Notice & Comment

Food Marketing Institute: Office of Information Policy Guidance Released

As noted in prior posts (here and here), the Supreme Court radically altered the long-accepted scope of Freedom of Information Act (“FOIA”) Exemption 4 in Food Marketing Institute v. Argus Leader Media, 139 S.Ct. 2356 (June 24, 2019). On October 3, the Department of Justice’s Office of Information Policy (“OIP”) released guidance to agencies regarding the Court’s decision.  Exemption 4 after the Supreme Court’s Ruling in Food Marketing Institute v. Argus Leader Media; Step-by-Step Guide for Determining if Commercial or Financial Information Obtained from a Person is Confidential Under Exemption 4 of the FOIA.[1]  This post analyzes OIP’s new guidance.

FOIA Exemption 4 allows agencies to withhold “trade secrets and commercial or financial information obtained from a person and privileged or confidential.”  5 U.S.C. §552(b)(4).  Food Marketing involved a FOIA request seeking store-level redemption data for each retail grocer participating in the Supplemental Nutrition Assistance Program (“SNAP”) in South Dakota.  The Court held that commercial or financial information qualified as confidential if its supplier customarily keeps it private (or at least closely held).  Food Marketing, 139 S.Ct. at 2363.  The Court did not decide whether the information also had to be provided to the Government under an assurance of confidentiality.  Id.  The Court noted its interpretation of a similarly-worded FOIA provision in Department of Justice v. Landano, 598 U.S. 165 (1993). There, the Court had construed the phrase “information furnished by a confidential source,” contained in FOIA’s law enforcement exemption.  Id. at 2363-64.

Office of Information Policy Guidance Document

In its guidance to federal agencies, OIP took into account the uncertainty Food Marketing left and assumed, as “a matter of sound administrative practice,” that assertion of Exemption 4 required both that the supplier treat the information as private and that the information had been shared with the agency under an assurance of confidentiality.  OIP relied heavily on Landano in elaborating upon the second requirement.

Landano had held that “information furnished by a confidential source” encompassed information given under an assurance that it would not be “published indiscriminately,” and that such an understanding could derive from express or implied assurances of confidentiality.  598 U.S. at 173.  OIP noted that Landano had adopted an “objective” test for determining the existence of implicit assurances of confidentiality.  More particularly, the existence of such unexpressed assurances depended on the “nature of the informant’s ongoing relationship with the [government],” “the character of the crime at issue,” and “the source’s relation to the crime.”  Id. at 179.  OIP did not acknowledge that in Landano these factors were related to an underlying issue, namely whether the confidential source would likely fear of reprisal from those implicated by the information it provided.  See, id.[2]

OIP explained that in determining whether the submitter treats the information at issue as private, an agency could rely on its own “knowledge of the information, the submitter’s practices, and/or . . . the records themselves.”  But it also encouraged agencies to use “industry representatives” as a source for “necessary information” regarding the industry’s customary confidentiality practices, much as they have done with regard to information needed to perform a competitive harm analysis under National Parks.

OIP then discussed express or implied assurances of confidentiality. An express assurance could be offered by direct communications with the submitter, general notices on agency websites, or regulations.[3]  OIP did not suggest any limitations on making such express promises.[4]  Indeed, because promises of confidentiality can be made in private communications with the supplier of the information, they can be made without any public notice.  Any written assurances of confidentiality or documents memorializing oral assurances should at least be subject to production pursuant to a FOIA request, albeit perhaps only in redacted form.  (Unrecorded oral assurances cannot be obtained through FOIA.)

OIP noted that agencies could negate any reasonable expectations of confidentiality by explicitly informing submitters of its intention to disseminate the information provided.  But here Landano may be relevant as well.

