Judicial Watch, Inc. v. U.S. Dep't of Health & Human Servs.

525 F.Supp.3d 90

JUDICIAL WATCH, INC., Plaintiff,

v.U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES, Defendant.

Case No. 1:19-cv-00876 (TNM)

United States District Court, District of Columbia.

Signed March 11, 2021

Meredith Leigh Di Liberto, Judicial Watch, Upper Holland, DC, Paul J. Orfanedes, Judicial Watch, Inc., Washington, DC, for Plaintiff.

Kristin Brudy-Everett, Michelle D. Jackson, U.S. Attorney's Office for the District of Columbia, Washington, DC, for Defendant.

MEMORANDUM OPINION

TREVOR N. McFADDEN, U.S.D.J.

Advanced Biosciences Resources ("ABR") partnered with Planned Parenthood and other abortion providers to dismember fetuses and sell their parts for research. It sold second-trimester livers and thymi for hundreds of dollars apiece. The same for brains, eyes, and lungs. After tacking on fees for services like shipping and cleaning, ABR could collect over $2,000 on a single fetus it purchased from Planned Parenthood for $60. The federal government participated in this potentially illicit trade for years.

Plaintiff Judicial Watch, Inc. sued under the Freedom of Information Act to obtain details from the Food and Drug Agency and the National Institutes of Health—two components of Defendant U.S. Department of Health and Human Services (collectively, "the Government")—on their involvement in this bloody business. The Government produced hundreds of documents, but, as relevant here, redacted some information under FOIA's Exemption 4, claiming that the information is confidential and commercial.

Before the Court are the parties’ cross-motions for summary judgment. The Court determines that the Government cannot rely on Exemption 4 to shield this information from disclosure. As a result, the Court will deny the Government's motion for summary judgment and grant Judicial Watch's cross-motion.

I.

In September 2018, Judicial Watch submitted FOIA requests to FDA and NIH.

It asked for information relevant to contracts between the Government and ABR. Def.’s Statement of Material Facts ("DSMF") ¶¶ 1–2, ECF No. 15. Judicial Watch's requests to each agency were identical. It sought these records for the 2013 to 2018 years:

1. All contracts and related documentation between [FDA/NIH] and Advanced Biosciences Resources ("ABR") for the provision of human fetal tissue to be used in humanized mice research.

2. All records reflecting the disbursement of funds to ABR for the provision of human fetal tissue to be used in humanized mice research.

3. All guidelines and procedural documents provided to ABR by [FDA/NIH] relating to the acquisition and extraction of human fetal tissue for its provision to the [FDA/NIH] for humanized mice research.

4. All communications between [FDA/NIH] officials and employees and representatives of ABR related to the provision by ABR to the [FDA/NIH] of human fetal tissue for the purpose of humanized mice research.

Id. ; Pl.’s Resp. to Def.’s Statement of Material Facts and Further Statement of Facts ("PSMF") ¶¶ 1–2, ECF No. 16.

When no records were released, Judicial Watch sued. DSMF ¶ 5. FDA then produced 740 pages of potentially responsive records. Id. ¶ 6. NIH produced 676 pages. Id. ¶¶ 6, 25. Each set of records was subject to partial redactions under FOIA's Exemption 4, which protects confidential commercial information. Id. ¶ 6; 5 U.S.C. § 552(b)(4). Judicial Watch challenges these withholdings. Pl.’s Mem. in Opp'n to Def.’s Mot. for Summ. J. and in Supp. of Pl.’s Cross-Mot. ("Pl.’s Opp'n/Cross-Mot.") at 8–9, ECF No. 16.¹ Before the Court are the parties’ cross-motions for summary judgment.²

II.

Courts decide the "vast majority" of FOIA cases on motions for summary judgment. See Brayton v. Off. of U.S. Trade Repr. , 641 F.3d 521, 527 (D.C. Cir. 2011). To prevail in this procedural posture, a movant must show that "there is no genuine dispute as to any material fact" and that it "is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a) ; see Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 247, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ; Celotex Corp. v. Catrett , 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). A factual dispute is material if it could alter the outcome of the suit under the substantive governing law. Anderson , 477 U.S. at 248, 106 S.Ct. 2505. And "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party," the dispute is genuine. Id.

"The mandate of ... FOIA calls for broad disclosure of Government records." CIA v. Sims , 471 U.S. 159, 166, 105 S.Ct. 1881, 85 L.Ed.2d 173 (1985). Federal agencies must "disclose information to the public upon reasonable request unless the records at issue fall within specifically delineated exemptions." Judicial Watch, Inc. v. FBI , 522 F.3d 364, 365–66 (D.C. Cir. 2008). The "nine specific exemptions" are "construed narrowly in keeping with FOIA's presumption in favor of disclosure." Pub. Citizen, Inc. v. OMB , 598 F.3d 865, 869 (D.C. Cir. 2010) ; see also FBI v. Abramson , 456 U.S. 615, 630, 102 S.Ct. 2054, 72 L.Ed.2d 376 (1982) (referring to "the oft-repeated caveat that FOIA exemptions are to be narrowly construed").

