Wallace L. Hall, Jr., in His Official Capacity as a Regent for the University of Texas System v. William H. McRaven, in His Official Capacity as Chancellor for the University of Texas System

ACCEPTED
03-15-00783-CV
11227410
THIRD COURT OF APPEALS
AUSTIN, TEXAS
6/20/2016 12:35:05 PM
JEFFREY D. KYLE
CLERK

No. 03-15-00783-CV

RECEIVED IN
3rd COURT OF APPEALS
In the Court of Appeals for the Third Judicial District of Texas
AUSTIN, TEXAS
Austin, Texas 6/20/2016 12:35:05 PM
JEFFREY D. KYLE
Clerk
WALLACE L. HALL, JR., in his official capacity as a Regent for the
University of Texas System,

Appellant

v.
WILLIAM H. MCRAVEN, in his official capacity as Chancellor for the
University of Texas System,

Appellee

On Appeal from the 200th Judicial District Court of
Travis County, Texas, Hon. Scott Jenkins, Presiding
Trial Court Case No. D-1-GN-15-002473

BRIEF OF THE ASSOCIATION OF GOVERNING BOARDS OF
UNIVERSITIES AND COLLEGES AS AMICUS CURIAE SUPPORTING
APPELLEE WILLIAM H. MCRA VEN

MARTIN MICHAELSON BRUCE D. OAKLEY
AMY FOLSOM KETT State Bar No. 15156900
HOGAN LOVELLS US LLP HEAVEN C. CHEE
Columbia Square State Bar. No. 24087290
555 Thirteenth St., N.W. HOGAN LOVELLS US LLP
Washington, D.C. 20004-1109 700 Louisiana Street, Suite 4300
Telephone: (202) 637-5600 Houston, TX 77002
Facsimile: (202) 637-5910 Telephone: (713) 632-1400
martin. michaelson@hoganlovells. com Facsimile: (713) 632-1401
amy. kett@hoganlovells. com bruce. oakley@hoganlovells. com
heaven. chee@hoganlovells. com

Counsel for Amicus Curiae the Association of
Dated: June 20, 2016 Governing Boards of Universities and Colleges
 IDENTITY OF PARTIES AND COUNSEL

Pursuant to Texas Rule of Appellate Procedure 38.1(a), the following is a

complete list to the best of Amicus Curiae the Association of Governing Boards of

Universities and Colleges' knowledge of all parties to the judgment being appealed

from and of the names and addresses of all trial and appellate counsel.

Parties to the Trial Court Judgment:

Plaintiff: Wallace L. Hall, Jr.

Defendant: William H. McRaven

Trial and Appellate Counsel:

For Plaintiff-Appellant Wallace L. Hall, Jr.

Joseph R. Knight
State Bar No. 11601275
EWELL, BROWN, BLANKE & KNIGHT LLP
111 Congress Avenue, 28th Floor
Austin, Texas 78701
Telephone: (512) 770-4010
Facsimile: (512) 684-7681
jknight@ebbklaw. com

For Defendant-Appellee William H. McRaven

Patton G. Lochridge
State Bar No. 12458500
Richard D. Milvenan
State Bar No. 14171800
Kayla Carrick
State Bar No. 24087264
MCGINNIS, LOCHRIDGE & KILGORE
600 Congress Ave., Suite 2100
Austin, Texas 78701
Telephone: (512) 495-6005
Facsimile: (512) 505-6305
plochridge@mcginnislaw. com
rmilvenan@mcginnislaw.com
kcarrick@mcginnis law. com

Wallace B. Jefferson
State Bar No. 00000019
Amy Warr
State Bar No. 00795708
ALEXANDER DUBOSE JEFFERSON & TOWNSEND, LLP
515 Congress Ave., Suite 2530
Austin, Texas 78701-3562
Telephone: (512) 482-9300
Facsimile: (512) 482-9303
wjefferson@adjtlaw. com
awarr@adjtlaw. com

For Amicus Curiae Ken Paxton, Supporting Appellant:

