Opinion ID: 3050326
Heading Depth: 1
Heading Rank: 2

Heading: analysis

Text: As a general rule, we employ a two-part inquiry to determine whether Exemption 3 applies to a particular FOIA request. See Minier, 88 F.3d at 801. First, we determine whether the withholding statute meets the requirements of Exemption 3. Then, we determine whether the requested information falls within the scope of the withholding statute. See id. However, neither party to this appeal contests the dis14028 CARLSON v. USPS trict court’s ruling that 39 U.S.C. § 410(c)(2) meets the requirements of Exemption 3. Therefore, we assume without deciding that 39 U.S.C. § 410(c)(2) qualifies as an Exemption 3 statute for purposes of this appeal and proceed directly to the question whether the requested records fall within the scope of § 410(c)(2). USPS asserts that the requested information is commercial because its Post Office locator database has commercial value and attracts customers to the Post Office website for marketing and advertising. It also argues that the Postal Reorganization Act (PRA) gave the Postal Service the status of a private commercial enterprise, such that its website is commercial, and the locator database, which attracts people to the website, is commercial information. However, USPS’s argument is undermined by the position and purpose of the United States Postal Service, common understanding of the definition of “commercial,” and case law interpreting the phrase “information of a commercial nature.” United States Postal Service Purpose. As we noted in Church of Scientology v. U.S. Postal Serv., 633 F.2d 1327, 1332-33 (9th Cir. 1980), the PRA sought to eliminate outmoded “legislative, budgetary, financial, and personnel policies” so that USPS could employ “modern management and business practices” to provide the American public with “efficient and economical postal service.” (quoting H.R. Rep. No. 91-1104, 91st Cong., 2d Sess., at 2 (1970), reprinted in 1970 U.S.C.C.A.N. 3649, 3650). Under the PRA, the Postal Service is to operate in a more “businesslike way” but with “appropriate safeguards” against abuse of its responsibility for managing the postal system and “appropriate assurances of continued congressional surveillance.” H.R. Rep. No. 911104 at 5, reprinted in 1970 U.S.C.C.A.N. at 3653. As stated in the PRA: The United States Postal Service shall be operated as a basic and fundamental service provided to the CARLSON v. USPS 14029 people by the Government of the United States, authorized by the Constitution, created by Act of Congress, and supported by the people. The Postal Service shall have as its basic function the obligation to provide postal services to bind the Nation together through the personal, educational, literary, and business correspondence of the people. 39 U.S.C. § 101(a) (Postal Policy). Thus, USPS is not a private business, but has different goals, obligations, and powers from private corporations. Its goals are not those of private enterprise. The most important difference is that it does not seek profits, but only to break even, which is consistent with its public character. It also has broader obligations . . . . Finally, the Postal Service has many powers more characteristic of Government than of private enterprise, including its state- conferred monopoly on mail delivery, the power of eminent domain, and the power to conclude international postal agreements. U.S. Postal Serv. v. Flamingo Indus. (USA) Ltd., 540 U.S. 736, 747 (2004) (citation omitted). [1] Thus, under the PRA, USPS is a government entity, not a business, which provides a service, mail delivery, to the public. Post offices are a primary means of public access to mail service. Basic information concerning these access points, such as the location of post offices and their phone number, hours of operation and time of mail pick-up is not information that is commercial in nature. [2] Definition of Commercial. Because the PRA and USPS do not define the term, “commercial,”1 we apply the common 1 USPS regulations list eight categories of “information of a commercial nature . . . which under good business practice would not be disclosed.” 14030 CARLSON v. USPS meaning of the term. See Lands Council v. Martin, 479 F.3d 636, 642 (9th Cir. 2007). We have previously surveyed the common definitions of commercial: Webster’s defines “commercial” as “occupied with or engaged in commerce or work intended for com- merce; of or relating to commerce.” The American Heritage Dictionary of the English Language pro- vides a strikingly similar definition, viewing “commercial” as meaning “1.a. of or relating to commerce, b. engaged in commerce, c. involved in work that is intended for the mass market.” Black’s Law Dictionary adds that “commercial” may be defined as “relates to or is connected with trade and traffic or commerce in general; is occupied with business or commerce.” 