In Landano, plaintiff argued that any assurance of confidentiality that had been given an FBI informant was invalid, because any promise that either the information he provided or his identity would never be divulged could not be absolute.  Landano, 598 U.S. at 173.  In particular, such information would have to be disclosed during the criminal prosecution to satisfy the prosecution’s various disclosure obligations.  Id.  The Court rejected the argument, explaining that “[i]n common usage, confidentiality is not limited to complete anonymity or secrecy.”  Id.  Rather, “[a] statement can be made ‘in confidence’ even if the speaker knows the communication will be shared with limited others, as long as the speaker expects that the information will not be published indiscriminately.”  Id.  Sharing information with a defense attorney for potential use in a public trial amounts to public dissemination of the information, despite the Landano Court’s characterization of such an act as sharing the information “with limited others.”

Thus, returning to the Exemption 4 scenario, even if an agency asserts its intention to publicly disseminate the information in some circumstances, the stated conditions under which it will do so may prove critical.  Those conditions may be so limited that the agency’s statement could nevertheless permit an implicit understanding that the information submitted will not be “published indiscriminately.”

Moreover, the power to negate an expectation of confidential treatment could permit the Attorney General to severely limit Exemption 4’s scope.  An Attorney General could direct all agencies to advise involuntarily submitters that their information is subject to release at the agency’s discretion or pursuant to FOIA request. Such a directive would severely circumscribe Exemption 4.[5]  Indeed, it would limit the protections offered by Exemption 4 even more than the now-discredited National Parks test (which allowed withholding of documents that would result in competitive harm to the submitter).  See, National Parks and Conservation Assn v. Morton, 498 F.2d 765 (D.C. Cir. 1974).  Such a possibility might prompt the Supreme Court to hold that a finding of confidentiality turns solely on the submitter’s treatment of the information, and that the absence of any assurance of confidentiality from the government is irrelevant.

OIP’s discussion of the circumstances under which an assurance of confidentiality can be inferred is brief but important.  In crafting an objective metric to decide such questions, agencies must focus upon the context in which the submitter provided the information.  For example, in deciding whether an implicit promise of confidentiality exists, an agency could consider its “treatment of similar information and its broader treatment of information related to the program or initiative to which the information relates.”  In this regard, an agency’s long history of protecting certain commercial or financial information can serve as an implicit assurance that the agency will continue to do so.

But OIP noted that a contextual analysis could also negate any possible existence of an implied promise of confidentiality.  For instance, an agency’s historical practice of disclosing records could do so.  Similarly, “what the government pays a private entity to supply goods or services to the government reflects the government’s own actions and will often undermine a submitter’s claim to reasonably expect such information to be kept confidential.”

General Observations: Analogizing Exemption 4 to Exemption 7(D)

The Food Marketing Court cited Exemption 7(D) in support of its textual approach to interpreting Exemption 4. But the Court may well not have been directing the Government to adopt an Exemption 7(D) analysis in considering the scope of Exemption 4.  By its literal reading of Food Marketing, OIP has drawn an analogy between the provision of information to the government in a wide range of contexts involving regulatory, subsidy and public benefit programs, on the one hand, and the provision of information in the law enforcement and national security context, on the other.  But the analogy seems strained.  Worse, in essence OIP suggests a government-wide approach to Exemption 4’s interpretation based on principles developed in the most secretive of contexts, criminal and national security investigations.

Provision of commercial and financial information to government agencies in the course of regulatory, subsidy, and public benefits programs differs dramatically from provision of information to law enforcement by confidential informants.  Confidential informants, particularly any “State, local, or foreign agency” or “private institution” that furnishes information on a confidential basis, will presumably be acting voluntarily in divulging the information.  Indeed, a major goal of FOIA’s protection of confidential source information is keeping such voluntary sources of information from drying up.[6]  By contrast, much of the information for which businesses seek protection under Exemption 4 is supplied under some level of compulsion.[7]  In many circumstances individuals or businesses supply commercial and financial information: (a) to establish their initial or ongoing qualifications to participate in a government program, (b) to establish compliance with regulatory requirements, or (c) to obtain payments as a part of a government contract or as a provider of benefits pursuant to a government benefits program.[8]

Of course, even in the three non-law-enforcement contexts identified above, the government program could be hampered by an agency’s failure to offer assurances of confidentiality.  For example, potential participants in a government aid program may choose to forego participation if they do not receive assurances that any commercial and financial information they submit will be kept confidential.  Potential entrants into a regulated industry may decide not to so expand their business into that sector to keep secret information they would have to reveal to the government as a part of its regulatory surveillance of market participants.  Of course, the advantages of receiving aid or entering a particular market will often offset concerns about the loss of confidentiality and thus induce such entities to seek aid or participate in a regulated market regardless of the cost in terms of confidentiality.  So the distinction between these non-law-enforcement contexts and the law-enforcement context nevertheless retains force.

