Court of Appeals Decisions
EEOC v. Kronos, Inc., No. 11-02834, 2012 WL 4040258 (3d Cir. Sept. 14, 2012). Holding: Remanding to the district court to remove the provision creating a presumption that certain information will be presumed to be trade secrets or commercial information entitled to remain confidential. The court rejects appellee's attempt to make information it discloses to the EEOC automatically exempt under Exemption 4. The court states that "allowing [appellee] to assert unilaterally that any information it discloses to the EEOC is automatically exempt under FOIA precludes EEOC officials from performing the analysis required by FOIA after a request is made." The information may indeed be exempt but the EEOC must be able "to do its required analysis when faced with a FOIA request."
Watkins v. U.S. Bureau of Customs & Border Protect., No. 09-35996, 2011 WL 1709852 (9th Cir. May 6, 2011) (Walter,J.). Holding: Affirming the district court's decision that Exemption 4 applies to the requested material, but concluding that CBP has waived that protection; and reversing the district court's determination that DHS's regulations control, rather than CBP's regulations, for FOIA fee purposes. Threshold: The Ninth Circuit holds that Exemption 4 applies to the information in question, but nevertheless concludes that the government waived its ability to assert the exemption by disclosing the Notices of Seizure to trademark owners without placing limits on dissemination. As an initial matter, the Circuit rejects plaintiff's argument that "the information contained in the Notices of Seizure cannot be commercial because it pertains to 'the unlawful importation of counterfeit goods, and not any sort of legitimate commercial activity.'" The Circuit instead agrees with the district court that the notices are not "final determinations that goods seized are counterfeit," but rather are "akin to a finding of probable cause," which are subject to administrative and legal challenge by the importer. As such, the Circuit finds that it "cannot conclude that information contained in a Notice of Seizure is non-commercial just because it's likely – perhaps even very likely – that the merchandise seized is counterfeit," but, rather, holds that "the district court's finding that the Notices contain plainly commercial information, which discloses intimate aspects of an importer's business such as supply chain and fluctuations of demand for merchandize, is well-supported."
Substantial competitive harm:The government "conceded that importers are mandated to provide" the requested information. As preliminary issue, the Circuit finds that, despite plaintiff's claims that defendants failed to specify a relevant market with respect to identifying actual competition for Exemption 4 purposes, the request itself "established the relevant market as the entire market for imported goods." The Circuit then finds that "the Agency's affidavits provide a sufficient factual basis for the district court to conclude that the disclosure of the information in the Notices of Seizure poses a substantial likelihood of competitive injury to importers of non-counterfeit goods who zealously guard their supply chains." Moreover, "[c]ombine this information with already public information and importers' entire distribution network and demand trends could be revealed." Accordingly, the Circuit concludes that "[t]he district court was not clearly erroneous in its finding that the information was confidential and privileged" and, therefore, finds that "Exemption 4 applies to Notice of Seizure."
United Technologies Corp. v. DOD, Nos. 08-5435 & 08-5436, 2010 WL 1030053 (D.C. Cir. Mar. 23, 2010) (Henderson, J.). The submitters do not challenge the district court’s finding that the information was a mandatory submission. The court finds that "[c]alling customers' attention to unfavorable agency evaluations or unfavorable press does not amount to an 'affirmative use of proprietary information by competitors.' . . . In other words, Exemption 4 does not guard against mere embarrassment in the marketplace or reputational injury." DOD "correctly rejected" this argument from the submitters.
However, the court finds that defendant has not responded sufficiently to the submitters' claim that release of the records will reveal proprietary information about plaintiffs' manufacturing and quality control processes. DOD claims it redacted all sensitive information, but "the documents describe, in part, how the contractors build and inspect helicopters and/or engines. Once disclosed, competitors could, it appears, use the information to improve their own manufacturing and quality control systems, thus making 'affirmative use of proprietary information' against which Exemption 4 is meant to guard. We believe that [DOD] failed to provide a reasoned basis for its conclusion to the contrary. . . . [W]here, as here, a contractor pinpoints by letter and affidavit technical information it believes that its competitors can use in their own operations, the agency must explain why substantial competitive harm is not likely to result if the information is disclosed." DOD has only provided conclusory statements of its position.
Fox News Network, LLC v. Bd. of Governors of the Fed. Reserve Sys., No. 09-3795, 2010 WL 986665 (2d Cir. Mar. 19, 2010) (Jacobs, C.J.). For the reasons discussed in the Bloomberg decision, the court overturns the district court's ruling that the records requested by plaintiff, "the identity of the borrowing bank, the dollar amount of the loans, the collateral securing the loans, and the loan origination and maturity dates," are protected by Exemption 4. The case is remanded and the Board will be required to release this information.
Bloomberg, L.P. v. Bd. of Governors of the Fed. Reserve Sys., Nos. 09-4083 & 09-4097, 2010 WL 986527 (2d Cir. Mar. 19, 2010) (Jacobs, C.J.). The court affirms the lower court ruling that the requested information, "the identity of the borrowing bank, the dollar amount of the loans, the loan origination and maturity dates, and the collateral securing the loan . . . was not 'obtained from' the borrowing banks within the meaning of FOIA Exemption 4."
Plaintiff's request did not seek loan applications, which would likely be obtained from a "person." Rather, it seeks records of loans actually made by defendant, and these records, generated by defendant itself, cannot be said to have been obtained from outside the agency. This is true regardless of the fact that "disclosure of loan terms allows one to back into information about the borrower." Cases that "have extended the protection of Exemption 4 to information beyond the raw data gathered from persons by the government" are irrelevant to "the present case, where what is requested is . . . disclosure of the agency's own executive actions." Defendant argues that the loans are granted "as a matter of course," hence the information in the loan approvals is a mere "translat[ion of] the loan requests." The court finds, however, that this contention "is not supported by the record," which indicates that "approval is required for the loan." Moreover, "even if the loans were granted automatically, they did not come into existence until the Federal Reserve Bank took executive action by granting the loan. The only information sought is a summary report of actions that were taken by the government. And it cannot be said that the government 'obtained' information as to its own acts and doings from external sources or persons."
Defendant's alternative argument is that the Federal Reserve Banks are "persons" from whom the Board received the information in question, and that disclosure would harm the Board in performance of its mission. The court finds that "[t]he 'program effectiveness' test [(recognized by the First and D.C. Circuits)], if applied as the Board invokes it, would give impermissible deference to the agency, and would be analogous to the 'public interest' standard rejected by the Supreme Court in the context of Exemption Five." Although finding the arguments made regarding program effectiveness harm to be "plausible," the court declines to adopt the test as not within the scope of Exemption 4 as drafted by Congress.
District Court Decisions
Comptel v. FCC, No. 06-1718, 2012 WL 6604528 (D.D.C. Dec. 19, 2012) (Lamberth, J.). Holding: Denying cross-motions for summary judgment and ordering FCC to file an amended declaration and Vaughn index. The court finds that it has insufficient information to determine whether Exemption 4 was appropriately applied to the withheld information. The court notes that "[t]he FCC has not met its burden to show that names and contact information should be exempt as confidential commercial or financial information. Names clearly are not financial information and thus the FCC must consider them to be commercial in nature. While the Court assumes corporations can have a commercial interest in the names of certain staff, it is not a certainty that a corporation would have a commercial interest in the names of every one of its employees. Thus, the FCC must state why this information is commercial in nature." In addition, "the FCC has not alleged that the information was 'obtained from a person.'" The FCC also has "not shown that the information is confidential." Noting that there are different tests for information submitted voluntarily versus involuntarily, the court declares that "the FCC must disclose … whether any information redacted was involuntarily submitted." With regard to settlement information withheld under Exemption 4, the Court notes that "[t]he FCC's rationale for its redactions is not entirely clear: its Vaughn index appears to attempt to fit the redacted information into the traditional requirements of Exemption 4 by labeling it 'competitively sensitive,' yet its declaration often justifies redactions purely on the basis of its relation to settlement negotiations." The court rejects plaintiff's argument that the information fails to meet the "obtained from a person" requirement. It comments that "information originally obtained from an outside source, but later included in agency documents, may be considered 'obtained from a person.' However, the FCC must state in its declarations or Vaughn index that the information was originally obtained" from a person. Nonetheless, overall, the court agrees with plaintiff that the FCC has failed to show how its redactions meet the requirements of Exemption 4 and requires the FCC to submit supplemental information.
