Case No. VFA-0515, 27 DOE ¶ 80,228

September 1, 1999

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Appeal

Name of Petitioner:Smith, Pachter, McWhorter & D'Ambrosio, P.L.C.

Date of Filing: August 4, 1999

Case Number: VFA-0515

On August 4, 1999, Smith, Pachter, McWhorter & D'Ambrosio, P.L.C. (Smith), a law firm, filed an Appeal from a final determination that the Strategic Petroleum Reserve Project Management Office (SPR) of the Department of Energy (DOE) issued on July 7, 1999. In its determination, SPR withheld various documents that were responsive to a request for information that Smith filed under the Freedom of Information Act (FOIA), 5 U.S.C. § 552, as implemented by the DOE in 10 C.F.R. Part 1004.

I. BACKGROUND

In a March 30, 1999 request for information (Request), Smith requested copies of documents relating to two specific Strategic Petroleum Reserve Life Extension projects at the Strategic Petroleum Reserve's Big Hill and Bayou Choctaw sites. (1) After subsequent discussions with SPR officials, SPR provided Smith with an index of files (Index) which could contain responsive documents and asked Smith to select from the Index those files it wanted searched. Smith subsequently provided SPR with a list of the files from which it was requesting documents. On July 7, 1999, SPR issued a determination letter (Determination Letter) releasing copies of various documents. However, SPR's Determination Letter stated that "the summary sheets and bid item sheets . . . contain detail[ed] cost information, including indirect cost figures of the unsuccessful bidders and are being withheld pursuant to Exemption 4." Determination Letter at 2. The Determination Letter went on to state that "Exemption 4 provides that an agency can withhold such data . . . if release would cause substantial harm to the competitive position of the person from whom the information was obtained or impair the Government's ability to obtain such information in the future." Id.

Smith argues that SPR failed to provide it with a list of the withheld documents or a description of the withheld information. Smith also argues that it was not provided any explanation as to why Exemption 4 is applicable to the withheld information or why redacted copies of the withheld documents cannot be produced. Smith asks that we order SPR to provide it with a Vaughn Index of the withheld documents that includes a complete description of all withheld documents, a statement of why a FOIA exemption is applicable to each of the withheld documents, and a statement of why a redacted version of the documents cannot be provided. (2)

II. ANALYSIS

After conducting a search for responsive documents under the FOIA, an agency is required by statute to provide the requester with a written determination notifying the requester of the results of that search and, if applicable, of the agency's intention to withhold any of the responsive information under one or more of the nine statutory exemptions to the FOIA. 5 U.S.C. § 552(a)(6)(A)(i). The statute further requires that the agency provide the requester with an opportunity to appeal any adverse determination. Id.

The written determination serves to inform the requester of the results of the agency's search for responsive documents and of any information that the agency has withheld. In doing so, the determination letter allows the requester to decide if the agency's response was adequate and proper and provides this Office a record upon which to base its consideration of an administrative appeal. Research Information Services, Inc., 26 DOE ¶ 80,139 (1996) (RIS).

An agency therefore has an obligation to ensure that its determination letters: (1) adequately describe the results of searches; (2) clearly indicate which information was withheld, and (3) specify the exemption or exemptions under which information was withheld. F.A.C.T.S., 26 DOE ¶ 80,232 at 80,888 (1997); RIS, 26 DOE at 80,592. Generally, a description is adequate if each document is identified by a brief description of the subject matter it discusses and, if available, the date upon which the document was produced and its author and recipient. An index of documents need not, however, contain information that would compromise the privileged nature of the documents. Paul W. Fox, 25 DOE ¶ 80,150 (1995). A determination must also adequately justify the withholding of documents by explaining briefly how the claimed exemption applies to the document. Id. Without an adequately informative determination letter, the requester must speculate about the adequacy and appropriateness of the agency's determinations. RIS, 26 DOE at 80,592.

As an initial matter, we do not find that SPR should be required to produce a Vaughn Index of the documents at issue in this case. We have consistently held that, although such an index may be required when an agency is in litigation with a FOIA requester, this degree of specificity is not required at the administrative stages of a FOIA request. Rockwell International, 21 DOE ¶ 80,105 at 80,526-27 (1991).

