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Michigan Supreme Court punts on MCCA transparency case, orders “re-do”

Justices want Michigan Court Of Appeals to decide whether MCCA is covered by FOIA and whether the FOIA exemption is constitutional

MSC punts order on CPAN v. MCCA

The Michigan Supreme Court punts in its order on CPAN v. the Michigan Catastrophic Claims Association.

The Michigan Supreme Court’s October 16, 2015 ruling on the controversial Michigan Catastrophic Claims Association (MCCA) transparency case wasn’t the result that I was hoping. On the other hand, it could have been much worse.

Essentially, the Court punted.

In their unanimous October 16, 2015, order in Coalition Protecting Auto No-Fault (CPAN) v. MCCA (#150001), the justices thankfully did not grant the MCCA carte blanche to be as secretive as it wants. I’ve written often on the pages of this legal blog about the need for transparency.

In this regard, I was disappointed. The Michigan Supreme Court unfortunately did not order the MCCA to comply with the Michigan Freedom of Information Act (FOIA) and thus, disclose information about how it calculates its annual No Fault fee for catastrophic claims.

Instead, the justices put the issues in legal limbo by sending the case back to the Michigan Court of Appeals for a “re-do” to decide issues that will ultimately determine whether the road to MCCA transparency is a through-way or a dead-end.

‘Public body’ under FOIA

For starters, on its “re-do,” the Supreme Court wants the Court of Appeals to decide an issue that the justices felt the appellate court judges should have decided in their May 2014 opinion (where they concluded that the MCCA was exempt from FOIA’s disclosure requirements).

Specifically, the Supreme Court wants the Court of Appeals to determine whether the MCCA is the type of organization, i.e., a “public body,” that is covered by FOIA.

In its remand order, the justices stated:

“In its opinion, the Court of Appeals assumed without deciding that the Michigan Catastrophic Claims Association (MCCA) is a ‘public body.’ We REMAND this case for reconsideration of this issue. On remand, the Court of Appeals is directed to decide the issue whether the MCCA is a ‘public body’ subject to the Freedom of Information Act …”

If the Court of Appeals rules the MCCA isn’t a “public body,” then, presumably, that will be the end of the case: If the MCCA isn’t a “public body” for FOIA purposes, then FOIA can’t be used to force the MCCA to disclosure information.

However, if the Court of Appeals concludes the MCCA is a “public body” for FOIA purposes, then the appellate judges will have to decide another issue – one with constitutional implications.

Is MCCA’s FOIA exemption constitutional?

Even if the MCCA is deemed to be a “public body” under FOIA, the MCCA may not have to comply with FOIA’s disclosure requirements under an Insurance Code statute (MCL 500.134(4) and (6)) that purports to “exempt” the MCCA from FOIA.

The question the Supreme Court wants the Court of Appeals to answer is whether the law creating the MCCA’s FOIA exemption is constitutional under Article 4, Section 25 (which provides that “[n]o law shall be revised, altered or amended by reference to its title only”) even though the “Legislature did not reenact and republish FOIA when it enacted MCL 500.134(4).”

For those in support of achieving MCCA transparency, these seem like pretty treacherous waters.

When the Court of Appeals addressed the issue previously in its May 2014 opinion, the judge rejected the argument that there had been a constitutional violation:

“MCL 500.134(4) did not revise, alter or amend FOIA. … Therefore, when the Legislature enacted MCL 500.134(4), there was no duty to reenact or republish FOIA. … MCL 500.134(4) does not violate … Const 1963, art 4, [section] 25 …”

CPAN v. MCCA

The MCCA transparency case began with the Coalition Protecting Auto No-Fault and the Brain Injury Association of Michigan filing a request under Michigan’s Freedom of Information Act (FOIA). They were seeking information from the MCCA about how it sets its annual assessments – i.e., No Fault catastrophic claims fees. The costs of these assessments are passed along by auto insurers to auto insurance consumers in the form of higher prices.

An Ingham County Circuit Court judge ruled that the MCCA was subject to FOIA and thus, was obligated to disclose the information. However, the Michigan Court of Appeals disagreed, ruling that the MCCA was exempt from FOIA. Both CPAN and BIA of Michigan sought review from the Michigan Supreme Court.

To learn more about the MCCA transparency case and why it’s so important for Michigan auto accident victims and auto insurance consumers, please check out the following Michigan Auto Law blog posts:

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