Conoco, Inc. v. United States Dept. of Justice, Civ. A. No. 80-418

• Decision Date: 11 September 1981
• Docket Number: Civ. A. No. 80-418,80-515.
• Parties: CONOCO, INC., Plaintiff, v. UNITED STATES DEPARTMENT OF JUSTICE, Defendant. CONOCO, INC., Plaintiff, v. UNITED STATES DEPARTMENT OF ENERGY, Defendant.
• Court: U.S. District Court — District of Delaware

521 F. Supp. 1301

CONOCO, INC., Plaintiff, v. UNITED STATES DEPARTMENT OF JUSTICE, Defendant.

CONOCO, INC., Plaintiff, v. UNITED STATES DEPARTMENT OF ENERGY, Defendant.

Civ. A. Nos. 80-418, 80-515.

United States District Court, D. Delaware.

September 11, 1981.

Charles S. Crompton, Jr. and Richard E. Poole of Potter, Anderson & Corroon, Wilmington, Del., Donald B. Craven, Mark L. Evans, Robert K. Huffman and James P. Tuite of Miller & Chevalier, Washington, D. C., and David M. Francis, Houston, Tex., for plaintiff.

James W. Garvin, Jr., U. S. Atty., Peggy L. Ableman, Asst. U. S. Atty., Wilmington, Del., John C. Keeney, Acting Asst. Atty. Gen., Lawrence Lippe, Benjamin C. Flannagan, IV and Daniel Friedman, U. S. Dept. of Justice, Washington, D. C., for United States Dept. of Justice.

James W. Garvin, Jr., U. S. Atty., Peggy L. Ableman, Asst. U. S. Atty., Wilmington, Del., Alice Daniel, Asst. Atty. Gen., Larry P. Ellsworth and S. Lamont Bossard, Jr., U. S. Dept. of Energy, Paul M. Geier and William L. Fang, Washington, D. C., for defendant United States Dept. of Energy.

MEMORANDUM OPINION

LATCHUM, Chief Judge.

This case raises issues concerning the scope of Exemptions Five and Seven to the general disclosure requirements of the Freedom of Information Act ("FOIA"), 5 U.S.C. § 552 (1976). The Court has jurisdiction, pursuant to 5 U.S.C. § 552(a)(4)(B), to make a de novo review of two agencies' decisions to withhold documents from plaintiff Conoco, Inc. ("Conoco").

Plaintiff Conoco filed written requests with defendants Department of Energy ("DOE") and the Department of Justice seeking access of all documents relevant in a criminal investigation conducted by the agencies. Both agencies have refused to honor all of Conoco's requests, contending that portions of the investigatory file are exempt from disclosure under two provisions of 5 U.S.C. § 552(b). There being no material facts in issue, the parties have filed cross motions for summary judgment pursuant to Rule 56, F.R.Civ.P. This Court finds that all but one of the documents are exempt from disclosure under the FOIA. Accordingly, this Court denies Conoco's Motion for Summary Judgment against the DOE and grants DOE's Cross Motion. It grants Conoco's Motion for Summary Judgment against the Department of Justice as to one document, but denies it to the other six documents. Finally, this Court grants the Department of Justice's Cross Motion against Conoco as to six of the seven documents and denies it for the seventh.

I. BACKGROUND

A. The Department of Justice and DOE's Investigation of Conoco.

On March 17, 1977, DOE's predecessor agency, the Federal Energy Administration ("FEA"), instituted an investigation after Conoco revealed to FEA that its own internal investigation had led to information suggesting that during 1973 and 1974 certain of its employees had participated in a scheme to circumvent petroleum price controls originally promulgated by the Cost of Living Council. DOE's investigation resulted in the referral of the case in July, 1977, to the Department of Justice for criminal prosecution. That prosecution resulted in a federal grand jury's returning indictments on August 11, 1978, against Conoco and two of its corporate customers on charges of making false record entries under 18 U.S.C. § 1001 (1976) and intentionally selling and buying oil at prices in excess of those permitted by the price regulations. On August 11, 1978, Conoco entered pleas of nolo contendere to one felony and one misdemeanor count and was fined $15,000. United States of America v. Continental Oil Co., Criminal Action No. H-78-126 (S.D.Texas). Conoco further agreed in a consent order to repay two million dollars in alleged overcharges as well as to pay civil penalties of $985,000.

