On November 24, 2019, Judge William Alsup of the U.S. District Court for the Northern District of California issued the first post-Argus Leader decision on the use of Exemption 4. In American Small Business League v. Department of Defense, No. 18-01979, 2019 WL 6255353 (N.D. Cal. Nov. 24, 2019), the court found that Lockheed Martin had “customarily” and “actually” kept secret “in the ordinary course of business” various records concerning “comprehensive subcontracting plans, program reports, and related correspondence.” The court, however, allowed certain information “generated by the government” to be disclosed.
The court further found that DOD and DOJ had “sufficiently shown that the government made an implied assurance” of privacy upon submission of the information at issue, but it did not decide whether the “‘assurance of privacy’ requirement applies” necessarily—a question left unanswered by the Supreme Court.
Finally, the court rejected arguments that the 2016 FOIA Improvement Act’s “foreseeable harm” standard could be used to reintroduce a sort of “competitive harm” standard into the Exemption 4 analysis. “[T]he plain and ordinary meaning of Exemption 4 indicates that the relevant protected interest is that of the information’s confidentiality—that is, its private nature. Disclosure would necessarily destroy the private nature of the information, no matter the circumstance.”
Interestingly, in dicta, Judge Alsup expressed “sympathy” for the requesting community’s “steep uphill battle under the new Exemption 4 standard.” “Under Food Marketing, it appears that defendants need merely invoke the magic words—”customarily and actually kept confidential”—to prevail. And, unless plaintiff can show that the information is in fact publicly available or possibly point to other competitors who release the information, defendants can readily ward off disclosure. . . . [T]he result seems ‘at odds with’ FOIA’s purpose[.]” Judge Alsup, citing his “twenty-five years of practice and twenty years as a judge,” noted “how prolifically companies claim confidentiality'“; “[n]evertheless, [he was] not writing on a clean slate. Food Marketing mandates this result.”