Cities Service Co. v. FTC

• Decision Date: 19 July 1984
• Docket Number: Civ. A. No. 83-812,83-888.
• Citation: 627 F. Supp. 827
• Parties: CITIES SERVICE COMPANY, Plaintiff, v. FEDERAL TRADE COMMISSION, Defendant. GULF OIL CORPORATION, Plaintiff, v. FEDERAL TRADE COMMISSION, Defendant.
• Court: U.S. District Court — District of Columbia

627 F. Supp. 827

CITIES SERVICE COMPANY, Plaintiff, v. FEDERAL TRADE COMMISSION, Defendant.

GULF OIL CORPORATION, Plaintiff, v. FEDERAL TRADE COMMISSION, Defendant.

Civ. A. Nos. 83-812, 83-888.

United States District Court, District of Columbia.

July 19, 1984.

Paul A. Lenzini, Chapman, Duff and Paul, Washington, D.C., John W. Castles 3d, David H. Marks, James R. Eiszner, Jr., Lord, Day & Lord, New York City, for plaintiffs.

Robert E. Eaton, Jr., Asst. U.S. Atty., Washington, D.C., for defendant.

MEMORANDUM OPINION

JUNE L. GREEN, District Judge.

Before the Court are two related Freedom of Information Act ("FOIA") cases. Plaintiffs Cities Service Company ("Cities Service") in Civil Action No. 83-812, and Gulf Oil Corporation ("Gulf") in Civil Action No. 83-888, seek exactly the same documents withheld by defendant Federal Trade Commission ("FTC" or "Commission"). Plaintiffs filed joint memoranda in the related actions and FTC also filed joint memoranda. Accordingly, the Court shall address these actions jointly.

Presently, these actions are before the Court on defendant's motion for summary judgment, plaintiffs' opposition thereto, defendant's supplemental memorandum in support of its motion for summary judgment, defendant's affidavit and index of documents, plaintiffs' statement of objections to defendant's affidavit and index of documents, defendant's response to plaintiffs' objections to defendant's affidavit and index of documents, and the entire record herein. The Court has conducted an in camera review of the documents at issue.

For the reasons outlined below, the Court grants defendant's motion for summary judgment.

Statement of Facts

Plaintiffs Gulf and Cities Service seek access to twenty-nine documents relating to a proposed acquisition of Cities Service by Gulf. A brief review of the facts which led to the actual creation of these documents is essential in order for the Court to fully explain the basis for its decision.

On June 17, 1982, plaintiffs filed pre-merger notification reports with the Commission and the Department of Justice. Upon receiving this notification, the Commission began an investigation of the proposed merger between Gulf and Cities Service to determine whether such a merger would violate section 7 of the Clayton Act, 15 U.S.C. § 18, or section 5 of the FTC Act, 15 U.S.C. § 45, and to determine whether it should file suit to enjoin the proposed merger. The investigation and subsequent litigation continued until August 17, 1982, when Gulf formally withdrew its pre-merger notification filing with the Commission.

Between the time Gulf and Cities Service filed their pre-merger notification reports and the time Gulf withdrew its tender offer, various commissioners, members of their staffs, the Director of the Bureau of Competition, and Commission attorneys and economists assigned to the matter met with representatives of Gulf and Cities Service to evaluate the need for the Commission to take legal action and to discuss the possibility of settlement.

On July 28, 1982, the Commission met to consider its attorneys' and economists' recommendations concerning the possibility of pursuing legal action to enjoin plaintiffs from conducting the merger. It was at this meeting that the Commission directed its attorneys to seek a temporary restraining order and a preliminary injunction to enjoin Gulf from consummating the proposed acquisition of Cities Service stock. An action was filed the following day in the United States District Court for the District of Columbia and the Honorable Charles A. Richey granted the Commission's request for a temporary restraining order. See FTC v. Gulf Oil Corp., No. 82-2131 (D.D.C. July 29, 1982) (order granting temporary restraining order).

On August 6, 1982, Gulf publicly announced that it was withdrawing its tender offer for Cities Service stock. Finally, on August 17, 1982, Gulf formally withdrew the pre-merger notification filing and the injunction action was dismissed when the merger plans were terminated.

Shortly after the termination of the Commission's preliminary injunction action against Gulf and Cities Service, both plaintiffs filed with the Commission a request under the FOIA for access to all documents in the Commission's possession which involved the proposed acquisition of Cities Service by Gulf.

When the Commission received these requests, it immediately began its search of documents responsive to these requests. After reviewing the documents, the Office of the Secretary ("Secretary") granted in part and denied in part the parties' requests. This decision of the Secretary was appealed to the Commission's General Counsel.

