s justification for the denial was provided in a single paragraph in Ms. Barbetta’s response:Based upon exemptions enumerated in New York State Public Officer’s Law §87(2)(g), your request for this information is denied. Public Officer’s Law Section 87(2)(g) states that an agency has the discretion to deny public access to records which are inter-agency or intra-agency materials which are not (j) statistical or factual tabulations or data; (ii) instructions to staff that affect the public; (ii) final agency policy or determinations; or (iv) external audits. Ia. 23. On April 24, 2015, the Nation, through its attorneys, appealed the Gaming ‘Commission's denial of its FOIL request. Ex. 3 (April 24,2015 FOIL Appeal). The Nation sought disclosure of the requested materials on the grounds that the Gaming Commission: (@) failed to satisfy its burden under FOIL to justify its withholding of the requested materials; and (b) erroneously invoked the FOIL exemption for inter-agency or intra-ageney materials. 24, The Gaming Commission denied the Nation’s appeal in a letter dated May 5, 2015. Ex. 4 (May 5, 2015 Gaming Commission Denial of Appeal). The Gaming Commission’s letter explained that the Gaming Commission has in its possession two categories of expert analyses and projection : those provided to the Location Board by the applicants and those prepared by “the [Location] Board’s experts” concerning the applicants’ proposals, Jd. at 3. 25. With respect to the expert analyses and projections provided by the applicants, the Gaming Commission claimed protection under FOIL's exemption for trade secrets or commercially sensitive material, Public Officers Law Section 87(2)(d). According to the Gaming Commission, most applicants invoked this exemption when they submitted expert materials. To the extent applicants did not request protection for expert analyses and projections (or portions thereof), the Gaming Commission stated, such materials are available on the Gaming Commission’s website. Ex. 4 (May 5, 2015 Gaming Commission Denial of Appeal at 3-5). As to the analyses and projections prepared by the Location Board’s experts, the Gaming Commission claimed that they are “pre-decisional materials prepared to assist the Board in itsdecision making” and, as such, are intra-agency materials” exempt from disclosure under Public Officer’s Law Section 87(2)(g). Id. According to the Gaming Commission, the analyses, prepared by the Location Board’s experts “consist of opinions and evaluations of the applicant proposals and do not contain facts beyond those included in the applicant's proposals.” Jd, at 3. 26. The Nation brings this Article 78 proceeding to challenge the Gaming ‘Commission’s withholding of this second category of documents: analyses and projections prepared by Location Board experts that the Nation sought in its March 20, 2015 FOIL request, and has standing to do so? See Ex. 1 (March 20, 2015 FOIL Request); N.Y. Pub. Off. Law § 89(4)(b) (“[A] person denied access to a record in an appeal determination under the provisions of paragraph (a) of this subdivision may bring a proceeding for review of such denial pursuant to article seventy eight.”). THE GAMING COMMISSION IMPROPERLY DENIED THE NATION’S FOIL REQUEST 27. When reviewing the denial of a FOIL request, the reviewing court's task is to “presume that all records of a public agency are open to public inspection and copying” and to “require the agency to bear the burden of showing that the records fall squarely within an exemption to disclosure,” a “far different rule” than the “arbitrary and capricious” standard Although it appears that the Gaming Commission relied on the exemption for intra-agenoy materials as the basis for its withholding of analyses and projections prepared by Location Board experts, the Gaming Commission posited in the altemative that the withheld material is inter- agency material “to the extent that the Board and Commission could be deemed to have acted in their capacities as separate state agencies.” Ex. 4 (May 5, 2015 Gaming Commission Denial of Appeal at 3). That distinction is immaterial for purposes of this proceeding given that the exceptions to the exemption apply with equal force to inter-agency and intra-agency materials. See N.Y. Pub. Off. Law § 87(2)(g). Accordingly, this Petition will refer to the exemption upon which the Gaming Commission relied as the “intra-ageney exemption.” 3 The Nation is not, in this action, seeking the expert analyses and projections provided to the Location Board by the applicants.under which agency actions are typically reviewed. N.Y. Comm. for Occupational Safety & Health v. Bloomberg, 72 A.D.34 153, 158 (Ist Dep't 2010). 