Supreme Court Hears FOIA Case That May Drastically Alter the Business Records Exemption
On April 22, 2019, the Supreme Court considered the scope of a Freedom of Information Act (FOIA) exemption allowing the government to withhold from public disclosure confidential business records that companies submit to the federal government. Food Marketing Institute v. Argus Leader Media, Case No. 18-481 (U.S., argued Apr. 22, 2019).
Under FOIA, all public records are presumed open, and they may be withheld from public disclosure only if one or more of the nine exemptions set forth in the statute are met. One of those exemptions – Exemption 4 – permits the government to withhold "trade secrets and commercial or financial information obtained from a person [that is] privileged or confidential." 5 U.S.C. § 552(b)(4).
In Food Marketing Institute v. Argus Leader Media, the Court is considering the meaning of "confidential," as used in Exemption 4. Since a 1974 District of Columbia Circuit Court decision, "confidential" has widely been interpreted to mean that disclosure of the information would be likely "(1) to impair the Government's ability to obtain necessary information in the future; or (2) to cause substantial harm to the competitive position of the person from whom the information was obtained." See Nat'l Parks & Conservation Ass'n v. Morton, 498 F.2d 765, 770 (D.C. Cir. 1974).
In this case, the business seeking to withhold information – Food Marketing Institute – and the government are advocating for a broader interpretation of Exemption 4. They argued in their briefing and at oral argument that the plain language of the statute does not require proof that disclosure would cause harm to a competitive position. Instead, they argue that "confidential" must be interpreted according to its ordinary meaning – that is, any information that the business has kept private and not publicly disclosed.
On the other side, the Argus Leader newspaper in Sioux Falls, South Dakota – which submitted a FOIA request for information about the Supplemental Nutrition Assistance Program (SNAP) program that would have revealed information about Food Marketing Institute's participation in SNAP – argued that a subjective reading of the term "confidential" would be detrimental to the public and against the longstanding interpretation by federal courts. If the Court interprets "confidential" to give it the meaning advocated by Food Market Institute, the newspaper argued that businesses could unilaterally decide whether their information in government hands should be disclosed, which would run contrary to the longstanding judicial construction of the term.
Given the amount of information that private entities submit to government agencies each year, the outcome of this case could substantially alter the breadth of information disclosed under FOIA regarding private businesses' interaction with the federal government.