Moreover, confidential informants generally provide information about the misdeeds of others (and perhaps how those misdeeds victimize them), not about their own operations and their own potential regulatory violations.  And the people and organizations law enforcement agencies use confidential sources of information to target, including criminal organizations and foreign powers, may be adept a counter-intelligence or counteracting law enforcement efforts.  This puts an even greater premium on vigorous maintenance of confidentiality in the law enforcement sphere than in other spheres largely unrelated to law enforcement.

Third, the major impetus for protecting sources in the law enforcement context is the risk of reprisal. Ortiz v. HHS, 70 F.3d 729, 732 (2d Cir. 1995) (Exemption 7(D) “protect[s] confidential sources from retaliation that may result from the disclosure of their participation in law enforcement activities”); see, Landano, 598 U.S. at 179 (citing cases).  Businesses and individuals who provide information to non-law-enforcement agencies about their own commercial and financial affairs hardly face a similar risk of reprisal.

OIP’s Treatment of Four Concerns

Nevertheless, OIP’s approach potentially ameliorates some of Food Marketing’s transparency-defeating implications.  Food Marketing supports the conclusion that only the submitter’s practice of keeping the information secret is critical in deciding whether Exemption 4 applies, making virtually any commercial or financial information provided to the government subject to withholding pursuant to Exemption 4.  By adopting the assumption that to satisfy Exemption 4 information must be provided with an assurance of confidentiality as well as be treated as private by the submitter, OIP has cabined the potentially broad scope of the Court’s decision.

In my two-part series of blogposts preliminary assessing Food Marketing, I noted that the Court’s opinion raised several issues.  Let’s examine how OIP’s guidance addresses those issues.

Four of the five concerns I noted at the time were:

(1) [The Court’s decision] may reduce fiscal transparency by allowing private entities or the government to assert that transactional information regarding government expenditures can/must be withheld under Exemption 4.

(2) [The Court’s decision] may undermine the caselaw involving FOIA’s privacy exemptions, by allowing the government or private entities to assert Exemption 4 in cases involving government payments to natural persons previously resolved under Exemptions 6 and 7(C).

(3) The application of the Court’s decision to FOIA requests post-dating the FOIA Improvement Act of 2016, in light of that Act’s “foreseeable harm” standard, may involve complications the Court did not fully appreciate.

(4)  [The Court’s decision, particularly when read in light of Justice Breyer’s concurrence] may expand private entities’ right to insist upon the government withholding information relevant to the safety of consumers or the welfare of its employees.

Items (1) and (4): Information that Should Not Be Considered Confidential

By requiring that there be an express or implied assurance of confidentiality, and introducing the concept that any implied assurance of confidentiality must have a reasonable basis, OIP has taken an important step toward addressing concerns (1) and (4).  Thus, if information should not be treated as confidential, it arguably does not qualify for Exemption 4 protection (at least absent an express promise of confidentiality).

In particular, OIP notes that “what the government pays a private entity to supply goods or services to the government reflects the government’s own actions and will often undermine a submitter’s claim to reasonably expect such information to be kept confidential.”  This observation suggests that some transactional information regarding government expenditures, which are critical to the Government’s satisfaction of its fiscal transparency obligations, will often fails to qualify as information for which an implicit assurance of confidentiality has been given.[9]  But OIP states the principle in far too limited terms.  Indeed, OIP seems to focus on one type of case in which this issue often arises, FOIA requests for prices the government pays government contractors.[10]

