American Red Cross has been reluctant to make public details over how it raised and spent over $300 million in Hurricane Sandy relief funds. The charity’s lawyers say the disclosure would inflict “competitive harm” on the group.
The Red Cross supplied some of the information concerning its Sandy activity to New York Attorney General Eric Schneiderman, whose office has been investigating the issue.
When a New-York based independent non-profit media outlet ProPublica filed a public records request for the same information, the charity’s lawyers argued that journalists could only be given a redacted version, as some of the facts mentioned in the report constituted a “trade secret.”
If such details were disclosed, "the American Red Cross would suffer competitive harm because its competitors would be able to mimic the American Red Cross's business model for an increased competitive advantage," Gabrielle Levin of the Gibson Dunn law firm wrote in a letter to the attorney general's office.
Disaster Accountability Project, a watchdog that monitors aid groups, found Red Cross’ citing trade secret exemption was a strange thing to do.
"Invoking a 'trade secret' exemption is not something you would expect from an organization that purports to be 'transparent and accountable,'" said Ben Smilowitz the group’s executive director.