Jurewicz v. USDA, No. 10-1683, 2012 WL 4130515 (D.D.C. Sept. 20, 2012) (Boasberg, J.).Holding: Granting defendant's motion for summary judgment.The court concludes that the USDA's "determination that Exemption 4 does not apply here  was not 'arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.'" The court explains that "Exemption 4 applies here if Plaintiffs' competitors would be likely to use [the information at issue] to cause Plaintiffs harm." The USDA "pointed out that similar information was already in the public domain" and "that too many other variables affect each dog's price… to make crude revenue-divided-by-dogs sold calculations useful." Plaintiffs' claim that "no record evidence shows that the fees paid by dealers are publicly available," was contrary to the facts because "even with the redactions that Plaintiffs seek, the Forms at issue in these very FOIA requests reveal the fee amount paid." The plaintiffs assert that "'the purpose of the … request for information is to destroy the business[es]'" of the plaintiffs. However, the court notes that the requesters are not business competitors of the plaintiffs; therefore, the plaintiffs' "comments have nothing to do with substantial competitive harm because they do not allege any injury that would 'flow from the affirmative use of proprietary information by competitors.'"
Elec. Privacy Info.Ctr. v. DHS, No. 11-945, 2012 WL 4044986 (D.D.C. Sept. 14, 2012) (Rothstein, J.). Holding: Granting defendant's motion for summary judgment but finding plaintiff eligible for and entitled to attorney's fees and costs. The court concludes that DHS properly withheld documents under Exemption 4. The court rejects plaintiff's argument that the documents withheld are publicly available and therefore could not be considered privileged or confidential. It examines the two documents submitted by plaintiff as support for its contention and finds that the public information cited by the plaintiff is not the same as what the plaintiff requested. The court looks to DHS's declaration and agrees that "the public documents that [plaintiff] cites contain generic performance information distinct from the specific data included in the document in dispute." Second, the "pricing document contained in the contract [at issue] … has nothing to do with the pricing under any other contract because [the contractor's] pricing is unique to each procurement." Segregability:The court notes that in its declaration the defendant "explains, document-by-document and page-by-page, what the contents include and why they could not be produced." It concludes that this new "court-ordered enhanced segregability analysis" is sufficient.
Pub.Emp's for Envtl. Resp. v. Off.of Sci. & Tech. Pol'y, No. 11-1518, 2012 WL 3126778 (D.D.C. July 30, 2012) (Leon, J.). Holding: Granting defendant's motion for summary judgment on the basis that its withholdings under Exemptions 4 and 5 were appropriate, and that it released all reasonably segregable material. The court concludes that OSTP properly invoked Exemption 4 to protect information provided to the agency inadvertently by a third-party trade association. First, the court finds that "this information is commercial for purpose of Exemption 4" because "[t]here is no doubt that both [the trade association] and its members have a commercial interest in [the association's] advocacy strategy, which is at the core of [its] competitive value to itself and its members." Second, the court determines that "OSTP also meets its obligation to show that this information was confidential." Because the information was submitted inadvertently, the court observes that "OSTP must show only that the information 'is of a kind that would customarily not be released to the public' to sufficiently prove confidentiality," which it has demonstrated. The court further notes that "the standard for assessing confidentiality is 'how the particular party customarily treats the information' and not how plaintiff or other parties might view the information." Here, the court find that the submitter's "representation that the information concerns a 'recommendation for [the submitter's] internal strategy' is sufficient to conclude that the information is confidential."
Island Film, S.A. v. U.S. Dep't of the Treasury, No. 08-286, 2012 WL 2389990 (D.D.C. June26, 2012) (Roberts, J.). Holding: Granting, in part, defendant's motion for summary judgment on the basis that it properly withheld certain information pursuant to Exemptions 4, 5, 6, 7(C) and 7(D) and conducted a reasonable search, the adequacy of which was not challenged by plaintiff; ordering defendant to provide additional submissions to justify withholding information for which it invoked Exemption 2, which is precluded by Milner, and to support certain withholdings under Exemptions 7(D) and 7(E); and directing defendant to provide segregbility analysis for certain specific documents withheld in full, but determining that defendant released all reasonably segregable portions from the remaining documents. The court concludes that Treasury properly asserted Exemption 4 to withhold "bank applications to release blocked funds" which contained detailed transactional information about the blocked transaction. As an initial matter, the court notes that "[t]his kind of information is readily characterized as commercial or financial within the meaning of the exemption." Further, the court observes that plaintiff "does not dispute Treasury's position that disclosure would impair the agency's collection of information," "[n]or does [it] dispute Treasury's representation . . . that public disclosure of these documents could also cause the applicants competitive harm by allowing competitors to gain access to information regarding business operations, confidential contacts, and financial and expense data." The court concludes that "[r]elease of the specified categories of information, particularly sensitive information such as contractual terms and banking information, could cause the applicants competitive harm by revealing customer identities and transaction details, and cause the customers to seek the services of competitors who may seem better able to protect their financial privacy." Additionally, the court finds that Treasury properly asserted Exemption 4 to withhold "[r]esponses to administrative subpoenas and OFAC reports on blocked assets [which] contain similar business expense details and amounts" because "[t]his information is both commercial and confidential."
Skybridge Spectrum Found. v. FCC, No. 10-1496, 2012 WL 336160 (D.D.C. Feb. 2, 2012) (Kollar-Kotelly,J.). Holding: Granting FCC's motion for summary judgment on the basis that plaintiff conceded the merits of the FCC's withholding decisions; but also concluding that, on the merits, the FCC's withholdings under Exemptions 4 and 6 were appropriate and that it properly released all reasonably segregable information.As a threshold matter, the court finds that the "revenue information, checking account information, service pricing, and the like [which are at issue] are at the core of 'commercial or financial information' eligible for protection under Exemption 4."
The court finds that the requirement that the information be "obtained from a person" "is also clearly satisfied in this case because the information that the FCC continues to withhold under Exemption 4 was submitted by third parties," specifically, two companies that were competitors of plaintiff.
The court notes that the certain forms submitted by telecommunications companies constitute required submissions to the FCC. Applying the National Parks test, the court finds that "[r]egardless of whether the disclosure of [the detailed revenue] information [contained on the forms] would impair the FCC's ability to obtain similar information in the future, the FCC has shown that forced disclosure would likely cause substantial competitive harm to the [submitters]" because "the FCC has made a sufficient showing that the public disclosure of this information would, either on its own or in conjunction with other publicly available information provide competitors with specific information about [the submitters'] (1) competitive lines of business, (2) general market segmentation and positioning, and (3) competitive strength."