But fiscal transparency involves far more situations than government supply contracts. Government payments pursuant to government subsidy and aid program also “reflect[] the government’s own actions” and thus should not be shielded from public view.  That would include records of payments to third parties to provide aid to program participants, such as food stamp redemption data. Similarly information regarding government loans to private banks reflect the government’s own actions.  See, e.g., Bloomberg, L.P. v. Board of Governors of the Federal Reserve System, 601 F.3d 143 (2d Cir. 2010)(loans to banks during financial crisis); Checkbook Center for the Study of Services v. HHS, 554 F.3d 1046, 1051 (D.C. Cir. 2009) (physicians’ Medicaid compensation), Multi Ag Media LLC v. Department of Agriculture, 515 F.3d 1224, 1232 (D.C. Cir. 2008)(agricultural subsidy and benefit programs); National Public Radio v. FEMA, 2017 WL 5633090 (D.D.C. Nov. 21, 2017)(list of individuals whose property FEMA purchased pursuant to its Hazard Mitigation Grant Program).

In the same vein, submitters perhaps cannot reasonably infer that critical information relevant to the safety of consumers or the welfare of the submitters’ employees will not be disclosed to those put at risk.  I discussed a few such cases in my July 8, 2019 blogpostSee, e.g., Utah v. U.S. Department of Interior, 256 F.3d 967 (10th Cir. 2001); Teich v. FDA, 751 F. Supp. 243 (D.D.C. 1990).  In such circumstances, the context negates the existence of an implied promise of confidentiality; government agencies that have a responsibility to protect the public or those endangered by a company’s conduct, cannot reasonably be expected to treat the company’s disclosures of information related to such risks as confidential.

Of course, all these contextual limits on assurances of confidentiality can be undermined by an express conferral of confidentiality, and, again, OIP suggests no limits on providing such express confidentiality assurances.  So the OIP approach provides more ephemeral guarantees that information about government activities and risks to others will remain public than a less textualist interpretation of Exemption 4 in Food Marketing would have provided.  An interpretation of Exemption 4 that would consider not only whether a submitter actually considers information confidential, but whether the submitter should be able to consider the information confidential as well, would have better guaranteed access to such information.  And of course, even OIP’s approach of introducing reasonableness through the concept of circumstances that would negate a reasonable inference of an assurance of confidentiality, would be undermined if the Supreme Court ultimately concludes that Exemption 4 requires only that the submitter treat submitted information as confidential.

Item (2): The Discrepancy Between Exemption 4 and the Privacy Exemptions

OIP’s guidance does not recognize the discrepancy Food Marketing creates between Exemptions 4 and 6.  Natural person receiving public benefits have traditionally claimed protection for information regarding their qualifications or benefits under Exemption 6.  Artificial persons would traditionally claim protection under Exemption 4.  (Of course, the Government actually makes the claim in the interest of those persons.) See Food Marketing Institute: A Preliminary Assessment (Part II)

With regard to Exemption 6, even if information is “private” and even if an express assurances of confidentiality has been given, the information must be released if the need for the information, in terms of evaluating the government’s actions, is greater than the privacy interest.[11]  Under OIP’s guidance regarding Exemption 4, express assurances of confidentiality are dispositive.  And once it is shown that there is an express assurance of confidentiality and that the submitter keeps the information closely held, the analysis is concluded. No assessment of the need for the information to evaluate the government’s performance is permitted.  This discrepancy between the Exemption 4 and Exemption 6 analyses might encourage natural persons to urge the Government to assert Exemption 4 more frequently, as much information regarding payments received from the government can qualify as “financial.”

That said, OIP’s guidance is faithful to Food Marketing, and there is little OIP can do to address the issue, even were it so inclined.  OIP could provide directions to agencies regarding when they should notify submitters that they will not keep information confidential, and thereby negate any implicit assumption that information will be treated confidentially.  Of course, such advice would also have to include a directive to avoid giving express assurances of confidentiality in the circumstances in which the agency should seek to prevent submitters from having any reasonable expectation that their information would receive confidential treatment.

