(a) When a municipal hospital established pursuant to this article is managed by a board of trustees that is appointed by the mayor, the city council may meet in a closed session held solely for the purpose of discussion, deliberation, or both, of reports involving trade secrets of the municipal hospital. Except as provided in this section, the closed session shall comply with all applicable requirements of Chapter 9 (commencing with Section 54950) of Division 2 of Title 5.

(b) “Hospital trade secrets,” as used in this section, means a “trade secret,” as defined in subdivision (d) of Section 3426.1 of the Civil Code, and which meets all of the following:

(1) Is necessary to initiate a new hospital service or program or add a hospital facility.

(2) Would, if prematurely disclosed, create a substantial probability of depriving the hospital of a substantial economic benefit.

(c) The exception provided in subdivision (a) to the general open meeting requirements for a meeting of the city council shall not apply to a meeting where there is action taken, as defined in Section 54952.6.

(d) Nothing in this section shall be construed to permit the city council to order a closed meeting for the purposes of discussing or deliberating, or to permit the discussion or deliberation in any closed meeting of, any proposals regarding any of the following:

(1) The sale, conversion, contract for management, or leasing of any municipal hospital or the assets thereof, to any for-profit or nonprofit entity, agency, association, organization, governmental agency, person, partnership, corporation, or hospital district.

(2) The conversion of any municipal hospital to any other form of ownership by the city.

(3) The dissolution of the municipal hospital.

(Added by Stats. 2006, Ch. 157, Sec. 1. Effective January 1, 2007.)