Supreme Court rejects narrow interpretation of FOIA exemption that protects confidential business information

Monday, June 24, 2019 - 9:45am

The Supreme Court in Food Marketing Institute v. Argus Leader Media held that the Freedom of Information Act’s (FOIA) exemption for “confidential” business information provided to the government is not limited to information that would cause competitive harm if disclosed.  This decision upends several decades of unfavorable D.C. Circuit precedent that made it more difficult for companies to prevent the disclosure of business information submitted to the government.  The Chamber urged the Court to take this case at the cert. stage and filed a brief at the merits stage supporting this result.

Background: Argus Leader Media filed a FOIA request with the U.S. Department of Agriculture (USDA), seeking the names and addresses of all retail stores that participate in the national food-stamp program.  The USDA refused to disclose this data, invoking FOIA’s exemption for private commercial and financial information that is “confidential.”  In response, Argus Leader sued the USDA to get the information.  After the district court ordered disclosure, the Food Marketing Institute, an association (C100) representing grocery retailers, intervened and appealed.  The Eighth Circuit affirmed, holding that FOIA’s exemption for “confidential” business information does not apply because disclosure would not cause the retailers substantial competitive harm.

Opinion:  The Supreme Court reversed in a 6-3 opinion written by Justice Gorsuch.  At the time of FOIA’s enactment, the Court explained, the term “confidential” simply meant “private” or “secret.”  As a result, the statute does not include a “competitive harm” requirement.  Where commercial or financial information is both customarily and actually treated as private by its owner and provided to the government under an assurance of privacy, the information is “confidential” within the FOIA exemption’s meaning.  The food-stamp information at issue satisfies both conditions because the grocery retailers customarily do not disclose store-level data or make it publicly available.  And to induce retailers to participate in the food-stamp program, the government has long promised retailers that it will keep their information private.