Item (3): The “Foreseeable Harm” Standard

OIP’s guidance does not address application of the foreseeable harm standard mandated by the FOIA Improvement Act of 2016;[12] it does not even acknowledge the issue.  Even if an agency believes the submitter’s information is confidential, it must decide whether its release will cause foreseeable harm, unless a statute prohibits the disclosure of such information.[13]  The Trade Secrets Act is arguably a statute that prohibits government release of commercial and financial information submitted to it.[14]  I discuss this issue, and the question of whether the Trade Secrets Act is coterminous with Exemption 4 at length in my prior blogpost. See, Food Marketing Institute: A Preliminary Assessment (Part II).

OIP appears willing to adopt the position of several courts that Exemption 4 is coterminous with the Trade Secrets Act.    DEPARTMENT OF JUSTICE, GUIDE TO THE FREEDOM OF INFORMATION ACT, Exemption 4 at 18-19 (posted Oct. 4, 2019).  If that conclusion is correct, the “foreseeable harm” standard would essentially not apply to information withheld pursuant to Exemption 4 as confidential commercial or financial information.  But if it is not, OIP’s guidance document provides little assistance to agencies regarding the application of the foreseeable harm standard in Exemption 4 cases.

Providing guidance on the application of the foreseeable harm analysis would require OIP to identify the harms Exemption 4 were meant to forestall.  Exemption 4 could have been intended to forestall the drying up of voluntary sources of information.  More broadly, it might have been designed to prevent private companies from deciding refrain from interacting with the U.S. government, because doing so would subject their proprietary information to exposure.  If Exemption 4 serves those purposes, in applying the “foreseeable harm” standard agencies would have to assess the harm to the government program, in terms of gaining needed cooperation from private entities, that would result from releasing information such entities submitted to it.

Exemption 4 might also have been designed to forestall harm to submitters of information themselves.  But these are exactly the sort of harms the D.C. Circuit sought to identify in National Parks; it ultimately focused on competitive harm.  Perhaps National Park Court’s conception of harm could have been broader, as Justice Breyer suggests in his separate concurrence in Food Marketing.  In any event, if a “foreseeable harm” analysis applies, and harm to submitters counts as a species of harm to be avoided, agencies may have to grapple with issue of competitive harm, i.e., the now-discredited metric crafted in National Parks, or Justice Breyer’s broader conception of harm in his Food Marketing concurrence.


OIP’s guidance starts from a questionable premise, that the analysis of Exemption 4 should follow the analysis of the Exemption 7(D) “confidential informant” exception.  Nevertheless, by introducing the concept that when assurances of confidentiality are not express, there must be a reasonable basis upon which to conclude that the agency has provided an implicit assurance of confidentiality, OIP has opened a path to a more transparency-friendly development of Exemption 4 doctrine.

[1] In conjunction with the new guidance, OIP posted a revised chapter regarding Exemption 4 in the Department of Justice Guide to the Freedom of Information Act.   The prior version, posted July 23, 2014, was 94 pages; the new version a mere 16 pages.

[2] Granted the factors may have illuminated a second underlying issue, the magnitude of the stigma resulting from being associated with a criminal investigation.  See id. at 176 (“The Government maintains that an assurance of confidentiality can be inferred whenever an individual source communicates with the FBI because of the risk of reprisal or other negative attention inherent in criminal investigations.”)

[3] With respect to provision of express assurance by regulation, OIP cites Argus Leader.  But the regulation providing for the confidentiality of SNAP redemption records was arguably based on an erroneous interpretation of the underlying statute.  The Eighth Circuit rejected the Department of Agriculture’s interpretation of the Food Stamp Act as mandating confidentiality for SNAP redemption records in Argus Leader Media v. USDA, 740 F.3d 1172, 1176 (8th Cir. 2014).  The Supreme Court did not disturb that ruling.  Thus, OIP seems to be suggesting that a reasonable assurance of confidentiality can be conveyed by a regulation ultimately adjudged invalid.

