Court Opinion

ID: 9466349
Source: CourtListenerOpinion
Date Created: 2023-08-05 01:12:59.389161+00
Date Added: 2024-06-11T17:39:40.951332
License: Public Domain

VANCE, Circuit Judge,
dissenting in part:
I agree with the majority’s holding that the district court erred in dismissing the FOIA action on the ground that the same issue was pending in the condemnation case. I dissent from the part of the panel opinion that holds that the appraisal report was not routinely available to Mr. Hoover under discovery rules and consequently was excepted from disclosure under exemption 5 of the Freedom of Information Act (FOIA).
There is at least a superficial righteousness in Hoover’s cause. The Department of Interior is taking his bat cave whether or not he wishes to give it up. His government is constitutionally obligated to pay him just compensation. To evaluate this unique property the Department used $18,-000 in public funds, provided by Hoover and his fellow taxpayers, to purchase an appraisal of the land by an independent expert in bat cave valuation. Hoover says that he doesn’t have personal funds to purchase another such appraisal, yet the Department resists his seeing the independent appraisal purchased for the purported purpose of offering a fair price. Although such equitable considerations are appealing, this case is controlled by existing precedent. Hoover’s position regarding his right to the appraisal report following the termination of the negotiating process is adequately supported by such precedent. The majority, in my opinion, has misapplied that precedent, although it has correctly determined that Hoover was not entitled to the report during the pendency of negotiations.
My disagreement with the panel majority stems from what I perceive as two logical oversights in its treatment of the relevant law. The panel majority fails to distinguish between the effect on exemption 5 of ongoing purchase negotiations, in which the government has reason to keep secret its appraisal report, and the effect on exemption 5 of condemnation proceedings, in which it has no further reason to withhold an appraisal prepared before condemnation began. The majority opinion also fails, I believe, to apply the plain language of Rule 26(b)(3) & (4) of the Federal Rules of Civil Procedure that the majority finds to be contemplated by exemption 5.
The purpose of the FOIA is to mandate governmental disclosure unless the requested information is specifically exempted. FOMC v. Merrill,-U.S. -,-, 99 S.Ct. 2800, 2808, 61 L.Ed.2d 587 (1979); Kent Gorp. v. NLRB, 530 F.2d 612, 617 (5th Cir.), cert. denied, 429 U.S. 920, 97 S.Ct. 316, 50 L.Ed.2d 287 (1976). The nine exemptions under the Act are construed narrowly. Department of the Air Force v. Rose, 425 U.S. 352, 361, 96 S.Ct. 1592, 48 L.Ed.2d 11 (1976); Soucie v. David, 145 U.S.App.D.C. 144, 157, 448 F.2d 1067, 1080 (D.C.Cir.1971). We should guard against expanding one of those exemptions, as the panel majority does, at the expense of a citizen’s access to agency information.
*1144Exemption 5 only applies if both of its requirements are satisfied: the requested document must be an intra-agency or inter-agency memorandum and it must not be routinely discoverable. FOMC v. Merrill, - U.S. at -, 99 S.Ct. at 2808; see EPA v. Mink, 410 U.S. 73, 85, 93 S.Ct. 827, 35 L.Ed.2d 119 (1973). An appraisal report may meet both requirements during purchase negotiations. E. g., FOMC v. Merrill, - U.S. at -, 99 S.Ct. at 2812. For present purposes I assume that the appraisal was an intra-agency memorandum.1 See Wu v. National Endowment for Humanities, 460 F.2d 1030, 1032 (5th Cir. 1972), cert. denied, 410 U.S. 926, 93 S.Ct. 1352, 35 L.Ed.2d 586 (1973). I believe, however, that the appraisal report does not meet the exemption’s second requirement involving routine discoverability, and consequently must be disclosed under the FOIA, now that purchase negotiations have ended and condemnation has begun.
The panel majority states or mentions three reasons why the appraisal report is not routinely discoverable: (1) it involves an expert’s knowledge and trial material; (2) it falls within a commercial privilege; and (3) it comes under executive privilege. Our decision in Wu did not consider the first two grounds for nondisclosure and so is not dispositive in those areas. I will discuss the panel’s reasons seriatim.
