Grumman Aircraft Eng. Corp. v. Renegotiation Board, 71-1730.

• Decision Date: 03 July 1973
• Docket Number: No. 71-1730.,71-1730.
• Citation: 482 F.2d 710
• Parties: GRUMMAN AIRCRAFT ENGINEERING CORPORATION v. The RENEGOTIATION BOARD, Appellant
• Court: U.S. Court of Appeals — District of Columbia Circuit

482 F.2d 710 (1973)

GRUMMAN AIRCRAFT ENGINEERING CORPORATION v. The RENEGOTIATION BOARD, Appellant

No. 71-1730.

United States Court of Appeals, District of Columbia Circuit.

Argued February 27, 1973.

Decided July 3, 1973.

Rehearing Denied September 27, 1973.

Irwin Goldbloom, Atty., Dept. of Justice, with whom L. Patrick Gray, III, Asst. Atty. Gen. at the time the brief was filed, Harold H. Titus, Jr., U. S. Atty., and Walter H. Fleischer, Atty., Dept. of Justice, were on the brief, for appellant.

Tom M. Schaumberg and Rexford T. Brown, Washington, D. C., for appellee.

Before BAZELON, Chief Judge, WRIGHT, Circuit Judge, and VAN PELT,^* Senior District Judge.

J. SKELLY WRIGHT, Circuit Judge.

This appeal involves the validity of a District Court order requiring the Renegotiation Board to disclose documents explaining decisions of the Board and its decision-making delegates, the Regional Boards, made between 1962 and 1965, as to whether 14 companies¹ accrued excess profits in their business with the Government. These documents were sought by Grumman Aircraft Engineering Corporation under the Freedom of Information Act, 5 U.S.C. § 552 (1970), which mandates that Government agencies, including the Renegotiation Board, make available for public inspection and copying "final opinions, including concurring and dissenting opinions, as well as orders, made in the adjudication of cases * * *." 5 U.S.C. § 552(a)(2)(A). The Act also requires disclosure of "identifiable records," 5 U.S.C. § 552(a) (3), but exempts from the disclosure requirement certain specified materials, 5 U.S.C. § 552(b)(1)-(9).

This is the second time this case is before us. Initially the District Court refused to order disclosure on the ground that the requested documents contained trade secrets and other confidential information covered by the Act's exemption for "trade secrets and commercial or financial information obtained from a person and privileged or confidential," 5 U.S.C. § 552(b) (4). On appeal we held that Congress did not intend to exempt an entire document simply because it contained confidential information, that the proper procedure where exempted data is contained in the requested documents is to accommodate the Freedom of Information Act's dual policy of promoting public awareness and administrative fairness, on the one hand, and the need for justifiable secrecy on the other, by striking identifying details from the documents prior to release. We remanded the case to the District Court for further proceedings to determine precisely which of the documents or parts thereof sought by Grumman should be produced under the Act. Grumman Aircraft Engineering Corp. v. Renegotiation Board, 138 U.S.App.D.C. 147, 425 F.2d 578 (1970).

On remand the Board agreed to produce many of the documents requested, but disagreement remained as to whether certain documents generated by the Board and its statutorily authorized decision-making delegates, the Regional Boards, in the decision-making process were "final opinions, including concurring and dissenting opinions," producible under 5 U.S.C. § 552(a) (2) (A) or, as appellant contends, inter- or intra-agency memoranda exempt from production under 5 U.S.C. § 552(b) (5). The District Court's opinion, D.D.C., 325 F.Supp. 1146 (1971), describes at length the kinds of documents at issue and holds that the documents requested by Grumman should be produced under the Freedom of Information Act as "final opinions, including concurring and dissenting opinions," of the Renegotiation Board. Given the evident care of the District Court's delineation of the facts and its discussion of the issues, we avoid covering the same ground. We hold its findings of fact not clearly erroneous and concur in its conclusions and its judgment. Indeed, we find its judgment as to the principal documents still in dispute supportable on two additional grounds.²

I

The District Court ordered disclosure of Regional Board reports in Class A renegotiation cases³ where pursuant to Renegotiation Board regulations (a) the Regional Board decides that a clearance, or finding of no excess profits liability, is proper⁴; (b) the Renegotiation Board (hereinafter the National Board) notifies the Regional Board that "it is in accord with the Regional Board's determination"⁵; and (c) the Regional Board issues a notice to the contractor under investigation of his non-liability.⁶ These reports, which the District Court found were "prepared and signed by a Regional Board member, and were signed on behalf of the Regional Board by its Chairman," 325 F.Supp. at 1153, were held by the District Court to be a "final opinion of the National Board," ibid., and thus required to be produced under the Freedom of Information Act.

