Case3:14-cv-02166-WHA Document28 Filed11/23/14 Page1 of 7

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

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AMERICAN SMALL BUSINESS LEAGUE,

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For the Northern District of California

United States District Court

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Plaintiff,

No. C 14-02166 WHA

v.
DEPARTMENT OF DEFENSE,
Defendant.

ORDER DENYING
CROSS MOTIONS FOR
SUMMARY JUDGMENT

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INTRODUCTION

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In this action under the Freedom of Information Act, both sides move for summary

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judgment in connection with Sections 552(b)(4) and (6) of Title Five of the United States Code.

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For the reasons discussed below, both motions are DENIED.

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STATEMENT
Plaintiff American Small Business League is an organization that promotes the interests

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of small businesses. To that end, it focuses public attention on emerging issues for small

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businesses, reviews federal and state government policies and procedures to determine the

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potential impact on small businesses, and monitors federal contracts that are awarded to large

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corporations rather than to small businesses (Compl. 3).

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On August 9, 2013, and under the Freedom of Information Act, plaintiff requested the

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following document from defendant agency Department of Defense: [t]he most recent master

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[C]omprehensive [S]ubcontracting [P]lan submitted by Sikorksy Aircraft Corporation for

participating in the Comprehensive Subcontracting Plan Test Program for the Department of

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Defense (id. 5). According to plaintiff, the Small Business Act of 1953 normally requires

large contractors to submit Individual Subcontracting Reports and Summary Subcontracting

Reports to show how government contracts and subcontracts are being awarded to small

businesses. But in 1990, Congress passed the Test Program as part of a defense appropriations

bill, thereby allowing certain defense contractors to do away with the normally required

Individual Subcontracting Reports and Summary Subcontracting Reports. Instead, those defense

contractors can submit a different type of report the Comprehensive Subcontracting Plan

to identify all subcontract amounts awarded to small businesses on all government contracts the

prime contractor fulfills (Br. 3). In this instance, the requested Sikorsky Comprehensive

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For the Northern District of California

United States District Court

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Subcontracting Plan comes from 2013.

On September 3, 2013, the agency responded to plaintiffs FOIA request as follows
(Compl. 6):
At this time we are unable to make a release determination on
your request within the twenty[-]day statutory time period as
there are unusual circumstances which impact our ability to
quickly process your request. These unusual circumstances are:
(a) the need to search for and collect records from several offices
geographically separated from this office and (b) the need to
consult with one or more agencies or DoD computers having a
substantial interest in either the determination or the subject
matter of these records. For these reasons, your request has been
placed in our complex processing queue and it will be worked in
the order the request was received.

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After an appeal of the agencys response, which has yet to be answered, plaintiff began this

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action on May 12, 2014.

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Now, plaintiff seeks summary judgment to compel a determination by [the agency] as to

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whether [Sikorksys Comprehensive Subcontracting Plan] [is] to be disclosed in whole or in

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part (Br. 2, 7). In opposition, the agency contends that plaintiffs motion is moot because the

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agency has now determined that the requested plan cannot be released. Reportedly, that plan

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falls under FOIAs exemption under Section 552(b)(4) of Title Five of the United States Code,

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and the agency also moves for summary judgment to confirm that determination. Of note, the

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agencys motion raises no other FOIA exemption.

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Following briefing and a hearing on the parties motions, the undersigned judge ordered

the agency to lodge Sikorskys Comprehensive Subcontracting Plan for in camera review (Dkt.

No. 23). That order further instructed the agency to tab and highlight every part of the

requested document that the agency believes is exempt under Section 552(b)(4), and to include

an accompanying declaration from either Sikorsky or the agency to address this non-exhaustive

list of questions:

(1) how stale is the information in the requested document; (2)

has any part of the requested documents content been disclosed
in any other setting; (3) what steps has Sikorsky taken to
maintain the confidentiality of the requested documents content,
including its actions with its own employees; and (4) how does
suppression of the requested document square with the Small
Business Acts mandate to encourage government contractors to
subcontract to small disadvantaged businesses?

