Cause of Action v. FTC, 799 F.3d 1108 (D.C. Cir. Aug. 25, 2015) (Garland, C. J.)

Cause of Action v. FTC, 799 F.3d 1108 (D.C. Cir. Aug. 25, 2015) (Garland, C. J.)

Re: Request for records concerning FTC's guides for use of product endorsements in advertising

Disposition: Reversing district court's grant of defendant's motion for summary judgment; remanding case to district court

• Litigation Considerations, Mootness and Other Grounds for Dismissal:  The Court of Appeals for the D.C. Circuit holds that "[b]ecause the FTC has not produced without charge all the non-exempt documents [plaintiff] sought in its third request, [plaintiff's] applications for fee waivers are not moot."  The D.C. Circuit explains that "[t]he Commission did produce without charge all nonexempt documents responsive to the new parts of [plaintiff's] third request, because those documents numbered fewer than 100 pages."  "Accordingly, the fee issue is moot for those parts of the request."  "But a part of the third FOIA request also renewed [plaintiff's] two earlier requests and sought to 'perfect[ ]' them by providing supplemental information about [plaintiff's] qualifications and recent activities."  The D.C. Circuit finds that "[t]he third request sought documents that the FTC still had not produced because [plaintiff] had not paid for them, and the Commission and the court were obliged to consider whether the continued denial of fee waivers with respect to those documents was warranted."
   
• Fees and Fee Waivers, Fee Waivers:  The D.C. Circuit holds that plaintiff's "entitlement to a public-interest . . . fee waiver must be reconsidered in light of the full agency record and the clarifications set out [below]."  The court first addresses the district court's finding "that [plaintiff's] first request—for documents regarding the Commission's product-endorsement guides—satisfied all of the elements it thought were required for a public-interest waiver, except one: [plaintiff] had 'not demonstrated that the requested information would increase understanding of the public at large.'"  The D.C. Circuit notes that "[t]he FTC regulation cited by the district court does require a requester to show that the information it seeks would increase the understanding of the public 'at large.'"  "But FOIA itself does not."  "The statute requires only that the disclosure be likely to contribute significantly to 'public' understanding."  "Nor does the statute require requester to show an ability to convey the information to a 'broad segment' of the public or to a 'wide audience.'"  "To the contrary, [the court has] held that 'proof of the ability to disseminate the released information to a broad cross-section of the public is not required.'"  Regarding the question of whether "disclosure of the requested information be 'likely to contribute significantly to public understanding[,]'" the D.C. Circuit holds that "'the relevant inquiry ... is whether the requester will disseminate the disclosed records to a reasonably broad audience of persons interested in the subject.'"  The D.C. Circuit also finds that "[n]or must a requester 'identify several methods of disseminating the information' it seeks."  The court "do[es] agree with the district court that [plaintiff's] initial submissions offered little information about whom the specific disclosures it sought could reasonably be expected to reach."  "But whether [plaintiff] cleared that bar with the substantial additional evidence it submitted with its third request—evidence regarding its newsletter, periodicals, website, social media presence, planned reports, and press releases to media contacts—must be addressed on remand."

The D.C. Circuit then addresses the district court's finding "that [plaintiff's] second FOIA request—for documents concerning the FTC's history of granting public-interest fee waivers—also failed to qualify for a public-interest waiver."  The D.C. Circuit first finds that the reasoning that it applied to the first portion of plaintiff's request applies to the second portion.  The D.C. Circuit also reviews the district court's finding "that [plaintiff] failed to qualify for a waiver '[b]ecause the primary beneficiary of the requested information is [[plaintiff]].'"  The D.C. Circuit holds that "amendments to FOIA eliminated that requirement."  "Now the text requires only that the disclosure be 'likely to contribute significantly to public understanding.'"  The court does find that "[i]t is still the case, of course, that a requester is ineligible for a waiver if the requested information will be to its benefit alone."  "But since the 1986 amendments, it no longer matters whether the information will also (or even primarily) benefit the requester."  "Nor does it matter whether the requester made the request for the purpose of benefiting itself."  "The statutory criterion focuses only on the likely effect of the information disclosure."  Additionally, regarding the question of whether the disclosure was "'primarily in the commercial interest of the requester,'" the D.C. Circuit finds that "[plaintiff's] interest in information regarding the FTC's treatment of fee-waiver applications (including [plaintiff's] own) is not rendered 'commercial' merely because the information could help it obtain a fee waiver."

• Fees and Fee Waivers, Requester Categories:  The D.C. Circuit holds "that [plaintiff's] entitlement to a . . . news-media fee waiver must be reconsidered in light of the full agency record and the clarifications set out [below]."  The D.C. Circuit first reviews the district court's finding "that [plaintiff] satisfied the first two criteria because its first and second requests sought to gather information of potential interest to segments of the public: the first request, regarding the FTC's product-endorsement guides, would be of interest to 'social media authors' and bloggers; and the second request, regarding fee-waiver denials, would be of interest to those who apply for such waivers."  The court notes that "[t]he FTC does not dispute that finding."  "Nor do we."  The court "do[es], however, want to sound a note of caution regarding an assumption underlying the [district] court's analysis."  "That analysis appears to require that each FOIA request be for information that is of potential interest to a segment of the public."  However, the court finds that "the news-media waiver . . . focuses on the nature of the requester, not its request."  The court finds that "[i]f [plaintiff] satisfies the five criteria as a general matter, it does not matter whether any of the individual FOIA requests does so." 

  Regarding the district court's finding "that [plaintiff] did not satisfy the third news-media criterion—that it uses its editorial skills to turn raw material into a distinct work—because it did not 'demonstrate that it would use information from a range of sources to independently produce a unique product,'" the D.C. Circuit finds that "[a] substantive press release or editorial comment can be a distinct work based on the underlying material, just as a newspaper article about the same documents would be—and its composition can involve 'a significant degree of editorial discretion.'"  Moreover, the court finds that "[t]he [district] court's second point—that [plaintiff] failed to indicate it would use any information beyond that obtained in the FOIA requests—does not bear on the statutory qualifications for a news-media waiver."  "The statute does not require that a requester gathers information 'from a range of sources' or a 'wide variety of sources,' . . . [i]t requires only that the requester 'gathers information.'" 

  Regarding the district court's finding "that [plaintiff] failed to satisfy a combination of the fourth and fifth criteria—that it 'distributes [its] work to an audience[,]'" the D.C. Circuit finds that "by focusing on [plaintiff's] intent and ability to disseminate 'the requested information' rather than information in general, this formulation again looks to the nature of the request rather than of the requester."  "As [the court] noted above, however, the news-media provision focuses on the latter."  Additionally, the court finds that "[t]here is no doubt that the requirement that a requester distribute its work to 'an audience' contemplates that the work is distributed to more than a single person."  "But beyond requiring that a person or entity have readers (or listeners or viewers), the statute does not specify what size the audience must be."  "Nor is it disqualifying that Action's newsletter did not exist at the time it made its first FOIA request."  The D.C. Circuit finds that "[t]he news-media provision requires a fact-based determination of whether a particular requester's description of its past record, current operations, and future plans jointly suffice to qualify it as a representative of the news media." 

  Regarding the district court's finding "that [plaintiff] failed to qualify for a news-media waiver because it did not show that its 'activities are organized especially around dissemination' of its work to an audience[,]" the court "disagree[s] with the suggestion that a public interest advocacy organization cannot satisfy the statute's distribution criterion because it is 'more like a middleman for dissemination to the media than a representative of the media itself.'"