FOIA Post (2001): Supreme Court Rules in Exemption 5 Case

April 4, 2001

Supreme Court Rules in Exemption 5 Case

The United States Supreme Court has ruled in a Freedom of

Information Act case that Exemption 5 of the FOIA cannot be

extended to protect all confidential communications between

the Department of the Interior and the Indian Tribes that it deals

with as part of the federal government's special "trust

relationship" with Native American tribal organizations.

The Supreme Court ruled unanimously on March 5 in the

case of Department of the Interior v. Klamath Water Users

Protective Ass'n, 121 S. Ct. 1060 (2001), that the "threshold"

requirement of Exemption 5 -- that the records in question first

must be "inter-agency or intra-agency memorandums or letters" -- was not satisfied for seven records exchanged between the

Department of the Interior and several Indian Tribes located in

the Klamath River Basin. Consequently, the Court ruled that

those records, which dealt with agency decisions on water

allocation and had been withheld from competing water users

under the attorney work-product and deliberative process

privileges, must be disclosed.

In the lower courts, the Department of the Interior at first

prevailed in its Exemption 5 position, but subsequently it did not.

At the district court level, Exemption 5 was found satisfied in

light of the agency's special "trust relationship" with the Indian

Tribes involved. The Court of Appeals for the Ninth Circuit,

however, ruled in a 2-1 decision that the Tribes' "direct interest"

in the agency's water-allocation decisionmaking disqualified

them from Exemption 5 protection as a threshold matter. See

Klamath Water Users Protective Ass'n v. Department of the

Interior, 189 F.3d 1034, 1038 (9th Cir. 1999); see also


Update, Vol. XX, No. 1, at 3.

The Supreme Court affirmed the Ninth Circuit's decision,

but it did so on a distinctly narrower ground. It began its

analysis of Exemption 5's threshold requirement with the

observation that it is "no less important" than the rest of the

exemption. 121 S. Ct. at 1066. It then recognized that several

courts of appeals have found Exemption 5's threshold to be

satisfied in cases involving an "outside consultant" of one type

or another, and it discussed that well-recognized basis for

Exemption 5 qualification at some length. It observed that such

a consultant, though it need not "be devoid of a definite point of

view," typically "does not represent an interest of its own." Id.

at 1067.

When it proceeded to apply this general "interested party"

standard to the records before it, though, the Supreme Court

found that those records (or, in effect, the Indian Tribes involved)

failed to qualify on a more precise ground. Having noted that the

Tribes' interests were "adverse" to those of the opposing

association of water users, "owing to [the] scarcity of water" in

the Klamath River Basin, 121 S. Ct. at 1064, the Court

characterized the Tribes as "self-advocates at the expense of

others seeking benefits inadequate to satisfy everyone," id. at

1068. Most significantly, it concluded that

the dispositive point is that the apparent object of the

Tribes' communications is a decision by an agency

of the Government to support a claim by the Tribe that

is necessarily adverse to the interests of competitors.


Thus, the Supreme Court ultimately applied an Exemption 5

threshold test rooted in the competition between an "outside"

party and other such parties -- here, between the Tribes and

competing water users -- not the Ninth Circuit's more general

test that disqualified an outside party due to the existence of a

self-interest alone. The Court made it clear that its Klamath

test necessarily went no further than excluding "an interested

party [that is] seeking a Government benefit at the expense of

other applicants." 121 S. Ct. at 1068 n.4. Under that test, the

records (and the relationships between the parties) that were

before the Court simply failed to qualify for protection under

Exemption 5.

A number of further conclusions can be drawn from the

Supreme Court's decision in the Klamath case:

First, the Court made it very clear that records that are

exchanged between the federal government and Indian Tribes in

furtherance of their special "trust relationship" may no longer be

protectible under Exemption 5. It explicitly rejected that

longstanding relationship as a sufficient counterweight to what

it found to be the disqualifying "competitive self-interest" of

such outside parties in this case. See 121 S. Ct. at 1069. Where,

as in Klamath, Indian Tribes act as "self-advocates at the

expense of others," id. at 1068, they no longer can expect to

receive the protection of Exemption 5.

Second, the Supreme Court readily assumed for purposes of

its decision, and thereby implicitly strengthened, the pragmatic

"outside consultant" interpretation of Exemption 5's threshold

language that has long been recognized in many FOIA cases at

the appellate court level. Although the Court ultimately did not

decide Klamath on this basis, such court of appeals decisions as

Hoover v. Department of the Interior, 611 F.2d 1132, 1137-38 (5th

Cir. 1980) (involving reports prepared by outside real estate

appraisers), Lead Indus. Ass'n v. OSHA, 610 F.2d 70, 83 (2d Cir.

