Case No. VFA-0342, 26 DOE ¶ 80,228

October 31, 1997

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Appeal

Name of Petitioner: ChemData, Inc.

Date of Filing: October 14, 1997

Case Number: VFA-0342

On October 14, 1997, ChemData, Inc. (Appellant) filed an Appeal from a determination issued to it on September 9, 1997, by the Rocky Flats Field Office (RFFO) of the Department of Energy (DOE). That determination denied a request for information submitted by the Appellant under the Freedom of Information Act (FOIA), 5 U.S.C § 552, as implemented by the DOE in 10 C.F.R. Part 1004. The Appeal, if granted, would require RFFO to release the requested information.

The FOIA requires that documents held by federal agencies generally be released to the public upon request. The FOIA, however, lists nine exemptions that set forth the type of information that may be withheld at the discretion of an agency. 5 U.S.C. § 552(b); 10 C.F.R. § 1004.10(b). The DOE regulations further provide that a document exempt from mandatory disclosure under the FOIA shall nonetheless be released to the public if the DOE determines that disclosure is permitted by federal law and is in the public interest. 10 C.F.R. § 1004.1.

I. Background

On January 10, 1997, the Appellant filed a request under the FOIA in which it sought "a copy of the selected Bid Prices for Data Validation work, under [Kaiser-Hill Company's] current TechLaw contract." This FOIA request was incorrectly filed with RFFO's management and operating contractor, Kaiser-Hill Company (Kaiser-Hill), instead of with RFFO as required by 10 C.F.R. § 1004.4. The request was, however, forwarded to RFFO, and RFFO issued a determination to the Appellant on September 9, 1997. In that determination, RFFO found that the records sought by the Appellant are not "agency records" because they were not in the possession and control of the agency at the time of the FOIA request. RFFO further explained that under the terms of the contract between DOE and Kaiser-Hill, all procurement records are owned by the contractor and therefore not subject to release under DOE regulations. Electronic Mail from Mary Hammack, FOIA Officer, RFFO, to Appellant (September 9, 1997).

In its Appeal, the Appellant claims that all taxpayer-funded records are subject to release under the FOIA. It also argues that all contracting or subcontracting records under DOE procurement are DOE property.(1) See Letter from Ann Mary Nefcy, Senior Chemist, to Director, Office of Hearings and Appeals (October 14, 1997) (Appeal Letter).

II. Analysis

Our threshold inquiry in this case is whether procurement records between a DOE contractor and sub-contractor which were in the possession of the DOE contractor at the time of the request are subject to the FOIA. Contrary to the Appellant's unsupported assertion, not all "taxpayer-funded records" are subject to review under the FOIA. Rather, we must first determine whether such records are "agency records," and thus subject to the FOIA, under the criteria set out by the federal courts. See 5 U.S.C. § 552(f). Records that do not meet these criteria may nonetheless be subject to release under the DOE regulations if they are owned by the government. 10 C.F.R. § 1004.3(e); see 59 Fed. Reg. 63,884 (December 12, 1994). For the reasons set forth below, we conclude that the records in question are not "agency records" and are not subject to release under the DOE regulations.

The statutory language of the FOIA does not define the essential attributes of "agency records," but merely lists examples of the types of information required to be made available to the public. See 5 U.S.C. § 552(a). In interpreting this phrase, we have applied a two-stage analysis fashioned by the courts for determining whether documents created by non-federal organizations, such as Kaiser-Hill, are subject to the FOIA. See, e.g., The Cincinnati Enquirer, 26 DOE ¶ 80,205 (1997); Diane C. Larson, 26 DOE ¶ 80,112 (1996); Judith M. Gibbs, 16 DOE ¶ 80,133 (1987) (Gibbs). That analysis involves a determination (i) whether the organization is an "agency" for purposes of the FOIA, and if not (ii) whether the requested material is nonetheless an "agency record." See Gibbs, 16 DOE at 80,595.

The FOIA defines the term "agency" to include any "executive department, military department, Government corporation, Government controlled corporation, or other establishment in the executive branch . . . , or any independent regulatory agency." 5 U.S.C. § 552(f). The courts have identified certain factors to consider in determining whether an entity should be regarded as an agency for purposes of federal law. In United States v. Orleans, 425 U.S. 807 (1976), a case which involved a statute other than the FOIA, the Supreme Court defined the conditions under which a private organization must be considered a federal agency as follows: "[T]he question here is not whether the . . . agency receives federal money and must comply with federal standards and regulations, but whether its day-to-day operations are supervised by the Federal Government." Id. at 815. In other words, an organization will be considered a federal agency only where its structure and daily operations are subject to substantial federal control. See Ciba-Geigy Corp. v. Matthews, 428 F. Supp. 523, 528 (S.D.N.Y. 1977). Subsequently, the Supreme Court ruled that the Orleans standard provides the appropriate basis for ascertaining whether an organization is an "agency" in the context of a FOIA request for "agency records." Forsham v. Harris, 445 U.S. 169, 180 (1980) (Forsham). See also Washington Research Project, Inc. v. HEW, 504 F.2d 238, 248 (D.C. Cir. 1974); cert. denied, 421 U.S. 963 (1975) (degree of independent governmental decision-making authority considered); Rocap v. Indiek, 539 F.2d 174 (D.C. Cir. 1976).

