Appleton Papers, Inc. v. Envtl. Prot. Agency

Decision Date26 December 2012
Docket NumberNo. 12–2273.,12–2273.
Citation702 F.3d 1018
PartiesAPPLETON PAPERS, INC., Plaintiff–Appellant, v. ENVIRONMENTAL PROTECTION AGENCY, and United States Department of Justice Environment and Natural Resources Division, Defendants–Appellees.
CourtU.S. Court of Appeals — Seventh Circuit

OPINION TEXT STARTS HERE

Heidi Davidson Melzer, Attorney, Green Bay, WI, Megan A. Senatori (argued), Attorney, Dewitt Ross & Stevens S.C., Madison, WI, for PlaintiffAppellant.

Adam C. Jed (argued), Mark B. Stern, Attorneys, Department of Justice, Civil Division, Appellate Staff, Washington, DC, Christian R. Larsen, Office of the United States Attorney, Milwaukee, WI, for DefendantsAppellees.

Before FLAUM, MANION, and ROVNER, Circuit Judges.

FLAUM, Circuit Judge.

After the government alleged Appleton Papers Inc. (API) and seven other companies caused $1 billion in contamination in the Fox River near Green Bay, Wisconsin, the government hired a consultant that prepared reports on the companies' responsibility for the contamination. API unsuccessfully sought discovery of these reports by challenging a consent decree between the government and another company.

Determined to see the content, it filed a Freedom of Information Act (FOIA) request seeking the material, but the government refused under the FOIA exemption covering attorney work product. API eventually filed suit in federal district court, and we uphold the district court's decision in favor of the government. Even though the government used portions of its reports in two consent decrees, that use does not waive work product immunity for all the related content. API also misconstrues the privilege by erroneously suggesting that facts underlying the conclusions are unprotected. As a result, API's arguments boil down to a series of policy justifications that must be left for district courts in individual litigation instead of a FOIA request, which is not a substitute for discovery.

I. Background
A. Factual Background

This case originates out of contamination in the Lower Fox River and Green Bay caused by a handful of paper companies. The United States issued a unilateral administrative order under the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), see42 U.S.C. § 9601 et seq., to API and seven other “potentially related parties (“PRPs”), alleging that the PRPs discharged polychlorinated biphenyls (“PCBs”) into the site from their facilities. Cleanup of the site is expected to cost approximately $1 billion.

In preparation for CERCLA litigation, the United States hired Amendola Engineering, Inc. (“Amendola”), as an environmental consultant to the Fox River matter. Amendola prepared a report in 2000 entitled “Preliminary Estimates of PCB Discharges to the Fox River 1945 to 1985.” The report estimated the amount of PCB each PRP discharged into the water. The Environment and Natural Resource Division of the Department of Justice (“ENRD”) released a partial copy of the report to API in 2000. It also released a partial copy of a revised version in 2001.

The government subsequently cited to the reports and post–2001 versions, which it had not released, in two consent decrees with other PRPs in the Fox River matter. First, the United States' brief in support of a consent decree with Fort James Operating Company estimated Fort James was responsible for 15–20% of the PCB contamination even though the 2000 and 2001 reports estimated Fort James's responsibility at 38% and 28% respectively. The district court in that case entered an order approving the consent decree over objection by the Clean Water Action Counsel. See United States v. Fort James Operating Co., 313 F.Supp.2d 902 (E.D.Wis.2004). Next, the government used the 15–20% estimate again in its brief in support of a consent decree with Georgia–Pacific Consumer Products (Fort James's successor-in-interest). Again the district court entered an order approving the consent decree relying, in part, on the various versions of the Amendola report. API and NCR, another PRP,1 opposed the order and sought additional discovery of the documents they seek in this case. The district court rejected API's and NCR's assertions “that the 15–20% figure has come out of left field.” United States v. NCR Corp., 10–C–910, Dkt. No. 130 (E.D.Wis. Apr. 4, 2011). The district court noted that the government's estimate was consistent with reports other than the 2000 and 2001 Amendola Reports, suggested “NCR and AP[I] do not seem to appreciate the distinction between a settlement negotiation and liability at trial,” found the settlement was fair, and concluded the additional discovery that API and NCR requested was not required. Id. at 4–5.

