Bloomberg L.P. v. Fed. Trade Comm'n

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BLOOMBERG LP, Plaintiff, v. FEDERAL TRADE COMMISSION, Defendant.

Civil Action No. 22-3309 (RC)

United States District Court, District of Columbia

January 16, 2024

MEMORANDUM OPINION

GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION FOR SUMMARY JUDGMENT; GRANTING IN PART AND DENYING IN PART PLAINTIFF'S CROSS-MOTION FOR SUMMARY JUDGMENT

RE DOCUMENT NOS.: 11, 14

RUDOLPH CONTRERAS United States District Judge

I. INTRODUCTION

Plaintiff Bloomberg LP has filed suit against Defendant Federal Trade Commission (“FTC”) under the Freedom of Information Act (“FOIA”), 5 U.S.C. § 552, to obtain documents the FTC has withheld from disclosure. Before the Court are the FTC's motion for summary judgment (“Def.'s Mot.”), ECF No. 11, and Bloomberg's cross-motion for summary judgment (“Pl.'s Mot.”), ECF No. 14-1, which includes Bloomberg's opposition to the FTC's motion for summary judgment. The FTC has filed a combined opposition to Bloomberg's cross-motion for summary judgment and reply in support of its own motion (“Def.'s Reply”), ECF No. 20. And Bloomberg has filed a reply in support of its own motion, (“Pl.'s Reply”) ECF No. 23. For the following reasons, the Court GRANTS in part and DENIES in part the FTC's motion for summary judgment and GRANTS in part and DENIES in part Bloomberg's motion for summary judgment.

II. BACKGROUND

The Hart-Scott-Rodino Act requires certain business entities that plan to “acquire, directly or indirectly, any voting securities or assets of any” other business to file a notification^[1]with the FTC if the transaction is worth over a certain dollar amount. 15 U.S.C. § 18a(a). After business entities file a pre-transaction notice, the FTC has thirty days to review that notice to determine whether the transaction would violate the antitrust laws. Id. § 18a(b), (d). As a general matter, transactions that are subject to the pre-transaction notice requirement may not be consummated until after the thirty-day waiting period has elapsed. Id. § 18a(b). In certain circumstances-such as when the FTC requests more information from the transacting businesses-the waiting period deadline may be extended. Id. § 18a(e)(2), (g)(2). If the FTC believes that the transaction would violate the antitrust laws, it may file an action to prevent the transaction. Id. § 45. Even if the FTC does not file an action within the thirty-day waiting period, however, it may still file an action later to enforce the antitrust laws-including after the transaction has been consummated. Id. §§ 18, 45.

This case arises from the FTC's practice of sending what Bloomberg calls “close at your own peril,” and what the FTC calls “pre-consummation warning,” letters. Def.'s Statement of Undisputed Facts (“Def.'s Undisputed Facts”) at 3-4, ECF No. 11; Pl.'s Mot. at 2. These are letters the FTC sends to business entities that have filed pre-transaction notices informing those businesses that the FTC will not be able to complete its investigation of their transaction within the 30-day deadline. The “close at your own peril” letters further alert recipients that the FTC's investigation remains open and that, should their transaction proceed, the FTC may seek to enforce the antitrust laws with respect to the transaction at a later date. Bloomberg sent the FTC a request under the Freedom of Information Act seeking that the FTC disclose “all preconsummation warning letters issued by the agency since July 2021.” Freedom of Information Act Request, ECF No. 11-2 at 7-8. The FTC made the determination that the letters were exempt from FOIA disclosure. Def.'s Undisputed Facts ¶ 6. Bloomberg filed an administrative appeal, where the agency's determination was affirmed. Id. at 7. Accordingly, Bloomberg brought suit in this Court to compel the FTC to disclose the letters. Compl. at 1, ECF No. 1.

III. LEGAL STANDARD

“The Freedom of Information Act is meant ‘to pierce the veil of administrative secrecy and to open agency action to the light of public scrutiny.'” Woodward v. U.S. Marshals Serv., No. CV 18-1249, 2022 WL 296171, at *2 (D.D.C. Feb. 1, 2022) (quoting U.S. Dep't of State v. Ray, 502 U.S. 164, 173 (1991)). Under FOIA, government agencies must disclose requested government records unless exempt from doing so by statute. 5 U.S.C. § 552(b). If an agency refuses to disclose records, the requesting party may then seek to enjoin the agency from withholding the records. 5 U.S.C. § 552(a)(4)(B).