28. This presumption of disclosure redounds to the benefit of the public, As FOIL declares: “The more open a government is with its citizenry, the greater the understanding and participation of the public in government.” N.Y. Pub. Off. Law § 84, 29. In denying the Nation’s FOIL request, the Gaming Commission failed to sustain its burden. The analyses and projections prepared by the Location Board’s experts that the Gaming Commission is withholding are, as the Gaming Commission asserts, not intra-agency materials exempt from disclosure under Public Officers Law Section 87(2)(e). 30. Rather, these materials fall (in whole or in part) into three of four of the categories of documents that the Legislature has excluded from the reach of the intra-agency exemption. ‘The materials the Gaming Commission is withholding contain, constitute, or reflect: (i) statistical or factual tabulations or data; (ji) instructions to staff that affect the public; and (ii) final agency policy or determinations. N.Y. Pub. Off. Law § 87(2)(g). Accordingly, they must be produced, ‘The Requested Documents Reflect, Explain and Were Incorporated Into Final Determinations by the Location Board 31. To begin with, the requested documents are not exempt intra-agency materials because they reflect, explain, and were incorporated into final agency policy or determinations.* “Tn contrast to the ripeness test for bringing an Article 78 action challenging a “final” administrative decision, to “constitute[] a final agency determination” under this provision of FOIL, a decision need not be one made by the “highest agency.” Miracle Mile Assocs. v. Yudelson, 68 A.D.24 176, 182 (4th Dep’t 1979). Rather, FOIL permits access to documents “at each stage of an often multilevel administrative process.” Jd. (explaining that “using the ordinary dictionary definition of the word ‘final’ would produce an unreasonable result by denying access to all opinions, orders and determinations except those made by the highest agency.”); see also Comm. on Open Gov't FOIL Advisory Op. 8399 (Aug. 8, 1994), 932, Documents that explain, directly or by reference, the reason for an agency's decision are treated as “adopt{ed] and incorporat{ed)” into the decision and are not exempt from disclosure under FOTL’s intra-agency exemption. N.Y. I News v. Office of President of Borough of Staten Is., 166 Misc. 2d 270, 274-75 (N.Y. Sup. Ct., N.Y. Cnty. 1995). 33. This rule makes good sense given that documents relied upon in, or explaining the reasons for, an agency’s decision or determination lose their “pre-decisional character.” SafeCard Servs., Inc. v. SEC, 926 F.2d 1197, 1203 (D.C. Cir. 1991). Once the proposals or recommendations contained in those documents are adopted, there is no longer a risk that, disclosure will be “injurious to the consultative functions of government that the privilege of nondisclosure protects.” Miracle Mile Assocs. v. Yudelson, 68 A.D.2d 176, 183 (4th Dep’t 1979), 34. The Gaming Commission’s decision to withhold the expert analyses and projections at issue here is not justified given the Location Board’s express reliance thereon in reaching a decision as to casino applicants, Ex. 6 (Board Report Excerpt at 8-9). It is clear from the Location Board’s repeated references to the materials in the Board Report, the’ document in which it set forth its “final .. . determinationf],” N.Y. Pub. Off. Law § 87(2g), regarding which applicants could apply for a gaming license, that the materials “explain(], directly or by reference, the reason for the agency's decision.” N.Y. J News, 166 Misc. 2d at 275 (quotation http://docs.dos.ny.gov/coog/ftext/18399.htm (citing Miracle Mile’s definition of finality “for purposes of the Freedom of information law”); Miracle Mile Assocs., 68 A.D.2d at 181 (“Since the [Clommittee [on Open Government] is the State agency charged with administering the Freedom of Information Law, its interpretation of the statute, if not irrational or unreasonable, should be upheld.”), For purposes of a FOIL challenge, the Gaming Commission stated in its denial of the Nation’s administrative appeal that both the Location Board’s December 17, 2014 recommendations and the February 27, 2015 Board Report “contain final agency policy or determinations,” Verified Pet. Ex. 4 at 5, consistent with FOIL’s purpose of permitting access to documents at each stage of an ongoing administrative process. 10omitted). As such, they were adopted or incorporated into its determination. Id. This is all the more so given that the Location Board was under a statutory mandate to consider certain factors and relied on the materials in question as key evidence in reaching conclusions with respect to these factors. Ex. 6 (Board Report Excerpt at 7-9). 