Smolen v. The Federal Aviation Administration

Background

The Federal Aviation Administration (FAA) decided to move responsibility for Newark Liberty International Airport’s sector airspace from the New York Terminal Radar Approach Control Facility to the Philadelphia Air Traffic Control Tower. The FAA said the decision was based on staffing shortages at the New York facility. The FAA and the National Air Traffic Controllers Association (NATCA), the certified bargaining representative for the affected FAA employees, negotiated a memorandum of understanding covering matters such as employee reassignments, transfers, pay, awards, expenses, and training.

Robert E. Smolen, an FAA air traffic controller at the New York facility, submitted requests under the Freedom of Information Act (FOIA). The request at issue sought responses from NATCA officials and other records concerning the Newark-area realignment. The FAA produced 58 pages, but withheld some material under FOIA Exemptions 2, 4, and 6. It later released additional information but continued to withhold portions of four draft memoranda of understanding because NATCA asserted that they contained confidential commercial or financial information.

Smolen’s amended complaint asserted three claims: improper withholding under Exemption 4, failure to respond to his administrative appeal within the statutory time limit, and failure to conduct an adequate search or provide a sufficiently detailed description of that search. The FAA moved for summary judgment under Rule 56, and Smolen cross-moved for summary judgment.

Withholding Under Exemption 4

FOIA generally requires federal agencies to disclose agency records, subject to statutory exemptions. Exemption 4 protects trade secrets and commercial or financial information obtained from a person that is privileged or confidential. The court applied a three-part test: the information must be commercial or financial, obtained from a person, and privileged or confidential.

The court held that the draft memoranda satisfied all three requirements. The documents contained NATCA’s proposals and the FAA’s counterproposals about pay and other employment conditions. They revealed NATCA’s bargaining demands, priorities, compromises, and negotiating positions concerning transfers, reassignments, awards, expenses, staffing, and pay. The court ruled that information can be commercial or financial even when it comes from a nonprofit labor organization, because the statute does not limit the protection to profit-making entities or traditional business records such as sales statistics and inventories.

The court also held that the information was obtained from a person. NATCA’s proposals came directly from the union. Although some draft documents contained FAA counterproposals, the court found that those documents incorporated and reflected NATCA’s proposals and negotiating positions through the parties’ use of tracked changes and their exchange of proposals during negotiations.

The court further found that NATCA and the FAA treated the draft proposals as confidential. The proposals were shared only with bargaining-team members, relevant staff, and subject-matter experts on a need-to-know basis. The court also found that disclosure would foreseeably harm NATCA’s commercial interests by undermining its ability to negotiate effectively in future collective bargaining.

The court rejected Smolen’s argument that Exemption 4 required proof of competitive injury. It explained that the Supreme Court had rejected adding a competitive-harm requirement that does not appear in the statutory text. The court also rejected Smolen’s request for review of the documents privately by the court, finding that his allegations about unfair labor practices, the FAA’s compliance with Section 804 of the FAA Modernization and Reform Act of 2012, and agency delay did not show bad faith by the FAA or justify that review.

Adequacy of the Search

The court held that Smolen had not exhausted his administrative remedies on his challenge to the adequacy of the FAA’s search. His administrative appeal challenged the FAA’s use of Exemptions 2 and 4, but did not challenge the search. The court reasoned that Smolen had enough information at the time of his appeal to raise his search objections, so his later judicial challenge was barred.

The court also ruled that constructive exhaustion did not help Smolen on this issue. A requester may be treated as having exhausted administrative remedies when an agency fails to respond on time to an issue properly raised in an appeal. But Smolen had appealed the withholding issue, not the adequacy of the search, so the court held that constructive exhaustion applied only to the appealed issue.

Alternatively, the court held that the search was adequate. FAA employees searched the email accounts of relevant negotiators and other employees who were likely to possess responsive records, using names of relevant participants and terms concerning the Newark airspace realignment and NATCA. Later supplemental searches found no additional substantive responsive records. The court found Smolen’s claim that other records must exist to be speculative and concluded that the FAA’s sworn declarations adequately described a reasonable search.

Disposition

The court granted the FAA’s motion for summary judgment and denied Smolen’s cross-motion for summary judgment. The Clerk of Court was directed to close the motion and close the case.