Opinion ID: 591123
Heading Depth: 3
Heading Rank: 2

Heading: The National Parks test

Text: 42 The National Parks two-part test was presented as a summary of its discussion of Exemption 4. See National Parks, 498 F.2d at 770 (To summarize....). The test must therefore be read in a manner consistent with the observations and conclusions that preceded it. We quote the most pertinent of these: 43 [O]ur decisions concerning this exemption have been guided by the following passage from the Senate Report, particularly the italicized portion: 44 This exception is necessary to protect the confidentiality of information which is obtained by the Government ..., but which would customarily not be released to the public by the person from whom it was obtained. 45 Id. at 766 (emphasis in original). 46 The financial information exemption recognizes the need of government policymakers to have access to commercial and financial data. Unless persons having necessary information can be assured that it will remain confidential, they may decline to cooperate with officials and the ability of the Government to make intelligent, well informed decisions will be impaired. 47 Id. at 767 (emphasis added). 48 Apart from encouraging cooperation with the Government by persons having information useful to officials, [Exemption 4] serves another distinct but equally important purpose. It protects persons who submit financial or commercial data to government agencies from the competitive disadvantages which would result from its publication. 49 Id. at 768 (emphasis added). 50 [There is] a twofold justification for the exemption of commercial material: (1) encouraging cooperation by those who are not obliged to provide information to the government and (2) protecting the rights of those who must. 51 Id. at 769 (emphasis added). 52 In summarizing these various purposes and justifications, we formulated the now familiar two-part test that defined as confidential any financial or commercial information whose disclosure would be likely either (1) to impair the Government's ability to obtain necessary information in the future; or (2) to cause substantial harm to the competitive position of the person from whom the information was obtained. Id. at 770 (footnote omitted). In applying this test to the facts of National Parks, we held that because 53 the concessioners [were] required to provide this financial information ..., there is presumably no danger that public disclosure will impair the ability of the Government to obtain this information in the future. 54 Id. (emphasis in original). Then, because the record was incomplete as to the competitive harm that might be suffered by the concessioners on the release of the information, we remanded for further findings on that question. 55 While we indicated that the governmental interest is unlikely to be implicated where the production of information is compelled, we have since pointed out that there are circumstances in which disclosure could affect the reliability of such data. See Washington Post Co. v. HHS, 690 F.2d 252, 268-69 (D.C.Cir.1982) (possible effect of disclosure on accuracy of statements filed by consultants). Thus, when dealing with a FOIA request for information the provider is required to supply, the governmental impact inquiry will focus on the possible effect of disclosure on its quality. 56 When a FOIA request is made for information that is furnished on a voluntary basis, however, we have identified a different aspect of the governmental interest in securing confidential information. As is apparent from the language we have italicized in the passages quoted above, the purpose served by the exemption in such instances is that of encouraging cooperation with the Government by persons having information useful to officials, National Parks, 498 F.2d at 768. Moreover, we have taken note of the probable consequences of a breach of confidence by the Government: 57 Unless persons having necessary information can be assured that it will remain confidential, they may decline to cooperate with officials[,] and the ability of the Government to make intelligent, well informed decisions will be impaired. 58 Id. at 767. Thus, when information is obtained under duress, the Government's interest is in ensuring its continued reliability; when that information is volunteered, the Government's interest is in ensuring its continued availability. 59 A distinction between voluntary and compelled information must also be made when applying the competitive injury prong. In the latter case, there is a presumption that the Government's interest is not threatened by disclosure because it secures the information by mandate; and as the harm to the private interest (commercial disadvantage) is the only factor weighing against FOIA's presumption of disclosure, that interest must be significant. Where, however, the information is provided to the Government voluntarily, the presumption is that its interest will be threatened by disclosure as the persons whose confidences have been betrayed will, in all likelihood, refuse further cooperation. In those cases, the private interest served by Exemption 4 is the protection of information that, for whatever reason, would customarily not be released to the public by the person from whom it was obtained--to use the formulation adopted by this court in Sterling Drug, 450 F.2d at 709 (quoting Senate Report at 9). Because Critical Mass I failed to take these distinctions into account, its holding would frustrate Congress's purpose of encouraging cooperation with the Government by persons having information useful to officials, National Parks, 498 F.2d at 768. See Critical Mass I, 830 F.2d at 288 (Buckley, J., concurring in part and dissenting in part); Critical Mass II, 931 F.2d at 948 (Randolph, J., concurring). 60 It should be evident from this review that the two interests identified in the National Parks test are not exclusive. Although we overrule our decision in Critical Mass I, we note that the panel there adopted the First Circuit's conclusion that the exemption also protects a governmental interest in administrative efficiency and effectiveness. See Critical Mass I, 830 F.2d at 286 (citing 9 to 5 Org. for Women Office Workers, 721 F.2d at 11). And today, of course, we recognize a private interest in preserving the confidentiality of information that is provided the Government on a voluntary basis. We offer no opinion as to whether any other governmental or private interest might also fall within the exemption's protection. 61