I.
EXPERT OPINIONS AND TRIAL MATERIALS
The panel majority contends that any qualified privilege against discovery or restriction on discovery under the Federal Rules of Civil Procedure renders material “not routinely discoverable” under exemption 5. It seems to me that the contention contradicts the Supreme Court’s caution in Merrill that “it is not clear that Exemption 5 was intended to incorporate every privilege known to civil discovery.” FOMC v. Merrill,-U.S. at-, 99 S.Ct. at 2809. See also EPA v. Mink, 410 U.S. at 86, 93 S.Ct. at 835 (“the discovery rules can only be applied under Exemption 5 by way of rough analogies”). Merrill implies that some material may be routinely discoverable, and thus disclosable under the FOIA, even though it may be somewhat restricted in discovery under the Federal' Rules of Civil Procedure. The panel majority makes the further argument that the appraisal report “constitutes a report of an expert witness which under Rule 26(b)(4) . is subject to a qualified privilege,” or material prepared for trial that under subsection (b)(3) is privileged, and therefore “is not routinely discoverable.” Even assuming that Rule 26(b)(3) & (4) under the Federal Rules of Civil Procedure renders some trial materials and expert opinion “not routinely discoverable,” however, the instant appraisal report does not come within the plain language of that procedural rule.
The panel majority asserts in a footnote, without case authority, that “[i]t is clear that the appraisal report was prepared in anticipation of litigation.” It reaches that questionable conclusion because “[ajppraisals are . . . obtained both for the purpose of providing a basis for an offer, and to support a claim of just compensation at a subsequent condemnation suit.” See note 8 ante. Nothing in the record indicates, however, that the Department of the Interior expected a breakdown of purchase negotiations and institution of condemnation proceedings, expected those proceedings to determine just compensation by trial rather than by a commission, see Fed.R. Civ.P. 71A(h), and “retained or specially employed” the expert appraiser “in anticipation of litigation or preparation for trial,” see Fed.R.Civ.P. 26(b)(4)(B). The majority then states that the expert who prepared the instant appraisal was not expected to testify in the condemnation proceedings, see note 12 ante, which places the appraisal under Rule 26(b)(4)(B) that requires “exceptional circumstances” for discovery of an expert’s opinions. That requirement of exceptional circumstances renders the appraisal not routinely discoverable and therefore *1145nondisclosable under exemption 5. This chain of reasoning, however, eviscerates the “not routinely discoverable” requirement of exemption 5, because it permits an agency to withhold any intra-agency appraisal from a property owner simply by electing not to have the appraiser testify in the event of a condemnation proceeding. The break in this logical chain is the unsupported assertion that the appraisal report was prepared in anticipation of litigation or trial.
Rule 26(b)(4) only applies to “facts known and opinions held by experts . . . acquired or developed in anticipation of litigation or for trial.” (Emphasis added.) Rule 26(b)(3) also is restricted to materials “prepared in anticipation of litigation or for trial,” and the ensuing discussion of subsection (b)(4) applies equally to subsection (b)(3).2 Multitudes of cases have recognized that Rule 26(b)(4)’s limitation on otherwise free discovery only applies to expert knowledge prepared “in anticipation of litigation” and not to expert knowledge in general such as that acquired or developed before litigation was expected. Barkwell v. Sturm Ruger Co., 79 F.R.D. 444, 446 (D.Alaska 1978); Harasimowicz v. McAllister, 78 F.R.D. 319, 320 (E.D.Pa.1978); Congrove v. St. Louis-S.F. Ry., 11 F.R.D. 503, 504 (W.D. Mo.1978); In re IBM Peripheral EDP Devices Antitrust Litigation, 11 F.R.D. 39, 40-41 (N.D.Cal.1977); Norfin, Inc. v. IBM Corp., 74 F.R.D. 529, 532 (D.Colo.1977); Grinnell Corp. v. Hackett, 70 F.R.D. 326, 331 — 32 (D.R.I.1976); In re Brown Co. Securities Litigation, 54 F.R.D. 384, 385 (E.D.La. 1972); Perry v. W.S. Darley & Co., 54 F.R.D. 278, 279 (D.Wis.1971); Duke Gardens Foundation, Inc. v. Universal Restoration, Inc., 52 F.R.D. 365, 366 (S.D.N.Y. 1971).3
That rule creates four classes of experts:
(1) Experts a party expects to use at trial [and who acquire or develop facts or opinions in anticipation of litigation], [Rule 26(b)(4)(A).] . . .