As to "portions of correspondence between [Universal Service Administrative Company (USAC)] and the [submitters] reflecting revenue information, checking account information, payment history, amounts owed to [the USAC's Universal Service Fund], customer information, and service pricing" withheld by the FCC, the court notes that although "[i]t is not entirely clear whether this information was submitted under compulsion or voluntarily," "the uncertainty is immaterial because the FCC's showing would satisfy either [the Critical Mass or National Parks standard" for nondisclosure. The court finds that "[o]n the one hand, the FCC has made a sufficient showing that the public disclosure of this information would [cause the harms enumerated above as well as] . . . , reveal confidential account numbers, and . . . disclose service pricing and customer identities that could be used by competitors to contact customers and undercut pricing." Conversely, the court finds that "it is plain from the context and the FCC's submissions that information of this kind would not customarily be released to the public." As to plaintiff's claim that "the public interest in the particular information covered by its requests should outweigh the private interest in non-disclosure," the court finds that once Exemption 4 is satisfied, "it is not the district court's role to second-guess that judgment on a case-by-case basis." Additionally, the court rejects plaintiff's assertion that "Exemption 4 'does not extend to documents/information that is [sic] false' or fraudulent," noting that plaintiff "cites to no legal authority supporting its unique interpretation of the exemption – none."
Morales v. Pension Benefit Guar. Corp., No. 10-1167, 2012 U.S. Dist. LEXIS 9101 (D. Md. Jan.26, 2012) (Legg, J.). Holding: Granting defendant's motion to withdraw its earlier motion to dismiss and granting its motion for summary judgment, on the basis that its withholdings under Exemptions 4, 5, and 6 were proper and its search was sufficient; and denying plaintiff's motions for attorney's fees. The court holds that PBGC properly asserted Exemption 4 to redact provisions from its "contracts with law firms and expert witnesses" "relating to forecasted hourly rates that would apply if PBGC were to exercise options allowing it to extend the contracts." Rejecting plaintiff's contention that "the exemption is inapplicable in this case because the contracts in question were not competitively bid," the court finds that regardless of whether the contracts were negotiated or competitively bid "option year pricing would give the competitors of the present contractors leverage with which to persuade PBGC to open the contracts for bidding or renegotiation with others rather than exercise its current option, thus harming the current contractors' competitive position." The court also observes that "while the public has a strong interest in information concerning how much government agencies actually pay for goods and services, that interest is significantly less compelling with regard to hypothetical future prices."
Am. Mgmt. Servs., LLC v. Dep't of the Army, No. 11-442, 2012 U.S. Dist. LEXIS 8124 (E.D.Va. Jan.23, 2012) (Ellis,J.). Holding: Granting, in part, Army's motion for summary judgment based on its withholdings pursuant to Exemptions 4 and 6, as well as information protected by the attorney client privilege of Exemption 5; concluding that the Army released all reasonably segregable portions of those records; and deferring, in part, Army's motion for summary judgment with respect to documents solely withheld pursuant to the deliberative process privilege, which the court will review in camera. As a preliminary matter, the court notes that because the documents withheld pursuant to Exemption 4 "satisfy the tests for confidentiality under both the National Parks and Critical Mass standards, it is unnecessary to reach or decide which test is required in the Fourth Circuit," which "has not yet determined whether to adopt the [D.C. Circuit's] Critical Mass modification to the National Parks test." Here, the court concludes that the records, which "include timelines and tables created at the direction of [the submitter's] outside counsel that relate to [plaintiff's] alleged wrongdoing, notes taken during interviews with personnel relating to the allegations of misconduct, and internal reports detailing the alleged wrongdoing and evaluating the project's internal financial controls," as well as "selected emails, invoices, invoice logs, checks, and work orders," "were submitted voluntarily to the Army and thus satisfy this prerequisite to the Critical Mass test." The court determines that the records at issue "clearly satisfy" the standard for voluntary submissions, i.e., they "are considered 'confidential' if they are 'of a kind that would customarily not be released to the public by the person from whom it was obtained.'" The court notes that some of the documents "were created by or at the direction of [the submitter's] outside counsel in anticipation of litigation," while others were specifically selected and included in the binder submitted to the Army, reflecting the "thought processes, theories, and specific preparation [of the submitter's] outside counsel in anticipation of the Georgia state action, thus constituting work product."
Additionally, the court finds that "the application of the National Parks test leads to the same result" because "where, as here, the voluntary submission of information that would not customarily be released to the general public satisfies the Critical Mass test for confidentiality, so also disclosure of that information would impair the government's ability to obtain it in the future." Further, the court notes that, in this case, there are no "'sufficient external incentives'" for the company "to submit information that is not customarily released even though the submitter knows that information could become publicly available." As to plaintiff's argument that disclosure of the records is in the public interest, the court finds that "in this FOIA action, the dispositive public interest with respect to . . . [the] documents [withheld pursuant to Exemption 4] is ensuring that entities like [the submitter] continue to provide high quality, confidential materials to the Army in the future, so that the Army is alerted to potential wrongdoing of its contractors and thus able to reach well-informed decisions regarding the proper course of action in such situations."
Plumbers & Gasfitters Local Union No. 1 v. Dep't of the Interior, No. 10-CV-4882, 2011 U.S. Dist. LEXIS 123868 (E.D.N.Y. Oct. 26, 2011) (Amon,J.). Holding: Denying the Department of Interior's (DOI's) motion for summary judgment, and ordering it to produce the information at issue. Threshold: The court holds that "DOI has not carried its burden of justifying its refusal to disclose the 'hours worked' columns on Gateway Project payroll forms" and "orders the DOI to turn over [that] data." At the outset, the court notes that "[t]he parties agree that the records in question were 'obtained from a person'" within the meaning of Exemption 4. In terms of the nature of the information at issue, the court finds that "[l]ittle more than common sense establishes that the number of hours an employee works is commercial or financial in character." The court notes that "the entity whose records [plaintiff] seeks, is a commercial entity" and that "because the number of hours worked is a component of these labor costs, that information relates directly to the commerce in which [the submitter] is engaged."
Substantial competitive harm: The court notes that the parties agree that disclosure would not affect the government's ability to obtain the information in the future, "so only the 'competitive harm' prong [of Exemption 4] is at issue." The court finds that although it "has little trouble crediting DOI's claim that [the submitter] faces 'actual competition,' . . . DOI has not demonstrated that [the submitter] faces a likelihood of substantial competitive injury." The court rejects DOI's argument that the submitter would suffer substantial competitive harm because "a competitor could predict [the submitter's] gross labor costs and undercut them" by using other available data. Rather, the court finds that "[t]he problem with the DOI and [the submitter's] argument is that the information they claim is confidential has already been disclosed, at least insofar as it could cause competitive harm," "because, as [plaintiff] points out, the DOI did not redact [the submitter's] gross labor costs from the Gateway Project payroll forms." The court observes that "any competitor could get a generalized sense of the time [the submitter] spends on certain tasks from the information already disclosed." The court concludes that it is "highly unlikely that further disclosure would confer any competitive advantage, let alone one resulting in 'substantial' competitive injury to [the submitter]."
