Reuters vs University of California Lawsuit
Oct 26, 2012
The state judge has decided that the UC system's venture capital funds, managed by Kleiner Perkins Caufield & Byers and Sequoia Capital, require public transparency.
A lawsuit filed in state court by the Reuters news agency argues that the California Public Records Act demands disclosure of investment-return information for the university system's multi-billion-dollar endowment fund.
The case is Reuters v The Regents of the University of California, Superior Court in the State of California, County of Alameda, case no. RG12613664.
Reuters asserted that California taxpayers have a specific interest in knowing the details of the funds' performance, as the University of California is not a private university but rather a public institution that belongs to The People.
Prior court rulings have upheld the fact that the UC returns are indeed public records.
The University of California has reacted by saying that Kleiner Perkins Caufield & Byers, as well as Sequoia Capital, considered the public information to be "confidential."
The university also said the investment performance data is not in the public record because it doesn't have detailed information on the investments managed by the two firms --- an arrangement which the lawsuit says was made to avoid public disclosure.
According to Judge Evelio Grillo, the University of California failed to prove (1) that UC fund performance data doesn't relate to The People's business, or (2) that UC regents don't possess or control the information.
"Assuming that the Regents can obtain the fund level information, it is not exempt from disclosure," declared Judge Grillo, who wants the university to obtain and disclose the information publicly.
The judge stayed the effect of his order and judgment through January 16, 2013.
Some other public universities have private foundations set up for their endowments that don't have to disclose returns, as many top venture capital funds will not manage investments for public groups that disclose investment returns publicly.