Under its contractual relationship with the DOE, Kaiser-Hill is the prime contractor responsible for maintaining and operating the Rocky Flats Environmental Technology Site. This Office has frequently held that DOE management and operating contractors are not "agencies" for FOIA purposes. See, e.g., The Cincinnati Enquirer, 26 DOE ¶ 80,205 (1997) (Fluor Daniel Fernald); Diane C. Larson, 26 DOE ¶ 80,112 (1996) (Westinghouse Hanford Company); William Kuntz III, 25 DOE ¶ 80,157 (1995) (Lockheed Martin Corporation); Cowles Publishing Co., 24 DOE ¶ 80,102 (1994) (Battelle Memorial Institute). As in those other cases, the DOE has obtained Kaiser-Hill's services and exercises general control over the contract work, but it does not supervise Kaiser-Hill's day-to- day operations. See Record of Telephone Conversation between Mary Hammack and Dawn Goldstein, Staff Attorney, OHA (October 20, 1997). Therefore, Kaiser-Hill does not meet the test set forth in the Orleans and Forsham decisions and we therefore conclude that Kaiser-Hill is not an "agency" subject to the FOIA.

Although Kaiser-Hill is not an agency for the purposes of the FOIA, records in its possession which are responsive to the Appellant's request could be deemed "agency records" if they were obtained by the DOE and were within the DOE's control at the time the FOIA request was made. Department of Justice v. Tax Analysts, 492 U.S. 136, 144-46 (1989) (Tax Analysts); see also Kissinger v. Reporters Comm. for Freedom of the Press, 445 U.S. 136 (1980); Forsham, 445 U.S. at 182. However in this case, the documents in question had not been obtained by the DOE and were not in the agency's possession at the time of the Appellant's request. See Record of Telephone Conversation between Mary Hammack and Dawn Goldstein (October 20, 1997).

Even if a contractor-acquired record fails to qualify as an "agency record," it may still be subject to voluntary release if the contract between the DOE and that contractor provides that the document in question is the property of the agency. The DOE regulations state that "[w]hen a contract with DOE provides that any records acquired or generated by the contractor in its performance of the contract shall be the property of the Government, DOE will make available to the public such records that are in the possession of the Government or the contractor, unless the records are exempt from public disclosure under 5 U.S.C. § 552(b)." 10 C.F.R. 1004.3(e)(1).

We therefore next look to the contract between DOE and Kaiser-Hill to determine the status of the withheld records. That contract states:

Except as is provided in paragraph (b) of this clause, all records acquired or generated by the Contractor in its performance of this contract shall be the property of the Government and shall be delivered to the Government . . . .

Contract DE-AC34-95RF00825, Section H.4. Paragraph (b) excludes from this provision "all records related to any procurement action by the Contractor." Id. at Clause H.20(b)(8). Thus, contrary to the Appellant's assertion, not all procurement records of DOE contractors are owned by the DOE. In this case, because procurement records are not among the records which are property of the Government under the DOE's contract with Kaiser-Hill, these records are not subject to release under the DOE regulations.

For the reasons set forth above, we find that the records sought by the Appellant are neither "agency records" within the meaning of the FOIA, nor subject to release under DOE regulations. Accordingly, the Appeal should be denied.

It Is Therefore Ordered That:

(1) The Appeal filed by ChemData, Inc. on October 14, 1997, Case Number VFA-0342, is hereby denied.

(2) This is a final Order of the Department of Energy from which any aggrieved party may seek judicial review pursuant to the provisions of 5 U.S.C. § 552(a)(4)(B). Judicial review may be sought in the district in which the requester resides or has a principal place of business, or in which the agency records are situated, or in the District of Columbia.

George B. Breznay

Director

Office of Hearings and Appeals

Date: October 31, 1997

(1)*/ In its Appeal, the Appellant also requests all prices for all Data Validation contract or subcontract awards to TechLaw, Inc., under any contracts between DOE and Kaiser-Hill. Documents regarding TechLaw, Inc. contracts other than the current contract with Kaiser- Hill Company are clearly outside the scope of the Appellant's initial FOIA request. The OHA will therefore not consider this request in the context of the present Appeal. Cox Newspapers, 22 DOE ¶ 80,106 at 80,512 (1992). Accordingly, the Appellant should, if it so wishes in light of our result below, file a new request for information regarding other contracts.

The Appellant also asserts in its Appeal that although it had requested information pertaining to the current DOE/Kaiser-Hill contract, RFFO's determination concerned only the DOE/Kaiser-Hill contract covering the period July 1, 1995 to June 30, 1996. That assertion is incorrect. In its response, RFFO referred to the contract which has been in continuous effect between DOE and Kaiser-Hill from April 4, 1995 to the present.