Judicial Watch, Inc. v. U.S. Dep't of the Treasury, No. 10-302, 2011 WL 3582152 (D.D.C. Aug. 16, 2011) (Howell, J.). Holding: Granting summary judgment to Treasury based on its withholdings under Exemption 5, but ordering defendant to release reasonably segregable information from one document or to demonstrate why this information is not segregable. The court also examines defendant's claim that Exemption 4 applies to a "Current Draft Talking Points" document, which was provided voluntarily and "contains confidential commercial or financial information obtained from AIG related to compensation and retention matters." The court rejects plaintiff's argument that the information document was not kept confidential because it was circulated to individuals at the Federal Reserve Bank of New York (FRBNY). The court finds that, given the FRBNY's regulatory role in the banking industry, "the limited disclosures of information to the FRBNY are akin to the type of limited disclosures, such as to suppliers or employees, that do not preclude protection under Exemption 4." The court notes that the submitter's declaration "explains that the information at issue is not a type AIG customarily discloses to the public and the cover email contained a confidentiality legend, which warned the recipients of the e-mail that the information, including the attachment, inside may be confidential and should not be disseminated, distributed, or copied." As to the documents that were required submissions, the court concludes that it does not need to decide this point, since it has already determined that this information is covered by Exemption 5.
Judicial Watch, Inc. v. Dep't of Treasury, No. 09-1508, 2011 WL 2678930 (D.D.C. July 11, 2011) (Howell, J.). Holding: Granting Treasury's motion for summary judgment except for three documents that contain reasonably segregable material that should have been released.As a preliminary matter, the court notes that for the purposes of Exemption 4 "[b]anks and other financial institutions are considered 'persons.'" Moreover, the information at issue was a required submission because "information provided to the government because it is required for participation in a voluntary government program is treated as a mandatory, as opposed to a voluntary, submission of information." Additionally, because plaintiff failed to address it, the court treats as conceded the defendant's argument that certain financial information provided by the bank satisfies the impairment prong of the National Parks test, because if the information were disclosed "financial institutions would be reluctant to share such information with Treasury in the future, which could compromise the effectiveness of Treasury's TARP-based programs." Consequently, the court rules that it "does not need to decide whether the defendant satisfied the second [competitive harm] prong of the National Parks test for determining confidentiality, because . . . the plaintiff conceded the defendant's arguments that the withheld materials satisfy the first prong."
Lake Travis Transitional Med. Ctr. v. HUD, No. 10-950 (W.D. Tex. June 11, 2011) (Sparks,J.). Holding: Ordering defendant to produced all documents examined in camera in full, except for certain information protected by Exemption 5. At the outset, the court notes that although HUD does not explicitly cite Exemption 4 as its basis for withholding a particular "methodology used to determine whether an area is 'underserved,' and thus deserving of mortgage guarantee by HUD for a proposed facility," the agency's declaration states that the information "was withheld because the documents contain information which, if disclosed, 'could put the applicant at a competitive disadvantage.'" Interpreting this statement to be a claim under Exemption4, the court finds that HUD's "simple assertion of competitive disadvantage falls well short of meeting HUD's burden for withholding documents under Exemption 4 of FOIA."
With regard to "a presentation to HUD by a third party[that is] the mortgage lender for the proposed hospital," the court concludes Exemption 4 is not applicable. The court rejects HUD's argument that the information was properly withheld "pursuant to the direction of the party providing the information based on an interpretation of Exemption4 recognized by the D.C. Circuit" in Critical Mass. The court notes that "[t]he Fifth Circuit has not addressed the holding in Critical Mass" and "HUD has provided [the] Court with no explanation of why it should ignore the existing binding precedent of the Fifth Circuit and adopt a test used only the D.C. Circuit." The court concludes that "HUD's simple assertion that [the document] is confidential under Exemption 4, because the third party mortgage lender designated it as confidential, without establishing substantial competitive harm, fails to meet the Fifth Circuit's test."
Raher v. BOP, No. 09-526, 2011 WL 2014875 (D. Or. May, 24, 2011) (Stewart, Mag.). Holding: Granting, in part, plaintiff's motion for summary judgment with respect to records withheld under Exemptions 3, 7(E) and 7(F) and certain records withheld pursuant to Exemption4; concluding that an evidentiary hearing is necessary to resolve a factual dispute with respect to certain records withheld under Exemption 4; and ordering that BOP supplement the record with regard to its search for certain documents. Voluntary or required submission: At the outset, the court notes that it had previously concluded that "the submitters [in this case] did not voluntarily provide information to BOP, but instead provided it as a mandatory requirement of compliance with the [Criminal Alien Requirement (CAR)] procurement process." Consequently, "the only issue is whether the disclosure is likely to cause substantial harm to the competitive position of the providers of the information."
Submitter notice: The court holds that because BOP first processed the records, redacting information it believed to be exempt and then sent those redacted versions to the submitters, the absence of objections from some submitters "can only be interpreted to mean that they concurred with BOP's proposed redactions." Thus, "BOP may invoke Exemption 4 as to information received from all five submitters despite the lack of objection by some of them."
Substantial competitive harm prong/actual competition: Based on declarations submitted by BOP, one of the submitters, and plaintiff, the court determines that "the record continues to show only that a small number of entities meet the solicitation criteria for the CAR procurement process and are capable of supplying BOP with the facilities and services required." Still, the court concludes that "BOP has met its burden of showing the existence of actual competition as required by Exemption 4," noting that plaintiff's declarant, an economist concedes that "the record 'supports the conclusion that prison operators compete in the relevant market, at least some of the time' for CAR contracts and renewals."
Threshold: The court holds that BOP cannot assert Exemption 4 "to categorically exempt all internal price evaluation and source selection decision records which [BOP itself] generated for the purpose of evaluating bids" because this information was "not 'obtained from a person' as required by Exemption 4." Rather, the court finds that "Exemption 4 only protects information contained in those records that was obtained from the submitters, disclosure of which will cause them substantial competitive harm."
Substantial competitive harm: The court agrees with plaintiff that Exemption4 does not protect documents that are publicly available, but finds that "[i]t is not clear . . . which documents BOP is withholding under Exemption 4 that are otherwise publicly available other than those already obtained by [plaintiff from a local government entity]." However, the court concludes that "[s]imply because [plaintiff] has obtained some documents from elsewhere does not necessarily mean that BOP is required to release all other documents in its possession that contain similar information." Accordingly, "[t]o obtain disclosure of any other documents not already obtained elsewhere, [plaintiff] must submit additional evidence conclusively establishing that those documents are 'freely and cheaply available from other sources.'"
The court identifies a number of issues with regard to BOP's decision to withhold the pricing structure contained in the awarded contracts and the proposals from successful bidders. However, the court determines that based on the declaration of one of the submitters, "BOP has created a genuine issue of material fact as to whether a submitter will likely suffer substantial competitive injury if the withheld information is released" and, as such, concludes that "an evidentiary hearing is necessary to determine whether BOP may invoke Exemption 4 to protect pricing information, in particular, activation and staffing schedules and option renewal prices." BOP has not, however, demonstrated that release of "the number of beds awarded by each contract" qualify for protection under Exemption 4. The court observes that "dividing the total price by the number of beds does not reveal the complicated pricing structure of the contract."
With respect to past performance records, the court finds that "[n]othing in BOP's or [one of the submitter's] submissions explain why Exemption 4 should protect those portions of past performance documents which are unrelated to pricing information." Accordingly, the court concludes that plaintiff "is entitled to summary judgment as to the past performance records that are narratives and lists of occurrences . . . which clearly are unrelated to pricing." As to technical proposals categorized by BOP as "Institutional Operations," "Contract Activation," and "Physical Plant," the court determines that "BOP has submitted insufficient evidence to satisfy its burden to justify Exemption 4 . . . and [plaintiff] is entitled to summary judgment to that extent."