Ken Paxton
Jeffrey C. Mateer
James E. Davis
Nichole Bunker-Henderson
Kimberly L. Fuchs
State Bar No. 24044140
OFFICE OF THE ATTORNEY GENERAL OF TEXAS
P.O. Box 12548, Capitol Station
Austin, Texas 78711-2548
Telephone: (512) 475-4195
Facsimile: (512) 320-0167

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For Amici Curiae Alex M. Cranberg, Brenda Pejovich, Charles Miller, and Wm.
Eugene Powell, Supporting Appellant:

Jeremy C. Martin
MALOUF & NOCKELS LLP
3811 Turtle Creek Blvd., Suite 800
Dallas, Texas 75219
Telephone: (214) 969-7373
Facsimile: (214) 969-7648

For Amicus Curiae the Association of Governing Boards of Universities and
Colleges, Supporting Appellee:

Bruce D. Oakley
State Bar No. 15156900
Heaven C. Chee
State Bar No. 24087290
HOGAN LOVELLS US LLP
700 Louisiana Street, Suite 4300
Houston, TX 77002
Telephone: (713) 632-1400
Facsimile: (202) 637-5910
bruce.oakley@hoganlovells.com
heaven. chee@hoganlovells. com

Martin Michaelson
Amy Folsom Kett
HOGAN LOVELLS US LLP
Columbia Square
555 Thirteenth St., N.W.
Washington, D.C. 20004-1109
Telephone: (202) 637-5600
Facsimile: (202) 637-5910
martin. michaelson@hoganlovells. com
amy. kett@hoganlovells. com

111
 TABLE OF CONTENTS

Identity of Parties and Counsel .................................................................................. i

Table of Contents ..................................................................................................... iv

Index of Authorities ................................................................................................... v

Interest of Amicus Curiae and Rule 11 (c) Disclosure ............................................. vi

Statement of the Case .............................................................................................. vii

Issue Addressed by Amicus Curiae ......................................................................... vii

Statement of Facts ..................................................................................................... 2

Summary of Argument .............................................................................................. 2

Argument ................................................................................................................... 3

I. THE FIDUCIARY DUTY OWED BY A UNIVERSITY
GOVERNING BOARD TO THE INSTITUTION IT SERVES
IMPLICITLY LIMITS INDIVIDUAL TRUSTEES' ABILITY TO
DEMAND INFORMATION FROM UNIVERSITY OFFICIALS ............... 3

II. REGENT HALL'S CLAIMED UNLIMITED RIGHT OF
ACCESS TO U.T. SYSTEM FILES CONTRAVENES THE
CLEAR PURPOSE OF THE BOARD OF REGENTS' ENABLING
STATUTE AND RULES, WHICH IS TO FACILITATE
PROFICIENT GOVERNANCE ..................................................................... 4

III. REGENT HALL IS NOT ENTITLED TO THE INFORMATION HE
SEEKS ............................................................................................................. 6

Prayer ......................................................................................................................... 8

Certificate of Compliance ......................................................................................... 9

Certificate of Service ................................................................................................. 9

lV
 INDEX OF AUTHORITIES

Page(s)

CASE

Citizens Bank ofBryan v. First State Bank, Hearne, 580 S.W.2d 344
(Tex. 1979) ........................................................................................................... 5

STATUTES

TEX. EDUC. CODE§ 65.16(b), (c) ............................................................................. 5

TEX. Gov'T CODE § 311.023(1 ), (5) .......................................................................... 6

RULES

Board of Regents' Rule 10101, § 3.1 ........................................................................ 4

Board of Regents' Rule 10101, § 3.5 ........................................................................ 5

