Exxon Corp. v. Federal Trade Com'n

• Decision Date: 17 November 1978
• Docket Number: Civ. A. No. 78-0530.
• Citation: 466 F. Supp. 1088
• Parties: EXXON CORPORATION, Plaintiff, v. FEDERAL TRADE COMMISSION et al., Defendants.
• Court: U.S. District Court — District of Columbia

466 F. Supp. 1088

EXXON CORPORATION, Plaintiff, v. FEDERAL TRADE COMMISSION et al., Defendants.

Civ. A. No. 78-0530.

United States District Court, District of Columbia, Civil Division.

November 17, 1978.

COPYRIGHT MATERIAL OMITTED

William Simon, John S. Kingdon, Howrey & Simon, Washington, D. C., for plaintiff.

Mark Kurzmann, U. S. Dept. of Justice, Washington, D. C., for defendants.

MEMORANDUM

OBERDORFER, District Judge.

This case arises under the Freedom of Information Act ("FOIA").¹ Plaintiff Exxon requested documents from the Federal Trade Commission ("FTC") relating to an ongoing FTC adjudicative proceeding in which Exxon is a defendant. Plaintiff invokes this Court's jurisdiction pursuant to 5 U.S.C. § 552(a)(4)(B), challenging the thoroughness of the FTC's search for responsive documents and the FTC's refusal to disclose certain admittedly responsive material it does possess.

I. Findings of Fact

On July 18, 1973, the FTC issued a complaint against, i. a., Exxon Corporation (the "Exxon case"), alleging that anticompetitive conditions in the petroleum industry violate Section 5 of the Federal Trade Commission Act, 15 U.S.C. § 45 (1976).² The FTC has asserted without contradiction by plaintiff that the Exxon case is the largest case ever brought by the Commission. To aid the FTC in the prosecution of the Exxon case, the Commission's staff has retained a number of economic consultants to provide advice and assistance in developing litigation strategy and designing the effective use of resources devoted to the case. Among the products of this collaboration is a report prepared by a panel of economists (the "Final Economic Report"), described by the FTC as containing an "in-depth evaluation of aspects of the theory of the case and the evidence supporting these aspects, discussions of possible future litigation strategies, and areas of possible inquiry for further economic analysis." Document # 12, defendants' index.

The Exxon case is currently in the stage of pretrial discovery. On April 17, 1978, Exxon filed a motion with the administrative law judge in that case for issuance of a subpoena duces tecum to direct complaint counsel to produce the Final Economic Report. Administrative Law Judge Berman denied Exxon's motion on the grounds that the economic report, containing assessments of strategy, evaluations and recommendations about theory development and discovery, was clearly attorney work product and therefore privileged.³ Order of June 2, 1978, FTC Docket No. 8934, Berman, Administrative Law Judge.

Prior to the filing of its motion with the administrative law judge to obtain discovery of the Final Economic Report, Exxon, through counsel, had made a request to the FTC under FOIA for three categories of documents regarding the Exxon case or the issues of that case:

All documents which constitute, refer or relate to any oral or written communication . . . during the period January 1, 1977, to the date hereof

(a) between any Commissioner of the Federal Trade Commission . . . or any member of such Commissioner's staff, and any Federal Trade Commission employee . . .

(b) between any Commissioner of the Federal Trade Commission . . . or any member of such Commissioner's staff, and any private party . . .

(c) between any employee of the Federal Trade Commission who is directly or indirectly engaged in the pending FTC Docket No. 8934 adjudicative proceeding and any private party. . . .⁴

The FTC granted partial access to the documents responsive to Exxon's request.⁵ Exxon appealed the partial denial to the General Counsel of the Federal Trade Commission. The General Counsel released additional documents (or portions thereof) and advised Exxon that the remaining documents (or portions thereof) were being withheld pursuant to exemptions 5, 7(A) and 7(D) of FOIA.⁶

As a result of Exxon's October 25, 1977 FOIA request, the FTC located approximately 2,000 pages of responsive documents; of these, approximately 1,200 pages are on public record. Of the remaining 800 responsive pages, the FTC has released approximately 425 pages, or approximately 53% of the responsive pages located that are not on the public record.

On March 24, 1978, Exxon filed the present complaint with this Court for injunctive relief, challenging the FTC's claims to exemption for the responsive documents withheld in whole or in part, including the Final Economic Report.

Defendants have provided an index of the 64 documents withheld in whole or in part, describing the portions withheld and the exemptions claimed.

