FOIA Update: Significant New Decisions

Sheet Metal Workers Int'l Ass'n, Local Union No. 19 v. United States Dep't of Veterans Affairs, 135 F.3d 891 (3d Cir. 1998).

In a decision that brings it into line with the D.C., Second, Ninth, and Tenth Circuits, the Court of Appeals for the Third Circuit has overruled its decision in International Bhd. of Elec. Workers Local Union No. 5 v. HUD, 852 F.2d 87 (3d Cir. 1988), and has held that the Department of Veterans Affairs may delete employee names, addresses and Social Security numbers from payroll records submitted pursuant to the Davis-Bacon Act by contractors on federally funded construction projects. In its earlier case the Third Circuit viewed the ability to monitor compliance with the Davis-Bacon Act as "a sufficiently strong countervailing public interest to warrant disclosure" of the names and addresses of the contractors' employees. It now concluded, however, that the intervening Supreme Court decisions in Reporters Committee and Department of Defense required a reconsideration of that ruling. Emphasizing the Supreme Court's definition of public interest as a disclosure that serves the "core purpose" of the FOIA to contribute to the "public understanding of the operations or activities of the government," the Third Circuit observed that "[a]fter the decisions in Reporters Committee and Department of Defense, no court of appeals has given much weight to the monitoring function." It went on to rule that even if the monitoring function were found to promote the public interest, release of the names and addresses of the employees "would not enhance agency enforcement of prevailing wage laws." It concluded by finding a "significant" privacy interest in "avoiding a barrage of unsolicited contact" and observing that there were less intrusive means by which the union could obtain the information that it sought.

Wade v. Department of Commerce, No. 96-0717 (D.D.C. Mar. 26, 1998).

In the only decision to grapple with the interplay of the FOIA and the National Technical Information Service's statutory fee provisions, United States District Court Judge Ricardo M. Urbina found that the requested record, the IRS electronic tax preparer mailing list, was covered by the NTIS dissemination scheme. NTIS, a component of the Department of Commerce, acts as a clearinghouse for the collection and disclosure of "scientific, technical and engineering information" that have been provided to it by Federal agencies. The requester argued that the tax preparer mailing list did not qualify as one of these categories of information. Giving "great weight" to Department of Commerce regulations which define technical information to include data "which has a direct relationship to business," Judge Urbina found that the IRS list had such a relationship. Therefore, he held, its disclosure was governed by the NTIS statute, 15 U.S.C. § 1153, which, pursuant to 5 U.S.C. § 552(a)(4)(A)(vi), displaced the standard FOIA fee provision. This statutory interplay resulted in the imposition of the NTIS fee of $1300 instead of what would have been the applicable FOIA fees of $210.

Gilmore v. United States Dep't of Energy, No. C-95-0285 (N.D. Cal. Mar. 13, 1998).

In the first case to expressly recognize the competitive harm that would result from disclosure of commercially valuable copyrighted software, Judge William H. Orrick of the Northern District of California has ruled that such software, if it were found to constitute an agency record, was properly withheld pursuant to Exemption 4. The Sandia Corporation -- which operates the Department of Energy's Sandia National Laboratory -- developed the requested video conferencing software, named CLERVER, which allows professionals in different locations to use their desktop computers to simultaneously collaborate on complex technical drawings. Although developed by Sandia Corporation while performing its management and operations contract with the Department of Energy, that contract permitted Sandia to retain title to any intellectual property it created. Thus, under the contract, Sandia Corporation owned the copyright to CLERVER, which gave it the right to make copies and distribute the software to the public, and the government held a nonexclusive license to use it for government purposes.

Judge Orrick first held that the government "lack[ed] sufficient control over CLERVER to make it an agency record." In so ruling, he focused on the fact that the government did not own the software itself, but rather "merely possess[ed] a license to use it for government purposes." Because the government did not have "unrestricted use" of the software, he found that it lacked sufficient "control" to render CLERVER an agency record subject to the FOIA.

Additionally, the court ruled that even if the CLERVER software were considered an agency record, it would still be exempt from disclosure under FOIA Exemption 4. Emphasizing that one of the provisions in Sandia's contract with the agency provided that Sandia expeditiously transfer any technology developed at the laboratory to the commercial marketplace, and that pursuant to that mandate Sandia had, in fact, licensed the CLERVER software to several other entities and was engaged in ongoing efforts to further market it, the court found that "[t]here can be no doubt that disclosure of CLERVER to [the requester] so that he can distribute CLERVER on the Internet will cause substantial commercial harm to Sandia." The court stressed that if the technology were to be "freely available on the Internet," there would be "no reason for anyone to license CLERVER from Sandia" and, consequently, "the value of [its] copyright effectively will have been reduced to zero."

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