National Organization for Women, Washington, D.C. Chapter v. Social Sec. Admin. of Dept. of Health and Human Services

• Citation: 237 U.S.App.D.C. 118,736 F.2d 727
• Decision Date: 02 July 1984
• Docket Number: 77-1269 and 77-1270,76-2163,76-2129,76-2128,77-1161,Nos. 76-2119,s. 76-2119
• Parties: 34 Fair Empl.Prac.Cas. 1514, 34 Empl. Prac. Dec. P 34,406, 237 U.S.App.D.C. 118 NATIONAL ORGANIZATION FOR WOMEN, WASHINGTON, D.C. CHAPTER v. SOCIAL SECURITY ADMINISTRATION OF the DEPARTMENT OF HEALTH AND HUMAN SERVICES, et al., Prudential Insurance Company of America, Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals (District of Columbia)

Page 727

736 F.2d 727

34 Fair Empl.Prac.Cas. 1514,

34 Empl. Prac. Dec. P 34,406, 237 U.S.App.D.C. 118

NATIONAL ORGANIZATION FOR WOMEN, WASHINGTON, D.C. CHAPTER v. SOCIAL SECURITY ADMINISTRATION OF the DEPARTMENT OF HEALTH AND HUMAN SERVICES, et al., Prudential Insurance

Company of America, Appellant.

Nos. 76-2119, 76-2128, 76-2129, 76-2163, 77-1161, 77-1269

and 77-1270.

United States Court of Appeals, District of Columbia Circuit.

Argued May 1, 1980.

Decided May 25, 1984.

As Amended July 2, 1984.

Appeals from the United States District Court for the District of Columbia (D.C. Civil Actions Nos. 76-0087, 76-0914).

Margaret A. Kohn, Washington, D.C., was on the brief, for National Organization for Women, appellants in No. 77-1161 and cross-appellants in Nos. 76-2119, 76-2128, 76-2129, 76-1269 and 77-1270. Collot Guerard, Washington, D.C., also entered an appearance for National Organization for Women, cross-appellants in Nos. 76-2119, 76-2128, 76-2129, 76-2163, 77-1269 and 77-1270.

Douglas N. Letter, Washington, D.C., with whom Alice Daniel, Acting Asst. Atty. Gen., Civil Division, Dept. of Justice, Carl S. Rauh, U.S. Atty., Washington, D.C., at the time the brief was filed, and Leonard Schaitman, Atty., Dept. of Justice, Washington, D.C., were on the brief for Social Security Administration of the Department of Health and Human Services, et al., cross-appellants in Nos. 77-1269 and 77-1270, and appellees in Nos. 76-2119, 76-2128, 76-2129, 77-1161 and 76-2163. John A. Terry, Asst. U.S. Atty., Washington, D.C., at the time the brief was filed, Richard A. Graham and Joseph Guerrieri, Jr., Asst. U.S. Attys., and Frederic D. Cohen, Atty., Dept. of Justice, Washington, D.C., also entered appearances for Social Security Administration, et al., cross-appellants in Nos. 77-1269 and 77-1270 and appellees in Nos. 76-2119, 76-2128, 76-2129, 77-1161 and 76-2163.

Michael S. Horne, Washington, D.C., with whom Jerome Ackerman and Bruce D. Sokler, Washington, D.C., for Prudential Insurance Company, J. Austin Lyons, Margaret F. Kelly, New York City, and James F. Bromley, Rockville, Md., for Metropolitan Life Insurance Company, and William F. Joy, Robert P. Joy, Boston, Mass., for John Hancock Mutual Life Insurance Company, were on the joint brief for the insurance company appellees and cross-appellants in Nos. 76-2119, 76-2128, 76-2129, 76-2163, 77-1161, 77-1269 and 77-1270.

Before ROBINSON, Chief Judge, MIKVA, Circuit Judge, and McGOWAN, Senior Circuit Judge.

Opinion filed PER CURIAM.

Opinion filed by Chief Judge SPOTTSWOOD W. ROBINSON, III, concurring in affirmance.

Opinion filed by Circuit Judge MIKVA and Senior Circuit Judge McGOWAN concurring in affirmance.

PER CURIAM:

The judgment of the District Court is affirmed. Chief Judge Robinson concurs for the reasons set forth in his opinion. Circuit Judge Mikva and Senior Circuit Judge McGowan concur for the reasons set forth in their opinion. The case is remanded to the District Court for further proceedings in accordance with instructions set forth in the opinion of Circuit Judge Mikva and Senior Circuit Judge McGowan.

SPOTTSWOOD W. ROBINSON, III, Chief Judge:

A federal regulatory agency ruled that documentary matter collected from regulatees is subject to public examination pursuant to the Freedom of Information Act (FOIA). ¹ The District Court, after reviewing the agency's decision de novo, issued a preliminary injunction barring release of much of the material. ² In that court's view, there is a substantial probability that the data thus impounded are removed from FOIA's disclosure mandate by Exemptions 4 and 6, ³ and that the proscriptions of the Trade Secrets Act ⁴ would brand voluntary agency divulgence an abuse of discretion. ⁵ We are asked to dissolve the court's injunction.

