Carlisle Tire and Rubber Co. v. U.S. Customs Service

• Decision Date: 17 December 1980
• Citation: 663 F.2d 210
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 210

663 F.2d 210

2 ITRD 1228, 214 U.S.App.D.C. 33

CARLISLE TIRE AND RUBBER COMPANY, Appellant v UNITED STATES CUSTOMS SERVICE, et al.

No. 80-1149.

United States Court of Appeals, District of Columbia Circuit.

Argued 30 Sept. 1980.

Decided 17 Dec. 1980.

Eugene L. Stewart, Washington, D. C., for appellant.

Michael J. Ryan, Asst. U. S. Atty., Washington, D. C., with whom Charles F. C. Ruff, U. S. Atty., John A. Terry and Michael W. Farrell, Asst. U. S. Attys., Washington, D. C., were on the brief, for appellee.

Before ROBINSON, WILKEY and GINSBURG, Circuit Judges.

Opinion for the Court filed by Circuit Judge WILKEY.

WILKEY, Circuit Judge:

Appellant Carlisle Tire and Rubber Company (Carlisle) seeks to compel disclosure under the Freedom of Information Act (FOIA), ¹ of twelve documents held by the United States Customs Service (Customs) relating to Customs' investigation of bicycle tire and tube imports from the Republic of China (Taiwan) and the Republic of Korea (ROK). In late 1977 Carlisle petitioned the Commissioner of Customs to investigate whether the Taiwanese and Korean governments were subsidizing their domestic manufacturers' production and export of bicycle tires and inner tubes to the United States, with hopes that such investigation would lead eventually to imposition of countervailing duties under the Tariff Act of 1930. ²

In August 1978, following Customs' publication of preliminary determinations in both the Taiwanese and Korean cases, Carlisle requested under FOIA all documentary material held by Customs pertaining to the two determinations. After Customs refused to turn over all documents immediately, Carlisle filed an administrative appeal. ³ Shortly thereafter, Customs partially granted Carlisle's FOIA request with respect to the Taiwanese case only, citing Exemptions 2, 4, and 5 of FOIA as authorization for withholding the remaining requested documents. ⁴ Carlisle then brought this suit in October 1978 to compel further disclosure. ⁵

To buttress its exemption claims, Customs submitted an affidavit sworn by its Assistant Commissioner for Regulations and Rulings explaining its reasons for refusing to disclose the requested information. ⁶ In response to additional motions over the next five months, the Government filed, inter alia, two supplemental affidavits by the same individual. ⁷ On 21 November 1979 District Judge Oberdorfer granted summary judgment for Customs, finding that, with minor exceptions, Customs' withholding of the requested documents was statutorily authorized. ⁸ On the same day, as part of pretrial discovery in two Customs Court actions filed by Carlisle challenging the Customs Service's underlying countervailing duty determinations, ⁹ Customs provided Carlisle with virtually unexpurgated copies of eight of the twelve documents at issue here. ¹⁰

On appeal Carlisle now reiterates its challenges to Customs' claims of authorized nondisclosure under Exemptions 1, 4, and 5. For reasons outlined below we vacate, under United States v. Munsingwear, Inc., ¹¹ the district court's ruling on all documents with respect to Exemption 5. At the same time, we affirm the district court's finding that the remaining portions of four documents were immune from disclosure under Exemption 1. ¹²

I. ANALYSIS

A. Exemption 5

The parties agree that eight of the documents in dispute have been released to appellants virtually in their entirety in the course of civil discovery in the Customs Court. ¹³ Because any case or controversy regarding these particular documents has consequently evaporated, ¹⁴ we find it unnecessary to decide now whether the district judge correctly found those documents to be intra-agency memoranda exempt from disclosure under Exemption 5. ¹⁵ "(T)o prevent a judgment, unreviewable because of mootness, from spawning any legal consequences," however, we vacate the district court's ruling with respect to those documents, as well as its ruling under Exemption 5 on the remaining four documents, and direct the district court to dismiss that part of the case. ¹⁶

B. Exemption 1

Under Exemption 1, an agency may withhold documents only if they apply to matters which are "(A) specifically authorized under criteria established by an Executive order to be kept secret in the interest of national defense or foreign policy and (B) are in fact properly classified pursuant to such Executive order...." ¹⁷ A court must conduct a de novo review of the agency's classification decision, with the burden on the agency to show proper classification. ¹⁸