35. In light of the Location Board’s adoption of its experts’ analyses and projections, these materials are far removed from the deliberative processes of government decision or policy-making the intra-agency exemption is designed to protect. Indeed, disclosure of materials like these, which carry the Location Board’s imprimatur, does not pose a risk of inhibiting agency actors from freely advising agency decision-makers. To the contrary, disclosure will provide the public with insight into the basis for the Location Board’s decision, an objective that is at the core of FOIL. The Requested Documents Contain Stati sal or Factual Tabulations 36. The expert analyses and projections prepared by the Location Board’s experts also contain “statistical or factual tabulations or data” that must be disclosed. N.Y. Pub. Off. Law § 87(2)(gX(i). 37. New York courts have, in the FOIL context, construed “factual data” to mean. formation, rather than opinions, ideas, or advice exchanged as part of the consultative or deliberative process of government decision making.” Gould v. New York City Police Dep't, 89 N.Y.2d 267, 277 (1996). Such factual information, even if collected in a way that constitutes a recommendation, is not exempt from disclosure. See Ingram v. Axelrod, 90 A.D.2d 568, 569 (3d Dep’t 1982), Consistent with these principles, New York courts regularly require the disclosure of purely factual information, regardless of whether that information is couched within memoranda and analyses otherwise exempt from disclosure. rT38. Here, the Location Board’s and Gaming Commission’s own statements demonstrate that the expert analyses sought by the Nation compile and discuss purely factual information, Ex. 6 (Board Report Excerpt at 12); Ex. 4 (May 5, 2015 Gaming Commission Denial of Appeal at 3). Any such information contained in the expert materials withheld by the Gaming Commission is not protected by the intra-ageney exemption and must be produced. 39. With respect to the projections prepared by the Location Board’s experts, the Gaming Commission asserts that they are not statistical or factual tabulations or data and contain only subjective numbers developed by the experts. Ex. 4 (May 5, 2015 Gaming Commission Denial of Appeal at 4, 5). However, given that “factual information” has been construed to mean any objective information exchanged as part of the consultative or deliberative process of government decision making, there is no question that the expert's projections contain such information. It too must be produced. ‘The Requested Documents Contain Instructions to Staff That Affect the Public 40. In addition to containing statistical and factual tabulations of data and embodying final policies or determinations, the analyses and projections the Nation seeks likely contain “instructions to staff that affect the public.” N.Y. Pub. Off. Law § 87(2)(g)(ii) 41. The Board Report itself so confirms: it states that experts prepared analyses af the Location Board’s direction and that those analyses were central to the Location Board's ultimate decision regarding which casinos could apply for gaming licenses. Ex. 6 (Board Report Excerpt at 8, 9). This decision impacts the State’s economy, its local communities, and its 5 «($]taff” as used in this provision includes outside experts and consultants retained by a government agency. Cf Gen. Motors Corp, GM Powertrain Div. v. Town of Massena, 180 Misc, 2d 682, 683 (Sup. Ct., St. Lawrence Cnty. 1999) (material available to petitioner limited to portions of retainer agreement between town and its consultant which might contain instructions to staff that affect the public) (citing N.Y. Pub. Off. Law § 87(2)(e)Gi)). 12workforce, and thus undoubtedly affects the public. So too do the Location Board’s instructions to its retained experts regarding which analyses and projections they should prepare because these instructions guided and shaped the Location Board’s decision-making process and the outcome of that process. Accordingly, such instructions constitute “instructions to staff that affect the public” that are not protected by FOIL’s exemption for intra-agency materials. N.Y. Pub. Off, Law § 87(2)(g)(ii). To the extent such instructions are included in the materials the Gaming Commission is withholding, they must be disclosed. 