Nelson v. U.S. Army, No. 10-1735, 2011 U.S. Dist. LEXIS 17193 (N.D. Ill. Feb. 22, 2011) (Pallmeyer, J.). The court finds that the Army properly determined that the requested records are subject to the pre-disclosure notification process detailed in Executive Order 12,600 and that plaintiff is required to pay the fees associated with that process. The court rejects plaintiff's argument that "none of the information he requested 'includes any confidential, proprietary or trade secret data," and, therefore, the submitter notice process is not required. Employing the Third Circuit's rationale in OSHA Data/CIH, Inc. v. U.S. Department of Labor, the court reasons that in order "to justify requiring pre-disclosure notification" to confidential business submitters, "Defendant needs only to show that disclosing the information could cause the commercial vendors substantial competitive harm." The court then finds that the Army's declaration "points out the various ways the commercial vendors could be placed at a competitive disadvantage if the dates of [Technology Integration Center (TIC)] testing and the amounts they paid to use the facility were made public."
The court also declines to find that the Army "'unlawfully inflated the estimated fees'" associated with processing plaintiff's FOIA request. The court dismisses plaintiff's challenges to the Army's fee calculations and his argument that the "'information should [have been] provided for no fee.'" Moreover, the court notes that it "is skeptical of Plaintiff's claim that he seeks the information for non-commerical use" where he "has his own private computer testing facility and his request appears to be motivated by the fact that potential customers are seeking out testing from the TIC rather than from his laboratory."
Gold Anti-Trust Action Comm., Inc. v. Bd. of Governors of the Fed. Reserve Sys., No. 09-2436, 2011 WL 332541 (D.D.C. Feb. 3, 2011) (Huvelle, J.). The court holds that the Board properly asserted Exemption 4 to protect "information provided by foreign central banks ('FCBs') regarding potential draws on currency swap arrangements or inquiries about swap arrangements that were never actually entered into" as well as certain details related to a proposed business transaction. The court finds that the withheld information "is commercial and financial in nature, as it details banking 'transactions' and 'account arrangements' or 'potential transactions' involving FCBs" and that the information obtained from the FCBs, "was obtained from 'persons' as defined by FOIA." Additionally, the court holds that although some of the withheld records were created by the Federal Reserve Board and the Federal Reserve Bank of New York, "this does not preclude the application of Exemption 4" because "[a]n agency may withhold portions of its own reports containing information 'supplied by' third parties."
Lastly, the court determines that "the information is confidential, as the FCB's provided it voluntarily and do not customarily release such information to the public." Despite plaintiff's argument that the FCB's "'were required to provide the information to [the Board]" as a condition for entering into certain transactions, the court finds the submissions of the FCBs were voluntary and that the Bank lacked "the legal authority to compel any such production from the FCBs."
Taylor v. Babbitt, No. 03-0173, 2011 WL 159769 (D.D.C. Jan. 19, 2011) (Urbina, J.). The court grants plaintiff's motion for summary judgment, concluding "the FAA has not demonstrated that the materials sought by plaintiff are secret and commercially valuable, as necessary to demonstrate that they are trade secrets protected from disclosure by Exemption 4." As a preliminary matter, the court notes that the parties do not dispute that the information at issue bears a direct relationship to the productive process as required by the D.C. Circuit in Public Citizen Health Research Group v. FDA.
The court concludes that the owner's authorization in 1955 to disclose the materials to outside parties precludes them from being "secret" as is necessary for trade secret production. In spite of the defendant-intervenor's attempt to revoke its authorization to the FAA to disclose the relevant materials, the court determines that "[t]he FAA has... offered no support for the proposition that materials that have been authorized for public disclosure by their owner are considered secret once more when that authorization is revoked." The court also finds that "even if there are circumstances in which secret status can be restored, they are not present here, where [the intervenor's] predecessor authorized the public disclosure of the records at issue in 1955, and [the intervenor] made no effort whatsoever to revoke that authorization until more than forty years later, when [another individual] submitted his FOIA request" for these materials.
Additionally, the court notes that although its conclusion that the documents are not "secret" "is sufficient to resolve the parties' cross-motions for summary judgment, the court nonetheless proceeds to the second disputed issue – whether the requested materials are commercially valuable." Here, the court observes that "the FAA concedes that the F-45 type certification materials are not commercially valuable based on their usefulness in manufacturing aircraft." With respect to the FAA's contention that the materials are valuable in the antique aircraft market, the court finds that while the records "may be valuable in [such a] market, there is no evidence that these materials are commercially valuable" to the intervenor where the FAA has not shown that the intervenor "currently competes in the antique aircraft market or  has any intention to do so in the future." The court concludes that "[b]ecause trade secret protection is ultimately grounded in the 'economic value . . . [from] the competitive advantage over others that [the owner] enjoys by virtue of its exclusive access to the data,' . . . the F-45 type certification materials are not commercially valuable because their economic value does not derive from the competitive advantage they confer upon [the intervenor] within the aircraft market."
McKinley v. FDIC, No. 10-420, 2010 WL 5209337 (D.D.C. Dec. 23, 2010) (Sullivan, J.). The court determines that the FDIC did not adequately justify its assertion of Exemption 4 to protect "'confidential commercial and financial information obtained from banks'" where the declaration fails to "explain whether the withheld information was voluntarily or involuntarily provided" and contains "vague statements" and "conclusory assertions."
Raher v. BOP, No. 09-526, 2010 WL 3488975 (D. Or. Sept. 2, 2010) (Stewart, J.). The information was provided "as a mandatory requirement" of the procurement process. The court concludes that BOP has failed to show actual competition in the market for private detention of foreign nationals or to explain how disclosure of the information withheld under Exemption 4 would likely cause substantial harm to the competitive position of the business submitters. Regarding actual competition in the marketplace, the court finds that "BOP is the only customer in the relevant market, and the submitters are among a small number of entities, perhaps the entire universe of such entities, that meet the solicitation criteria for the [Criminal Alien Requirement (CAR)] procurement process and are capable of supplying BOP with the facilities and services required." Moreover, "BOP has not shown that there were any unsuccessful bidders [for a given contract], that the submitters bid against each other, or that unidentified potential contractors exist that could compete in the CAR procurement process." Likewise, the court observes that "BOP failed to show competition in the contract renewal process," finding "no persuasive evidence that BOP considered competing bids when determining whether to exercise its option to renew an expiring CAR contract." The court also finds that BOP offered no support for the claim of one of the submitters that "it faces day-to-day competition from businesses offering similar services."
With respect to pricing information from past of existing contracts, the court notes that "the assertion appears to be that all pricing information in existing contracts . . . is categorically protected under Exemption 4." The court holds that "[s]uch categorical and conclusory assertions do not provide the particularized explanation necessary to show that disclosure of a specific document or part of a document would damage the interest in private competition protected by Exemption 4." The court finds insufficient support for the argument presented by one of the submitters that competitors "could use the information from past or existing contracts to underbid [the company] in the future." The court notes that while "[t]heoretically, disclosure of the contractor's costs of materials and services, mark up, profit margin, and other factors used to determine its bid, would permit competitors to estimate the contractor's bid on a future contract," "[w]ithout evidence and an explanation of [that] process . . . the alleged harm remains theoretical." The court determines that "[u]nless BOP can provide more specific evidence regarding each redaction and explain how a competitor could use the redacted information to inform its bidding in future competition for similar contracts, the alleged harm appears to be no more than a theoretical possibility."
Similarly, the court concludes that BOP has not justified its decision to withhold "option year prices" based on the premise that disclosure of such information "would enable competitors to induce BOP to forego its option to extend the contract and then undercut the current contractor's option price when BOP opens the contract to new bidding." The court notes that "likelihood that BOP would decline to exercise an option in favor of a lower price is diminished by its need for continuity of operations and the significant costs of disruptions in the continuity" and, additionally, that "nothing would exclude the original contractor from participating in the rebidding process so that the rival bidder still would not know the precise bid to undercut." The court orders BOP to supplement its declarations with respect to information withheld pursuant to Exemption 4.
