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Illinois Supreme Court: Settlements with Private Companies When Contracted for Government Service Are Public Record

The Illinois Supreme Court on December 19, 2019 held that settlement agreements reached by private contractors, if directly related to the services they provide, are public record. It said the plain language of the Freedom of Information Act (FOIA), when viewed in light of legislative intent, showed that it was created to ensure that governmental entities could not avoid disclosure obligations by contracting services to private companies.

Illinois Times journalist Bruce Rushton filed a FOIA request in August 2015 concerning a wrongful death settlement between the Illinois Department of Corrections (IDOC) and the estate of Alfonso Franco, who died due to the substandard care of his contracted healthcare provider, Wexford Health Sources, Inc. IDOC agreed with Rushton and requested the documents be turned over by Wexford, which refused. Rushton and the Illinois Times filed suit in April 2017.

The lower tribunal granted summary judgment to Wexford, agreeing that the document did not directly relate to the governmental service the company performed, and that section 2.20 of FOIA exempted private contractor settlement agreements. (See PLN, June 2019.)

Rushton and the Times appealed, and the appellate court reversed the summary judgment. Wexford then petitioned the Illinois Supreme Court for review. It held that, foremost, in cross summary judgments both parties agree to the material facts of the case, so the only question remaining is whether the out-of-court settlement agreement concerned a governmental function performed by Wexford in accordance with its contract.

The Court disagreed that Wexford’s arguments were dispositive. Section 2.20 did not distinguish private companies performing contracted services from public bodies. In fact, section 2.20 was written to clarify that settlement agreements of contracted private companies were not included among the exempt documents that do not directly relate to the governmental function for transparency and accountability purposes.

The settlement agreement in question concerned the quality of health care received while in IDOC custody. The Court quoted the opening section of the FOIA, which stated, “Such access is necessary to enable the people to fulfill their duties of discussing public issues fully and freely, making informed political judgments and monitoring government to ensure that it is being conducted in the public interest.” See: Rushton v. Department of Corrections, S. Ct. IL, Case No. 124552 (2019). 

 

Related legal case

Rushton v. Department of Corrections