No. 96-1518 IN THE SUPREME COURT OF THE UNITED STATES OCTOBER TERM, 1996 ______________ UNITED TECHNOLOGIES CORPORATION, BY ITS DIVISION, PRATT & WHITNEY, PETITIONER v. FEDERAL AVIATION ADMINISTRATION _______________ ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT BRIEF FOR THE RESPONDENT IN OPPOSITION ____________ WALTER DELLINGER Acting Solicitor General FRANK W. HUNGER Assistant Attorney General LEONARD SCHAITMAN JOHN S. KOPPEL Attorneys Department of Justice Washington, D.C. 20530-0001 (202) 514-2217 ---------------------------------------- Page Break ---------------------------------------- QUESTION PRESENTED Whether Exemption 4 of the Freedom of Infor- mation Act (FOIA), 5 U.S.C. 552(b)(4), which allows agencies to withhold from disclosure "trade secrets and commercial or financial information obtained from a person and privileged or confidential," pro- tects from disclosure documents relating to design drawings for aircraft engine replacement parts, not- withstanding the FOIA requester's assertion that it already has knowledge of the allegedly confidential information because the requested drawings are identical to drawings it previously submitted to the (I) ---------------------------------------- Page Break ---------------------------------------- TABLE OF CONTENTS Page Opinions below . . . . 1 Jurisdiction . . . .1 Statement . . . . 2 Argument . . . .7 Conclusion . . . . 14 TABLE OF AUTHORITIES Cases: Bibles v. Oregon Natural Desert Ass'n, 117 S. Ct. 795 (1997) . . . .10 Campbell v. HHS, 682 F.2d 256 (D.C. Cir. 1982) . . . . 13 Fine v. United States Dep't of Energy, 823 F. Supp. 888 (D.N.M. 1993) . . . . 11, 13 Grasso v. IRS, 785 F.2d 70 (3d Cir. 1986) . . . . 11, 12 Linsteadt v. IRS, 729 F.2d 998 (5th Cir. 1984) . . . . 13 Maricopa Audubon Soc'y v. United States Forest Serv., 108 F.3d 1082 (9th Cir. 1997) . . . . 14 NLRB v. Robbins Tire & Rubber Co., 437 U.S. 214 (1978) . . . .12 NLRB v. Sears, Roebuck & Co., 421 U.S. 132 (1975) . . . . 6, 10 National Parks & Conservation Ass'n v. Morton, 498 F.2d 765 (D.C. Cir. 1974) . . . . 5, 6, 7 Schiffer v. FBI, 78 F.3d 1405(9th Cir. 1996) . . . . 6, 10, 14 Swan v. SEC, 96 F.3d 498 (D.C. Cir. 1996) . . . .14 United States Dep't of Defense v. FLRA, 510 U.S. 487 (1994) . . . . 10 United States Dep't of Justice v. Julian, 486 U.S. I (1988) . . . . 4, 8, 9, 1O, 11 United States Dep't of Justice v. Reporters Comm. for Freedom of the Press, 489 U.S. 749 (1989) . . . .4, 5, 6, 10,13 Willard v. IRS, 776 F.2d 100 (4th Cir. 1985) . . . . 13 ---------------------------------------- Page Break ---------------------------------------- IV Statutes and regulations: Page Freedom of Information Act, 5 U.S.C. 552 . . . .3 5 U.S.C. 552(b)(3) (Exemption 3) . . . . 9 5 U.S.C. 552(b)(4) (Exemption 4) . . . . 3, 5, 6, 7, 8, 10, 11, 12, 13 5 U.S.C. 552(b)(5) (Exemption 5) . . . .9, 10 5 U.S.C. .552(b) (6) (Exemption 6) . . . . 13 5 U.S.C. 552(b)(7)(A) (Exemption 7(A)) . . . . 11, 12 5 U.S.C. 552(b)(7)(C) (Exemption 7(C)) . . . . 13 49 U.S.C. 44704 . . . . 2 14 C.F.R.: Section 21.303 . . . . 2 Section 21.303 (c)(4) . . . . 2, 5 ---------------------------------------- Page Break ---------------------------------------- In the Supreme Court of the United States OCTOBER TERM, 1996 No. 96-1518 UNITED TECHNOLOGIES CORPORATION BY ITS DIVISION, PRATT & WHITNEY, PETITIONER v. FEDERAL AVIATION ADMINISTRATION ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT BRIEF FOR THE RESPONDENT IN OPPOSITION OPINIONS BELOW The opinion of the court of appeals (Pet. App. 1-12) is reported at 102 F.3d 688. The orders of the district court (Pet. App. 20, 31, 51) adopting the recommended rulings of the magistrate judge are unreported; the district court's corrected judgment (Pet. App. 52) is unreported. The recommended rulings of the mag- istrate judge (Pet. App. 13-19, 21-30, 32-50) are un- reported. JURISDICTION The judgment of the court of appeals was entered on December 23, 1996. The petition for a writ of (1) ---------------------------------------- Page Break ---------------------------------------- 2 certiorari was filed on March 24, 1997 (a Monday). The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). STATEMENT 1. Before an aircraft engine may be used lawfully in civil aviation, its design must be approved by respondent, the Federal Aviation Administration (FAA). The engine manufacturer must submit to the FAA drawings, designs, and specifications for the aircraft engine and its component parts. Those speci- fications are considered the proprietary information of the manufacturer and are not made available by the FAA to the general public. Pet. App. 3. Upon approval of the engine, the FAA issues a "type cer- tificate" to the manufacturer. 