American Small Business League v. Department of Defense , 674 F. App'x 675 ( 2017 )

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FILED
FOR THE NINTH CIRCUIT
JAN 06 2017
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
AMERICAN SMALL BUSINESS No. 15-15120
LEAGUE,
D.C. No. 3:14-cv-02166-WHA
Plaintiff-Appellee,
v. MEMORANDUM*
DEPARTMENT OF DEFENSE,
Defendant-Appellant,
and
SIKORSKY AIRCRAFT
CORPORATION,
Intervenor-Defendant.
AMERICAN SMALL BUSINESS No. 15-15121
LEAGUE,
D.C. No. 3:14-cv-02166-WHA
Plaintiff-Appellee,
v.
DEPARTMENT OF DEFENSE,
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Defendant,
and
SIKORSKY AIRCRAFT
CORPORATION,
Intervenor-Defendant-
Appellant.
Appeal from the United States District Court
for the Northern District of California
William Alsup, District Judge, Presiding
Argued and Submitted December 14, 2016
San Francisco, California
Before: KOZINSKI, BYBEE, and N.R. SMITH, Circuit Judges.
The U.S. Department of Defense (the Department) and Sikorsky Aircraft
Corporation (Sikorsky) appeal the district court’s order requiring the production of
Sikorsky’s entire Comprehensive Small Business Subcontracting Plan under the
Freedom of Information Act (FOIA). We review the ruling below de novo, Animal
Legal Def. Fund v. U.S. Food & Drug Admin., 836 F.3d 987, 988 (9th Cir. 2016)
(en banc) (per curiam), and conclude that the district court erred in holding that
none of the information currently redacted from the Plan is protected from
disclosure under Exemption 4 or Exemption 6 of FOIA.
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1. Exemption 4 assures companies doing business with the government
that their “trade secrets and commercial or financial information [that is] privileged
or confidential” will not be revealed to third parties. 5 U.S.C. § 552(b)(4).
Commercial information is considered “confidential” if “there is (1) actual
competition in the relevant market, and (2) a likelihood of substantial competitive
injury if the information were released.” Lion Raisins v. U.S. Dep’t of Agric., 354
F.3d 1072, 1079 (9th Cir. 2004) (citing G.C. Micro Corp. v. Def. Logistics Agency,
33 F.3d 1109, 1113 (9th Cir. 1994)), overruled on other grounds by Animal Legal
Def. Fund, 836 F.3d at 989. The government need not show, however, that
disclosure would cause “actual competitive harm.” Id. (quoting G.C. Micro Corp.,
33 F.3d at 1113).
The Department at least created a genuine issue of fact as to whether most of
its redactions qualified for Exemption 4. The Department submitted a declaration
from Sikorsky’s director of supply management (1) identifying the entities with
which Sikorsky competes for government defense contracts and (2) averring that
those entities could use the redacted information to gain a significant competitive
advantage over Sikorsky. Nothing more is required to gain protection from
disclosure under Exemption 4, and the district court erred in ruling otherwise. See
G.C. Micro Corp., 33 F.3d at 1111 (indicating that information similar to the
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redacted information here would be subject to Exemption 4); Bowen v. U.S. Food
& Drug Admin., 925 F.2d 1225, 1227–28 (9th Cir. 1991) (holding that an affidavit
with the following description of sensitive information was sufficiently specific to
trigger Exemption 4: “trade secret information regarding the manufacturing
formulas and processes, as well as quality control and internal security measures,
of private business entities”).
2. The Department also created a genuine issue of fact as to whether the
remaining redactions, which encompass Sikorsky employees’ business contact
information and signatures, were proper under Exemption 6. See 5 U.S.C.
§ 552(b)(6). Although the employees’ privacy interests in that information are
small, they are not trivial because culprits could use the information for such
purposes as harassment or forgery. See Elec. Frontier Found. v. Office of the Dir.
of Nat’l Intelligence, 639 F.3d 876, 887–88 (9th Cir. 2010). We can identify no
countervailing public interest sufficient to justify disclosure in these circumstances,
especially since the Department already disclosed the names of all employees
mentioned in the Plan. See id.
REVERSED.
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