The National Board strongly challenges this disposition on the ground that the Regional Boards are merely advisory to the National Board, that the National Board is in fact the final decision-maker in cases of this sort, and, finally, that the unrecorded and undisclosed reasons for the National Board's agreement with the Regional Board's finding might have been different from those contained in the Regional Board report. As the District Court's opinion indicated, this argument loses much of its force when one considers the perfunctory nature of the National Board's review in such cases, the fact that in cases of this sort the National Board, in accepting the determination of the Regional Board, rejects the alternative of assigning the case to its own docket for independent consideration by a division of its membership,⁷ and the fact that the determination reflected in the clearance notice to the contractor is attributed to "the Regional Board pursuant to due delegation of authority" under National Board regulations.⁸

Conceding, arguendo, that the Regional Board report is not tantamount to a "final opinion" of the National Board, we have no doubt that it does represent the "final opinion" of the Regional Board. Not only is the report, as the District Court found, "prepared and signed by a Regional Board member, and * * * signed on behalf of the Regional Board by its Chairman," 325 F.Supp. at 1153, but the practicalities of National Board procedure dictate this conclusion. When the Regional Board decides that a clearance should be granted in the type of case at issue here, the report is the only document in the file it forwards to the National Board which purports to justify the Regional Board's clearance recommendation in terms of the statutory standards the National Board is required to apply to the facts of the case.⁹ And the National Board itself acknowledges that the report is treated at the National Board level as the Regional Board's justification of its recommendation.¹⁰ Given this function, plus the formal role it is assigned in the National Board's regulations, 32 C.F.R. § 1473.2(a), and the District Court's findings, the Regional Board report clearly occupies the same opinion status as any document produced by a decision-maker in an adjudicatory-like process and forwarded to a reviewing tribunal.

For purposes of the Freedom of Information Act, the crucial question then becomes whether the Regional Board, wholly apart from the National Board, is to be considered an "agency" to which the provisions of the Act, including the requirement of disclosure of "final opinions," applies. Compare Soucie v. David, 145 U.S.App.D.C. 144, 149-153, 448 F.2d 1067, 1072-1076 (1971), with International Paper Co. v. FPC, 2 Cir., 438 F.2d 1349, 1359, cert. denied, 404 U.S. 827, 92 S.Ct. 61, 30 L. Ed.2d 56 (1971). We believe the Regional Board should be so considered.

The statutory definition of "agency" in the Freedom of Information Act is supplied in Section 2 of the Administrative Procedure Act, 5 U.S.C. § 551(1) (1970),¹¹ which states: "`agency' means each authority of the Government of the United States, whether or not it is within or subject to review by another agency * * *." This statutory language obviously disposes of any contention that the Regional Board cannot be considered an "agency" merely because it is subject, in the kinds of cases for which the reports are sought here, to de novo review by the National Board. But beyond that the provision is hardly self-defining, as both this court¹² and commentators,¹³ have acknowledged.

We believe that several broad guidelines as to the meaning of the term "agency" have emerged and that they compel the conclusion that the Regional Boards fit within the APA definition. The leading case, of course, is Soucie v. David, supra, where we held that the Office of Science and Technology in the Office of the President is to be considered an "agency" for the purposes of Section 2 of the Administrative Procedure Act and therefore for the Freedom of Information Act. Soucie, relying on the legislative history of the APA, reasoned that the "APA apparently confers agency status on any administrative unit with substantial independent authority in the exercise of specific functions." 145 U.S.App.D.C. at 150, 448 F.2d at 1073. We then concluded that OST met this broad standard and was not to be considered merely personal staff to the President.¹⁴ We relied on several factors for this conclusion, including indications that Congress, in acquiescing in the presidential reorganization plan that created OST, believed that the unit would assume the independent administrative function of evaluating congressionally approved federal scientific programs. 145 U.S.App.D.C. at 151-152, 448 F.2d at 1074-1075.

The factors we relied on in Soucie to conclude that OST was an "agency" for purposes of the Administrative Procedure Act and thus for purposes of the Freedom of Information Act are clearly evident in this case. There is no question that the Regional Boards have been granted what Soucie termed "substantial independent authority." Equally, the Regional Boards fit the functional definition of "agency" proposed...