B. Conoco's Request Pursuant to the FOIA.

On March 23, 1979, Conoco filed a written request seeking access to, and copies of, all documents in DOE's possession that related to the investigation by DOE and the Department of Justice of Conoco's sales of refined petroleum products to two resellers. On April 2, 1979, DOE acknowledged receipt of Conoco's request, but did not respond to the request until October 25 and November 5, 1979. On these latter dates DOE provided Conoco with indices of approximately 125 documents or portions thereof that DOE claimed were exempt from disclosure. DOE thereafter revised its index on August 15, 1980. On October 22, 1980, Conoco instituted action in this Court seeking disclosure of those documents.¹ On January 15, 1981, DOE again revised its index. Conoco presently is challenging the DOE's withholding of the twenty-seven documents in its possession.²

On July 31, 1980, Conoco filed a written request with the Criminal Division of the Department of Justice requesting access to, and copies of, all documents in the Criminal Division's possession that related to the Justice Department's investigation of Conoco's sales refined petroleum products to two resellers. Conoco received no response to its request and subsequently, on August 25, 1980, brought suit against the Department of Justice in this Court seeking an order requiring the Department to produce the requested documents.³ On September 24, 1980, the Department identified 13 documents as responsive. The Department released six of these documents, but withheld the seven remaining documents.⁴ It is these latter seven documents that Conoco now seeks. Conoco's actions against the governmental agencies were consolidated for purpose of oral argument.

II. DISCLOSURE UNDER FOIA

The basic principles of the FOIA are well established. Congress enacted the Act for the express purpose of increasing disclosure of government records. The statute reflects "a general philosophy of full agency disclosure" and protects the public's right to know the operations of its government. H.Rep.No.1497, 89th Cong., 2nd Sess. 6 (1966), quoted in EPA v. Mink, 410 U.S. 73, 80 n. 6, 93 S.Ct. 827, 832-33 n.6, 35 L.Ed.2d 119 (1973). It was designed "to pierce the veil of administrative secrecy and to open agency action to the light of public scrutiny." Rose v. Department of Air Force, 495 F.2d 261, 263 (C.A.2, 1974), aff'd, 425 U.S. 352, 96 S.Ct. 1592, 48 L.Ed.2d 11 (1976). Government files, therefore, must be provided to the public on request unless there are compelling reasons for nondisclosure. Founding Church of Scientology of Washington D.C. v. Bell, 603 F.2d 945, 949 (C.A. D.C.1979).

Despite the strong policy favoring disclosure, FOIA does not command the disclosure of all government records. Congress realized that some secrecy is necessary for the government to function effectively. Consequently, the second part of the statute — subsection (b) — enumerates nine categories of records that are exempt from the Act's disclosure requirements. 5 U.S.C. § 552(b). Jordan v. United States Department of Justice, 591 F.2d 753, 756 (C.A.D.C.1978). These limited exceptions "do not obscure the basic policy that disclosure, not secrecy, is the dominant object of the Act." The nine enumerated exemptions are "exclusive" and "must be narrowly construed." Accordingly, when the government declines to disclose a document, the burden is upon the agency to prove de novo in the trial court that the documents sought fit under one of the exemptions to the FOIA.

The DOE and the Department of Justice collectively claim that 5 U.S.C. § 552(b)(5), 7(C) & (D) apply. These subsections exempt —

(5) inter-agency or intra-agency memorandums or letters which would not be available by law to a party other than an agency in litigation with the agency;

* * * * * *

(7) investigatory records compiled for law enforcement purposes, but only to the extent that the production of such records would ... (C) constitute an unwarranted invasion of personal privacy and (D) disclose the identity of a confidential source and, in the case of a record compiled by a criminal law enforcement authority in the course of a criminal investigation, or by an agency conducting a lawful national security intelligence investigation, confidential information furnished only by the confidential source.

III. EXEMPTION FIVE

Exemption Five applies only to those documents that (1) are "inter-agency or intra-agency memorandums or letters" which (2) "would not be available by law to a party other than an agency in litigation with the agency...." 5 U.S.C. § 552(b)(5). The exemption is intended to protect the deliberative process of government. Congress found that the full and frank exchange of ideas within an agency serves as an integral part of the deliberative processes; to conduct the process in public view would inhibit the free flow of ideas and impair the quality of agency decisions. See S.Rep.No.813, 89th Cong., 1st Sess. 9 (1965); H.Rep.No.1497 at 10. Thus, the exemption is designed to encourage a free and candid exchange of ideas during the process of decisionmaking and to prevent predecisional disclosure of incipient policy or decisions that could disrupt agency procedures. NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 95 S.Ct. 1504, 44 L.Ed.2d 29 (1975).

A. Intra-Agency Memoranda

Conoco first contends that the withholding of each of the twenty-seven documents by the DOE and five of the seven documents by the Department of Justice is improper because the documents are not "intra-agency memoranda."⁵ Each of these thirty-two documents withheld by the agencies is handwritten notes made by its employees assigned to investigate Conoco. The handwritten notes reflect strategy decisions of agency personnel in preparing to interrogate Conoco employees in depositions, weighing possible settlement positions, considering evidence and deliberating on various other aspects of the investigation. Conoco and the agencies agree that the handwritten notes are memoranda but disagree on the issue of whether they are "intra-agency" documents. Conoco asserts that these notes are not intra-agency memoranda solely...