[4] A regulation mandating confidential treatment of certain categories of information would presumably be subject to judicial review under the “arbitrary and capricious” standard of review.  The provision of such assurances by more “informal” means, particularly when done on a case-by-case basis, would presumably be unreviewable, as a matter committed to agency discretion. 5 U.S.C. §701(a)(2).  Such review might also be barred by Norton v. Southern Utah Wilderness Alliance, 542 US 55 (2004).

[5] Several Attorney Generals have issued such Government-wide directives with regard to the exercise of the discretion to withhold documents covered by FOIA’s exemptions.  See, e.g, Memorandum from John Ashcroft, Attorney Gen., The U.S. Dep’t of Justice, to Heads of Departments and Agencies on the Freedom of Information Act, (Oct. 12, 2001); Memorandum from Eric Holder, Attorney Gen., The U.S. Dep’t of Justice, to Heads of Departments and Agencies on the Freedom of Information Act, (March 19, 2009).

[6] See, e.g., Providence Journal Co. v. U.S. Dep’t of the Army, 981 F.2d 552, 563 (1st Cir. 1992) (Exemption 7(D) is intended to avert “drying-up” of sources); Nadler v. DOJ, 955 F.2d 1479, 1486 (11th Cir. 1992); Shaw v. FBI, 749 F.2d 58, 61 (D.C. Cir. 1984); see generally, Landano, 598 U.S. at 178 (discussing legislative history).

[7] After Critical Mass Energy Project v. Nuclear Regulatory Commission, 975 F.2d 871 (D.C. Cir. 1992)(en banc), cert. denied, 507 U.S. 984 (1993), the National Parks test for entitlement to Exemption 4 protection did not apply to voluntarily-submitted information.

[8] Granted, some confidential informants may not be providing information voluntarily, but rather to avoid prosecution themselves.  (The FBI refers to such persons as “cooperating witnesses.”)  And, of course, some confidential informants are paid.  For a description of the FBI’s use of confidential informants, see Office of the Inspector General, The Federal Bureau of Investigation’s Compliance with the Attorney General’s Investigative Guidelines, Chapter Three: The Attorney General’s Guidelines Regarding the Use of Confidential Informants (September 2005); Federal Bureau of Investigation, Confidential Human Source Policy Manual (Revised September 5, 2007), available in redacted form on the American Civil Liberties Union website here.

[9] I discuss the interest in government fiscal transparency in Bernard Bell, Oh SNAP!: The Battle Over “Food Stamp” Redemption Data That May Radically Reshape FOIA Exemption 4 (Part II) (September 12, 2018)

[10] Gregory H. McClure, The Treatment Of Contract Prices Under The Trade Secrets Act And Freedom Of Information Act Exemption 4: Are Contract Prices Really Trade Secrets?, 31 PUB. CON. L.J. 185 (2002); 2 JAMES T. O’REILLY, FEDERAL INFORMATION DISCLOSURE § 10:75 (2019)(available on westlaw); Department of Justice, Guide to the Freedom of Information Act, Exemption 4, 330-347 (posted July 23, 2014)(superseded).

[11] U.S. Department of State v. Ray, 502 U.S. 164, 177 (1991)(“a promise of confidentiality does not necessarily prohibit disclosure”); accord, Washington Post v. HHS; 690 F.2d 252, 263-64 (D.C. Cir. 1982); Kurzon v. HHS, 649 F.2d 65, 69-70 (1st Cir. 1981); Robles v. EPA, 484 F.2d 843, 846 (4th Cir. 1973).

[12] Pub. L. No. 114-185, 130 Stat. 538 (2016).

[13] 5 U.S.C. § 552(a)(8)(A) (“[a]n agency shall . . . withhold information under this section only if [ ] (I) the agency reasonably foresees that disclosure would harm an interest protected by [a FOIA] exemption described in [5 U.S.C. § 552(b) (2012)]; or (II) disclosure is prohibited by law[.]”).

[14] Sen. Rep. No. 114-4, at 8 (2015)( (citing U.S. Department of Justice, Guide to the Freedom of Information Act for the proposition that information protected from disclosure by the Trade Secrets Act is not an appropriate subject of discretionary disclosure).

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