I would hold that de novo review on questions of exemption by FOIA was proper in the context in which it occurred, ⁶ and would leave undisturbed the District Court's determinations on the scope of the FOIA exemptions involved and the reach of the Trade Secrets Act. ⁷ I would conclude, however, that the court should not have undertaken to gauge, without prior assessment by the agency itself, the propriety of voluntary disclosure of items ostensibly exempted from FOIA's purview and left unprotected by the Trade Secrets Act. ⁸ I thus would remand for further proceedings.

I. BACKGROUND

A. The Regulatory Scheme

The three major insurance companies litigating here ⁹ are contractors with the Federal Government. As such, the companies are subject to Executive Order 11246, ¹⁰ which requires the Secretary of Labor to ensure that contractors' workforces are free from employment discrimination based on race, sex, religion or national origin. The Secretary has delegated this responsibility to the Office of Federal Contract Compliance Programs (OFCCP). ¹¹ When the cases at bar germinated, a number of federal entities served as "compliance agencies" monitoring equal employment opportunity within various geographical areas and industrial classifications. The unit so designated for the insurance industry was the Insurance Compliance Staff (ICS) of the Social Security Administration. ¹²

OFCCP rules require government contractors to file annual statements, known as EEO-1 reports, ¹³ detailing the number of women and minority-group members working in specified job categories. ¹⁴ Additionally, each contractor must prepare an affirmative action plan projecting the employment of women and minorities, and establishing goals and timetables for correcting deficiencies. ¹⁵ Each contractor's affirmative action program is audited periodically, and on-site reviews are conducted when the contractor's submission is deemed unsatisfactory. ¹⁶ The results of these audits and reviews are then compiled in compliance review reports. ¹⁷

The Department of Labor has promulgated regulations on disclosure of data obtained or generated pursuant to Executive Order 11246. ¹⁸ These rules instruct OFCCP to release such information voluntarily upon request--unless legally forbidden, but notwithstanding the availability of a FOIA exemption from mandatory release--whenever doing so would further the public interest and would not impede the agency's functions. ¹⁹ If, however these two preconditions are not met, the agency must withhold FOIA-exempt portions of affirmative action plans, such as goals and timetables, constituting confidential commercial or financial information "because they indicate, and only to the extent that they indicate, that a contractor plans major shifts or changes in his personnel requirements and he has not made this information available to the public." ²⁰ Also to be withheld, absent satisfaction of the two preconditions, is FOIA-exempt information on staffing patterns and pay scales in affirmative action plans, but only insofar as divulgence "would injure the business or financial position of the contractor, would constitute a release of confidential financial information of an employee or would constitute an unwarranted invasion of the privacy of an employee." ²¹

With these and other limited exceptions, ²² the regulations thus favor voluntary disclosure of contract-compliance information--even that which, because exempt under FOIA, OFCCP is not compelled to reveal. Recognizing, however, that submitters of EEO-1 reports and affirmative action plans may have a justifiable interest in maintaining the confidentiality of particular data, the regulations also provide a process by which a contractor may solicit protection. ²³ An administrative determination on applicability of a FOIA exemption, or on discretionary release of exempt information, thus may arise either from a third-party demand for disclosure or a contractor's request for nondisclosure.

B. The Administrative Proceedings

Metropolitan Life Insurance Company presented to ICS a statement seeking to preserve the confidentiality of portions of its affirmative action plans, ²⁴ and ICS began to proceed under the regulations. ²⁵ Shortly thereafter, the District of Columbia Chapter of the National Organization for Women (NOW) requested all EEO-1 reports, current affirmative action plans and compliance review reports pertaining to four insurance companies, including Metropolitan. ²⁶

ICS notified the companies of NOW's application and offered each an opportunity to demonstrate that, under the guidelines supplied by the regulations, the information sought should not be revealed. At the same time, ICS asked NOW for clarification of the scope of its demand. ²⁷ NOW treated this response as the equivalent of a denial and instituted an administrative appeal, ²⁸ but ICS continued to consider NOW's bid along with oppositions presented by the companies. Somewhat later, ICS, addressing the companies' challenges, informed them of its decision to release most of the data requested. ²⁹

Resorting both to FOIA and the OFCCP regulations, ICS believed that a few items in the affirmative action plans should be excluded from NOW's inspection because public availability would cause competitive harm. ³⁰ ICS also felt that additional items should be withheld because their release conceivably could result in unwarranted invasions of personal privacy. ³¹ As to the remainder, however, ICS rejected company arguments that particular FOIA exemptions applied, and ordered disclosure. ³² The companies appealed to the Director of OFCCP, ³³ who substantially affirmed ICS' decision. ³⁴

C. The Judicial Proceedings

While its efforts at the agency level continued, Metropolitan instituted an action in the District Court for the Southern District of New York, and sought a temporary restraining order blocking release of its affirmative action statistics until administrative remedies could be exhausted. ³⁵ Counsel for the Government ³⁶ stipulated that no disclosure would take place until five days after full resort through those channels, and the other companies were subsequently...