Defendants have also produced an affidavit by Carol Thomas, Secretary of the Commission, describing and attesting to the adequacy of the FTC's search for responsive documents, and an affidavit by Roger Pool, complaint counsel in the Exxon case, further explaining defendants' reasons for claiming each exemption.

The index and affidavits provided by defendants are relatively detailed and nonconclusory. For example, document # 2 is described in defendants' index as follows:

(2) Undated. From economist. To Exxon panel and FTC staff. Analysis of one aspect of theory of case and role of government agencies in relation to that aspect, including characterization of conditions in petroleum industry, and suggestions for further information to be gathered.

The index also records that both exemptions (b)(5) and (7)(A) are claimed by defendants for this document. This example is typical of the entries in defendants' index.

Plaintiff has not alleged, nor has defendants' showing exhibited to the Court, anything other than good faith compliance with FOIA by defendants.

Defendants have filed a motion for summary judgment. In the course of its consideration the Court ordered defendants to produce three disputed documents in camera. The so-called Blue Minutes of May 24 and July 29, 1977 (documents # 61 and # 62) and the Final Economic Report (document # 12).

The Court has examined these documents in camera and, as more fully described below, finds that the Blue Minutes contain, among other things, some facts which are already public and some account of pre-decisional, deliberative communications within the Commission. The Final Economic Report contains pretrial tactical and strategic advice about a pending case to defendants' counsel from consulted specialists.

II. Conclusions of Law

This case is now before the Court on defendants' motion for summary judgment. In opposition, plaintiff raises in the first instance its need for additional discovery pursuant to Fed.R.Civ.P. 56(f). The Court has ordered that discovery be stayed pending decision on the motion for summary judgment. (Order of August 11, 1978.) The discovery issue will be considered before turning to the merits of defendants' motion for summary judgment.

A. Plaintiff's motion for discovery pursuant to Fed.R.Civ.P. 56(f).

Plaintiff's initial response to defendants' motion for summary judgment takes the form of an affidavit of counsel, John S. Kingdon, pursuant to Fed.R.Civ.P. 56(f), explaining that plaintiff is unable to respond to factual statements in defendants' affidavits or to formulate its full opposition to defendants' motion without first obtaining certain discovery. Plaintiff states that its discovery "seeks information concerning the retention of the economists engaged in the Exxon study, the involvement of Commission employees in the preparation or supervision of the Economists' Report, and the use and distribution of documents reflecting the subject matter of the Report." Plaintiff's Opposition to Defendants' Motion for Close of Discovery, p. 2. Plaintiff also seeks discovery to respond to defendants' affidavit in support of the completeness and thoroughness of defendants' search for responsive documents. Accordingly, plaintiff outlines the following plan of discovery that it feels it must undertake in order adequately to respond to defendants' motion for summary judgment: the deposition on written questions of FTC Commissioners Pertschuk, Dole and Clanton, the oral deposition of complaint counsel in the Exxon case, Roger Pool, the oral deposition of Kenneth Elzinga, Professor of Economics at the University of Virginia and believed by plaintiff to have been involved in the preparation of the Final Economic Report,⁷ and the oral deposition of Keith Golden, a paralegal in the FTC's Office of the Secretary, alleged by plaintiff to have been given responsibility for coordinating the FTC's search for documents responsive to plaintiff's October 25, 1977, FOIA request. Kingdon affidavit, ¶¶ 4-8.

The discovery requested by plaintiff is intended to uncover facts in support of three different legal contentions: (1) that defendants are not entitled to claim any privilege, and specifically no attorney work product privilege, for the records withheld (oral deposition of complaint counsel Pool, oral deposition of Professor Elzinga; Kingdon affidavit at ¶¶ 6-7), (2) that defendants have waived any exemption for the records withheld (deposition on written questions of Commissioners Pertschuk, Dole and Clanton, oral deposition of Professor Elzinga; Kingdon affidavit at ¶¶ 5 and 7), and (3) that defendants have failed to search adequately for documents responsive to plaintiff's October 25, 1977, FOIA request (oral deposition of Keith Golden; Kingdon affidavit at ¶ 8).

We shall examine plaintiff's need for discovery in light of each of the legal contentions for which plaintiff would like to find further evidence.

1. Adequacy of Defendants' search.

Plaintiff seeks to discover facts relating to the adequacy of defendants' search for responsive records but does not put at issue defendants' claim, supported by the Thomas affidavit, that defendants' search was complete and thorough. Rather, plaintiff seeks to argue that, ab initio, it deserves an opportunity to discover facts that may controvert the evidence submitted by defendants.

The law does not support plaintiff's position. Ou...