49 U.S.C. 44704. Petitioner, the United Technologies Corporation, by its division, Pratt & Whitney, holds numerous type certificates for aircraft engines it has designed and built. In order for a person, other than the type certificate holder, to be able to legally manufacture and sell replacement parts for those engines, the person must obtain from the FAA a Parts Manufac- turer Approval (PMA). Pet. App. 3; 14 C.F.R. 21.303. A PMA holder may manufacture and sell approved replacement parts directly to the owners of the air- craft engines on which the parts are to be installed. Pet. App. 3. One method of obtaining a PMA is to demonstrate that the design of the replacement part is identical to the design of the original part that is covered under a type certificate. 14 C.F.R. 21.303(c)(4). After an ap- plicant for such a PMA submits drawings and speci- fications for its part, the FAA compares them to data regarding the original part, considers other ---------------------------------------- Page Break ---------------------------------------- 3 relevant data, and determines whether the PMA part "will be an adequate replacement for the original part as to fit, form, and function." Pet. App. 3-4. If the re- placement part meets the FAA's standards, it issues the replacement part manufacturer an identicality PMA. 2. In letters dated November 8, 1991, petitioner filed requests under the Freedom of Information Act (FOIA), 5 U.S.C. 552, with the FAA seeking disclo- sure of documents relating to two companies- Pyromet Industries and Turbine Kinetics-that com- pete with petitioner in the sale of replacement parts. Specifically, petitioner requested disclosure of the documents the two companies had submitted in order to obtain their identicality PMAs to manufacture and sell certain replacement parts for petitioner's air- craft engines. Pet. App. 4, 33-34. 1 The FAA disclosed approximately 200 pages of documents in their entirety, and withheld approxi- mately 40 pages in their entirety, 11 pages in part, and eight engineering drawings. Pet. App. 4, 34 n.2. The FAA indicated that it was withholding the docu- ments and parts thereof under Exemption 4 of the FOIA, 5 U.S.C. 552(b)(4), which permits an agency to withhold "trade secrets and commercial or financial information obtained from a person [that is] privileged or confidential." Pet. App. 4. The FAA rejected peti- tioner's administrative appeal, specifically disagree- ing with petitioner's contention that any information submitted by a PMA applicant under the identicality ___________________(footnotes) 1 Petitioner claimed that it had reason to believe that its proprietary information was being used by certain PMA applicants to improperly obtain PMAs for replacement parts. Pet. App. 4. ---------------------------------------- Page Break ---------------------------------------- 4 provision is, by definition, non-confidential to the person who holds the type certificate for the original engine. Id. at 5. 3. Petitioner filed the instant action in June 1993, in the United States District Court for the District of Connecticut, seeking disclosure of the withheld documents. Pet. App. 5. The court referred the mat- ter to a magistrate judge, and the parties filed cross- motions for summary judgment. Ibid. The district court ultimately approved and adopted the magistrate's recommended ruling granting the FAA's motion for summary judgment and denying pe- titioner's cross-motion. See Pet. App. 32-52. The court rejected petitioner's contention that it has a special right of access to the requested documents by virtue of the fact that the FAA found that the designs therein were "identical" to its designs. Pet. App. 5-6, 37-42. The court found that the ruling in United States Department of Justice v. Julian, 486 U.S. 1 (1988), did not support petitioner's contention. It explained that Julian involved a narrow exception under which the identity of the FOIA requester was taken into consideration to permit persons to obtain otherwise privileged presentence reports that were prepared in connection with criminal charges against them. Pet. App. 38-39. The court noted that, in United States Department of Justice v. Reporters Committee for Freedom of the Press, 489 U.S. 749 (1989), the Court reaffirmed the narrowness of Julian, stating that, "[e]xcept for cases in which the objection to disclosure is based on a claim of privilege and the person requesting disclosure is the party protected by the