FOIA Exemption 4 After Argus Leader And The FOIA Improvement Act

• Published date: 20 May 2022
• Subject Matter: Corporate/Commercial Law, Government, Public Sector, Compliance, Corporate and Company Law, Government Contracts, Procurement & PPP
• Law Firm: Jenner & Block
• Author: Nathaniel E. Castellano

Any company that submits confidential information to the U.S. Government should consider whether that information might be publicly released (to market competitors, the media, and civic society alike) pursuant to the Freedom of Information Act (FOIA).¹ They should also understand how to protect that information from release under FOIA Exemption 4, which protects from disclosure "trade secrets and commercial or financial information obtained from a person and privileged or confidential."² Updating prior resources,³ this BRIEFING PAPER provides a comprehensive introduction and guide to protecting confidential business information using FOIA Exemption 4. The update is necessary, as this area of law has changed drastically in the past several years, due primarily to the U.S. Supreme Court's landmark 2019 decision in Food Marketing Institute v. Argus Leader Media, ⁴ the FOIA Improvement Act of 2016 (FIA),⁵ and the many lower court decisions that have attempted to reconcile Argus and the FIA with the practical realities of FOIA practice and how companies share information with the Government.⁶

The Supreme Court's decision in Argus Leader upended the way that courts have traditionally analyzed whether information is "confidential" for purposes of FOIA Exemption 4 protection. However, the post-Argus swell of Exemption 4 litigation has given courts across the country opportunities to engage critically with all of the elements relevant to Exemption 4. For example, although the Supreme Court in Argus Leader did not address the "commercial or financial" aspect of Exemption 4 or the FIA, these issues repeatedly take central importance in the lower court cases that have grappled with Exemption 4 in the roughly three years since Argus Leader. Moreover, these decisions showcase deepening divides as to how district courts in the District of Columbia, Second, and Ninth Circuits approach Exemption 4 litigation. It is more important now than ever for FOIA practitioners to keep an eye trained on the Exemption 4 precedent developing in each jurisdiction.

This BRIEFING PAPER begins with context for FOIA and Exemption 4, and then walks through the mechanics of a FOIA Exemption 4 dispute, providing best practices and practical insights for how these matters typically progress. Next, the PAPER addresses the primary substantive elements that must be satisfied for information to be protected from release under FOIA Exemption 4, discussing in each instance how the analysis has been...