Liquor retailer seeks injunction to stop use of ‘sensitive’ records disclosed by Wheat Ridge

By Jeffrey A. Roberts
CFOIC Executive Director

Can documents provided in response to a public records request be clawed back and their use restricted if they may have been disclosed by mistake?

That question is central to a court fight involving two Colorado liquor stores, Applejack Wine & Spirits in Wheat Ridge and Hazel’s Beverage World in Boulder.

Applejack seeks an injunction declaring that Hazel’s co-owner Bruce Dierking is not entitled to possess or use Applejack liquor license records he obtained from the city of Wheat Ridge because the documents, the retailer maintains, were “filled with highly sensitive personal and commercial information.”

Dierking disputes that assertion and accuses Applejack in a counterclaim of impinging on both his legal right to obtain public documents under the Colorado Open Records Act (CORA) and his free speech right to talk about the documents.

Dierking made a “lawful request for public records,” his court filing says, and the documents he obtained under CORA “passed into the public domain when they were produced by the lawful custodian of records, as required by state statute.”

A hearing on Applejack’s injunction motion is set for Sept. 28 before Jefferson County District Court Judge Lily Wallman Oeffler. She issued a temporary restraining order against Dierking in early May, requiring him to give the court all documents he obtained from Wheat Ridge in response to his CORA request and to destroy any other copies in his possession.

The judge also ordered Dierking to “make no use” of the documents or the information contained within them, including disseminating the information to any third parties “orally, in writing, or otherwise.” He was given 72 hours to contact anyone else who received the Applejack records “to inform them to destroy or return such materials to him at once.”

By that time, however, a story in The Colorado Statesman (now Colorado Politics) referenced some of the records.

The legal dispute between Applejack and Dierking began during the state legislature’s consideration last session of two (eventually unsuccessful) bills that would have allowed independent liquor stores to secure more licenses than a 2016 law allows. Applejack and Hazel’s were on opposite sides of the legislation.

During testimony in March on one of the bills, Dierking became curious about Applejack’s ownership structure and decided to check public records on file at Wheat Ridge city hall, he later told The Colorado Statesman.

Applejack’s lawsuit claims that a Wheat Ridge clerk “who is relatively inexperienced with open records requests” permitted Dierking to see and copy records from Applejack’s liquor license file that are supposed to be protected from disclosure under CORA. The records allegedly contained trade secrets, privileged information and confidential data such as the dates of birth of certain Applejack investors.

“These documents also include a host of sensitive commercial information that – if in the wrong hands – would subject Applejack to severe competitive disadvantage and harm,” the liquor store says in a court filing.

Dierking disputes that the documents he received from Wheat Ridge were full of legally non-disclosable information or that they contained information that would put Applejack at a competitive disadvantage. In a court filing, he also challenges Applejack’s assertion that Wheat Ridge allowed an inexperienced employee to respond to his CORA request for materials in Applejack’s liquor license application file.

“Dierking properly relied on public officials, authorized by statute and designated by the City of Wheat Ridge, to obtain CORA documents and then to speak about them to persons of his choosing,” the filing says.

Wheat Ridge, according to Applejack’s suit and The Colorado Statesman, demanded the immediate return of dozens of pages of documents it provided to Dierking on March 14, saying they were “mistakenly” released. Dierking hadn’t responded to Wheat Ridge’s demand at the time Applejack sued him in April and didn’t thereafter because “the dispute with the city was preempted by Applejack’s lawsuit,” said his attorney, Mark Grueskin. “The court order required that the documents be returned not to the city but to the court.”

First Amendment attorney Steve Zansberg, president of the Colorado Freedom of Information Coalition, said courts have held that “once information has been publicly disclosed by the government, whether properly or not, the government is powerless to order that it not be published.” Though Applejack’s lawsuit seeks to restrict the use of the records provided by Wheat Ridge, “the cat is out of the bag, and once that occurs, the information is no longer ‘confidential’ or a ‘trade secret.’ It’s public information,” Zansberg said.

“Applejack’s remedies, if any, lie against the city of Wheat Ridge, not those who lawfully obtained the truthful information,” he added.

Follow the Colorado Freedom of Information Coalition on Twitter @CoFOIC. Like CFOIC’s Facebook page. Do you appreciate the information and resources provided by CFOIC? Please consider making a tax-deductible donation.

Subscribe to Our Blog