(2) Experts retained or specially employed in anticipation of litigation or preparation for trial but not expected to be used at trial. [Rule 26(b)(4)(B).] .
(3) Experts informally consulted in preparation for trial but not retained. .
(4) Experts whose information was not acquired in preparation for trial. .
8 C. Wright & A. Miller, Federal Practice and Procedure § 2029, at 250 (1970). The facts and opinions of experts in categories (1) and (2) are not routinely discoverable, under the reasoning of the panel majority. The facts and opinions of experts in category (4), however, are “freely discoverable as with any ordinary witness.” Id. § 2029, at 251. Professor Charles Wright has observed about category (4) experts that
Since [the introductory language of Rule 26(b)(4)] speaks only to information “acquired or developed in anticipation of litigation or for trial” it does not limit discovery of information that an expert may have that was not acquired or developed in this fashion. That kind of information may be obtained through the routine discovery process.
Id. § 2033, at 257-58. In adopting Rule 26(b)(3) & (4), the advisory committee said that
*1146It should be noted that the subdivision does not address itself to the expert whose information was not acquired in preparation for trial but rather because he was an- actor or viewer with respect to transactions or occurrences that are part of the subject matter of the lawsuit. Such an expert should be treated as an ordinary witness.
Advisory Committee’s Explanatory Statement Concerning Amendments of the Discovery Rules, 48 F.R.D. 487; 503-05 (1970). The facts and opinions held by the appraiser as an ordinary witness are thus routinely discoverable.
The majority opinion concludes that the appraiser is a category (2) expert, or else a category (1) expert, and thus exempt from FOIA disclosure. I believe that he clearly is a category (4) expert, one whose information was not acquired in anticipation of litigation or trial, because the appraisal report was made to justify an offer and negotiated price before purchase negotiations even began. The appraisal was not prepared with an -eye to imminent condemnation and trial.4 Cases decided before the 1970 amendment to Rule 26(b), which limited discovery of expert knowledge in categories (1) and (2), are relevant to experts in category (4). The cases involving appraisal reports similar to the requested one have generally concluded that the appraisals were not prepared in anticipation of litigation, but for ordinary business transactions, and that they were routinely discoverable under Rule 26 and not excepted under exemption 5. E. g., Tennessean Newspapers, Inc. v. FHA, 464 F.2d 657, 660 (6th Cir. 1972); GSA v. Benson, 415 F.2d 878, 880 (9th Cir. 1969). See also United States v. Meyer, 398 F.2d 66, 70 (9th Cir. 1968); United States v. McKay, 372 F.2d 174, 177 (5th Cir. 1967). I conclude that the challenged appraisal report is routinely discoverable, Rule 26 notwithstanding, and should be disclosed.
II.
COMMERCIAL PRIVILEGE
The Supreme Court in Merrill ruled that “Exemption 5 incorporates a qualified privilege for confidential commercial information ... to the extent that this information is generated by the Government itself in the process leading up to awarding a contract.” FOMC v. Merrill, - U.S. at -, 99 S.Ct. at 2812.5 The court said that the “theory behind a privilege for confidential commercial information generated in the process of awarding a contract . is . that the Government will be placed at a competitive disadvantage or that the consummation of the contract may be endangered” if the information is disclosed while the contract is pending, and that “the rationale for protecting such information expires as soon as the contract is awarded or the offer withdrawn.” Id. at -, 99 S.Ct. at 2812.