42. The Nation raised this point in its administrative appeal, and the Gaming Commission responded in a conclusory and cursory fashion. Ex. 3 (April 24, 2015 FOIL Appeal at 7); Ex. 4 (May 5, 2015 Gaming Commission Denial of Appeal at 4, 5). The Gaming ‘Commission’s response falls short of the “particularized and specitic justification” required for not disclosing requested documents. Gould, 89 N.Y.2d at 275. The Gaming Commission should thus be ordered to produce any instructions to staff contained in the materials the Nation is seeking in this action. Alternatively, if it objects on the basis that the materials contain no such instructions, it should be ordered to set forth a particularized factual basis for that assertion. PETITIONER IS ENTITLED TO LEGAL FEES AND COSTS 43. A party that substantially prevails in an Article 78 proceeding challenging the denial of a FOIL request may recover attomey’s fees and other reasonable litigation costs where the agency “had no reasonable basis for denying access.” N.Y. Pub. Off. Law § 89(4)(c). 44, As demonstrated in this proceeding, the Gaming Commission lacks any reasonable basis for denying the Nation’s request for access to analyses and projections prepared by experts at the direction of the Location Board. Accordingly, pursuant to Section 89(4)(c), theNation should be awarded it costs and disbursements related to this action, including attorney's fees. AS AND FOR A CAUSE OF ACTION: THE GAMING COMMISSION HAS VIOLATED FOIL 45. The Nation repeats and realleges each of the foregoing paragraphs as though fully set forth herein, 46. Pursuant to FOIL, “[eJach agency shall, in accordance with its published rules, make available for public inspection and copying all records,” with certain limited exemptions. N.Y. Pub, Off. Law § 87(2) (emphasis added). ‘These exemptions are narrowly interpreted, and the burden of demonstrating that an exemption is properly invoked falls on the governmental entity asserting the exemption. 47. The Gaming Commission has invoked the intra-agency exemption under Section 87(2)(g) of the Public Officers Law as a basis to withhold analyses and projections prepared by or on behalf of the Location Board, 48. The intra-agency exemption does not shield these materials from disclosure because they fall (in whole or in part) under exceptions enumerated in Section 87(2)(g) for (i) statistical or factual tabulations or data; (ji) instructions to staff that affect the public; and (Gli) final ageney policy or determinations. 49. The Gaming Commission has violated FOIL by unlawfully withholding these materials. 50. The Nation has exhausted its administrative remedies with respect to the Gaming ‘Commission’s wrongful withholding of the records requested in the Nation’s March 20, 2015 FOIL request. WHEREFORE, the Oneida Indian Nation respectfully demands: 14(1) An Order and Judgment declaring that the Gaming Commission’s decision to deny access to the expert analyses and projections sought in this proceeding was erroneous as a matter of law, and is therefore ineffective, null and void, and unenforceable; (2) An Order directing the Gaming Commission to grant access to the expert analyses and projections sought in this proceeding; (3) An Order awarding attorney’s fees and costs under Public Officers Law Seetion 89(4)(c); (4) Such other and further relief as the Court, may deem just, proper, and equitable, Dated: September 4, 2015 MAG Arthur W. Wentlandt 101 South Salina Street, Suite 600 P.O. Box 4967 Syracuse, NY 13221-4967 Telephone: 315-233-8261 Facsimile: 315-426-8358 WILLIAMS & CONNOLLY LLP* Marcie R. Ziegler Edward C. Bamidge 725 12th St. NW Washington, DC 20005 Telephone: 202-434-5000 Facsimile: 202-434-5029 Attorneys for Petitioner © Pro hae vice applications for counsel from Williams & Connolly LLP will be submitted forthwith,ATTORNEY'S VERIFICATION STATE OF NEW YORK) COUNTY OF ONONDAGA ) SS: ‘The undersigned, an attorney admitted to practice in the courts of New York State, shows: that deponent is the attomey of record for the Petitioner in the within action; that deponent has read the foregoing Verified Petition and knows the contents thereof; that the same is true to deponent’s own knowledge, except as to the matters therein stated to be alleged on information and belief, and that as to those matters deponent believes it to be true. Deponent further says that the reason this verification is made by deponent and not by Petitioner is because the Petitioner’s principal place of business is located outside of the county in which the attomey’s office is located. The grounds of deponent’s belief as to all matters not stated upon deponent’s knowledge io n and belief, . Wentlandt are as follows: file review, conferences, investi Subscribed and sworn to before me this 4" day of September, 2015. Parag Q. OT Mera foiary Pubite