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For the Northern District of California

United States District Court

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On November 20, 2014, the agency lodged Sikorskys Comprehensive Subcontracting

Plan, but did not highlight the reportedly exempt portions thereof. Instead, it provided one
redacted version and one unredacted version of the requested document, forcing the undersigned
judge to compare each page of each version in identifying where the allegedly exempt portions
are. Sikorsky has also submitted an accompanying declaration by Amy Johnson, Director
Supply Management at the company, but her declaration does not address the aforementioned
question of how suppression in this matter squares with the Small Business Acts mandate
(Johnson Decl. 2).
This order now decides all motions, having considered full briefing, supplemental
responses, and oral argument from both sides.
ANALYSIS
As a preliminary matter, plaintiffs brief concedes that its motion for summary judgment
is necessarily limited to compelling a determination by [the agency] on the exemption issue
(Br. 3, 7). Because the agency has now made that determination, plaintiffs motion is DENIED
AS MOOT.

There still remains the agencys own motion for summary judgment. Here, the question
presented is whether the agency has properly determined that the requested plan is exempt under
Section 552(b)(4). According to the agency, Sikorksys Comprehensive Subcontracting Plan
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cannot be released because that plan contains confidential and financial information that would

harm Sikorskys competitive position if that information were released.

The agency has the burden of proving that the information is protected from disclosure

under FOIA. Frazee v. U.S. Forest Serv., 97 F.3d 367, 37071 (9th Cir. 1996). Frazee further

instructed that Section 552(b)(4) exempts from disclosure commercial or financial information

that is privileged or confidential, stating the following (emphasis added) (internal citations

omitted):

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Commercial or financial matter is confidential for purposes of

[Section 552(b)(4)] if disclosure of the information is likely to
have either of the following effects: (1) to impair the
Governments ability to obtain necessary information in the
future; or (2) to cause substantial harm to the competitive
position of the person from whom the information was obtained
....
While a party need not show actual competitive harm, it must
present specific evidence revealing (1) actual competition and
(2) a likelihood of substantial competitive injury in order to
prove that the information falls under [Section 552(b)(4)].
Here, the agency argues that it is entitled to summary judgment based on Johnsons
accompanying declaration. In relevant part, her declaration states (Johnson Decl. 69)
(emphasis added):
The information subject to the FOIA Request . . . consists of
Sikorskys operational strategies and methods, including the
companys make-or-buy process, the type of supplies and
services subcontracted by Sikorsky, the techniques of
identification and development of potential sources,
subcontractor proposal evaluation criteria, flow-down of
subcontracting requirements, the companys socio-economic
goals used in subcontracting, the methods for developing such
goals, selected industry categories targeted for major outreach
initiatives, case-study examples, data regarding administration
of the plan, as well as the associated organizational structure
and the roles and responsibilities of specific individuals.
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Release of the information subject to the FOIA Request would

cause substantial harm to the companys competitive position.
Based on my experience and on my understanding of and
familiarity with the information requested information that
Sikorsky does not release to the public it is my professional
opinion that a competitor with similar expertise could readily use
the information to determine Sikorskys approach to key
manufacturing and sourcing decision[s] that are competitively
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evaluated as part of [the agencys] contract proposal review. If a

competitor had access to this information, it could use the
information to determine the relative strengths and weaknesses
of Sikorskys proposals, as well as to misappropriate operational
and manufacturing strategies that are the product of Sikorskys
innovation or substantial effort. The competitor could then use
all of this data and information to Sikorskys detriment when
preparing its own proposals or marketing materials for such
contracts.

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Johnsons declaration also adds that [d]isclosing the data in he response to the FOIA Request

provides a potential competitor with information that will allow a competitor to better

understand how Sikorsky has done business in the past, how it structures its proposals, and how

it was able to win certain government contracts (id. 11). To that end, the declaration

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identifies proprietary information such as names and contact information for Sikorsky

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employees, training program information, dollar amounts of awarded subcontracts, the

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substantiation of the companys small business goals, the methodology for spending allocation,

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and specific commodities for which Sikorsky subcontracts that would reveal Sikorskys

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purchasing strategies and business relationships to its competitors (id. 12).

