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Tesoro Petroleum Corporation v. State2/15/2002
No. 5539
MATTHEWS, Justice, dissenting.
I. INTRODUCTION
Tesoro Petroleum Company challenges the civil investigative demand (CID) served on the company by Alaska's attorney general as part of an investigation into gasoline prices. Tesoro contends that the CID was overbroad and that the State impermissibly disclosed to outside counsel documents that Tesoro produced in response to the CID. Because Spencer Hosie, outside counsel to the attorney general, should be considered "an authorized employee of the state" for purposes of AS 45.50.592(e), we affirm the superior court's decision to allow disclosure of the documents to Hosie. Moreover, we affirm the superior court's decision that the CID was not "unreasonable and oppressive."
II. FACTS AND PROCEEDINGS
Upon determining that the public interest would be served by an investigation of possible violations of the Alaska Antitrust Act by Tesoro, the State served a CID on Tesoro, pursuant to AS 45.50.592. The CID described the subject matter of the investigation as "possible price fixing, combinations in restraint of trade, and other anticompetitive fuel refining, marketing, pricing, distribution, and sales practices in the State of Alaska."
The CID contained forty-six specific demands for documents. With the exception of Demand No. 35, which covers the time period of January 1, 1985 through the date of service, the CID covers Tesoro's business practices over a period of approximately ten years, from January 1, 1990 to present. As described by the State, the demands "request information regarding prior statements or testimony, organizational charts to identify potential witnesses, product exchange documents, reports analyzing margins, returns on capital, pricing component information, refining input and output information, transportation costs, etc." The State engaged Spencer Hosie and his law firm, Hosie, Frost & Large, as outside legal counsel to assist in the Tesoro investigation; a written contract established an independent contractor relationship between Hosie and the State.
Tesoro, pursuant to AS 45.50.592(f), filed a petition to modify the CID. Tesoro's arguments to the superior court encompassed two main issues: disclosure of documents to outside counsel and overbreadth of the CID.
First, Tesoro argued that the CID should be set aside or limited because its requirements are "too burdensome and thus contain requirements which would be unreasonable and improper if contained in a subpoena duces tecum issued by a court of this state." At oral argument before Superior Court Judge Peter A. Michalski, Tesoro specified four areas in which the CID was overly burdensome: it covers too many employees, it covers too long a time period, it covers too broad a range of products, and it covers too broad a geographic scope.
Second, Tesoro objected to the disclosure of documents produced under the CID to the State's outside counsel and requested that the court prohibit such disclosure. Tesoro argued that the statute does not authorize Hosie and his firm to review documents produced pursuant to the CID because Hosie and his firm, as outside counsel, are not "authorized employee " under AS 45.50.592(e) and because Tesoro did not consent to disclosure.
In response, the State contended that the document requests reasonably facilitated investigation of the high price of petroleum products in Alaska. The State explained that in order to determine whether antitrust violations had occurred, it required documents from other Pacific markets, regarding all types of petroleum products, and over a time period long enough to determine trends. The S
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