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Clinics Win Battle Over Meaning of 2016 FOIA Amendments

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Three law school clinics, working in tandem and with lawyers at Vinson & Elkins, have succeeded before the United States Court of Appeals for the Second Circuit in a high impact case concerning the scope of 2016 amendments to the Freedom of Information Act (FOIA).

The successful clinics, all part of the Free Expression Legal Network, a coalition of clinics devoted to free speech and government transparency, include the Cornell Law School First Amendment Clinic, Yale Media Freedom & Information Access Clinic, and SMU Dedman School of Law First Amendment Clinic.

In the first ruling on this critical issue, the Second Circuit agreed with the clinics’ argument in Seife v. FDA that the 2016 amendments require federal agencies to disclose the confidential commercial and financial information they obtain from third parties unless they can show that disclosing the confidential material will cause affirmative harm to the commercial interests of the entity that provided the information.

The Seife case centered around the scope of exemption 4 to FOIA, which permits an agency to withhold from the public all commercial or financial information it obtains from third parties if that information is “confidential.”  For several decades, courts had construed this exemption narrowly to allow the withholding of such confidential information only if its disclosure would cause “competitive harm.” But in a 2019 decision, the Supreme Court held in Food Marketing Institute v. Argus Leader that the plain language of exemption 4 allows an agency to withhold any confidential commercial or financial information, regardless of whether its disclosure would cause any harm. According to the Court, all confidential commercial and financial information falls within the literal terms of exemption 4 and can be withheld.

The clinics’ case involved the meaning of a 2016 amendment to FOIA that did not apply to the FOIA request in Argus Leader. That amendment requires agencies to disclose information even when it falls within one of FOIA’s exemptions unless the agency can show that disclosure is likely to cause the type of harm the exemption was intended to prevent.  The FDA contended in Seife that exemption 4 seeks only to prevent a destruction of confidentiality, so all confidential information can be withheld even under the 2016 amendment.

The clinics argued that exemption 4 did not seek to protect confidentiality for the sake of confidentiality, but sought to avoid the commercial harm that can result from disclosure of certain confidential business information. Under that reading of the 2016 amendment, an agency invoking exemption 4 is required to show both that commercial or financial information is confidential and that its disclosure is likely to cause some specific commercial harm. In the first appellate ruling to address the issue, the Second Circuit agreed with the clinics.

The plaintiff in the precedent-setting case is Charles Seife, an award-winning science reporter and journalism professor at NYU.  Seife was seeking to obtain documents from the FDA related to its approval of a controversial drug – Exondys 51 – created by pharmaceutical company Sarepta.    The FDA largely rejected Seife’s request for information pertaining to the drug’s approval, asserting that the clinical trial data and other information he sought could be withheld under exemption 4 since Sarepta considered it confidential. While ultimately affirming the FDA’s decision to withhold much of the information, the Second Circuit rejected its contention that information can be withheld under exemption 4 simply because it is confidential.

The Seife case originated with a 2016 email to Cortelyou C. Kenney, then a staff attorney at Yale Law School and later the Associate Director of the Cornell Clinic.  The email posed a simple inquiry: “lawsuit?” as a possible way to promote transparency for clinical trial data in the wake of multiple scandals involving drugs that turned out to be less safe and effective than suggested by the analysis of the confidential trial data conducted by the pharmaceutical companies themselves.   The case went through three rounds of summary judgment briefing in the district court before finally landing in the Second Circuit Court of Appeals in 2021.

“This case sets a vital precedent,” according to Kenney.  “The Second Circuit is the first Court of Appeals in the nation to take up the question of the meaning of the foreseeable harm standard under the 2016 amendments, and this ruling will have an important spillover effect as other circuits address the issue.”

“The decision circumscribes Exemption 4 in a really important way, and in my future FOIAs I will be able to quote this every time and make sure FOIA officers understand that they must be able to show a foreseeable harm from disclosure in order to withhold confidential commercial information,” said Seife.

“This decision holds federal agencies to the standard congress directed and promotes a more open government” said Jared Carter, a Cornell Clinic attorney who argued the case before the Second Circuit.

Many attorneys and students contributed to this case over the past five years, including SMU students and alums Ellen Yost, Abigail Walker, Kayla Bright, Richard Friedl, Julien Tagnon, Randee Williams Koeller, Kyle Dudney, and Lynzi Rojas.  The Vinson & Elkins team was led by senior partner Thomas Leatherbury and included associate Jamie Davidson.

“It was an honor to represent such a dedicated advocate for government transparency as Charles Seife and a pleasure to work so seamlessly with our colleagues in the Cornell First Amendment Clinic and the Yale MFIA Clinic.  The Second Circuit’s decision carries out Congressional intent and significantly raises the bar for agencies and companies that seek to withhold information,” said Vinson & Elkins’ Leatherbury, who is also the director of the First Amendment Clinic at SMU Dedman School of Law.

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