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Here is the problem. For the standard of review of a FOIA exemption, a district court

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must accord substantial weight to [the agencys] affidavits, provided the justifications for

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nondisclosure are not controverted by contrary evidence in the record or by evidence of [the

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agencys] bad faith. Minier v. C.I.A., 88 F.3d 796, 800 (9th Cir. 1996) (internal citations

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omitted). But on this issue, our court of appeals has further explained:

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Although the [agencys] reasons are entitled to deference, the

[agencys] declarations must still describe the justifications for
nondisclosure with reasonably specific detail, demonstrate that
the information withheld logically falls within the claimed
exemptions, and show that the justifications are not controverted
by contrary evidence in the record or by evidence of CIA bad
faith. The CIA must do more than show simply that it has acted
in good faith.

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Berman v. C.I.A., 501 F.3d 1136, 1140 (9th Cir. 2007) (emphasis added) (internal citations
omitted).
Having reviewed Sikorskys lodged Comprehensive Subcontracting Plan and Johnsons
accompanying declaration, this order finds that the agency has not provided reasonably specific
detail to explain why the redacted portions of the lodged document are exempt under Section
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552(b)(4). Neither the lodged document nor Johnsons declaration adequately shows how the

redacted information is likely to cause substantial competitive injury if disclosed. Frazee, 97

F.3d at 37071. At best, Johnson concludes in her declaration that the [r]elease of the

information . . . would cause substantial harm to the companys competitive position, on the

basis that a competitor could use such information to assess the strengths and weaknesses of

Sikorskys bid proposals to the agency (Johnson Decl. 810, 12) (emphasis added). That is

not enough to grant summary judgment for the agency.

For the Northern District of California

United States District Court

Nevertheless, Sikorskys lodged Comprehensive Subcontracting Plan and Johnsons

accompanying declaration raise for the first time after briefing a new FOIA exemption that

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reportedly applies to several of the redacted parts of the lodged document. That new FOIA

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exemption is Section 552(b)(6), which applies to personnel and medical files and similar files

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the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.

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Allegedly, Section 552(b)(6) covers the handwritten signatures of government officers named on

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the first page of Sikorskys Comprehensive Subcontracting Plan, as well as Sikorsky employees

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names, their work phone numbers, their work e-mail addresses, and/or their work mailing

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addresses found therein.

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This order disagrees. There is no clearly unwarranted invasion of personal privacy

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that justifies exemption under Section 552(b)(6). See Forest Serv. Employees for Envtl. Ethics v.

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U.S. Forest Serv., 524 F.3d 1021, 102425 (9th Cir. 2008). To the contrary, the work contact

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information for several Sikorsky employees listed in the Comprehensive Subcontracting Plan is

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already accessible online. Moreover, Johnsons accompanying declaration does not specify why

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the employees work contact information or the government officials handwritten signatures

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justify redaction under Section 552(b)(6). At most, she declares that this is [p]ersonal

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identifying information . . . which was not disclosed to protect the individuals privacy

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(Johnson Decl. 12). As such, this amounts to a trivial privacy interest for which Exemption

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6 cannot apply. Prudential Locations LLC v. U.S. Dept of Hous. & Urban Dev., 739 F.3d 424,

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430 (9th Cir. 2013).

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The agencys motion for summary judgment is therefore DENIED.

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CONCLUSION

For the reasons discussed above, both motions for summary judgment are DENIED.

Given that the agencys motion has been rejected, the Court hereby ORDERS the agency to

release Sikorskys Comprehensive Subcontracting Plan to plaintiff by DECEMBER 3, 2014,

subject only to appeal.

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IT IS SO ORDERED.

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Dated: November 23, 2014.

WILLIAM ALSUP
UNITED STATES DISTRICT JUDGE

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For the Northern District of California

United States District Court

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