University of California Hit With VC Disclosure Suit

April 1, 2003 ( - The San Jose Mercury News joined a University of California (UC) employees union in suing UC regents to force disclosure of the university retirement fund's venture capital investments.

The suit by the newspaper and the Coalition of University Employees (CUE), which represents 18,000 UC workers, claimed that the California Public Records Act mandates such disclosure, according to a Mercury News story. The fact that UC receives state funds also means the university should release the data, the suit contends. University officials argue that they are exempt from the records law because of investment confidentiality agreements they’ve signed.

The value of the UC endowment fund fell 10.7% last year, more than any other of the 10 largest US university endowments, except for the Massachusetts Institute of Technology, which dropped 12.6%.

The suit comes on the heels of a recent decision by CalPERS, the California Public Employees’ Retirement System, to disclose the same information after it was sued by the Mercury News (See CalPERS to Go Public With Private Equity Info ). Several other institutions have also since released similar information, including the University of Michigan and the California State Teachers’ Retirement System.

The lawsuit also seeks records of closed sessions UC held in 2000, when it adopted a new asset allocation plan and hired an outside adviser, Wilshire Associates, and in 2002, when UC fired its inside investment staff and voted to hire multiple outside advisers.

The university’s retirement plan manages $34 billion for 173,343 people, including 36,165 current retirees and beneficiaries.