On February 4, 1983, after review of all responsive documents, the General Counsel responded to the parties' appeal of the Secretary's partial denial of their requests. The General Counsel granted the parties access to over 3,200 pages of documents responsive to their requests. The General Counsel denied access to the remaining documents based on FOIA Exemptions 3, 4, and 5. 5 U.S.C. § 552(b)(3), (4), (5). It was from this final agency decision that plaintiffs have filed their suits.

The parties, since the time of suit, have narrowed the number of documents at issue to twenty-nine. Plaintiffs have further indicated that the only documents or portions of documents the withholding of which they wish to contest, are those withheld by the Commission under Exemption 5 of FOIA ("Exemption 5"). 5 U.S.C. § 552(b)(5). The Commission has released all portions of the documents which it believes are not subject to the FOIA exemptions.

The documents at issue, except for Document No. 20 and parts of Document No. 2, relate to meetings or telephone conversations with representatives of Gulf and/or Cities Service and the Commission staff. The remaining two documents relate to meetings among members of the Commission staff. All the documents were created between the time plaintiffs filed their pre-merger notification reports and the time Gulf withdrew its tender offer.

The Commission has filed a motion for summary judgment, as well as an affidavit and index of documents withheld. In addition, the Commission has submitted to the Court for in camera review "unexpurgated copies" of the twenty-nine documents at issue. The Court has reviewed these documents carefully, as well as all of the material that has been submitted in this action. Defendant's motion for summary judgment has been opposed jointly by plaintiffs.

Conclusions of Law

In order for the Court to grant a motion for summary judgment, there can be no genuine issue of material fact. See Fed.R.Civ.P. 56(e). For the Government to be entitled to a grant of summary judgment in a FOIA action, it must demonstrate that "no substantial and material facts are in dispute and that it is entitled to judgment as a matter of law." Founding Church of Scientology v. National Security Agency, 610 F.2d 824, 836 (D.C. Cir.1979) (quoting National Cable Television Association v. FCC, 479 F.2d 183, 186 (D.C.Cir.1973)). To prevail in a FOIA action "the defending agency must prove that each document that falls within the class requested either has been produced, is unidentifiable, or is wholly exempt from the Act's inspection requirements." National Cable Television Association v. FCC, 479 F.2d at 186. If the agency withholds disclosure of certain requested documents it "must show by detailed and specific justification" the basis for the withholding. Mead Data Central, Inc. v. U.S. Department of Air Force, 566 F.2d 242, 259 (D.C.Cir.1977). It is plain that "`conclusory generalized allegations of exceptions' are unacceptable...." Founding Church of Scientology v. National Security Agency, 610 F.2d at 830 (quoting Vaughn v. Rosen, 484 F.2d 820 (D.C.Cir. 1973), cert. denied, 415 U.S. 977, 94 S.Ct. 1564, 39 L.Ed.2d 873 (1974)). The Government must indicate by "detailed affidavit that the documents are clearly exempt from disclosure." Id. (emphasis in original) (quoting S.Rep. No. 1200 (93d Cong., 2d Sess. 9 (1974) U.S.Code Cong. & Admin. News 1974, pp. 6285, 6287).

Plaintiffs argue that summary judgment is not appropriate in this case at this time because the Commission has failed to meet its burden by adequately explaining in its affidavit and index its justification for withholding the documents requested. After reviewing the affidavit and index, the Court finds that plaintiffs' argument is without merit. The affidavit and index are substantailly detailed. They provide the Court a clear, thorough, and specific description of the characteristics of each document, as well as a detailed reason why the Commission believes that each document, or withheld portion of each document, should be exempt. E.g., Coastal States Gas Corp. v. Department of Energy, 617 F.2d 854, 861 (D.C.Cir.1980); Mead Data Central, Inc. v. U.S. Department of Air Force, 566 F.2d at 261; Vaughn v. Rosen, 484 F.2d at 827.

The Court notes that the index provided by the Commission, standing alone, would have provided it with enough material to determine whether the claim of exemptions were justified or not. In order to be certain, however, that the Commission has provided plaintiffs and the Court with the proper justification for withholding the documents through the affidavits and index, and further to address any objection plaintiffs have concerning the thoroughness or completeness of the index or affidavit, the Court also conducted an in camera review of these documents.¹ This review confirmed the conclusion that these affidavits did, in fact, comply with the requirements outlined in Coastal States, Mead Data Central, and Vaughn.

Each of the documents which defendant has withheld is claimed to be exempt from disclosure under Exemption 5 of the FOIA. 5 U.S.C. § 552(b)(5). Pursuant to Exemption 5, an agency may withhold "intraagency memorandums or letters which would not be available by law to a party other than an agency...