public records act abuses letter

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February 28, 2014

[Board Member]Board of AdministrationCalPERSLincoln Plaza North400 Q StreetSacramento, CA 95811

Dear [Board Member]:

In light of your duty for the management and control of CalPERS, I wanted to call toyour attention repeated and troubling violations of CalPERS policies and state law in thehandling of a California Public Records Act request that I first filed last September.

By way of background, I publish the widely-read finance and economics website, NakedCapitalism (www.nakedcapitalism.com). Naked Capitalism receives roughly 1.5 million page

view a month and has been ranked at or near the top among financial blogs in terms of itstraffic and influence. In particular, this website has a strong following among financialregulators and on the Hill. We are in the midst of an original series on the private equityindustry.

As you may know, once an agency has given out a record to one member of the public, ithas forever waived the right to claim any exemption from disclosing the records to others. Ihave requested CalPERS private equity fund data which was the basis for an article written bythree academics at Oxford University:http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2229547.The article stresses that theresearchers obtained the entire performance history of all of CalPERS 761 investments in

private equity since it began committing funds to it in 1990, including actual cash flow data,and that much of the information has not previously been accessible to researchers.

My efforts to obtain this data have been met with delays, obfuscation, and flat outfalsehoods. I made my first FOIA request on September 29, 2013 and received a trackingnumber, 1385. However, in early October, I checked the CalPERS log and did not see myrequest included with the September requests (https://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201310/item11-attach-2.pdf).

I used the FOIA form on October 15, 2013 to ask why my request was not listed andwhat had become of it. Barbara Galli, a CalPERS public records act coordinator, e-mailed to sayshe had no record of the request and asked me to resubmit it via e-mail. Because her e-mail

reply was misidentified by my computer as spam, I did not respond until November 12, 2013.

My request was again not listed on the roster in November(http://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201312/item11-attachment-2.pdf). Mind you, at this point, my requesthas been outstanding for two months, yet the CalPERS PRA staff was withholding thatinformation from the board and the public.
http://www.nakedcapitalism.com/http://www.nakedcapitalism.com/http://www.nakedcapitalism.com/http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2229547https://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201310/item11-attach-2.pdfhttps://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201310/item11-attach-2.pdfhttps://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201310/item11-attach-2.pdfhttps://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201310/item11-attach-2.pdfhttp://papers.ssrn.com/sol3/papers.cfm?abstract_id=2229547http://www.nakedcapitalism.com/


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I made calls and sent e-mails to Ms. Galli in December as to why my record continuedto be missing and got not reply. However, she did send a letter dated December 18, 2013,which stated:

Staff continues to gather and review responsive information for disclosure under the PublicRecords Act. We estimate having the information to you by December 27, 2013.

However, I did not receive any information or other communication by December 27 orby early January. So again, the board continued not to be informed as to the existence of aPRA that was supposedly on the verge of completion.

In January, I made further calls and sent additional e-mails to find out what hadhappened to the information I had been promised. Note that the letter I had been sentencouraged me to call, yet despite leaving voicemails, I got no reply.

On January 30, 2014, my attorney, Timothy Fong, sent a letter to Deputy GeneralCounsel Gina Ratto. It recited this history in more detail, with supporting documents, and

indicated that if the information was not forthcoming, I was prepared to petition for a writ ofmandamus and seek an award of attorney fees and costs.

In reply, Ms. Galli e-mailed a letter dated January 27 signed by Linda Evans which hadbeen sent certified mail. It stated:

The information provided to the authors of the article you referenced was not provided byCalPERS staff. After an extensive search, staff has determined we do not have anything to

produce in response to your request.

This response is patently false. I have e-mailed the lead author of the article, Timothy

Jenkinson, who has stated in two separate e-mails that the data came directly from CalPERS,and that CalPERS dealt directly with him and one other named author of the article, RuedigerStucke. Thus, either the search was not extensive or if it was, CalPERS chose to misrepresentwhat it unearthed.

