(Editor’s Note.  The following case shows how the courts are diverging from the priority of “transparency” of government contractors’ dollars favored by many members of Congress.)

The Air Force awarded CCC a contract for repair and maintenance for the J85 turbojet engine.  Sabreliner filed a protest where it asked for, under the Freedom of Information Act (FOIA), detailed cost and pricing information for option year prices.  CCC  brought a “reverse FOIA” action to prevent the Air Force from releasing the information asserting the release of its cost and pricing data would cause it competitive harm.  In evaluating the contractor’s challenge to the Air Force’s decision to release the data, the Court explained that FOIA Exemption 4 permits the government to withhold information in response to a FOIA request if that information is commercial or financial and privileged or confidential.  The Court said because the information was submitted “involuntarily” – required for the contract proposal – it is considered “privileged or confidential” if it is likely either to (1) impair the government’s ability to obtain necessary information in the future or (2) cause substantial harm to the plaintiffs’ competitive position.  

The Air Force ruled for CCC arguing neither condition was met and thus Exemption 4 did not apply. For the first condition, the government asserted the Court could not “second-guess” the government assessment of its own interests and that it had released similar information in the past with no harm.  As for the second condition, the government asserted no harm would result from divulging of “contract prices.  The Court rejected the Air Force’s first contention stating that its “vague and unsupported contentions” did not square with the need to specifically explain why future interests will not likely be impaired by the release of the information and that it had found no evidence that the type of information the FAR allows to be released is the type in question here.  As for its second assertion of no harm, the Air Force’s “amorphous term of ‘contract prices’” fails to analyze whether the information is  “cost breakdown” information which is protected from discloser by the FAR and Exemption 4 or “unit price” information which may be disclosed under the FAR (Canadian Commercial Corp. v Dept. of Air Force, No. 04-1189).

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