privilege, the identity of the requesting party has no bearing on the merits of his or her FOIA request." Pet. App. 3940 (quoting ---------------------------------------- Page Break ---------------------------------------- 5 Reporters Comm., 489 U.S. at 771). Here, the district court explained, the requesting party (petitioner) is not the person intended to be protected by Exemption 4 and, therefore, its request is not supported by the reasoning of Julian and Reporters Committee. Id. at 42. After rejecting petitioner's claim of a special right of access, the district court held that the requested information met the general standard for withhold- ing under Exemption 4. There was no dispute that the information is of commercial interest and. was obtained from the two named companies. Pet. App. 43- 44. The court found that the withheld information met the third requirement, that it be privileged or confidential, because its disclosure would cause sub- stantial harm to the competitive positions of the two companies from whom it was obtained. Id. at 44-49 (relying on National Parks & Conservation Ass'n v. Morton, 498 F.2d 765,770 (D.C. Cir. 1974)). 4. The court of appeals affirmed. Pet. App. 1-12. The court of appeals rejected petitioner's contention that Exemption 4 of the FOIA should not apply because petitioner allegedly already had access through other sources to the confidential information contained in the withheld documents. Id. at, 2. 2 It ___________________(footnotes) 2 Petitioner contended that it has knowledge of any al-: legedly confidential information contained in the withheld documents because identicality PMAs were granted based on those documents. Pet. App. 6. The two companies that had submitted the documents and obtained the PMAs contended, however, that the design drawings submitted to obtain the PMAs are not necessarily identical to petitioner's original design drawings, on which its type certificate is based, because, under the identicality provision (14 C.F.R. 21.303(c)(4)), the drawings could be substantially different, although portraying ---------------------------------------- Page Break ---------------------------------------- 6 concluded that such knowledge is irrelevant to the FOIA request because "[i]t is a basic principle under FOIA that the individuating circumstances of a re- quester are not to be considered in deciding whether a particular document should be disclosed." Id, at 7-8 (citing NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 143 n.10 (1975)). And in this case, the court noted, petitioner conceded that it cannot prevail if it must proceed under Exemption 4 as if it is any other mem- ber of the general public. Id. at 8. The court disagreed with petitioner's contention that Julian supports its claim that "confidential- ity under Exemption 4 should be examined on a requester-specific basis." Pet. App. 8. It explained that Julian involved a narrow exception to the gen- eral principle that the identity of the requester is irrelevant to a FOIA request. Ibid. In the court's view, because petitioner "is not the party for whom the protections of Exemption 4 were intended, it has no claim of special access." Id. at 10 (citing Reporters Comm., 489 U.S. at 771, and Schiffer v. FBI, 78 F.3d 1405, 1410-1411 (9th Cir. 1996)). The only parties that would have such a claim, the court reasoned, are the two businesses that submitted the information to the FAA. Ibid. The court of appeals also pointed out that its view of Exemption 4 is consistent with the test for deter- mining whether a document is confidential within the meaning of Exemption 4, as set forth in Morton, the same design. Pet. App. 6. The FAA agreed, however, for purposes of the appeal, to assume that the drawings sub- mitted for the PMAs are identical to the drawings contained in petitioner's type certificate. Id. at 7. Similarly, the court of appeals hypothesized that the drawings are functionally indistinguishable. Ibid. ---------------------------------------- Page Break ---------------------------------------- 7 supra. Under that test, a court must determine whether disclosure would likely impair the govern- ment's ability to obtain necessary information in the future, or would likely cause substantial harm to the competitive position of the person from whom the information was obtained. Morton, 498 F.2d at 770. The court below reasoned that it would be imprac- tical to apply that test on a requester-specific basis, which would require a case-specific assessment of the requester and the circumstances surrounding its request. Pet. App. 11. Accordingly, because disclo- sure of the requested information to the general public would cause substantial harm to the two businesses from which it was obtained, the court of appeals affirmed the FAA's withholding of the information. Id. at 12. 