OTHER AUTHORITIES

Association of Governing Boards of Universities and Colleges,
A GB Board ofDirectors ' Statement on the Fiduciary Duties of
Governing Board Members (20 15) ...................................................................... 3

v
 INTEREST OF AMICUS CURIAE AND RULE ll(C) DISCLOSURE

Amicus Curiae the Association of Governing Boards of Universities and

Colleges ("AGB"), founded in 1921, is the premier national organization centered

on governance in higher education. Its members are some 1,300 boards of 1,900

colleges, universities, and institutionally-affiliated foundations. Through its

members, AGB serves more than 40,000 representatives of higher education

institutions, including trustees and regents, presidents and chancellors, senior-level

administrators, and college and university board professional staff. AGB's mission

is to strengthen, protect, and advocate on behalf of trusteeship that advances higher

education. AGB has a particular interest in presenting its views in this case

because the case involves an issue of substantial importance to college and

university governance in this nation. In addition, AGB notes that Appellant

Wallace L. Hall, Jr. ("Regent Hall") has attached to his reply brief an AGB

publication that is intended to educate board members about their fiduciary duties

and how to translate their fulfillment of those duties into effective board conduct

and oversight, from which he quotes one sentence. See Reply Brief of Appellant at

9 & Tab C. By so doing, Regent Hall may give this Comi to believe that AGB

supports his position, which AGB does not.

Pursuant to Texas Rule of Appellate Procedure 11 (c), AGB represents that it

is paying the fee for preparation of this brief.

VI
 STATEMENT OF THE CASE

AGB adopts Appellee William H. McRaven's ("Chancellor McRaven's")

statement of the case. See Br. of Appellee at xii.

ISSUE ADDRESSED BY AMICUS CURIAE

Whether an individual member of a university governing board has an

unlimited right of access to all information or documents created or maintained by

the institution.

Vll
 No. 03-15-00783-CV

In the Court of Appeals for the Third Judicial District of Texas
Austin, Texas

WALLACE L. HALL, JR., in his official capacity as a Regent for the
University of Texas System,

Appellant
v.
WILLIAM H. MCRA VEN, in his official capacity as Chancellor for the
University of Texas System,

Appellee

On Appeal from the 200th Judicial District Court of
Travis County, Texas, Hon. Scott Jenkins, Presiding
Trial Court Case No. D-1-GN-15-0024 73

BRIEF OF THE ASSOCIATION OF GOVERNING BOARDS OF
UNIVERSITIES AND COLLEGES AS AMICUS CURIAE SUPPORTING
APPELLEE WILLIAM H. MCRA VEN

TO THE HONORABLE THIRD COURT OF APPEALS:

The limitless right of access that Regent Hall claims to information

maintained by the University of Texas System ("U.T. System") is irreconcilable

with the fiduciary principles on which he bases the asserted right, and it

contravenes the manifest purpose of the Board of Regents' enabling statute and
rules intended to foster proficient governance. This Court should reject Regent

Hall's untenable position and affirm the trial court judgment granting Chancellor

McRaven' s plea to the jurisdiction.

STATEMENT OF FACTS

AGB adopts Chancellor McRaven's statement of facts. See Br. of Appellee

at 2-10.

SUMMARY OF ARGUMENT

Individual university trustees do not have an unlimited right to all

information created or maintained by the institution. Trustees must be able to

inquire about matters relevant to the governing board's policy-making role. But

the board as a whole, and not any individual member, holds legal authority to

act. An information request, as here, can be so excessive that it amounts to

micromanagement, or even harassment, of the officials charged with administering

the university's affairs. Conflation of the trustee and administrative roles severely

undermines administrative authority and improperly places the trustee in the role of

prosecutor or grand jury. And a request by a single member in opposition to the

expressed will of the board distracts the board from fulfilling its fiduciary duties to

the institution.

The exact line where an information request becomes excessive need not be

drawn to conclude that it is transgressed in this case by Regent Hall's demand for

2
hundreds of thousands of pages of documents contained in a third-party

investigative file related to a now-superseded University policy, and as to which

the U.T. System has bona fide student privacy concerns. Construing Texas law to

afford Regent Hall unlimited access to this and any other information he asks for

simply because he is a regent is manifestly contrary to the objective of the Board of

Regents' authorizing statute and rules, which is to facilitate proficient governance.

ARGUMENT

I. THE FIDUCIARY DUTY OWED BY A UNIVERSITY GOVERNING
BOARD TO THE INSTITUTION IT SERVES IMPLICITLY LIMITS
INDIVIDUAL TRUSTEES' ABILITY TO DEMAND INFOR-
MATION FROM UNIVERSITY OFFICIALS.