The court dismisses plaintiff's argument that "none of the redacted information in the proposals can be protected under Exemption 4 because the submitters waived any claim of confidentiality by failing to assert it during the bidding process." Rather, the court finds that "[t]his argument fails because the test for confidentiality is not based on the subjective expectation of the submitter that the information is confidential, but is based on an objective evaluation of the likelihood of substantial injury to the competitive position of the submitter of the information."
Lastly, the court rejects plaintiff's argument that because documents incorporated by reference into the contracts are not protected from disclosure by 41 U.S.C. § 253b(m), they "should not be deemed confidential information under FOIA Exemption 4." The court notes that the statute "does not purport in any way to limit FOIA protection for successful proposals."
Abou-Hussein v. Mabus, No. 09-1988, 2010 US Dist. LEXIS 114830 (D.S.C. Oct. 28. 2010) (Gergel, J.). The court finds that defendants properly invoked Exemption 4 to protect certain "contractor financial data, employee names, and subcontractor firm names" "in order to protect the integrity of the bidding process."
Fox News Network, LLC v. U.S. Dep't of the Treasury, No. 08-11009, 2010 U.S. Dist. LEXIS 94451 (S.D.N.Y. Sept. 2010) (Maas, Mag. J.). The court affirms Treasury's redactions of "bank account information of the entities that received TARP funds under Exemption 4," because "Treasury needs to be able to maintain the confidentiality of sensitive banking records to ensure that it will continue to have an effective working relationship with banks and other similar entities." Obtained from a person: The court holds that Exemption 4 does not protect the name of a commercial bank which applied for, but ultimately, withdrew its application for [Capital Purchase Program (CPP)] funding. Because "the record was generated by the agency, not the bank," it failed to meet the "obtained from a person" threshold.
The court finds that Exemption 4 properly applies to a proposal submitted by BONY to provide services in connection with TARP, because "the 'pricing structure' in the BONY proposal contains proprietary information about BONY, not just a net price or price list." With regard to "documents reflecting the negotiations between Treasury and AIG regarding compensation," the court rejects Treasury's arguments that AIG would suffer competitive harm from "inaccurate speculation about new compensation restrictions" or that disclosure of such information "would allow AIG's competitors to 'poach' key AIG employees." Similarly, the court concludes that, with respect to documents reflecting compensation negotiations between Treasury and Citigroup, "Citigroup also fails to explain adequately how competitors' insights into [its] 'strategies, objectives and approaches regarding compensation of its senior executives,' . . . would give its competitors an unfair advantage."
The court orders the disclosure of documents concerning AIG's negotiations with Treasury. Although "AIG's bottom line, i.e., the favorable terms it gave Treasury, might be helpful to those seeking to purchase AIG assets,  those terms have already been made public" and AIG has failed to explain "how the disclosure of additional information . . . would put [it] at a disadvantage in future negotiations with non-governmental entities." The court also finds that Citigroup has not established a likelihood of substantial competitive harm with respect to "Citigroup employees' waivers of rights relating to their personal compensation." The court notes that "unless Citigroup expects to require government funding again, there is no reason why its compensation information will become public in the future, and thus no reason why potential recruits should fear the release of their compensation information to the public." Lastly, the court finds that Citigroup "has demonstrated a sufficiently likely competitive injury" with respect to a draft presentation containing "actual data from Citigroup's operations," such as "'the composition of a Citigroup asset pool, its loan loss reserves, its risk classifications, its asset types, and the originating business and geographical location of those assets.'"
JCI Metal Prods.v. U.S. Dep't of the Navy, No. 09-2139, 2010 WL 2925436 (S.D. Cal. July 23, 2010) (Gonzalez, J.). The court determines that plaintiff failed to show a likelihood of "substantial competitive injury" from the release of the requested information. For one, the court noted that plaintiff disclosed "seventeen of its purported confidential prices" by filing a document containing a list of that information on the court's publicly available electronic filing system. "[B]ecause these prices have been in the public domain for the past nine months, and because they were not subsequently sealed, destroyed, or otherwise rendered unavailable, they cannot be exempt from production under FOIA." With regard to the unit prices that were not publicly disclosed, the court finds that "the presence of too many fluctuating variables . . . makes it unlikely that JCI's competitors would be able to deduce JCI's overall bid strategy and be able to underbid JCI in the future" and that even if competitors "could potentially deduce some of its strategy, JCI has failed to demonstrate that any resulting harm would be 'substantial.'" The court also rejects plaintiff's argument that release of the prices themselves would cause competitive harm where plaintiff only presents qualified claims that the unit prices contained in an expired contract would remain similar or unchanged in future contracts. Additionally, the court concludes that "public interest outweighs any confidentiality concerns JCI might have in its unit prices." Regarding plaintiff's Trade Secrets Act causes of action, the court finds that "because the information in this case is not protected by Exemption 4, neither can it be protected by the Trade Secrets Act."
Gov't Accountability Project v. U.S. Dep't of State, No. 08-1295, 2010 WL 1222156 (D.D.C. Mar. 29, 2010) (Leon, J.). Though plaintiff "appears to argue that the withheld information is not commercial," the D.C. Circuit "has found that 'the terms "commercial" and "financial" in the exemption should be given their ordinary meanings' and that the commercial information provision is not confined to only those records that reveal 'basic commercial operations.'" The withheld documents, which pertain to the possibility of FF establishing operations in certain areas as well as other matters pertaining to FF operations, show that "defendant has demonstrated FF's commercial interest in the information withheld under Exemption 4." Moreover, defendant "has shown that the information withheld under Exemption 4 was submitted voluntarily and 'was provided with the expectation of confidentiality.' . . . In addition, the defendant has demonstrated that releasing the withheld information 'would harm the competitive position of the FF vis-a-vis other foundations working in the same region and competing for similar high-quality projects.' . . . This information concerning FF's internal deliberations is certainly not the type that would '"customarily" be made public.'"
Gov't Accountability Project v. HHS, No. 07-1702, 2010 WL 779774 (D.D.C. Mar. 9, 2010) (Kollar-Kotelly, J.). Defendants contend, and plaintiff does not dispute, that the records at stake were not provided voluntarily to the government by drug companies, because "the government requires submission of the information at issue as part of the drug application process." Accordingly, the court evaluates whether the disclosure of the withheld information would "'cause substantial harm to the competitive position of the person from whom the information was obtained.'" The court finds that "even assuming that Defendants have sufficiently shown the existence of actual competition," they have "failed to meet their burden of showing 'a likelihood of substantial competitive injury'" because they "proffered only vague and conclusory allegations in support of their claim that release of the information at issue will likely cause competitive harm" to the submitters.
As an initial matter, the court dismisses two of defendants' arguments as irrelevant to the central issue of whether Exemption 4 was properly applied. First, the court notes that although defendants, in an effort to explain the lack of evidence showing that actual competition exists, point to the regulatory provisions prohibiting the FDA from disclosing information about pending drug applications, they "make no argument that they are precluded from releasing the withheld material because it is drawn from a pending drug application and therefore cannot be publicly disclosed." Second, the court finds that defendant's arguments concerning 21 U.S.C. § 355(l)(1) and its implementing regulations, which govern public disclosure of certain safety and effectiveness data, are immaterial because plaintiff has not challenged defendants' disclosure obligations under these provisions. The court also stresses that "while Defendants affirmatively argue that the relevant statutory and regulatory provisions do not require them to disclose the raw data related to the cipro oral suspension, they do not argue the reverse – i.e., that the provisions explicitly prohibit them from disclosing the withheld material."