1979) (involving feasibility reports prepared by outside

scientists), and also Formaldehyde Inst. v. HHS, 889 F.2d 1118,

1123-24 (D.C. Cir. 1984) (involving critiques of scientific articles

prepared by outside peer reviewers), still stand as sound

precedents for the satisfaction of Exemption 5's threshold

requirement under what in the past has been termed the

exemption's "functional test." See "Initial Considerations"

Subsection of "Exemption 5" Section of "Justice Department

Guide to the Freedom of Information Act."

Third, the Court explicitly left open the continued viability

of another line of such cases -- Public Citizen, Inc. v. Department

of Justice, 111 F.3d 168, 169-70 (D.C. Cir. 1997) (involving

agency consultations with former presidents), and Ryan v.

Department of Justice, 617 F.2d 781, 784 (D.C. Cir. 1980)

(involving agency consultations with senators) -- which it

recognized as being arguably in tension with, but not overturned

by, its Klamath ruling. Significantly, this compelled the Court to

stress that, at bottom, its new test necessarily went only so far

as to exclude from Exemption 5 any "communications to or from

an interested party seeking a Government benefit at the expense

of other applicants." 121 S. Ct. at 1068 n.4 (emphasis added);

see also id. at 1068 ("[A]gain, the dispositive point is" that the

putative "consultant" has interests that are "necessarily adverse

to the interests of competitors."). Thus, those decisions, and

their potential progeny, stand apart from what clearly was

rejected under the Court's bottom-line threshold test.

Fourth, the Klamath decision surely casts some doubt on

the viability of protecting certain settlement-related records on

the basis of the "settlement privilege" under Exemption 5 in the

future. This basis for record protection was identified many

years ago, see

FOIA Update, Vol. VI, No. 4,

at 3-4, and it has

been applied sparingly since then, see

"Initial Considerations"

Subsection of "Exemption 5" Section of "Justice Department

Guide to the Freedom of Information Act." The settlement

privilege actually has been applied in court more readily under

Exemption 4 of the FOIA than under Exemption 5, for settlement

records that are sent to an agency rather than from the agency

to an outside party, see id. (citing M/A-COM Info. Sys. v. HHS, 656

F. Supp. 691, 692 (D.D.C. 1986) (applying settlement privilege

under "privilege" part of Exemption 4)) -- and that is something

that remains entirely unaffected by the Klamath decision. As for

settlement records that are sent by an agency to an outside

party, they should fail to qualify at the threshold for Exemption 5

protection only if they run afoul of Klamath's ultimate test -- i.e.,

if they involve a self-interested outside party that is acting "at

the expense of other [such parties]." 121 S. Ct. at 1068 n.4. It

remains to be seen exactly how Klamath might be applied in any

future FOIA case that involves the settlement privilege under

Exemption 5.

Lastly, it also remains to be seen whether the Klamath

decision will have such a strong impact on the government/tribal

relations of agencies such as the Interior Department that it

necessitates a legislative remedy, as the Supreme Court itself

suggested might be the case. See 121 S. Ct. at 1069-70 & n.7. If

so, then the enactment of an "Exemption 3 statute" may be seen

as a most appropriate legislative response. Such remedial

action by Congress would be much like the legislative response

to a very comparable FOIA problem experienced by the Interior

Department just a few years ago, when two appellate courts

ruled that it could not protect the site locations of endangered

species under FOIA Exemption 2. See Maricopa Audubon Soc'y

v. United States Forest Serv., 108 F.3d 1082, 1087 (9th Cir.

1997); Audubon Soc'y v. United States Forest Serv., 104 F.3d

1201, 1204 (10th Cir. 1997); see also FOIA Update, Vol. XVI, No.

3, at 2. The legislative response to those FOIA decisions was

the enactment of an Exemption 3 statute, see National Park

Omnibus Management Act of 1998, 16 U.S.C. § 5937 (1994 &

Supp. IV 1998), one that readily addressed the problem and

already has been upheld in court. See Pease v. United States

Dep't of Interior, No. 1:99CV113, slip op. at 2, 4 (D. Vt. Sept. 17,


Klamath is the first Freedom of Information Act decision

that the Supreme Court has issued in more than four years, since

it summarily reversed the Court of Appeals for the Ninth Circuit,

and ruled in the government's favor, in Bibles v. Oregon Natural

Desert Ass'n, 519 U.S. 355 (1997), an Exemption 6 case involving

the protection of mailing lists. During the past four years, the

only other significant action taken by the Court in a FOIA case

was its nullification of a Ninth Circuit decision that had required

the disclosure of classified information, in United States v.

Weatherhead, 528 U.S. 1042 (1999), when that case suddenly

became moot shortly before Supreme Court argument at the end

of 1999. See FOIA Update, Vol. XX, No. 1, at 1.   (posted 4/4/01)

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