Regent Hall roots his purported right of unlimited access to the U.T.

System's files in the fiduciary duties that he owes the U.T. System as a regent. See,

e.g., Br. of Appellant at 21; Reply Br. of Appellant at 9. This is incorrect.

An individual trustee has both a right and a duty to inquire into matters over

which the trustee has policy-making oversight. But the trustee's exercise of his or

her fiduciary role requires "careful attention to [a] balancing of interests." AGB,

AGB Board of Directors' Statement on the Fiduciary Duties of Governing Board

Members at 3 (2015) (attached to Reply Br. of Appellant at Tab C). University

board members "must understand that while they hold fiduciary duties individually,

they act collectively as a board." !d.

3
 An individual trustee's information request can be so excessive or obtrusive

as to amount to self-aggrandizement, not stewardship. Consider, for example, a

trustee's insistence on being copied on all communications to and from a

university president's office, or a demand for the complete files that relate to every

decision a chancellor makes. Such second-guessing of university executives'

judgment confuses the roles of trustee and administrator, undermines

administrative authority, and hobbles university officials in their ability to carry

out their duties.

So, too, information requests pursued in disregard of the expressed will of

the board as a whole subvert the board's ability to perform its oversight

responsibilities. Controversies over the scope of an individual trustee's entitlement

to sensitive information distract from the board's strategic initiatives and, as this

case demonstrates, can lead to protracted and costly litigation. The law must

impose reasonable limits on the conduct of individual trustees to prevent overreach.

II. REGENT HALL'S CLAIMED UNLIMITED RIGHT OF ACCESS TO
U.T. SYSTEM FILES CONTRAVENES THE CLEAR PURPOSE OF
THE BOARD OF REGENTS' ENABLING STATUTE AND RULES,
WHICH IS TO FACILITATE PROFICIENT GOVERNANCE.

Regent Hall also premises his asserted unlimited right of access on Board of

Regents' Rule 10101, § 3.1 ("Members of the Board of Regents are to be provided

access to such information as will enable them to fulfill their duties and

4
responsibilities as Regents of the U.T. System."). But the rule will not bear the

weight of his inflexible interpretation.

The clear objective of the Board of Regents' Rules, and of the Board of

Regents' enabling statute, is to ensure sound governance, including due

recognition of the respective policy-making and managerial roles assigned to the

Board and the U.T. System administration. See, e.g., TEX. Eouc. CODE§ 65.16(b),

(c) (requiring Board of Regents to "appoint a chief executive officer" who,

"[s]ubject to the power and authority of the board, ... is responsible for the general

management of the university system within the policies of the board"); Board of

Regents' Rule 10101, § 3.5 ("Members of the Board will at all times respect the

role of the Chancellor as the chief executive officer of the U.T. System .... ").

Regent Hall's insistence that an individual regent has an absolute unlimited

right to inspect the Chancellor's files cannot be squared with this objective because,

as explained above, unreasonable information requests impede both the

administration and the Board in fulfilling their respective duties. Because it is at

odds with the manifest purpose of the statute and rules, under settled canons of

statutory construction, Regent Hall's interpretation cannot stand. See, e.g.,

Citizens Bank of Bryan v. First State Bank, Hearne, 580 S.W.2d 344, 348 (Tex.

1979) ("It is recognized that a statute is to be construed with reference to its

manifest object, and if the language is susceptible of two constructions, one of

5
which will carry out and the other defeat the manifest object, it should receive the

former construction."). See also TEX. Gov'T CODE § 311.023(1), (5) ("In

construing a statute, whether or not the statute is considered ambiguous on its face,

a court may consider among other matters the ... object to be attained" and "the

consequences of a particular construction") .

