BELTH v. NEW YORK STATE DEPARTMENT OF INSURANCE (2001)

Petitioner, publisher of The Insurance Forum, a newsletter, seeks a judgment pursuant to CPLR Article 78 directing respondent to disclose state insurance records under the Public Officer's Law §§ 84-90.

The Life Insurance Council of New York, Incorporated, an insurance industry association, is an intervenor-respondent in this proceeding.

Specifically, petitioner seeks the names, titles and salaries of employees working for life insurance companies doing business in New York, who earn $600,000 a year or more, including the three senior officers and the directors of each company regardless of the amount, and (b) the officer or the other person, firm, or corporation receiving $600,000 or more;  and (ii)the titles, persons, firms receiving $60,000 or more but less than $600,000.

This information is routinely contained in the New York Supplement to the Annual Statement and is required to be filed by insurance companies pursuant to New York Insurance Law §§ 307(a)(1) and 4233(a), (b) and (3).

Petitioner's request for the individual names was refused by respondent on the grounds that disclosing names would constitute an unwarranted invasion of privacy under Public Officer's Law §§ 87(2)(b), and 89(2)(b), but respondent offered to list the positions and salaries with names redacted.

Petitioner argues that respondent has routinely disclosed this information since 1986.   Petitioner had circulated the information in his newsletter since around that time.   Beginning in 2000, however, various insurance companies, upon learning that petitioner was also circulating this information on the internet, wrote respondents expressing their opposition to the continued public disclosure of this information in any form.

One of these companies, the Equitable Life Assurance Society complained to respondent that the information would be available to marketers, creditors, “and the like”, and that its dissemination over the internet constituted an “unwarranted invasion of privacy”.

Another firm, Prudential Life Insurance Company of America, claimed that posting this information on the internet, had caused “major problems for New York licensed insurers”, and that the information could generate “ undesired solicitations and possible criminal wrongdoing”.   There was no attempt, however, to show how the data's potential impact had changed during its former availability in printed format as compared with its current availability on the internet.

 Petitioner's argument that Insurance Law § 4233 in itself provides a basis for releasing the information is rejected.   Although the statute mandates that insurers file the information, the statute does not state that the information must be publicly disseminated.

 Therefore, the sole issue is whether Public Officers Law § 89(2)(b) bars disclosure of the names of individuals earning over $600,000 because it constitutes an unwarranted invasion of privacy.   This court answers no.   The fact that the employees are non-governmental employees should not ipso facto shield their salary from public view.   The insurance industry is highly regulated, and the filing of employees' salary has been required since the early 1900's.   Consequently, contrary to respondent's assertion, insurance company employees, although privately employed, do not have a greater expectation of privacy rights than would government employees.   Moreover, there is no basis for a newly enhanced expectation of privacy, because until 1999, respondent regularly disclosed this information.

Respondent argues that federal decisions should control when interpreting New York State FOIL provisions having federal counterparts (see, Encore College Bookstores, Inc. v. Auxiliary Service Corp. of the State University of New York, 87 N.Y.2d 410, 639 N.Y.S.2d 990, 663 N.E.2d 302), and cites Hopkins v. United States Department of Housing and Urban Development, 929 F.2d 81, that holds, contrary to Hopkins v. City of Buffalo, 107 A.D.2d 1028, 486 N.Y.S.2d 514, that the governmental agency may not release the names of non-governmental employees.

However, in Hopkins v. City of Buffalo, supra, the court held that releasing the names and payroll records of non-governmental employees, working on public works projects, did not constitute an unwarranted invasion of privacy.   This court is bound by the holding in Hopkins, a Fourth Department case, in the absence of a contrary ruling by the New York State Court of Appeals or the Appellate Division, First Department (see, Mountain View Coach Lines, Inc. v. Storms, 102 A.D.2d 663, 476 N.Y.S.2d 918).   This court, however, is not similarly bound by federal cases.  Encore College Bookstores, Inc. v. Auxiliary Service, Corp., supra, does not hold that a trial court may ignore controlling the Appellate Division precedent.

Harris v. City University of New York, 114 A.D.2d 805, 495 N.Y.S.2d 175, and Obiajulu v. City of Rochester, 213 A.D.2d 1055, 625 N.Y.S.2d 779, on which respondent relies as authority contrary to Hopkins v. City of Buffalo, are both inapposite.   While revealing an individual's qualifications or performance evaluations may have a potentially adverse effect on that person's career, revealing neutral salary information does not pose this danger.   Moreover, the First Department has recently held that details concerning public employment history and attendance at academic institutions, contained in employment applications, may be publicly disclosed (Kwasnik v. City of New York, 262 A.D.2d 171, 691 N.Y.S.2d 525).

Other than respondent's conclusory and unsupported claim that internet dissemination can have a deleterious result, respondent has offered nothing to substantiate this claim.   Respondent's conclusory allegations cannot serve as a basis for denial of petitioner's FOIL request (see, Hopkins v. City of Buffalo, supra, citing Church of Scientology v. State of New York, 46 N.Y.2d 906, 414 N.Y.S.2d 900, 387 N.E.2d 1216).

There are other substantial reasons favoring disclosure.   Since 1906 our legislature has mandated that insurance companies file the names, salaries, and titles, of specified employees.   This was to discourage the political corruption and nepotism then tainting the insurance industry.   Based on the statute's perseverance over the past century, the legislature still discerns a continuing need for the vigilance provided by the statute in ensuring that insurance companies are competently managed, and are discouraged from unduly influencing regulatory officials by filling lucrative positions based on political connections.

Consequently, in balancing the public interest against non-disclosure, the court concludes that respondent must continue to disclose the information sought by petitioner.

Given the fact that respondent has not specified any potential harm resulting from the data being currently placed on the internet, respondent's refusal to withhold this data lacks a rational basis, and is therefore arbitrary and capricious (see, Pell v. Board of Education, 34 N.Y.2d 222, 356 N.Y.S.2d 833, 313 N.E.2d 321).

Accordingly, it is adjudged that the petition is granted.

[Portions of opinion omitted for purposes of publication.]

NICHOLAS FIGUEROA, J.