Lakin Law Firm v. FTC ( 2003 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 03-1689
THE LAKIN LAW FIRM, P.C.,
Plaintiff-Appellant,
v.
FEDERAL TRADE COMMISSION,
Defendant-Appellee.
____________
Appeal from the United States District Court
for the Southern District of Illinois.
No. 02-CV-1121-DRH—David R. Herndon, Judge.
____________
ARGUED SEPTEMBER 22, 2003—DECIDED DECEMBER 16, 2003
____________
Before ROVNER, EVANS, and WILLIAMS, Circuit Judges.
EVANS, Circuit Judge. When people feel so strongly about
something that they actually complain about it to a federal
agency, they probably think their names and addresses will
not be released to a firm of private lawyers seeking fuel to
propel a possible class-action lawsuit. And so it is with this
case which deals with “cramming”—the shady practice of
putting bogus charges on a person’s bill (usually a monthly
credit card statement) in the hope that the consumer will
pay the inflated balance without noticing that he has been
duped.
The Lakin Law Firm, a small band of lawyers operating
out of Wood River, Illinois, filed a Freedom of Information
2 No. 03-1689
Act (FOIA) request with the Federal Trade Commission
(FTC) seeking “[a]ny consumer complaints” about charges
“ ‘crammed’ . . . onto credit card bills, phone bills, or mort-
gage statements,” particularly complaints of this nature
against Cendant Corporation, FleetBoston Financial
Corporation, Fleet Credit Card Services, Bell Atlantic, Bank
of America, or Washington Mutual. The FTC granted the
request in part, releasing some 1,400 pages of complaints.
But it withheld the names and addresses of those who
complained, claiming “[t]his information is exempt from
release under FOIA Exemption 6, 5 U.S.C. § 552(b)(6),
because individuals’ right to privacy outweighs the general
public’s interest in seeing personal identifying information.”
Lakin filed an administrative appeal of the Commission’s
partial denial, stating
“[p]ersonal privacy” does not include a consumer
complaint. Personal privacy has to do with something
that could cause injury to a person, such as disclosing
the names of Iranian students who have sought asylum
in the United States, and who would be killed if their
government found them. There is no such threat here.
This information has one, and only one use; to bring the
companies that the consumers are complaining about to
justice.
The appeal was denied and the law firm filed this suit in
the district court challenging the FTC’s decision. The dis-
trict judge dismissed the suit and we now consider Lakin’s
appeal.
The FOIA has a noble goal: it contemplates a policy of
broad disclosure of government documents to serve the
“basic purpose of ensuring an informed citizenry, vital to
the functioning of a democratic society.” Solar Sources, Inc.
v. United States, 142 F.3d 1033, 1037 (7th Cir. 1998), quot-
ing NLRB v. Robbins Tire & Rubber Co., 437 U.S. 214, 242
No. 03-1689 3
(1978). Stated another way, the FOIA’s central purpose is
to guarantee “that the Government’s activities be opened to
the sharp eye of public scrutiny, not that information about
private citizens that happens to be in the warehouse of the
Government be so disclosed.” U.S. Dep’t of Justice v.
Reporters Comm. For Freedom of the Press, 489 U.S. 749(1989) (emphasis in original).
The FOIA requires governmental agencies “upon any
request for records which . . . reasonably describes such
records . . . [to] make the records promptly available.” 5
U.S.C. § 552(a)(3). But like many laws and most rules, the
FOIA has loads of exemptions. Exemption 6, at issue in this
case, permits the withholding of “personnel and medical
files and similar files the disclosure of which would consti-
tute a clearly unwarranted invasion of personal privacy.”
We think the information withheld here by the FTC clearly
falls within the exemption.
One item we found to be exempt from disclosure when
complying with a FOIA request was the name of a high
school student who asked the Department of Justice for
information about the wiretapping of Jimmy Hoffa. Silets v.
U.S. Dep’t of Justice, 945 F.2d 227 (7th Cir. 1991) (en banc).
Other courts have taken a similar view. See Strout v. U.S.
Parole Comm’n, 40 F.3d 136, 139 (6th Cir. 1994) (names
and addresses of people who wrote to Parole Commission
opposing a convict’s parole); Voinche v. Fed. Bureau of
Investigation, 940 F. Supp. 323, 329-30 (D.D.C. 1996)
(“identities of . . . private citizens who wrote to government
officials . . . .”), aff’d per curiam, 1997 WL 411685 (D.C.
Cir.); Holy Spirit Ass’n v. U.S. Dep’t of State, 526 F. Supp.
1022, 1032-34 (S.D.N.Y. 1981) (identities of individuals who
wrote letters to senators about the Unification Church).