III. REGENT HALL IS NOT ENTITLED TO THE INFORMATION HE
SEEKS.

The Court need not in this case definitively draw the precise line at which an

individual trustee's information request offends principles of sound governance in

order to conclude that the line has been crossed here. This is not Regent Hall's

first excessive document request. He has never articulated a specific or legitimate

need to view the hundreds of thousands of pages of documents he now demands to

see, other than his conclusory speculation that the independent investigator's file

"may" contain evidence of "admissions irregularities or illegalities that are not

fully documented" in the investigator's public report. Reply Br. of Appellant at

22-23.

But unsupported hunches about potential improprieties cannot be the

standard for access to the Chancellor's files, or else there are no constraints at all

on an individual trustee's power perpetually to harass university officials carrying

out their duties in good faith. What is more, the investigative file Regent Hall now

6
wants to reopen relates to events that occurred several years ago, under a different

administration, and an admissions policy that has since been amended to remedy

the very defects the investigation identified. For these reasons, and because the

U.T. System is appropriately concerned to protect personally identifiable student

information, Regent Hall cannot meet his high burden of showing that he is

entitled to the information he seeks.

Recognition of reasonable limits on an individual trustee's right to inspect

university documents contrary to the expressed will of the board and

administration does not signify that a trustee lacks recourse when faced with

alleged wrongdoing by fellow board members or administrators who oppose his

request. For instance, the trustee is free to bring to law enforcement authorities a

belief that illegality occurred. What the law does not, and should not, permit are

information requests amounting to fishing expeditions that prevent the board and

university officials from fulfilling their statutorily mandated responsibilities.

7
 PRAYER

For the foregoing reasons, this Court should reject Regent Hall's claim to an

unlimited right of access to U.T. System documents and affirm the judgment of the

trial court.

Dated: June 20, 2016

Respectfully submitted,

By: Is/ Bruce D. Oakley

MARTIN MICHAELSON BRUCE D. OAKLEY
AMY FOLSOM KETT State Bar No. 15156900
HOGAN LOVELLS US LLP HEAVEN C. CHEE
Columbia Square State Bar. No. 24087290
555 Thirteenth St., N.W. HOGAN LOVELLS US LLP
Washington, D.C. 20004-1109 700 Louisiana Street, Suite 4300
Telephone: (202) 637-5600 Houston, TX 77002
Facsimile: (202) 637-5910 Telephone: (713) 632-1400
martin. michaelson@hoganlovells. com Facsimile: (713) 632-1401
amy. kett@hoganlovells. com bruce. oakley@hoganlovells. com
heaven. chee@hoganlovells. com

Counsel for Amicus Curiae the Association of
Dated: June 20,2016 Governing Boards of Universities and Colleges

8
 CERTIFICATE OF COMPLIANCE

I certify that the foregoing Brief of the Association of Governing Boards of

Universities and Colleges as Amicus Curiae Supporting Appellee William H.

McRaven complies with Tex. R. App. P. 9.4(i), because the relevant portions of the

brief contain 1,599 words, as counted by Microsoft Word 2010.

Is/ Bruce D. Oakley
Bruce D. Oakley

CERTIFICATE OF SERVICE

I certify that a true and correct copy of the foregoing Brief of the

Association of Governing Boards of Universities and Colleges as Amicus Curiae

Supporting Appellee William H. McRaven was served on June 20, 2016 on the

following attorneys of record via e-service in accordance with the Texas Rules of

Appellate Procedure:

Joseph R. Knight
State Bar No. 11601275
EWELL, BROWN, BLANKE & KNIGHT LLP
111 Congress Avenue, 28th Floor
Austin, Texas 78701
Telephone: (512) 770-4010
Facsimile: (512) 684-7681
j knight@ebbklaw. com

9
Patton G. Lochridge
State Bar No. 12458500
Richard D. Milvenan
State Bar No. 14171800
Kayla Carrick
State Bar No. 24087264
MCGINNIS, LOCHRIDGE & KILGORE
600 Congress Ave., Suite 2100
Austin, Texas 78701
Telephone: (512) 495-6005
Facsimile: (512) 505-6305
plochridge@mcginnislaw. com
rmilvenan@mcginnislaw.com
kcarrick@mcginnislaw. com

Is/ Bruce D. Oakley
Bruce D. Oakley

10