FOIA Doesn’t Entitle Newspaper to Private Business Information

June 24, 2019 by Dan McCue

WASHINGTON – The U.S. Supreme Court ruled Monday that the media and general public are not entitled to every bit of information a government body collects about private businesses.

The underlying case came to the high court from South Dakota where the Argus Leader, a newspaper owned by USA Today publisher Gannett, which wanted to see how much grocery stores across the nation were earning through their participation in the federal government’s Supplemental Nutrition Assistance Program, also known as SNAP.

Reporters from the Argus Leader, which happens to be South Dakota’s largest daily paper, filed a Freedom of Information Act request with the U.S. Department of Agriculture for data on the $65 billion a year program, but the government rejected the request, citing Exemption 4 of the Freedom of Information Act.

Exemption 4 shields from disclosure of “commercial or financial information” provided by private parties, if that information is also “confidential.”

The newspaper sued, arguing that the information is public and its use by the reporters is of considerable public interest because it would detail how the government is spending their tax money.

A lower court ordered the government to comply with the newspaper’s request, at which point, the Food Marketing Institute, a supermarket trade association, stepped in to continue the case.

The association maintains its members rarely if ever disclose their store-level sales data publicly because it can be used by competitors to secure an edge in future marketing.

The Trump administration has thrown its support behind both the department and the association.

Writing for the six-member majority, Justice Neil Gorsuch said the Agriculture Department was correct in applying Exemption 4 to the Argus Leader’s request.

In his view, “at least where commercial or financial information is both customarily and actually treated as private by its owner and provided to the government under an assurance of privacy, the information is ‘confidential’ within the meaning of Exemption 4.” 

The court majority went on to conclude that the store-level SNAP data qualifies as “confidential” under this standard.

The 8th Circuit Court of Appeals erred to hold otherwise, Gorsuch said.

Justice Stephen Breyer wrote a separate opinion concurring in part and dissenting in part, which Justices Ruth Bader Ginsburg and Sonia Sotomayor joined.

In a statement Food Marketing Institute President and CEO Leslie Sarasin said she agrees with the Supreme Court’s ruling and is pleased to have “a clear interpretation of confidentiality regarding private businesses’ commercial data.”

“Our industry’s commitment to the shopper remains constant amidst seismic marketplace shifts,” Sarasin said.  “The nation’s grocery stores have long kept confidential the amount consumers spend at individual stores whether through payment by cash, credit, debit or the Supplemental Nutrition Assistance Program, or SNAP.

“This store-level sales data undoubtedly must be considered confidential because its release would provide an unfair advantage to competitors,” she continued. “Legislative history tells us the Freedom of Information Act, or FOIA, was created to shine a light on actions by the government, not on that of private parties, and the Court’s expressed desire to refer our case back to the lower courts demonstrates that our case sets an important precedent well beyond disclosing store-level SNAP sales in grocery.”

As for the Argus Leader, news director Cory Myers said in a statement published by USA Today, that he and his colleagues at the paper are “disappointed in today’s outcome.”

“This is a massive blow to the public’s right to know how its tax dollars are being spent, and who is benefiting. Regardless, we will continue to fight for government openness and transparency, as always,” Myers said.

The case is Food Marketing Institute v. Argus Leader Media, 18-481.

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