“FOIA cases typically and appropriately are decided on motions for summary judgment.” Louise Trauma Ctr. LLC v. U.S. Dep't of Just., No. CV 20-3517, 2023 WL 6646335, at *2 (D.D.C. Oct. 12, 2023) (citation omitted). The Court will grant a motion for summary judgment “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “To prevail on a motion for summary judgment in a FOIA case, ‘the defending agency must prove that each document that falls within the class requested either has been produced, is unidentifiable or is wholly exempt from the Act's inspection requirements.'” Woodward, 2022 WL 296171, at *2 (quoting Weisberg v. U.S. Dep't of Just., 627 F.2d 365, 368 (D.C. Cir. 1980)); Niskanen Ctr. v. FERC, 436 F.Supp.3d 206, 212 (D.D.C. 2020), aff'd, 20 F.4th 787 (D.C. Cir. 2021) (“The Court may grant summary judgment based solely on information provided in an agency's affidavits or declarations when they ‘describe the documents and the justifications for nondisclosure with reasonably specific detail, demonstrate that the information withheld logically falls within the claimed exemption, and are not controverted by either contrary evidence in the record nor by evidence of agency bad faith.'” (citation omitted)).

An agency's declarations are accorded a presumption of good faith, SafeCard Servs., Inc. v. S.E.C., 926 F.2d 1197, 1200 (D.C. Cir. 1991), but the withholding agency bears the burden of demonstrating that its withholding is proper, 5 U.S.C. § 552(a)(4)(B). “This burden does not shift even when the requester files a cross-motion for summary judgment because ‘the Government ultimately has the onus of proving that the documents are exempt from disclosure,' while the ‘burden upon the requester is merely to establish the absence of material factual issues before a summary disposition of the case could permissibly occur.'” Hardy v. ATF, 243 F.Supp.3d 155, 162 (D.D.C. 2017) (cleaned up) (quoting Pub. Citizen Health Research Grp. v. FDA, 185 F.3d 898, 904-05 (D.C. Cir. 1999)). Moreover, FOIA exemptions are “narrowly construed.” Bloche v. Dep't of Def., 370 F.Supp.3d 40, 50 (D.D.C. 2019) (quoting Morley v. CIA, 508 F.3d 1108, 1115 (D.C. Cir. 2007)). Even if some requested material is exempt from disclosure, “any reasonably segregable non-exempt parts of records” must be “disclosed after redaction of exempt information.” Am. Immigr. Council v. U.S. Customs & Border Patrol, No. CV 19-2965, 2023 WL 2755412, at *2 (D.D.C. Apr. 3, 2023) (cleaned up).

IV. ANALYSIS

The FTC relies on two statutory FOIA exemptions to justify withholding the “close at your own peril” letters that Bloomberg seeks. The Court addresses each exemption in turn.

A. FOIA Exemption 3

The FTC contends that FOIA Exemption 3-in conjunction with the Hart-Scott-Rodino Act-exempts it from having to disclose the pre-consummation warning letters that Bloomberg seeks. Def.'s Mot. at 8-9. “FOIA Exemption 3 authorizes agencies to withhold records that are ‘specifically exempted from disclosure by statute.'” Corley v. Dep't of Just., 998 F.3d 981, 984 (D.C. Cir. 2021) (quoting 5 U.S.C. § 552(b)(3)). “A statute qualifies for the exemption if it ‘requires that . . . matters be withheld from the public in such a manner as to leave no discretion on the issue' or if it ‘establishes particular criteria for withholding or refers to particular types of matters to be withheld.'” Id. (quoting 5 U.S.C. § 552(b)(3)(A)). “To withhold records under Exemption 3, an agency must make two showings: ‘that the statute [ ] is one of exemption as contemplated by Exemption 3,' and ‘that the withheld material falls within the statute.'” Id. at 984-85 (quoting Larson v. Dep't of State, 565 F.3d 857, 865 (D.C. Cir. 2009)).

The FTC asserts that Exemption 3 applies because the Hart-Scott-Rodino Act contains a provision prohibiting FOIA disclosure of the content of the letters that Plaintiff seeks. See Def.'s Mot. at 9. In particular, the Hart-Scott-Rodino Act states that “[a]ny information or documentary material filed with . . . the Federal Trade Commission pursuant to this section shall be exempt from disclosure under [FOIA], and no such information or documentary material may be made public, except as may be relevant to any administrative or judicial action or proceeding.” 15 U.S.C. § 18a(h). Because the Hart-Scott-Rodino Act specifically creates an exemption from FOIA, there is no question that “the statute is one of exemption as contemplated by Exemption 3.” See Corley, 998 F.3d at 984 (cleaned up). The relevant question, then, is whether the letters the FTC seeks to withhold “fall[] within the statute.” Id. (quotation marks omitted). The Court concludes that some-but not all-of the information contained in the FTC's letters is covered by the Hart-Scott-Rodino Act's disclosure exemption.

The Court begins with the plain meaning of the statute, which the Court reads as prohibiting the FTC from disclosing “close at your own peril” letters if they contain information that the FTC has solely because it received a pre-transaction notice. As explained above, the Hart-Scott-Rodino Act prohibits disclosure of “[a]ny information . . . filed” with the FTC pursuant to the Act. 15 U.S.C. § 18a(h). Parsing out the phrase “any...