Supreme Court makes corporations slightly less impervious to FOIA disclosures

By J. DeVoy

In FCC v. AT&T Inc., No. 09-1279 – released today – the Supreme Court seems to have taken a position that will unite the politically liberal, who believe the right of privacy should be upheld for individuals, and the conservatives who doubt the propriety of any rights not enumerated in the Constitution or its amendments.

This case arises from a dispute between the Federal Communications Commission (FCC) and telecom giant AT&T, which was resolved with a consent decree in 2004.  CompTel, a trade organization representing some of AT&T’s competitors, submitted a Freedom of Information Act (FOIA) request to the FCC, seeking pleadings and other documents produced in its investigation of AT&T and subsequent settlement.  AT&T opposed CompTel’s request, and the FCC decided to withhold some of AT&T’s information from disclosure based on FOIA exemption 4, 5 U.S.C. § 552(b)(4), which protects trade secrets and commercial or financial information.

AT&T, however, wanted more information protected from disclosure under FOIA exemption 7(C), 5. U.S.C. § 552(b)(7)(C), which exempts “records or information compiled for law enforcement purposes” that “could reasonably be expected to constitute an unwarranted invasion of personal privacy” from disclosure.  While the FCC did not apply exemption 7(C) to AT&T itself, it concluded that exemption 7(C) could be properly invoked protect the privacy interests of individuals identified in AT&T’s submissions.  Nonetheless, the FCC did not invoke this exemption, as it was not designed to withhold information that was merely embarrassing information about a corporation, even if individuals were named in the submissions.

AT&T appealed the FCC’s decision to the Third Circuit.  The Circuit court concluded that the root of this personal privacy – the “person,” as defined in 5 U.S.C. § 551(2) -embodies corporations and, thus, so too should the notion of personal privacy within FOIA exemption 7(C). See 582 F.3d at 497.  After all, if a corporation is a “person” under the law, shouldn’t it be accorded the full protection of personal rights?  In some ways this would be congruent with Citizens United — but personhood, apparently, does not convey the full palate of personal rights to corporations.

The Supreme Court, led by Chief Justice Roberts (and with Justice Kagan sitting out, just like people warned Obama she would have to do) disagreed with this view of personal privacy.  The Justices’ first step was to delineate the line between a person and what was personal:

“Person” is a defined term in the statute; “personal” is not. When a statute does not define a term, we typically “give the phrase its ordinary meaning.” Johnson v. United States, 559 U. S. ___, ___ (2010) (slip op., at 4). “Personal” ordinarily refers to individuals. We do not usually speak of personal characteristics, personal effects, personal correspondence, personal influence, or personal tragedy as referring to corporations or other artificial entities. This is not to say that corporations do not have correspondence, influence, or tragedies of their own, only that we do not use the word “personal” to describe them.

And, as the corporation is a legal fiction – rather than an actual person – this makes sense.  Just because a corporation is treated as a person for a variety of reasons, including economy and administrability, does not necessarily mean it receives all of the protections of an individual.  And thus the court held that though a “person,” traditional and legal notions of what is “personal” are beyond what a corporation qua person may enjoy:

In drafting Exemption 7(C), Congress did not, on the other hand, use language similar to that in Exemption 4. Exemption 4 pertains to “trade secrets and commercial or financial information obtained from a person and privileged or confidential.” 5 U. S. C. §552(b)(4). This clearly applies to corporations—it uses the defined term “person” to describe the source of the information—and we far more readily think of corporations as having “privileged or confidential” documents than personally private ones. So at the time Congress enacted Exemption 7(C), it had in place an exemption that plainly covered a corporation’s commercial and financial information, and another that we have described as relating to “individuals.” The language of Exemption 7(C) tracks the latter.

The Government has long interpreted the phrase “personal privacy” in Exemption 7(C) accordingly.

In a devilish display of wit, the Court concluded its opinion on this note:

We trust that AT&T will not take it personally.

So, to those who feared the collapse of society as a result of Citizens United, fear not — or fear slightly less.  So long as statutory construction persists and we have jurists who do not roll “person” and “personal” into a shared meaning, there will be some curbs on what corporate power, even if limited to FOIA exemption 7(C).