Madel v. United States Department of Justice

Background

Christopher W. Madel sought records under the Freedom of Information Act (FOIA) concerning monthly or quarterly oxycodone sales and distribution. His current requests sought information for Georgia from 2012 through May 2017 and for Michigan from 2006 through May 2017, involving Cardinal Health, Inc., CVS Caremark, and Walgreen Company. He also sought specified reports from the Automation of Reports and Consolidated Orders System database.

The Department of Justice and the Drug Enforcement Administration asserted that they had no responsive information for CVS Caremark. They said they had produced all responsive information for Walgreen Company through 2013 and for Cardinal Health through January 2015, except information withheld under FOIA Exemption 4. That exemption covers trade secrets and certain confidential commercial or financial information. The parties agreed that the remaining dispute concerned some Cardinal Health distribution information from January 1, 2015, through May 29, 2017. Cardinal Health objected to disclosure.

The court had previously commented in an earlier round of this dispute that the requested information was old enough that the defendants’ claimed competitive harm was not credible. The court explained that this comment did not create a five-year rule allowing the defendants to withhold all information less than five years old.

Legal standard

In a FOIA summary-judgment proceeding, the agency bears the burden of showing that each requested document was produced, cannot be identified, or is entirely exempt from disclosure. The court must view the facts in the light most favorable to the FOIA requester.

The defendants argued that the Supreme Court’s decision in Food Marketing Institute v. Argus Leader Media required only a showing that the information was confidential, meaning that it was customarily kept private. Madel argued that a 2016 amendment to FOIA required an agency invoking Exemption 4 to establish competitive harm as well as confidentiality.

The court did not resolve that dispute because it concluded that the defendants had not met even the less demanding standard they proposed. Under the standard the court applied, information must be commercial or financial information that its owner both customarily and actually treats as private and that was provided to the government under an assurance of privacy. Agency declarations receive substantial weight, but they cannot consist only of general or conclusory statements.

Court’s analysis

The court found that the declaration of Angela Hertel, the Acting Unit Chief for the Drug Enforcement Administration’s FOIA unit, lacked sufficient detail. Hertel relied on Cardinal Health’s response to the agency’s notice of the FOIA request. That response generally stated that disclosure could reveal customer identities and market share at the state and three-digit ZIP-code levels.

Hertel then concluded that Cardinal Health had provided the withheld information to the agency under an assurance of privacy. The court held that this did not establish the required facts. The agency also failed to show that the time limit it placed on the withheld information was necessary to protect Cardinal Health’s general confidentiality interests. The court characterized the declaration as the kind of unsupported assertion that was insufficient under the governing FOIA standards.

Disposition

The court denied the defendants’ Motion for Summary Judgment, docket number 22. The order did not direct the defendants to disclose the disputed information; it rejected their request for summary judgment based on FOIA Exemption 4.