With respect to whether the withheld material was properly characterized as confidential commercial information under Exemption 4, the court finds defendants' arguments that "'a competitor could use that [ ] information to support its own new drug application without having to incur the time and expense involved in developing the information itself'" to be "conclusory." Defendants fail to explain how the specific categories of information at issue would cause substantial competitive injury. Additionally, defendants' contention that "'the withheld information could permit a compet[ing] generic manufacturer to more easily design around the patent(s)'" likewise is too general to support withholdings under Exemption 4. "Defendants offer no explanation whatsoever as to how a competitor could use the information at issue to support their own drug applications, simply concluding that such information could be used in some unspecified manner to the submitters' disadvantage." Lastly, the court concludes that defendants' assertion that the owners of the information could sue the FDA for improperly releasing information that would harm their competitive position "even if true – is not the type of alleged harm that qualifies as a 'competitive injury' under FOIA Exemption 4." For the foregoing reasons, the court grants plaintiff's motion for summary judgment with respect to Exemption 4 and directs defendants to release all of the material characterized as confidential commercial information.
Nat'l Bus.Aviation Ass'n v. FAA, No. 09-1089, 2010 WL 675529 (D.D.C. Feb. 26, 2010) (Collyer, J.). Plaintiff's claim that the aircraft registration numbers constitute commercial information is overly broad, "especially in light of the [D.C.] Circuit's admonition that 'not every bit of information submitted to the government by a commercial entity qualifies for protection under Exemption 4.' . . . The FAA's decision that the Block List does not include any commercial information is 'entitled to a presumption of regularity' and this Court should consider only whether the decision was based on relevant factors and whether there has been a clear error of judgment."
Plaintiff "speculates that if the Block List is released, competitors will be able to discover sensitive commercial information." However, "the FAA determined that the aircraft registration numbers themselves do not constitute commercial information. The FAA's determination was reasonable, as the Block List is a list of numbers only, unaccompanied by narrative. The release of Block List information would not provide the requester with any real-time or near real-time data regarding aircraft location [given that] [a] FOIA request takes days or weeks to process." Though "the release of the registration numbers whose location information was blocked from the [Aircraft Situation Display to Industry (ASDI)] data stream in days and weeks past would enable the recipient to determine the owner of the aircraft, a description of the aircraft, and historical location[,] [i]t information would not enable the recipient to (1) determine the identity of the occupants of any particular flight; (2) discover the business purpose of any flight; (3) track the flight in real-time or near real-time; or (4) discern the reasons why the aircraft owner sought to block the flight information from the ASDI data feed. . . . [Plaintiff's] speculation that the registration numbers might be used to obtain historical location information and that location information might be used for insight into the nature of a company's business dealings does not convert the aircraft registration numbers themselves into commercial information.
[Plaintiff's] prediction of the dire consequences of release of the aircraft registration numbers was countered by the FAA's reasonable determination that the Block List simply does not contain commercial information. The FAA's decision that the Block List does not contain commercial information was not arbitrary, capricious, or an abuse of discretion." Plaintiff's claims that release of the Block List "will compromise the privacy and security of the blocked aircraft and their often high profile occupants[,] . . . do not support [plaintiff's] contention that the information is exempt from disclosure under Exemption 4, which deals with confidential commercial information and not with personal privacy or security." Morever, "it is highly unlikely that the disclosure of the List would impact the security of aircraft or aircraft passengers."
Essex Electro Eng'rs, Inc. v. U.S. Sec'y of the Army, No. 09-372, 2010 WL 710595 (D.D.C. Feb. 26, 2010) (Leon, J.). The offeror "was required to provide the Army with the unit pricing information in order to compete for" the contract. "In this case, despite [plaintiff's] argument that any harm from releasing the unit prices is highly speculative because unit prices are based on multiple factors, the Army has demonstrated that releasing the withheld information would cause substantial competitive harm because the requested information could reveal [the submitter's] business strategy and cost structure." The winning offeror "was the first private entity to be awarded the items in [the contract], thus the prices were not known in the industry, further supporting the need to prevent their release." Plaintiff is also incorrect in its assertion that the Federal Acquisition Regulation (FAR) requires disclosure, as the FAR's disclosure requirements have an exception for information exempt from release under the FOIA. Similarly, plaintiff's claim that the information withheld here is of a type routinely disclosed by the Army is inaccurate.
Massi v. DEA, No. 09-538, 2009 WL 3756636 (D.S.C. Nov. 10, 2009) (Currie, J.) (adoption of Magistrate's Report and recommendation). Because the court determines that the information submitted by Walgreens to DEA is "virtually identical" to information produced by Walgreens in other litigation, "the court finds that DEA's conclusion that Walgreens would likely suffer substantial harm to its competitive position as a result of the public disclosure of this information was in error." The court also finds that DEA "has made no compelling argument . . . that the quality of future information [it receives from Walgreens] will be reduced by the disclosure of information that Walgreens has already placed into the public domain."
Watkins v. U.S. Bureau of Customs & Border Prot., No. 08-1679, 2009 WL 3633893 (W.D. Wash. Oct. 30, 2009) (Robart, J.). The court finds that there is no dispute that information in Notices of Seizure constitutes commercial information that is obtained from a person. The agency "offers no argument" that the information was submitted voluntarily and so the court applies the competitive harm test of Nat'l Parks. Plaintiff's assertion that the Notices of Seizure create an "unrebuttable presumption" that the importers themselves were knowingly involved in illegal activity (and are thus not entitled to protection from competitive harm) is incorrect. Also, while it is typical in competitive harm cases for the agency defendant to submit a supporting affidavit from the submitter, this is not required, especially "in cases where the Agency submits a declaration from a declarant that is 'very familiar' with the industry at issue." The court also disagrees with plaintiff's assertion that CBP's statements of competitive harm were conclusory. "The Agency has come forth with more than adequate information detailing the various harms that could befall importers if the Notices of Seizure were disclosed." Indeed, "the court concludes that the Agency has met its burden of showing that there is actual competition in the commercial importation market . . . and that if the Notices of Seizure were released - evidencing an importer's supply chain - the importer would likely suffer substantial competitive injury."
In Defense of Animals v. USDA, No. 02-557, 2009 WL 2974764 (D.D.C. Sept. 18, 2009) (Roberts, J.). Aided by expert testimony, the court determines that the defendants "carried their burden of demonstrating that there is actual competition in the contract research business among [contract research organizations] that provide toxicology research to secure study sponsors, and there is actual competition in the pharmaceutical industry to be the first to get a particular type of drug to market." However, the court concludes that defendants did not establish that disclosure of the 1017 pages of withheld records had a "likelihood of causing substantial injury to [the facility] or its clients." The defendants' argument that the facility would suffer harm because "their customers or potential customers would perceive disclosure as a breach of [the facility's] confidentiality agreements" "does not satisfy their burden under Exemption 4." Similarly, the court finds unpersuasive defendants' "'[c]onclusory and generalized allegations'" that competitors could use the records at issue to identify standard operating procedures or the chemical compounds tested at the facility. Although the experts' testimonies "established that there are at least two potential ways competitors might be able to use the information likely to be found in the records at issue, neither related competitors' potential uses of information to the specific records at issue with sufficient detail to establish by a preponderance of the evidence that competitors of [the facility] or its clients are likely to use the particular records at issue to cause substantial harm to [the facility] or its clients."
