Supreme Court Issues Opinion Expanding the Scope of FOIA Exemption

By Brett W. Johnson, Derek Flint and Mary Colleen Fowler

A common tactic by competitors is to seek adversaries’ (or even supply-chain partners’) data that is maintained by the United States, an individual state, or even municipal governmental agencies.  These efforts are meant to gain such information to obtain a competitive advantage. Sometimes obtaining the data is not even the ultimate purpose of filing a request; requesters may be attempting to ascertain how the government makes decisions that impact a company’s competitive advantage.  Most public records laws, including the federal Freedom of Information Act (“FOIA”) have constraints on what can be released, especially related to the protection of confidential data or the government’s deliberative process. Recent court cases have highlighted the importance of companies and individuals being vigilant in protecting their proprietary data by raising objections to the release of it.

One such case is United States Fish and Wildlife Service v. Sierra Club, Inc., where the Supreme Court limited the ability of companies and individuals to obtain information from federal agencies under FOIA. At issue in Sierra Club was the so-called “deliberative process privilege,” which exempts certain agency communications from FOIA requests. The Sierra Club, an environmental organization, filed a FOIA request seeking information from the U.S. Fish and Wildlife Service and the EPA (together, the “Agencies”) regarding a 2014 agency rule that governs the operation of cooling water intake structures. The Agencies invoked the deliberative process privilege and withheld documents designated as “draft biological opinions,” asserting that they were nonfinal and therefore protected.

The Court sided with the Agencies, holding that the “draft biological opinions” were shielded from FOIA requests because they “reflect a preliminary view—not a final decision.” The Court noted that labeling the documents as “drafts” was a strong, though not determinative, indication that they were part of the deliberative process. The Court also reasoned that the pre-decisional status of the “draft biological opinions” was evidenced by the fact that they were prepared by lower-level staff and were never approved by agency decision-makers. Nevertheless, the Court explained that determining the application of deliberative process privilege is a “functional rather than formal inquiry,” and cautioned that the privilege will not apply if the evidence shows that “an agency has hidden a functionally final decision in draft form.”

Takeaways for Companies and Individuals that Operate in the FOIA Space

Sierra Club is the most important FOIA decision in the last year. It narrows the scope of documents that agencies must produce in response to FOIA requests, limiting the ability of the public to glean information regarding agency rulemaking processes. And, although Sierra Club only addressed the deliberative process privilege, the decision may signal the Court’s willingness to interpret other privileges more broadly in the FOIA context, such as the attorney-client privilege, the attorney work-product doctrine, or even the competitive advantage exemption. Any company or individual seeking information through a FOIA request should be aware that some important agency documents may be exempt from disclosure if an agency invokes a privilege.

Companies and individuals should also be aware of other recent shifts in the Court’s interpretation of FOIA exemptions. In particular, the Court recently changed a decades-old standard that governs when commercial and trade secret information obtained from companies is exempt from FOIA requests. Any company or individual that submits FOIA requests or provides sensitive commercial information to the federal government may want to reevaluate its FOIA-related policies in light of the Supreme Court’s recent decisions.