Nonetheless, we have reviewed the SPR determination letter and find that it falls short of the basic requirements outlined in our discussion above. The Determination Letter, on its face, does identify the withheld documents as being summary sheets and bid item sheets contained in a particular file described in the Index. However, there is no indication of how many documents are being withheld or any description of these documents beyond that of "summary sheets or bid item sheets." Additionally, the Determination Letter contains no specific explanation regarding how Exemption 4 applies to the withheld documents. The only explanation provided is a statement that the documents contain "detail[ed] cost information, including indirect cost figures of the unsuccessful bidders" along with a restatement of the Exemption 4 standard for withholding information involuntarily submitted to the government.(3) Both the FOIA and the Department’s regulations require the agency to provide a reasonably specific justification for its withholding. 5 U.S.C. § 552(a)(6), 10 C.F.R. § 1004.7(b)(1); Mead Data Central, Inc. v. Department of the Air Force, 566 F.2d 242 (D.C. Cir. 1977); National Parks & Conservation Ass'n v. Kleppe, 547 F.2d 673 (D.C. Cir. 1976) (Kleppe); Digital City Communications, Inc., 26 DOE ¶ 80,149 at 80,657 (1997); Data Technology Industries, 4 DOE ¶ 80,118 (1979). This allows the requester to determine whether the claimed exemption was accurately applied. Tri-State Drilling, Inc., 26 DOE ¶ 80,202 at 80,816 (1997). It also aids the requester in formulating a meaningful appeal and this Office in reviewing that appeal. Wisconsin Project on Nuclear Arms Control, 22 DOE ¶ 80,109 at 80,517 (1992).

Thus, if an agency withholds material under Exemption 4 because its disclosure is likely to cause substantial competitive harm, it must state the reasons for believing such harm will result. Larson Associated, Inc., 25 DOE ¶ 80,204 (1996); Milton L. Loeb, 23 DOE ¶ 80,124 (1993). Conversely, conclusory and generalized allegations of substantial competitive harm are unacceptable and cannot support an agency's decision to withhold requested documents. Public Citizen Health Research Group v. F.D.A., 704 F.2d 1280, 1291 (D.C. Cir. 1983); Kleppe, 547 F.2d at 680 ("conclusory and generalized allegations are indeed unacceptable as a means of sustaining the burden of nondisclosure under the FOIA").

Given our finding that the Determination Letter fails to meet the requirements for an adequate FOIA determination, we will remand this matter to SPR so that it may issue another determination regarding Smith's Request. Additionally, on remand, SPR may wish to consider whether there is releasable non-Exemption 4 material contained on the withheld summary sheets and bid item sheets. See Puget Sound Energy, Inc., 27 DOE ¶ 80,193 (1999). Consequently, we will grant Smith's Appeal in part.

It Is Therefore Ordered That:

(1) The Appeal filed by Smith, Pachter, McWhorter & D'Ambrosio, P.L.C. on August 4, 1999, Case No. VFA-0515, is hereby granted in part as specified in Paragraph (2) below.

(2) This matter is hereby remanded to the Strategic Petroleum Reserve Project Management Office, which shall issue a new determination in accordance with the instructions set forth above.

(3) 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 either in the district where 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: September 1, 1999

(1)The projects are part of the Strategic Petroleum Reserve Life Extension Program which seeks to upgrade or replace most major systems in the Strategic Petroleum Reserve by the year 2000, and to streamline Strategic Petroleum Reserve facilities to reduce operating and maintenance costs.

(2)A Vaughn Index is recognized in the context of FOIA as an index identifying each responsive document, the exemption under which it is being withheld and an explanation why that exemption is applicable, or in the alternative a similar document describing each withholding. See Vaughn v. Rosen, 484 F. 2d 820 (D.C. Cir 1974).

(3)Commercial or financial information submitted to the federal government involuntarily is "confidential" for purposes of Exemption 4 if disclosure of the information is 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 government obtained the information. See National Parks & Conservation Ass'n v. Morton, 498 F.2d 765, 770 (D.C. Cir. 1974).