Gen. Elec. Co. v. Dep't of the Air Force, No. 01-1549, 2009 WL 2749359 (D.D.C. Aug. 28, 2009) (Blake, J.). The court "assume[s] without deciding that the information was not submitted voluntarily." "[W]hile it is true that [plaintiff] needs to put forward evidence of actual competition, such evidence need not be of actual competition over these particular contracts. Rather, [plaintiff] need only put forward evidence that it has actual competition and that disclosure of the disputed information is likely to cause it substantial competitive harm in the future." Here, "[w]hile there was technically no competition for these two contracts - since [plaintiff] was awarded them on a sole source basis - [plaintiff] has demonstrated that there remains actual competition over both future contracts with the Air Force and contracts with other countries' air forces. . . ." The court finds that, "[t]hus, [plaintiff] has adequately shown the likelihood of substantial competitive injury as well." Furthermore, the court finds that the Air Force is attempting to hold plaintiff to too high a standard of precision in demonstrating how release will cause it substantial competitive harm. "While the burden is on [plaintiff] to produce evidence indicating that release of pricing information would be competitively harmful, it need not demonstrate precisely how the release of the information would cause competitive harm." Additionally, contrary to defendant's claim, "this circuit has expressly found [the risk that release will give a submitter's customers leverage in negotiations has] the potential to be substantially competitively harmful and therefore a basis for nondisclosure." Plaintiff need not show that its other customers have a bargaining position "wholly comparable" to the government's in order to establish the possibility of losing leverage with these customers. The court notes that "[it] shares the view expressed by some in the D.C. Circuit that such nondisclosure is not the optimal policy course."
Kahn v. Fed.Motor Carrier Safety Admin., No. 07-02323, 2009 WL 2632718 (D.D.C. Aug. 26, 2009) (Kennedy, J.). "The Court easily concludes that the information redacted from the [withheld documents] - e.g., revenue, net worth, [and] income . . . - is financial and commercial in nature because it all concerns the business interests and/or finances of [the submitters]." Moreover, "[b]ecause commercial motor carriers wishing to qualify for self-insurance must submit the type of commercial and financial information at issue, the Court finds it unlikely that upholding the redactions will impair the government's ability to obtain such information in the future." The court further finds that "[a]lthough the FMCSA could have done more to explain how the disclosure of the redacted information could harm the competitive positions of [the submitters]," it "is 'virtually axiomatic'" that release of the withheld information could cause substantial competitive harm to them.
Bloomberg, L.P. v. Bd. of Governors of the Fed. Reserve Sys., No. 08-9595, 2009 WL 2599336 (S.D.N.Y. Aug. 24, 2009) (Preska, C.J.). The court finds that the withheld documents were not obtained from a person, and therefore do not qualify for protection under Exemption 4. "The only information in the [requested] Remaining Term Reports [RTRs] that the FRBNY and other FRBs could possibly have obtained from the borrow[er]s is the borrowers' names; the FRBs generated all the other information from internal data regarding their lending programs." Though borrowers did provide information to the FRBs, none of this information (other than the borrowers' names) is included in the withheld records. "Rather, the [RTRs] describe the originating FRB districts of the loans, individual loan amounts extended by the FRBs, the types of FRB lending program borrowed from, and loan origination and maturity dates." Indeed, though "the [RTRs] certainly include information about the FRBs' interactions with the borrowers, it is a non sequitur to say that information about a person is obtained from that person."
"The Board has not met its burden of proving that disclosure of the information contained in the [RTRs] will cause substantial harm to the competitive position of the borrowers. . . ." Defendant's affidavits "say nothing about how borrowers' competitors will affirmatively use the information that the borrowers participated in the Federal Reserve lending programs. . . . [T]he risk of looking weak to competitors and shareholders is an inherent risk of market participation; information tending to increase that risk does not make the information privileged or confidential under Exemption 4." The court declines to "import or apply the program effectiveness test in this action." The court finds that "[c]onjecture, without evidence of imminent harm, simply fails to meet the Board's burden of showing that Exemption 4 applies."
Nikelsberg v. FDIC, No. 08-1899, 2009 WL 2423470 (D.D.C. Aug. 6, 2009) (Robertson, J.). Though the withheld information was provided to defendant as part of a mandatory submission, "[p]laintiff concedes that the information . . . is of a type 'customarily not released to the public.'" The court finds that "[i]t is thus unnecessary to analyze the 'competitive disadvantages' to banks and account holders that might result from disclosure of information involuntarily provided to the government." Furthermore, "[e]ven if the contact information of businesses is not 'confidential,' to require FDIC to sort through depositor records trying to decide which businesses are closely held or individually owned and which are not might well compromise its efficiency and effectiveness."
Fox News Network, LLC v. Bd. of Governors of the Fed. Reserve Sys., No. 09-272, 2009 WL 2345097 (S.D.N.Y. July 30, 2009) (Hellerstein, J.). The requested information ("borrowers' names, loan amounts, and pledged collateral") was "obtained from a person," i.e. the borrowers who participated in the Discount Window program, because it "originated with the borrower[s]." The loans in this case "'implicate' potentially 'personal' and sensitive financial information." Furthermore, disclosing that a particular institution participated in the Discount Window program may suggest that the institution has a serious financial problem. "'A primary dealer would suffer competitive and reputational harm if its name and the relevant collateral it posted were disclosed to the public,' for the public is likely to draw inferences of its relative financial strength and viability. . . . Similarly, the Board's concern is real that disclosure would reveal proprietary trading information of borrowers, their trading strategies and the size and nature of their portfolios of assets." Finally, as participants in the program expect their participation to be confidential, the court accepts defendant's assertion that the Board's program effectiveness would be compromised if the requested information were disclosed.
Ctr. for Biological Diversity v. OMB, No. 07-04997, 2009 WL 1298123 (N.D. Cal. May 5, 2009) (Patel, J.). OMB's explanation for its use of this exemption "provides no information revealing any sort of business competition-related disadvantage, let alone specific evidence revealing either actual or a likelihood of substantial competitive injury." Moreover, OMB's declaration does not establish that the withheld information "is either (1) privileged and confidential or (2) would result in competitive disadvantage." OMB claims that it cannot release the information in question because it has been unable to contact the submitter, but if this is true, it calls into question the basis for OMB's claim that the submitter would in fact object to the release of the information.
Boeing Co. v. U.S. Dep't of the Air Force, No. 05-365, 2009 WL 1373813 (D.D.C. May 18, 2009) (Kessler, J.). Plaintiff has not shown that release of the requested information (pricing information consisting of wrap-around rates) would likely result in substantial competitive harm to it. For the vast majority of the requested data, plaintiff has provided no support for its contention that disclosure would make it possible for a competitor to accurately gauge plaintiff's future labor costs. Secondly, plaintiff has not refuted defendant's claim that labor prices do not fluctuate in a linear fashion, thus making it more difficult to predict future wages from information on past wages. Furthermore, plaintiff's claim that wages increase in a constant fashion is undercut by its willingness to release wage information for some years, but not others. If plaintiff were correct, even the release of less recent wage information could be used to predict future labor costs. The Air Force withheld data for the period 2005-2012 because "release . . . would have provided competitors with an exact future rate," which would have permitted underbidding. By contrast, "releasing past data from 1996 to 2004 . . . would only harm Boeing to the extent that it could be used to extrapolate future data." The Air Force did not act arbitrarily and capriciously when "[it] concluded that this past data could not be used to reliably predict future data."