B. Procedural Background

Unsuccessful in its attempts to get full copies of the Amendola Reports, API submitted a FOIA request to ENRD requesting all copies, drafts, and supporting information related to the 2000 and 2001 Amendola Reports as well as subsequent versions. The government provided two documents—what API calls partial copies of the 2000 and 2001 Amendola Reports, which the government previously released—but withheld 101 documents under FOIA exemptions. API filed an administrative appeal, to which the government did not respond. API then filed an appeal in the Eastern District of Wisconsin.

The government moved for summary judgment, asserting the documents were work product subject to FOIA exemption 5. The district court agreed and granted the motion. The court rejected API's argument that “purely factual material” could be separated from the protected material. In rejecting this claim, the district court relied on Rule 26(b)(4)(D) of the Federal Rules of Civil Procedure, which prevents discovery of the facts in a nontestifyingexpert witness's report. The district court next rejected API's argument that “because some of the results of the consultant experts” were released in the consent decrees, work product immunity no longer applied to “all of the underlying technical data and other materials underlying those results.” The district court cited Federal Rule of Evidence 502(a)(2). Under this rule, subject matter waiver occurs only if the undisclosed material “ought in fairness be considered together” with the disclosed material. The district court applied the rule and found that the government's submissions in the consent decrees were passive and did not result in waiver. API timely appeals.

II. Discussion

We do not review entries of summary judgment in FOIA cases de novo. Instead, we “determine whether the district court had a sufficient factual basis for its ruling and, if so, whether the court's decision was clearly erroneous.” Enviro Tech Int'l, Inc. v. U.S. EPA, 371 F.3d 370, 373 (7th Cir.2004). The government bears the burden of proof because the statute is construed in favor of disclosure. Patterson v. IRS, 56 F.3d 832, 836 (7th Cir.1995).

FOIA requires government agencies to disclose their records to the public. 5 U.S.C. § 552(a). However, subsection (b) exempts nine categories of material “that represent the congressional determination of the types of information that the Executive Branch must have the option to keep confidential, if it so chooses.” FTC v. Grolier Inc., 462 U.S. 19, 23, 103 S.Ct. 2209, 76 L.Ed.2d 387 (1983) (internal quotation marks and original brackets omitted); see5 U.S.C. § 552(b). Specifically, subsection (b)(5) protects “inter-agency and or intra-agency memorandums or letters which would not be available by law to a party ... in litigation with the agency.” 5 U.S.C. § 552(b)(5). This exemption covers work product, which prevents “a party [from] discover[ing] documents and tangible things that are prepared in anticipation of litigation or for trial by or for another party or its ... agent.” Fed.R.Civ.P. 26(b)(3)(A); see Grolier, 462 U.S. at 20, 103 S.Ct. 2209 (“It is well established that [exemption 5] was intended to encompass the attorney work[ ]product rule.”); see generally Hickman v. Taylor, 329 U.S. 495, 67 S.Ct. 385, 91 L.Ed. 451 (1947) (establishing work product immunity).

In assessing the validity of a work product claim under exemption 5, we determine whether “the documents would be ‘routinely’ or ‘normally’ disclosed upon a showing of relevance.” Grolier, 462 U.S. at 26, 103 S.Ct. 2209. In litigation, Federal Rule of Civil Procedure 26(b)(1) permits a party to discover information “relevant” to a claim or defense. Fed.R.Civ.P. 26(b)(1) (parties “may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense”). But Rule 26(b)(3)(A) protects, as privileged, relevant material that constitutes work product. Thus, this material is not “disclosed upon a showing of relevance” and falls under exemption 5 in FOIA cases. Grolier, 462 U.S. at 26, 103 S.Ct. 2209.

Of course, there are ways to overcome the privilege in an individual case. For instance, a party may overcome a work product claim by showing “it has substantial need for the materials to prepare its case and cannot, without undue hardship, obtain their substantial equivalent by other means.” Fed.R.Civ.P. 26(b)(3)(A)(ii). Additionally, although a report prepared in anticipation of litigation is work product, the party must disclose that report if its author plans to testify at trial. Fed.R.Civ.P. 26(a)(2)(B). However, we ignore these case-specific considerations in FOIA cases. NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 149 n. 16, 95 S.Ct. 1504, 44 L.Ed.2d 29 (“The ability of a private litigant to override a privilege claim set up by the government, with respect to an otherwise disclosable document, may itself turn on the extent of the litigant's need in the context of the facts of his particular case; or on the nature of the case. However, it is not sensible to construe the Act to require disclosure of any document which would be disclosed in the hypothetical litigation in which the private party's claim is the most compelling.” (...

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