Although disclosure in some of these cases was upheld
under different exemptions (there are several) in the FOIA,
they have one thing in common: personal identifying
4 No. 03-1689
information is regularly exempt from disclosure. And that
is as it should be, for the core purpose of the FOIA is to
expose what the government is doing, not what its private
citizens are up to.
Against this backdrop, the Lakin firm advances several
unpersuasive arguments in support of its contention that
the FTC has not fully complied with its request. First, citing
a district court case in California, it argues that there is an
inconsistency between the FTC’s position here and its effort
to obtain by means of a Civil Investigative Demand (CID)
the names and addresses of consumers who complained to
a company that was under investigation. There is, however,
no inconsistency. The Commission’s CID authority does not
alter our Exemption 6 analysis because the standards
governing enforcement of government agencies’ CIDs are
wholly different from FOIA principles. See, e.g., FTC v.
Texaco, Inc., 555 F.2d 862, 879 (D.C. Cir. 1977) (en banc)
(administrative subpoenas are to be enforced unless
information sought is irrelevant to “a lawful purpose of the
agency”); General Fin. Corp. v. FTC, 700 F.2d 366, 369 (7th
Cir. 1983) (noting “limited” scope of judicial review of CIDs).
One obvious reason for the different standards is that CIDs
involve disclosure of information to the government for
investigative purposes, while the FOIA involves disclosure
to the public at large. See Reporters Committee, 489 U.S. at
770 (“The right to collect and use [personal] data for public
purposes is typically accompanied by a concomitant . . .
duty to avoid unwarranted disclosures.”) (quoting Whelan
v. Roe, 429 U.S. 589, 605 (1977)); see also section 21(b) of
the FTC Act, 15 U.S.C. § 57b-2(b) (statutory provision
governing confidentiality of information received by FTC
pursuant to CIDs). Furthermore, complaints to the FTC
about unfair or deceptive trade practices by the companies
that hold the complainers’ mortgages or supply their credit
cards or telephone services are in no way parallel to
No. 03-1689 5
decisions to complain directly to the companies themselves.
The personal privacy interests of consumers did not disap-
pear when they complained to the FTC.
Lakin also contends that the FTC is already releasing the
withheld information to other entities, citing the database
of the “Consumer Sentinel.” See www.consumer.gov/
sentinel/about/htm. This argument is unavailing. Consumer
Sentinel is a consumer fraud database accessible to law
enforcement officials and shared with law enforcement
partners in the United States and abroad. Public and
private organizations contribute complaints to the database
in an effort to combat illegal activities. The fact that a
limited group of law enforcement officials has access to
these nonpublic files does not alter the individual consum-
ers’ privacy interests in keeping their identities and home
addresses free from general public disclosure. Moreover, the
FTC cannot waive individual consumers’ privacy inter-
ests—whatever it does or fails to do. See, e.g., Sherman v.
U.S. Dep’t of the Army, 244 F.3d 357, 363-64 (5th Cir. 2001)
(“[O]nly the individual whose informational privacy inter-
ests are protected by Exemption 6 can effect a waiver of
those privacy interests.”).
Lakin also contends that disclosure is not “unwarranted”
because the website that consumers use to make complaints
to the Commission cautions that the information provided
may be subject to release under the FOIA. See
www.ftc.gov/ftc/privacy/htm. But a warning that FOIA
disclosure “may be required by law” cannot be construed as
a waiver by the consumer of the privacy rights protected
by the FOIA. See, e.g., Hill v. Dep’t of Agriculture, 77
F. Supp. 2d 6 (D.D.C. 1999) (similar statement in Farmers
Home Administration loan application is a warning, not a
waiver).
Finally, Exemption 6 requires a balancing of individual
privacy interests of consumer complainants against the
6 No. 03-1689
public interest in disclosure to determine whether disclo-
sure is “clearly unwarranted.” The Supreme Court has
repeatedly held that the only public interest that is relevant
to this balancing test is the shining of a light on an agency’s
performance of its statutory duties. Reporters Committee,
489 U.S. at 773. Compelling disclosure of the identity of
consumers’ complaints about cramming would not further
the core purpose of the FOIA. Lakin has failed to carry its
burden of “identify[ing] with reasonable specificity the
public interest that would be served by release” of the
withheld identifying information. See Hale v. U.S. Dep’t of
Justice, 973 F.2d 894, 900 (10th Cir. 1992), vacated and
remanded on other grounds, 509 U.S. 918 (1993), and
Senate of the Commonwealth of Puerto Rico v. U.S. Dep’t of
Justice, 823 F.2d 574, 588 (D.C. Cir. 1987) (R.B. Ginsburg,
J.) (requester must demonstrate that there is a public
interest in the specific information being withheld).
The judgment of the district court is AFFIRMED.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—12-16-03