The second exemption from disclosure applicable to FOIA requests for EEO-1 information is Exemption 4. In Food Marketing Institute v. Argus Leader Media, — S. Ct. —, 2019 WL 2570624 (June 24, 2019), the Supreme Court ruled that FOIA Exemption 4 protects information that is customarily and actually treated as private by its owner and provided to the government under an assurance of privacy.With respect to the EEO-1 pay data, assuming employers treat the information as private, the question is whether that information is provided to the OFCCP “under an assurance of privacy.” The OFCCP represents that it “will protect the confidentiality of EEO-1 data to the maximum extent possible consistent with FOIA and the Trade Secrets Act.”
Supreme Court Upends Half-Century Standard for Handling Confidential Commercial Information Under the Freedom of Information ActBusinesses that provide sensitive commercial or financial information to the federal government can now breathe a little easier. In a recent Supreme Court case, Food Marketing Institute v. Argus Leader Media, No. 18-481, 588 U.S. __ (2019), the court relaxed a nearly 50-year-old precedent used by the federal government to determine whether to release commercial or financial information to private third parties pursuant to Freedom of Information Act (“FOIA”) requests. Under the prior precedent—followed by most federal circuits—the federal government was required to disclose “confidential” information unless the original disclosing party could demonstrate that it would cause “substantial competitive harm.”
On June 24, 2019, the Supreme Court ruled in Food Marketing Institute v. Argus Leader Media, 2019 U.S. LEXIS 4200 (2019) that the Freedom of Information Act (FOIA) allows a federal agency to withhold from disclosure records submitted by a private entity when the entity submitting the information treated the records as confidential and the agency promises to keep the records private. The decision marks a departure from longstanding precedent that required government agencies to disclose private commercial and financial information in response to FOIA requests unless disclosing the information would cause “substantial competitive harm” to the business or entity that previously turned over the information.FOIA generally requires the disclosure of information that the federal government collects, subject to certain exemptions.
The Supreme Court in Food Marketing Institute v. Argus Leader Media, No. 18-481 (U.S. June 24, 2019) recently relaxed the standard for withholding confidential information under Exemption 4 of the Freedom of Information Act (“FOIA”)—a major win for contractors that regularly submit sensitive business information to the government.Exemption4 protects from disclosure trade secrets and commercial or financial information that is privileged or confidential. For the past 45 years, courts have been guided by the stringent “competitive harm” test first enunciated in National Parks & Conservation Association v. Morton, 498 F.2d 765 (D.C. Cir. 1974).
However, filers need not report proxy hours for all exempt employees: it may report actual hours for some and proxy hours for others.Regarding FOIA requests, the FAQs specifically address the recent Supreme Court case. “Pursuant to the Supreme Court’s recent decision, Food Marketing Institute v. Argus Leader Media, — S. Ct. —, 2019 WL 2570624 (June 24, 2019), Exemption 4 protects information that is customarily and actually treated as private by its owner and provided to the government under an assurance of privacy.”EEOC has held true to its word to provide additional information in advance of the start of the reporting obligation, not all of which we address above.
Thus, in many cases, information that would have been disclosed under FOIA can now be withheld under Exemption 4.Food Marketing Institute v. Argus Leader Media (2019) Opinion by Justice Gorsuch, joined by Chief Justice Roberts and Justices Thomas, Alito, Kagan, and Kavanaugh; opinion concurring in part and dissenting in part by Justice Bryer, joined by Justices Ginsburg and Sotomayor 5 U.S.C. § 552(b)(4).See Argus Leader Media v. United States Dept. of Agriculture, 889 F.3d 914, 915 (8th Cir 2018).
On June 24, 2019, the United States Supreme Court, in an opinion by Justice Gorsuch, held that information that “is both customarily and actually treated as private by its owner and provided to the government under an assurance of privacy” is protected from disclosure under the Freedom of Information Act (“FOIA”) pursuant to Exemption 4 thereto, which protects “commercial or financial information obtained from a person and privileged or confidential.” Food Mktg. Inst. v. Argus Leader Media, —U.S.—, 2019 WL 2570624 (June 24, 2019). The Court thus reversed a decision of the Eighth Circuit that had required an additional showing that disclosure would cause “substantial competitive harm.”
On June 24, 2019, the Supreme Court ruled that Exemption 4 of the Freedom of Information Act (“FOIA”), which protects from public disclosure “trade secrets and commercial or financial information obtained from a person [that is] privileged or confidential,” does not require a showing of substantial competitive harm for information to qualify as “confidential.” The Court’s ruling represents a sea-change in how the Government must protect information under this important exemption.As discussed in our previous blog article, the case – Food Marketing Institute v. Argus Leader Media, 588 U.S. ___ (2019) (“FMI”) – involved a FOIA request made by Argus Leader Media, a South Dakota newspaper, to the U.S. Department of Agriculture (“USDA”), seeking the yearly Supplemental Nutrition Assistance Program (“SNAP”) sales figures for every grocery store participating in the program. After the USDA refused to release the store-level SNAP data, citing FOIA Exemption 4, Argus filed suit, resulting in both the trial court and the Eighth Circuit ruling in its favor.