I agree with the panel majority that the confidentiality privilege shields an agency appraisal from FOIA disclosure while pur*1147chase negotiations are pending in order to protect the government’s negotiating position. That rationale expires, as in Merrill, when negotiations fail and are terminated. I do not believe “that the Government will be placed at a competitive disadvantage or that the consummation of the [purchase] may be endangered.” Id. at-, 99 S.Ct. at 2812. The confidentiality privilege no longer justifies nondisclosure of the appraisal report made for negotiations.
III.
EXECUTIVE PRIVILEGE
The Supreme Court has held that exemption 5 includes the “executive privilege” over “ ‘decision making processes of government agencies.’ ” NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 150, 95 S.Ct. 1504, 1516, 44 L.Ed.2d 29 (1975) (quoting Tennessean .Newspapers, Inc. v. FHA, 464 F.2d at 660). Accord, Kent Corp. v. NLRB, 530 F.2d at 618. That executive privilege “focus[es] on documents ‘reflecting advisory opinions, recommendations and deliberations comprising part of a process by which governmental decisions and policies are formulated.’ ” NLRB v. Sears, Roebuck & Co., 421 U.S. at 150, 95 S.Ct. at 1516 (quoting Carl Zeiss Stiftung v. V.E.B. Carl Zeiss, Jena, 40 F.R.D. 318, 324 (D.D.C.1964), aff’d, 128 U.S. App.D.C. 10, 384 F.2d 979 (D.C.Cir.), cert. denied, 389 U.S. 952, 88 S.Ct. 334, 19 L.Ed.2d 361 (1967)). Accord, EPA v. Mink, 410 U.S. at 89, 93 S.Ct. 827. The executive privilege under exemption 5, in my view, does not apply to every governmental decision, however inconsequential and minor, but to decisionmaking that involves policies or major discretionary actions. The instant decision about purchase of 264 acres including a bat cave simply is not the sort of policy decision protected by the executive privilege.
Our decision in Wu does not compel an infinitely broad reading of executive privilege. Wu did not explicitly rely on the executive privilege, but instead on a “ ‘purely factual’ test.” Wu v. National Endowment for Humanities, 460 F.2d at 1033. It held that purely factual information must be disclosed while agency opinion could be withheld. For example, the court ruled that “[t]he records [Wu] wants . are opinions, not facts, and are thus protected by exemption (5).” Id. Supreme Court decisions subsequent to Wu have recognized the executive privilege under exemption 5 but have refused to articulate that privilege in the overly-expansive Wu manner to include any agency opinion. See FOMC v. Merrill,-U.S. at-, 99 S.Ct. at 2814 (no automatic exemption of agency policy directives involving governmental open market sales); NLRB v. Sears, Roebuck & Co., 421 U.S. at 155, 95 S.Ct. 1504 (no exemption of agency opinion recommending against labor complaint). The court in Mer-. rill found overly broad a reading of executive privilege allowing nondisclosure of agency material that furthered the public interest, which is much like agency documents in Wu that involve opinions.
Such an interpretation of Exemption 5 would appear to allow an agency to withhold any memoranda, even those that contain final opinions and statements of policy, whenever the agency concluded that disclosure . . . would not be in the “public interest.” This would leave little, if anything, to FOIA’s requirement of prompt disclosure, and would run counter to Congress’ repeated rejection of any interpretation of FOIA which would allow an agency to withhold information on the basis of some vague “public interest” standard.
FOMC v. Merrill,-U.S. at-, 99 S.Ct. at 2809. Other courts, and scholarly commentary, have rejected the fact-opinion distinction relied upon in Wu. E. g., United States v. Meyer, 398 F.2d at 72-73; C. Wright & A. Miller, supra § 2029, at 247-49 (citing cases). The executive privilege should not, in my opinion, be extended beyond policy decisions and major decision-making to the decision about the value of a bat cave.
The panel majority concluded that “this qualified [executive] privilege should be recognized in the instant FOIA action . to protect the government’s bargaining po*1148sition with the landowner during the negotiation process.” (Emphasis added.) The government, however, is no longer bargaining or negotiating with Mr. Hoover; it is condemning his property without his assent. The majority opinion continues that “[t]he acquisition process is still continuing, so the appraisal remains vital to the Department’s litigation decisions.” (Emphasis added.) In my view the negotiation process has ended. The litigation decision has been made, and the condemnation process is now underway.
