Food Marketing Institute v. Argus Leader Media

STATUTORY INTERPRETATION OF EXEMPTION 4

Petitioner Food Marketing Institute argues that the Court is required by precedent to interpret the plain meaning of the term “confidential” in Exemption 4 of the Freedom of Information Act (“FOIA”). Specifically, FMI asserts that the Court’s general statutory interpretation principal begins with the plain meaning of a word at the time the statute was enacted, and this is enough insofar as the definition of the term is plain. Additionally, FMI posits that the Supreme Court has previously in U.S. Department of Justice v. Landano applied the plain meaning interpretation of “confidential” in Exemption 7 of FOIA. – After examining the various dictionary definitions and case law usage of the term “confidential,” FMI concluded that the ordinary plain meaning of ‘confidential’ in the context of the statute is “private and not publicly used.”– FMI also points out that the Senate and House reports accompanying FOIA interpret “confidential” by this ordinary plain meaning of the term. –

Furthermore, FMI argues that the United States Court of Appeals for the D.C. Circuit erroneously looked beyond the plain meaning of “confidential” in National Parks and Conservation Association v. Thomas S. Kleppe, Secretary, U. S. Department of the Interior. – Specifically, FMI contends that the D.C. Circuit in National Parks contravened precedent by requiring a showing that the interpretation of Exemption 4 conforms with the legislative purpose behind the exemption. – Also, FMI asserts that the D.C. Circuit cited congressional subcommittee witness statements from an unenacted predecessor bill of FOIA to conclude that the legislative purpose of FOIA is not consistent with the plain meaning of Exemption 4.– Because the Supreme Court does not give weight to statements made by members outside of Congress and statements made outside official congressional reports when evaluating legislative history, FMI maintains that the D.C. Circuit’s usage of legislative history was not consistent with the Supreme Court’s precedent.

FMI also explains that the information at issue here falls under the plain meaning of “confidential” and is therefore protected by Exemption 4 of FOIA. FMI points out that the information at issue here is not disclosed publicly, and measures were taken to prevent the public disclosure of the information at issue. – For example, FMI asserts that retailers had implemented computer-network security measures and trained employees extensively on information security. Additionally, FMI argues that for the last 40 years the USDA has not released SNAP redemption data because they interpreted 7 U.S.C. § 2018 of the Food Stamp Act to restrict the disclosure of such data. Thus, FMI maintains that retailers operate with the expectation that the government is restricted from releasing the information at issue here. Lastly, FMI contends that there is no Article III standing issue here because the USDA has already promised to not disclose the information at issue if the court rules against mandatory disclosure here.

Conversely, Respondent Argus Leader argues that even if the Supreme Court was to rule in favor of FMI’s interpretation of Exemption 4 the USDA still has the discretion to release this information because Exemption 4 only determines USDA’s obligation to disclose information but does not prevent disclosure. – Therefore, according to Argus Leader, FMI does not have Article III standing to bring suit here because FMI’s claim that they will suffer injury if the USDA discloses the information at issue is not redressable.Also, Argus Leader contends that the Eighth Circuit has already ruled that Section 2018 does not bar the USDA from disclosing the information at issue here.–

Additionally, Argus Leader argues that there is no plain dictionary definition of “confidential” and Congress has not explicitly defined the term “confidential.” –According to Argus Leader, it is not conclusive whether “confidential” refers to information that is confidential by its nature or information that is confidential because it is treated as confidential by a party. Thus, Argus Leader asserts that the common law uses of “confidential” must be examined. Argus Leader contends that at the time FOIA was passed, “confidential” was used in the common law to refer to trade secrets and information that if revealed would harm the parties holding the information. –Thus, Argus Leader explains that the term “trade secrets” was used interchangeably with “confidential business information” and a showing of likely commercial harm was required in common law unfair competition tort cases. –According to Argus Leader, only after the passage of FOIA the term “trade secrets” was formalized to equal “confidential business information.” Also, Argus Leader points out that, given the judicial consensus that “confidential business information” means information that can harm business competitiveness if disclosed, Congress has expressly incorporated the principle in 60 provisions across 46 statutes.–

Furthermore, Argus Leader contends that FMI misinterprets the Court in Landano. –Argus Leader asserts that Landano held that the information at issue was private because of its objective nature not because one party believed it to be private information. And finally, according to Argus Leader, the text from the Senate and House reports accompanying FOIA cited by FMI to support their position derives from a quoted snippet of a previously unenacted version of FOIA. –

THE NATIONAL PARKS TEST FOR EXEMPTION 4

FMI argues that even under the National Parks test the Eighth Circuit erred by requiring a substantial competitive harm standard rather than a reasonable possibility of competitive harm standard. –Specifically, FMI posits that a reasonable possibility of competitive harm standard better conforms with the National Parks court’s desire to protect legitimate private interests when applying Exemption 4. –FMI contends that the reasonable possibility of commercial harm standard better protects legitimate private interests because: (1) the standard does not require the showing of a precise, immediate competitive harm; (2) the standard can be applied to parties beyond present commercial competitors; (3) the standard does not differentiate between type of harms; and 4) the standard can take into account factors external to competitive harm, such as if the party took actions to protect the information at issue. – FMI points out that it is reasonably possible that the disclosure of the information at issue will harm sales of the retailers involved here. –Therefore, FMI maintains that the information at issue here is protected by Exemption 4 of FOIA.

Argus Leader argues that FMI has no basis for opposing the competitive harm standard in favor of a reasonable possibility of harm standard. First, Argus Leader asserts that in common law unfair competition tort cases, rather than the possibility of economic harm, a party had to show that economic harm was likely in order to recover damages. According to Argus Leader, the competitive harm standard is objective, and embarrassment or negative publicity resulting from disclosure of information is not enough to show that legitimate commercial interests are violated. Argus Leader points out that Congress has also repeatedly ratified the competitive harm standard. Moreover, Argus Leader contends that the competitive harm standard is not overly difficult to meet and, depending on the specific facts of the case, the plaintiff may not always be required to demonstrate precise harm or an immediate injury. Lastly, Argus Leader argues that even under the reasonable possibility of harm standard FMI’s claim would still fail because of the speculative nature of FMI’s injury.