3 ARGUMENT The decision of the court of appeals is correct and does not conflict with any decision of this Court or of any other court of appeals. Petitioner concedes (Pet. 15) that, if the proper test is whether disclosure of the requested documents to the general public under the FOIA would cause competitive harm to the submitter, the courts below were correct in determining that the records are exempt under Exemption 4 of the FOIA. Petitioner, however, seeks a special right, shared by no other member of the public, to override the confidentiality interests of the two companies that submitted the requested materials to the FAA. Thus, as the court below recognized, this case presents a . ___________________(footnotes) 3 The court noted that petitioner may be able to obtain the withheld documents through discovery in civil litigation, but emphasized that the FOIA "was not intended to serve as a substitute for discovery." Pet. App. 12 n.4. ---------------------------------------- Page Break ---------------------------------------- 8 narrow and "unusual question" (Pet. App. 2). Indeed, petitioner has not identified any other case arising under Exemption 4 that involved a claim of a spe- cial right of access by a competitor of the company that submitted the confidential information to the agency. Further review by this Court therefore is not warranted. 1. Petitioner first contends (Pet. 11-12, 15-26) that the court of appeals' decision conflicts with this Court's decision in United States Department of Justice v. Julianl 486 U.S. 1 (1988). The court of appeals correctly held, however, that Julian does not require disclosure of the withheld documents in this case. In Julian, federal prisoners sought disclosure under the FOIA of presentence reports that had been prepared about them in connection with their sentencings in criminal cases. After sentencing, the reports were transmitted to the Bureau of Prisons for use in determining the requesters' treatment programs and entitlement to various privileges, and were then transmitted to the Parole Commission for use in making federal parole decisions. 486 US. at 3, 5-6. The FOIA requesters already had a legal right, in particular circumstances, to see the presentence reports they sought to have released. The presen- tence reports were required, by statute, to be dis- closed to the prisoners about whom the reports were written, prior to their sentencings, subject to with- holding of portions that contained information that could harm the prisoner or others (e.g., diagnostic opinions that could disrupt rehabilitation, and sources of confidential information). Id. at 3-4. And the pris- oners were entitled by law to see the reports at least ---------------------------------------- Page Break ---------------------------------------- 9 30 days before any scheduled parole hearings, subject to withholding of the same portions. Id. at 6. The government declined to disclose the documents in response to the prisoners' FOIA request, however, contending, inter alia, that they were protected from disclosure by Exemption 5 of the FOIA, 5 U.S.C. 552(b)(5), which authorizes the withholding of agency memoranda "which would not be available by law to a party other than an agency in litigation with the agency," i.e., memoranda that would normally be privileged against civil discovery. Julian, 486 U.S. at 11. 4 The Court concluded that Exemption 5 does not apply to withholding of a presentence report from the prisoner about whom it is written because such reports generally are not privileged against pre- trial civil discovery by the prisoner, although they are generally privileged in pretrial civil discovery against others. Id. at 12-13. The Court ruled that, in light of the absence of any privilege preventing disclosure to a prisoner of his own presentence report in civil discovery, but the existence of such a privi- lege against disclosure to other persons in civil ___________________(footnotes) 4 The government also relied in Julian on FOIA Exemption 3, 5 U.S.C. 552(b)(3), which permits the withholding of matters "specifically exempted from disclosure by statute" in certain circumstances. The Julian Court agreed that all information in a presentence report that is exempt from disclosure by the relevant court rule and statute (e.g., diagnostic reports or sources of confidential