39 C.F.R. § 265.6(b)(3)(2005). The regulations do not define commercial. The eight categories are: (i) Information pertaining to methods of handling valuable registered mail. (ii) Records of money orders, except as provided in R900 of the Domestic Mail Manual (DMM). (iii) Technical information concerning postage meters and prototypes submitted for Postal Service approval prior to leasing to mailers. (iv) Reports of market surveys conducted by or under contract in behalf of the Postal Service. (v) Records indicating rural carrier lines of travel. (vi) Records compiled within the Postal Service which would be of potential benefit to persons or firms in economic competition with the Postal Service. (vii) Information which, if publicly disclosed, could materially increase procurement costs. (viii) Information which, if publicly disclosed, could compromise testing or examination materials. Id.. CARLSON v. USPS 14031 The Wilderness Soc’y v. U.S. Fish & Wildlife Serv., 353 F.3d 1051, 1061 (9th Cir. 2003) (en banc) (citations omitted). Thus, “[i]nformation is commercial if it relates to commerce, trade, or profit.” McClellan Ecological Seepage Situation v. Carlucci, 835 F.2d 1282, 1285 (9th Cir. 1987) (interpreting “commercial” as used in FOIA fee waiver provision). [3] Mail service may be essential to commerce and trade, but information concerning the names, addresses, telephone numbers, and regular business hours of post offices, is not commercial information. While the Postal Service argues the requested information concerning post offices is commercial because it has value, this is too broad a definition of commercial, particularly given our prior admonition that an Exemption 3 statute’s “identified class of nondisclosable matters [must be] narrow” to meet the requirements of Exemption 3. Lessner, 827 F.2d at 1336. [4] USPS also relies on two of its regulations, 39 C.F.R. § 265.6(b)(3)(vi) & (vii), to support its argument that the information requested by Carlson is commercial. These regulations provide in relevant part: (b) Records not subject to mandatory public disclosure. . . . .... (3) Information of a commercial nature, including trade secrets, whether or not obtained from a person outside the Postal Service, which under good business prac- tice would not be publicly disclosed. This class includes, but is not limited to: .... (vi) Records compiled within the Postal Service which would be of potential benefit 14032 CARLSON v. USPS to persons or firms in economic competi- tion with the Postal Service. (vii) Information which, if publicly dis- closed, could materially increase procure- ment costs. 39 C.F.R. § 265.6(b)(3)(vi) & (vii). USPS’ interpretation of these regulations to encompass the location, phone numbers and hours of its post offices is inconsistent with the regulation and with the statute, because both require that the information be of “a commercial nature” in the first instance. See 39 U.S.C. § 410(c)(2); 39 C.F.R. § 265.6(b)(3). Because USPS’s interpretation is inconsistent with its own regulations and based on an impermissible construction of the governing statue, it is not entitled to deference. See Auer v. Robbins, 519 U.S. 452, 457 & 461 (1997); League of Wilderness Defenders v. Forsgren, 309 F.3d 1181, 1183 (9th Cir. 2002). [5] Case Law. The majority of cases which have upheld USPS’s withholding of information under § 410(c)(2) have concerned proprietary information. See, e.g., Wickwire Gavin, P.C. v. U.S. Postal Serv., 356 F.3d 589, 589 (spreadsheets detailing quantity and pricing information in contract between USPS and the successful bidder for the mailing supplies contract); Piper & Marbury LLP v. U.S. Postal Serv., 2001 WL 214217, at -5 (D.D.C. Mar. 6, 2001) (figures and data in a contract between USPS and DHL); Reid v. U.S. Postal Serv., No. 05-cv-294-DRH, 2006 WL 1876682, at -8 (S.D. Ill. July 5, 2006) (information in USPS mailing permits for a private marketing firm which would reveal the firm’s clients, mailing agents, and charges by USPS); Airline Pilots Ass’n Int’l v. U.S. Postal Serv., Civil Action No. 03-2384, 2004 WL 5050900 (D.D.C. June 24, 2004) (redacted information in delivery agreements between USPS and FedEx including pricing and rates). [6] In contrast, in Nat’l Western Life Ins. Co. v. United States, 512 F. Supp. 454, 462 (N.D. Tex. 1980), the names CARLSON v. USPS 14033 and duty stations of USPS employees in two cities did not constitute commercial information and was not within the scope of § 401(c)(2) even though “it may not be good business practice for a private company to disclose names and addresses of its employees.” Here, the records requested are not proprietary, and, in fact, are already publicly available. That it may not be good business practice to disclose the information requested does not, by itself, make it commercial in nature. [7] Post office names, addresses, telephone numbers, hours of operation and final collection times are not “information of a commercial nature,” and, therefore, are not within the scope of § 401(c)(2). We do not decide whether the complete USPS database from which Carlson requested an electronic version of this particular information is commercial nor whether the USPS database may be exempt from disclosure. In so ruling we do not preclude further consideration by the district court nor do we preclude consideration of reasonable conditions. [8] Litigation Costs. Carlson has requested an award of his district court litigation costs and his costs on appeal. Under 5 U.S.C. § 552(a)(4)(E) a court may award a substantially prevailing plaintiff in a FOIA action litigation costs that are reasonably incurred. Carlson’s request for district court litigation costs is remanded to the district court for its consideration in the first instance. See Lissner v. U.S. Customs Serv., 241 F.3d 1220, 1224 (9th Cir. 2001). Carlson is awarded costs on appeal. REVERSED AND REMANDED.