D.C. Circuit Bars Air Force From Disclosing Contractor’s Pricing Information in Response to FOIA Request

Whether pricing information furnished to the Government by a contractor is discoverable through a FOIA request was before the D.C. Circuit Court of Appeals recently. In Canadian Commercial Corp. v. Department of the Air Force,"http://pacer.cadc.uscourts.gov/docs/common/opinions/200801/06-5310a.pdf", the court held that such information is protected from disclosure under Exemption 4 of the Freedom of Information Act.

In 2003, an unsuccessful bidder filed a FOIA request with the Air Force seeking a copy of the contract awarded to CCC which contained line-item pricing information. CCC objected on the basis that the line-item rates constituted trade secrets. The Air Force rejected CCC's contention and issued a decision letter indicating its intention to release the information. CCC filed a "reverse" Freedom of Information suit seeking to prevent the Air Force from releasing the information. It prevailed at the district court level, but the Air Force appealed.

On appeal, the D.C. Circuit noted that Exemption 4 of FOIA protects from disclosure "matters that are … trade secrets and commercial or financial information obtained from a person and privileged or confidential." 5 U.S.C. § 552(b)(4). Commercial or financial information is "confidential" if it is obtained from a person involuntarily and its disclosure would either "impair the Government's ability to obtain necessary information in the future; or .. cause substantial harm to the competitive position of the person from whom the information was obtained." The court held that line-item pricing meets this test.