"The agency bears the burden of establishing that a claimed exemption applies." Citizens for Resp. & Ethics in Wash. v. DOJ , 746 F.3d 1082, 1088 (D.C. Cir. 2014). "[S]ummary judgment may be granted on the basis of agency affidavits if they contain reasonable specificity of detail rather than merely conclusory statements, and if they are not called into question by contradictory evidence in the record or by evidence of agency bad faith." Pub. Citizen v. HHS , 975 F. Supp. 2d 81, 94 (D.D.C. 2013) (cleaned up). Courts review the applicability of FOIA exemptions de novo. King v. DOJ , 830 F.2d 210, 217 (D.C. Cir. 1987).

III.

To begin with, the Government says that FOIA's concern is with "the operations or activities of the government," not private parties like ABR. Def.’s Mem. in Supp. of Mot. for Summ. J. ("Def.’s Mot.") at 23, ECF No. 15 (cleaned up). True enough. But Judicial Watch's FOIA request does concern "the operations or activities of the government." Here, ABR was a supplier of human body parts to the Government and thus is implicated in the Government's activities. They were business partners. Judicial Watch wants to know how the Government used taxpayer dollars participating in this trade. This is a far cry from when the Government only acquires private documents through its role as a regulator or law maker. Cf. Pub. Citizen Health Rsch. Grp. v. FDA , 704 F.2d 1280, 1282 (D.C. Cir. 1983) (explaining that companies had "submitted the data requested by the [plaintiff] to the FDA as part of the agency's investigation of" the product they manufactured).

This leads us to the crux of the case. This case concerns FOIA's Exemption 4, which allows the Government to withhold "trade secrets and commercial or financial information obtained from a person" that are "privileged or confidential."³ 5 U.S.C. § 552(b)(4). Neither party contends that the withheld information constitutes "trade secrets," so whether Exemption 4 applies hinges on whether the withheld information is: (1) "commercial or financial"; (2) "obtained from a person"; and (3) "privileged or confidential." Pub. Citizen Health Rsch. Grp. , 704 F.2d at 1290.

Judicial Watch challenges the Government's invocation of Exemption 4 as to two types of information: (A) the names and addresses of ABR's contract laboratories; and (B) unit prices and line-item amounts in contracts between ABR and the Government. See Pl.’s Opp'n/Cross-Mot. at 9–15. For the former, Judicial Watch claims that the information is not commercial. See id. at 9–10. For the latter, it contends that the information is not confidential. See id. at 10–15. The Court agrees on both counts.

A.

Consider first whether the names and addresses of ABR's contract labs constitute "commercial" information that FOIA's Exemption 4 protects from disclosure.⁴ Judicial Watch concedes that the withheld information is "obtained from a person." Id. at 8 n.3. And it does not argue that the information is not "confidential." See id. at 9–10.

Information is "commercial" and therefore comes within Exemption 4 "if, in and of itself, it serves a commercial function or is of a commercial nature." Nat'l Ass'n of Home Builders v. Norton , 309 F.3d 26, 38 (D.C. Cir. 2002) (cleaned up). That means that "records that actually reveal basic commercial operations, such as sales statistics, profits and losses, and inventories, or relate to the income-producing aspects of a business, fall within the scope of ‘commercial’ information." Pub. Citizen , 975 F. Supp. 2d at 99 (cleaned up); see also id. (explaining that "documents that contain revenue, net worth, income, and EBITDA information are plainly commercial" (cleaned up)).

The exemption covers a broader category of information, too. It "applies (among other situations) when the provider of the information has a commercial interest in the information submitted to the agency." Baker & Hostetler LLP v. U.S. Dep't of Com. , 473 F.3d 312, 319 (D.C. Cir. 2006). But the definition of "commercial" is not boundless—indeed, "the D.C. Circuit has cautioned that, consistent with the narrow construction given to FOIA exemptions, not every bit of information submitted to the government by a commercial entity qualifies for protection under Exemption 4." Pub. Citizen , 975 F. Supp. 2d at 101 (cleaned up).

The Government argues that ABR has a commercial interest in the names and addresses of its contract laboratories. See Def.’s Mem. in Opp'n to Pl.’s Cross-Mot. and Reply in Supp. of Def.’s Mot. for Summ. J. ("Def.’s Opp'n/Reply") at 7–9, ECF No. 20. For evidentiary support, it cites two sources: (1) an agency declaration; and (2) a letter from ABR to the Government explaining why the redacted information is confidential and commercial. See id. at 7–8. This evidence falls well short of what the Government needed to show on the commercial prong.

Take the declaration....