Even if the executive privilege under exemption 5 applies to the Department of the Interior’s decision to purchase the bat cave, I would hold that the privilege expired when the purchase negotiations ceased. I recognize that memoranda from major predecisional deliberations may remain privileged after the decision is made if “disclo-. sure at any time could inhibit the free flow of advice . . . within the agency,” because the purpose of that privilege “is to insure that a decisionmaker will receive the unimpeded advice of his associates.” FOMC v. Merrill,-U.S. at - — , 99 S.Ct. at 2812. The executive privilege for predecisional deliberations, like the privilege for commercial information, should expire when the decision is made if disclosure would not impede the free flow of candid advice within the agency and if the information does not involve a major policy decision. See EPA v. Mink, 410 U.S. at 87, 93 S.Ct. at 836 (material is exempt under the executive decisionmaking privilege only if “production of the contested document would be ‘injurious to the consultative functions of government that the privilege of nondisclosure protects’ ”) (quoting Kaiser Aluminum & Chemical Corp. v. United States, 157 F.Supp. 939, 946, 141 Ct.Cl. 38 (1958) (per Reed, J.)). See also NLRB v. Sears, Roebuck & Co., 421 U.S. at 155, 95 S.Ct. 1504 (memoranda of agency advice branch and appeals office regarding whether to file a labor complaint fall under exemption 5 if the complaint was filed and is still being litigated but must be disclosed if the complaint was not filed). Disclosure of the appraisal report would not inhibit candid advice during agency decisionmaking because of the minor nature of the decision-making involved and particularly in view of the outside source of the independent appraiser. The appraisal is not now exempt from disclosure and should be disclosed.

. That presumes that the appraisal report does not come within exemption 4. See note 5 infra.

. Subsection (b)(3) limits discovery “of documents and tangible things otherwise discoverable . . . and prepared in anticipation of litigation or for trial ” to a showing of substantial need and no alternative access. (Emphasis added.) The appraisal report is not trial material prepared in anticipation of litigation for the same reasons that it is not expert knowledge prepared in anticipation of litigation.

. The agency has the burden of proof that a withheld memorandum is exempt from disclosure. E. g., Seafarers lnt’1 Union, AFL-CIO v. Baldovin, 508 F.2d 125, 128 (5th Cir.), vacated on other grounds, 511 F.2d 1161 (5th Cir. 1975). That includes the burden of proof that the appraisal report was prepared in anticipation of litigation, which the agency has not shown. The panel majority departs from fifth circuit precedent on the burden of proof issue and mentions only that “[a] party seeking disclosure under Rule 26(b)(4)(B) carries a heavy burden,” see note 13 ante.

. Exemption 4 under the FOIA applies to “trade secrets and commercial or financial information obtained from a person and privileged or confidential . . . .” 5 U.S.C. § 552(b)(4). Exemption 4 appears to apply to commercial information supplied to government agencies under regulatory requirements, e. g., Continental Oil Co. v. FPC, 519 F.2d 31, 35-36 (5th Cir. 1975), cert. denied, 425 U.S. 971, 96 S.Ct. 2168, 48 L.Ed.2d 794 (1976), whereas exemption 5 “is necessarily confined to information generated by the Federal Government itself.” FOMC v. Merrill,-U.S. at -, 99 S.Ct. at 2812. I assume that the appraiser’s report, paid for by the Department of the Interior and prepared in response to its commissioning, falls under the exemption 5 category and not under exemption 4. If it does come within the exemption 4 category, I believe that it is not exempt from disclosure either because it is not privileged now that purchase negotiations have ended, e. g., Shermco Industries, Inc. v. Secretary, 452 F.Supp. 306, 323-24 (N.D.Tex.1978), or because it is not confidential now that negotiation has ceased, e. g., GSA v. Benson, 415 F.2d at 881; Martin Marietta Aluminum, Inc. v. Administrator, 444 F.Supp. 945, 948 (C.D.Cal.1977).