Could corporate-privacy case gut FOIA?

Wednesday, September 29, 2010

WASHINGTON — The Supreme Court yesterday agreed to hear a case that could, in the view of government-openness advocates, gut the Freedom of Information Act by vastly expanding an exemption to disclosure for documents that invade “personal privacy.”

First enacted in 1966 and amended in 1974, FOIA was intended to promote disclosure of government documents, but it includes several exemptions that agencies can cite in refusing to release material. One is for records that could result in “an unwarranted invasion of personal privacy.”

In Federal Communications Commission v. AT&T (09-1279), the telecommunications company is seeking to preserve a lower court ruling that interprets that phrase to include the privacy of corporations and, by implication, state, local, and foreign government agencies.

But public-interest groups led by Public Citizen argued to the Court that such an expansion would permit “a veil of secrecy to cover records that are at the heart of FOIA’s disclosure goals.”

Citing recent headline-making corporate scandals that have been investigated by government agencies, the Public Citizen brief adds, “If companies like Goldman Sachs, BP, and Massey Coal can interject a claim of corporate privacy into an exemption designed to recognize only ‘valid governmental and individual interests in confidentiality,’ then each time a request is made for records concerning newsworthy topics like the economic downturn, oil spill, and mine explosion, delay and withholding could result.”

The issue of corporate “personhood” has been a flashpoint ever since the Supreme Court’s ruling last January in Citizens United v. Federal Election Commission, which gave corporations and unions First Amendment rights equivalent to individual freedom of speech in the context of limits on corporate expenditures in campaigns.

The 3rd U.S. Circuit Court of Appeals ruled in the AT&T case before Citizens United came down, but it gave a similarly broad interpretation to the word “personal” to include corporations.

The decision stemmed from a dispute over a FOIA request made by AT&T competitors for documents relating to a federal program in the 1990s that aimed to expand schools’ access to the Internet and new technology.

AT&T had notified the FCC voluntarily that it might have overcharged the government for services related to the program in New London, Conn. AT&T challenged the request for related documents in a “reverse-FOIA” claim. The FCC argued that exemption 7(c) was meant to protect individuals from embarrassment that might result from government disclosure of documents, but did not protect companies.

The 3rd Circuit agreed with the company that it was covered by the “personal privacy” exemption to disclosure, citing a separate section of the law that defines “person” to include corporations. It also added in a footnote that corporations, like human beings, “face public embarrassment, harassment, and stigma” because of involvement with government investigations that might be the subject of FOIA requests.

But the government, citing numerous precedents, legislative history, and interpretations of the law, including one from 1981 by then-law professor Antonin Scalia, asserts that the exemption was never meant to protect corporations or groups from disclosure of government documents.

The government petition, signed by then-Solicitor General Elena Kagan, asserts that the 3rd Circuit ruling, if upheld, “threatens to impose barriers to the public disclosure of government records concerning government malfeasance in government programs that the public has a right to review.” It would also “revolutionize” the processing of FOIA requests by introducing a new factor into decisions on whether to release certain documents.

Because of Kagan’s earlier involvement in the case, she has recused herself now that she is a justice.