Moreover, the response is deliberately evasive and misleading. My request was fordata provided by CalPERS, not data provided by CalPERS staff. It may be that the data wastransmitted from LP Capital or another data repository at the direction of CalPERS employees,rather than being retrieved from a data warehouse to CalPERS staffers and then sent on toJenkinson and Stucke. Nevertheless, it is well-settled California law that actions taken byagents within the scope of their agency are imputed to the principal. Thus, even if as a matter ofform, the data was provided directly by LP Capital or another CalPERS data repository to

Jenkinson and Stucke, it would still be disclosable under the PRA.

And the board and the public were again misled. My PRA was finally included in theJanuary 2014 log (http://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201402/item10-attachment-2.pdf)and listed as the last item, as closed.

In fact, my attorney wrote a to Barbara Gatto on February 1, 2014, strenuouslyobjecting to the claim that PRA was closed. He then received a call from one Robert Carlin
http://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201402/item10-attachment-2.pdfhttp://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201402/item10-attachment-2.pdfhttp://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201402/item10-attachment-2.pdfhttp://www.calpers.ca.gov/eip-docs/about/committee-meetings/agendas/full/201402/item10-attachment-2.pdf


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indicating that CalPERS would comply with the request, provided we identify more specificallywhat records we wanted.

Carlin wrote in an e-mail on February 13, 2014 that the records he was sending weretoo large to be sent as an e-mail attachment, so they were going out that afternoon via CD. Infact, the records were a mere 3 MB, which could easily have been sent via e-mail, so it appearsthat sending the information by mail, which took nine days to arrive, was yet another delayingtactic.

Most important, the CD contained noneof the records we had originally requested (thedata provided to Jenkinson and Stucke) but some additional data we had asked for (on thepremise that it was updating the Jenkinson/Stucke data from the period covered in their paper,1990 to March 31, 2012, to the present; if the sort of data that Jenkinson and Stucke receivedwas disclosable, we could request the updated information via a separate FOIA). We did,however, get some non-public information (actual date of receipt of cash flows from variousprivate equity funds, information that is not published in CalPERS quarterly updates).

Now perhaps my assumption is incorrect and the board supports this sort ofmisrepresentation to the public in order to defend CalPERS relationships with private equityfunds and limit the scrutiny of its history of investing in private equity. However, the interestsof CalPERSstaff are not at all the same as the interest of CalPERS as an institution. CalPERSduty above all is to the members whose funds it invests. It should recognize that the interestsof vendors like private equity funds are often adverse to their aims.

As far as the public record is concerned, CalPERS staff pronounced my FOIA to beclosed on January 27,2014, the date of the misleading the "we don't have anything to give you"letter. One can only surmise that the intention of failing to publish the existence of my FOIAuntil it had been incorrectly deemed closed (I have filed suit against CalPERS today as

discussed longer form on my website (http://www.nakedcapitalism.com/2014/02/sue-calpers-denial-private-equity-public-records-act-request.html), so I trust your February log willmention the litigation) was to stymie other requests for public equity return data. Shouldanyone in the future ask for the records that they gave me, CalPERS staff can supply January27, 2014 letter and say, "This was our official response," which would lead that future requesterto think that nothing was provided. If as in my case, the original requester continues to pressthe matter, CalPERS staff can later slip the records to them without entering it into theirofficial log so that future requesters can't readily find out that the requested records were infact provided.

Is standard operating procedureto generate denials or "we don't have a record"letters for requests staff does not want to comply with? Has the board been notified of this

practice? If so, by what basis under law can you justify misleading the public as to the statusand resolution of PRA requests? Ostensibly, this log exists as a report to the board so that itcan engage in oversight to verify that CalPERS is being responsive to public record requests.However, my experience shows that in practice, it is being used as a vehicle to mislead thepublic and presumably the board as well.

Sincerely,


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Susan Webber

public records act abuses letter

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