information that could harm the prisoner or third parties) is exempt from disclosure under the FOIA. 486 U.S. at 9. The Court pointed out, however, that the relevant court rule and statute required disclosure of the balance of the report to the prisoner and, thus, could not be relied upon to exempt the balance of the report from disclosure to him under Exemption 3. Id. at 10-11. Petitioner does not reIy on that aspect of the Court's ruling in the instant case. ---------------------------------------- Page Break ---------------------------------------- 10 discovery, there is good reason to differentiate be- tween the prisoner and others in the context of Exemption 5 of the FOIA as well. Id. at 14. The courts below correctly recognized that Julian involved a narrow exception to the general principle that the identity of the requester is irrelevant to a FOIA request. The Julian exception is limited to cases in which "the objection to disclosure is based on a claim of privilege and the person requesting disclosure is the party protected by the privilege." United States Dep't of Justice v. Reporters Comm. for Freedom of the Press, 489 U.S. 749, 771 (1989); United States Dep't of Defense v. FLRA, 510 U.S. 487, 496 (1994). Otherwise, "the identity of the re- questing party has no bearing on the merits of his or her FOIA request." Reporters Comm., 489 U.S. at 771. The Court has repeatedly emphasized the over- arching principle that "Congress `clearly intended' the FOIA `to give any member of the public as much right to disclosure as one with a special interest [in a particular document],'" fbid. (quoting NLRB v. Sears, Roebuck &. Co., 421 U.S. 132, 149 (1975)); accord Bibles v. Oregon Natural Desert Ass'n, 117 S. Ct. 795,795-796 (1997) (per curiam). Petitioner has not identified any case that has created a Julian-type exception in the context of documents withheld by an agency under Exemption 4. Petitioner's suggestion that its purported knowledge of the requested information requires selective dis- closure notwithstanding Exemption 4 is misguided. See Schiffer v. FBI, 78 F.3d 1405, 1410-1411 (9th Cir. 1996) [fact that requester knew "much of the informa- tion" contained in requested documents did not sup- port claim of special access). If mere knowledge of the contents of a document were sufficient to render ---------------------------------------- Page Break ---------------------------------------- 11 Exemption 4 inapplicable, then numerous other en- tities could claim special entitlement to disclosure. For instance, access to petitioner's proprietary de- sign information would be available to its custom- ers and contractors and licensees, as well as to the hundreds of "identicality" PMA holders. Moreover, even in Julian, the Court did not hold that the FOIA requesters were entitled to disclosure of information that could harm others. 486 U.S. at 9. Thus, the court of appeals here properly declined to extend Julian to require disclosure under the FOIA of in- formation that would cause substantial harm to the companies that had submitted it to respondent. 2. Petitioner contends (Pet. 12, 27-29) that the court of appeals' decision conflicts with the decision of another court of appeals in Grasso v. IRS, 785 F.2d 70, 76-77 (3d Cir. 1986), and the decision of a dis- trict court in Fine v. United States Department of Energy, 823 F. Supp. 888,909 (D.N.M. 1993). a. In Grasso, the court of appeals held, inter alia, that an agency could not withhold from disclosure, under Exemption 7(A) of the FOIA, 5 U.S.C. 552(b)(7)(A), certain portions of an agency memoran- dum that purported to reflect what the FOIA re- quester had said to the agency during the course of an interview. 785 F.2d at 72. Exemption 7(A) permits withholding of investigatory records compiled for law enforcement purposes to the extent release "could reasonably be expected to interfere with enforcement proceedings." 5 U.S.C. 552(b)(7)(A). The Grasso court merely concluded that release of the interview could not reasonably be expected to interfere with enforcement proceedings. The court observed that such interference generally results from allowing litigants early or greater access to the agency's ---------------------------------------- Page Break ---------------------------------------- 12 investigation file than they would otherwise have, or from revealing to litigants the identities of witnesses that could lead to witness intimidation or a chilling of potential witnesses. 