The four documents for which Customs claims Exemption 1 protection are responses by the ROK government to questionnaires issued to it by Customs in the course of the countervailing duty proceedings. ¹⁹ Each of these responses was transmitted to Customs together with an express ROK government request for confidential treatment. ²⁰ Through administrative oversight, however, the documents were never formally classified pursuant to the Executive Order governing at the time that the documents were received by Treasury. ²¹ Carlisle asserts that the district court should not have condoned the withholding of these four documents under Exemption 1, first because they were never properly classified to begin with according to either the procedural ²² or the substantive criteria ²³ of Executive Order No. 11,652; and second, because they were subsequently improperly classified under both the procedural ²⁴ and substantive ²⁵ criteria of Executive Order No. 12,065, which superseded Executive Order No. 11,652.

In our view, only the second of these two contentions deserves more than cursory discussion here. In Lesar v. United States Department of Justice ²⁶ and Baez v. United States Department of Justice ²⁷ we have recently reiterated that an appellate court's role in reviewing the propriety of an agency's classification decision should proceed in two steps: first, determining which Executive Order properly governed the agency's ultimate classifications of documents in dispute, ²⁸ and second, ensuring that those documents were in fact properly classified according to both the procedural and substantive criteria contained in that Executive Order. ²⁹

With regard to the first step, in Lesar and Baez we held that when a court conducts procedural and substantive review of a classification decision the relevant Executive Order is the one "in effect at the time the agency makes its ultimate classification determination." ³⁰ By this test, Executive Order No. 12,065 governs the classification here; since that Executive Order expressly provides for classification at times later than that of the origin of the document, ³¹ proper subsequent classification under Executive Order No. 12,065 suffices to cure any procedural and substantive defects in classification which may have existed under Executive Order No. 11,652. ³² The second step of our review is simplified as well by Carlisle's acknowledgment that the four documents it seeks are currently properly classified according to the procedural criteria of Executive Order No. 12,065. ³³ Thus the only issue properly remaining on review is whether the district judge correctly concluded that the contested documents had been properly classified "Confidential" as "foreign government information" under the substantive criteria found in Executive Order No. 12,065. ³⁴

Executive Order 12,065 provides generally for classification as "Confidential" of information "the unauthorized disclosure of which reasonably could be expected to cause identifiable damage to the national security." ³⁵ Information may not be considered for classification unless it concerns one of seven categories, of which "foreign government information" is one. ³⁶ Furthermore, the Executive Order goes on to provide that "(e)ven though information is determined to concern one or more of the (seven categories) in Section 1-303, it may not be classified unless an original classification authority also determines that its unauthorized disclosure reasonably could be expected to cause at least identifiable damage to the national security." ³⁷ Thus, to show proper classification the agency must satisfy the reviewing court of two matters: that "the information fits within one of the seven enumerated categories and (that) unauthorized disclosure of the material reasonably could be expected to cause the requisite potential harm." ³⁸

We have held repeatedly in recent years that the agency may carry this burden

through the submission of affidavits that describe with reasonably specific detail the nature of the documents at issue and the justification for nondisclosure. The courts must accord "substantial weight" to these affidavits. That is, if the description in the affidavits demonstrates that the information logically falls within the claimed exemption and if the information is neither controverted by contrary evidence in the record nor by evidence of agency bad faith, then summary judgment for the Government is warranted. The court need not review the documents in camera unless the affidavits are inadequate for a reasoned de novo determination. ³⁹

Customs has sought to bear its burden here primarily through submission of the three affidavits sworn by its Assistant Commissioner in charge of Regulations and Rulings. ⁴⁰ The third of these asserts that the documents sought fell into the category of "foreign government information" because they embrace "information that has been provided to the United States in confidence by ... a foreign government." ⁴¹ The affidavits further aver that, given the express foreign government requests for confidentiality, classification of this foreign government information as "Confidential" is compelled by section 1-505 of the Executive Order:

Foreign government information shall either retain its original classification designation or be assigned a United States classification designation that shall ensure a degree of...