FOIA Update: FOIA Counselor: Questions & Answers

Can agencies still continue to withhold federal personnel lists under Exemption 2 after the D.C. Circuit's decision in Schwaner v. Department of the Air Force?

No. Although it is logical for such lists to come within the protection of Exemption 2, as "related solely to the internal personnel rules and practices of an agency," 5 U.S.C. § 552(b)(2),see FOIA Update, Summer 1986, at 3-4, the D.C. Circuit Court of Appeals has now held otherwise in Schwaner v. Department of the Air Force, 898 F.2d 793 (D.C. Cir. 1990), reh'g denied, No. 88-5341 (D.C. Cir. May 9, 1990). Surprisingly, the D.C. Circuit ruled in a 2-1 decision in Schwaner that a list of names and duty addresses of military personnel at Bolling Air Force Base "does not bear an adequate relation to any rule or practice of the Air Force as those terms are used in exemption 2." 898 F.2d at 794. To reach this result, it gave a new, stringent interpretation to the term "related to" in Exemption 2 -- holding that where information is not actually a "rule or practice" itself, it must "shed significant light on" one to qualify. Id. at 797. It concluded that name-and-address lists "do not necessarily (or perhaps even normally) shed significant light on a rule or practice; insignificant light is not enough." Id.

By holding that such a list does not meet its new "related to" test for this aspect of Exemption 2, the D.C. Circuit shortcircuited any consideration of whether there exists any "genuine public interest" in the disclosure of such lists. Id. at 798. Especially after the Supreme Court's decision last year in Reporters Committee, 489 U.S. 749 (1989), which established a limited definition of "public interest" for FOIA purposes, it would be difficult to imagine how disclosure of such a list could serve any "genuine public interest."

Nevertheless, the D.C. Circuit is the circuit of "universal venue" under the FOIA, see 5 U.S.C. § 552(a)(4)(B) (providing that any FOIA requester can sue there), which means that its FOIA interpretations must be followed by agencies at the administrative level unless they are overturned. On August 7, the Solicitor General determined not to seek Supreme Court review of the Schwaner decision. Therefore, agencies no longer may apply Exemption 2 at the administrative level to withhold lists of government employees and their office addresses; as a practical matter, any further reliance upon the Exemption 2 guidance given in FOIA Update, Summer 1986, at 3-4, is foreclosed.

Can Exemption 4 protect the "unit prices" in unsuccessful government contract proposals?

Yes, in rare cases. In 1984, OIP advised all agencies that "unit prices" submitted by successful contract offerors generally should be disclosed, based upon a provision in the Federal Acquisition Regulation (FAR) that provides for disclosure of successful offers. See FOIA Update, Fall 1984, at 4. Moreover, release of successful offerors' unit prices has been consistently upheld by the courts, which have found no competitive harm where such disclosure "would not enable competitors to calculate confidential proprietary information." J.H. Lawrence Co. v. Smith, Civil No. 81-2993, slip op. at 8 (D. Md. Nov. 10, 1982); see, e.g., Pacific Architects & Eng'rs v. Department of State, 906 F.2d 1345, 1347-48 (9th Cir. 1990); Acumenics Research & Technology v. Department of Justice, 843 F.2d 800, 807-08 (4th Cir. 1988).

The first case to address the distinction between successful and unsuccessful offerors in determining whether pricing information should be disclosed under the FOIA recently involved a request for the "bottom-line prices" (total cumulative prices) that an unsuccessful offeror had proposed for a government contract that included four years' worth of contract options. See Raytheon Co. v. Department of the Navy, Civil No. 89-2481, slip op. at 2-3 (D.D.C. Dec. 22, 1989). The court in Raytheon accepted that unsuccessful offeror's argument that disclosure would cause it competitive harm, finding that unsuccessful offerors have a different "expectation of confidentiality" than do successful offerors and that the public interest in disclosure of pricing information submitted by unsuccessful offerors is "slight." Id. at 11-12. Moreover, it was found in Raytheon that the unsuccessful offeror had shown how the prices could be used by its competitors to derive data harmful to its future competitive position regarding the option years of the contract. Id. at 13.

Inasmuch as disclosure of unsuccessful offerors' prices is not compelled by the FAR provision, and in light of the Raytheon decision, agencies should employ a traditional Exemption 4 analysis when responding to FOIA requests for an unsuccessful offeror's pricing data. See FOIA Update, Fall 1983, at 10-11 (advising careful consideration of whether submitter has shown that disclosure of its prices would likely cause it to suffer substantial competitive harm).

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