785 F.2d at 76 (citing NLRB v. Robbins Tire & Rubber Co., 437 U.S. 214,224, 239-240 (1978)). The court found that none of those reasons applied because the FOIA requester had provided his statements to the agency in the first instance. Id. at 77. The Grasso court did not create a general FOIA exception based on the requester's identity. It did not involve or discuss Exemption 4 or address the reasons underlying that. exemption, and it did not consider the impact of either Julian or Reporters Committee inasmuch as it predated those decisions. Rather, the Grasso court considered the identity of the requester only as it was directly relevant to determining whether Exemption 7(A) applied at all, i.e., whether disclosure would interfere with enforce- ment proceedings. And the court specifically noted that, even when the document requested is a state- ment provided by the requester-and, by definition, contains information known to the requester-there could be circumstances when an agency could prop- erly withhold information under Exemption 7(A) from a person who provided the information to it, e.g., where disclosure would reveal the direction of the investigation and therefore make Exemption 7(A) applicable to prevent interference with enforcement proceedings. 785 F.2d at 77. Other cases also have made clear that, while ordinarily there will be no harm to an ongoing investigation when the target of the investigation has possession of, or submitted, the information in question, the agency may make a showing that justifies withholding even under those ---------------------------------------- Page Break ---------------------------------------- 13 circumstances. See, e.g., Willard v. IRS, 776 F.2d 100, 103 (4th Cir. 1985); Linsteadt v. IRS, 729 F.2d 998, 1004-1005 (5th Cir. 1984); Campbell v. HHS, 682 F.2d 256,262 (D.C. Cir. 1982). b. In Fine, the district court cited Julian when it held that an agency could not withhold, under FOIA Exemption 6 or 7(C), 5 U.S.C. 552(b)(6) or (7)(C), certain information from a requester that had been I provided by that requester to the agency. Exemption 6 permits withholding of files the disclosure of which would "constitute a clearly unwarranted invasion of personal privacy." Exemption 7(C) permits withhold- ing of investigatory records compiled for law enforce- ment purposes to the extent that disclosure "could reasonably be expected to constitute an unwarranted invasion of personal privacy." Both exemptions re- quire "balancing the privacy interests of the person mentioned in the documents against the public's interest in disclosure." Fine, 823 F. Supp. at 907 (citing Reporters Committee). As in Grasso, the Fine court did not create a general FOIA exception based on the requester's identity, and it did not discuss Exemption 4 or the reasons underlying that exemption. Rather, the Fine court considered the identity of the requester only as it was directly relevant to determining whether the exemptions applied at all, i.e., whether disclosure would result in a serious invasion of personal privacy. The court concluded that, on the particular facts of that case, no unwarranted invasion of privacy would result from disclosure of the document because the document contained only allegations and statements by the requester himself, and the requester would not learn the identity of any witness, source or third person not provided by himself. Fine, 823 F. Supp. at ---------------------------------------- Page Break ---------------------------------------- 14 908. The court specified, however, that withholding of the name of the agent who had conducted the inter- view was appropriate. c. Neither Grasso nor Fine is inconsistent with the court of appeals' ruling in this case that the FAA is permitted to withhold from petitioner confidential commercial information submitted to the ageney by other entities. In fact, the court of appeals recognized the principle animating both the Grasso and Fine courts when it noted that, " [i]f any party has such a claim [i.e., a claim of special access], it would be only Promet or TK," the two companies that submitted to the agency the information requested. Pet, App. 10. Finally, as petitioner concedes (Pet. 29 n.13), recent authority from the courts of appeals is consistent with the decision below. See Maricopa Audubon Soc'y v. United States Forest Serv., 108 F.3d 1082, 1088 & n.5 (9th Cir, 1997); Swan v. SEC, 96 F.3d 498, 459-500 (D.C. Cir. 1996); Schiffer, 78 F.3d at 1410-1411. CONCLUSION The petition for a writ of certiorari should be denied. Respectfully submitted. WALTER DELLINGER Acting Solicitor General FRANK W. HUNGER Assistant Attorney General LEONARD SCHAITMAN JOHN S. KOPPEL Attorneys MAY 1997