Center for the Study of Serv. v. HHS, et al

Filing

OPINION [1701040] filed (Pages: 12) for the Court by Judge Rogers, CONCURRING OPINION (Pages: 1) by Judge Randolph. [16-5296]

USCA Case #16-5296

Document #1701040

Filed: 10/24/2017

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 7, 2017

Decided October 24, 2017

No. 16-5296
CENTER FOR THE STUDY OF SERVICES, D/B/A CONSUMERS’
CHECKBOOK,
APPELLEE
v.
UNITED STATES DEPARTMENT OF HEALTH AND HUMAN
SERVICES AND CENTERS FOR MEDICARE AND MEDICAID
SERVICES,
APPELLANTS
Appeal from the United States District Court
for the District of Columbia
(No. 1:14-cv-00498)
Karen Schoen, Attorney, U.S. Department of Justice,
argued the cause for appellants. With her on the briefs was
Mark B. Stern, Attorney. R. Craig Lawrence, Assistant U.S.
Attorney, entered an appearance.
Paige M. Jennings argued the cause for appellee. With her
on the brief was Caroline M. Brown.
Before: ROGERS and MILLETT, Circuit Judges, and
RANDOLPH, Senior Circuit Judge.

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Opinion for the Court filed by Circuit Judge ROGERS.
Concurring opinion filed by Senior Circuit Judge
RANDOLPH.
ROGERS, Circuit Judge: The government appeals the order
of the district court, in response to requests pursuant to the
Freedom of Information Act by the Center for the Study of
Services (“Consumers’ Checkbook”), directing the
government to release health insurance plans to be offered
“each year” on the federal exchanges under the Affordable
Care Act once their terms are effectively final, or “locked
down.” The government contends that the order is contrary to
the statutory scheme and unwarranted absent a finding the
government had been and was likely to continue to be
delinquent in responding to Consumers’ Checkbook’s requests.
For the following reasons, we reverse the order granting
prospective relief.
I.
The Freedom of Information Act (“FOIA”) provides that
upon receiving a request for release of records, an agency shall
release the information “promptly” to the requester. 5 U.S.C.
§ 552(a)(3)(A). A request that “reasonably describes” the
records sought, id., triggers the agency’s obligation to search
for and disclose all responsive records, Morley v. CIA, 508 F.3d
1108, 1114 (D.C. Cir. 2007), unless the records fall within one
of the statutory exemptions. The burden is on the agency to
demonstrate that the records have not been “improperly
withheld.” U.S. Dep’t of Justice v. Tax Analysts, 492 U.S. 136,
142 & n.3 (1989) (citing S. REP. NO. 89-813, 2d Sess., 8
(1965); H. R. REP. NO. 89-1497, 2d Sess., 9 (1966)). District
courts are authorized “to enjoin the agency from withholding

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agency records and to order the production of any agency
records improperly withheld.” 5 U.S.C. § 552(a)(4)(B).
Under the Affordable Care Act, Pub. L. No. 111-148, 124
Stat. 119 (2010) (“ACA”), entities seeking to offer insurance
plans on federally-funded healthcare exchanges must submit
their proposals to the Centers for Medicare and Medicaid
Services (“CMS”). Through an iterative process over several
months, CMS determines which plans can be certified as a
“Qualified Health Plan” and included on a federal healthcare
exchange. Pub. L. No. 111-148, 124 Stat. 119 §§ 1301, 1302;
45 C.F.R. pt. 156. For example, entities seeking to offer plans
in 2016 were required to submit data in May 2015 describing
their proposed plans. CMS discovered deficiencies in the data
for all proposals in 2015 and sent “correction notices.”
Corrected data in support of a revised plan was to be submitted
by August 25, 2015. After that date, the data was “locked
down” for final CMS review. Changes thereafter required
CMS approval and were limited to technical changes, such as
those “necessary to correct data display errors.” In October
2015, CMS published the final plan lists and the eligible plans
on the healthcare exchange website, HealthCare.gov.
Consumers’ Checkbook is a nonprofit organization
“dedicated to conducting and supporting studies of consumer
services . . . and providing public benefit by publishing
magazines, books, reports, and websites that educate and
inform consumers.” Letter of Nov. 29, 2013 to CMS from
Robert Krughoff, President of Consumers’ Checkbook. In
November 2013, as healthcare exchanges were launching
under the ACA, Consumers’ Checkbook submitted a FOIA
request to CMS for data related to the insurance plans that
would be offered on the new healthcare exchanges. It
requested that data as soon as it was initially provided to CMS.
Having received no records, Consumers’ Checkbook sued

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CMS and the Department of Health and Human Services
(collectively, “the agency”) in March 2014, alleging they failed
to “release any of the requested information or even to set a
schedule for production of the information,” Cmpt. ¶ 4, and that
this delay prevented it “from establishing online consumerhelp tools it sought to establish prior to the expiration of the
ACA’s initial open enrollment period,” id. ¶ 5. It further
alleged that “CMS’s failure to respond raises doubts about
whether the agency can be relied on to release similar
information to Consumers’ C[heckbook] for future plan years,”
when it intended to “provide up-to-date online tools for
consumers during each annual, health plan enrollment period.”
Id. Consumers’ Checkbook sought a declaration the agency
had violated FOIA and an injunction against withholding the
requested records, as well as a permanent injunction against
“refusing to disclose or delaying the disclosure of substantially
the same information sought for future plan years”;
alternatively, it asked the district court to retain jurisdiction to
ensure the agency “promptly disclose[s]” this information in
the future. Id. 11.
Consumers’ Checkbook submitted FOIA requests to the
agency in June 2014, May 2015, and August 2016, each
seeking the same type of data for the upcoming ACA open
enrollment period. In 2013, 2014, and 2015, it sought the data
as soon as it was submitted to CMS. In its 2016 request,
Consumers’ Checkbook sought records only after the data had
been “locked down.” The several FOIA requests were
consolidated in the litigation pending in the district court. The
basic dispute in the district court centered on the agency’s
invocation of Exemption 4, which permits agencies to withhold
“trade secrets and commercial or financial information
obtained from a person and privileged or confidential.” 5
U.S.C. § 552(b)(4). The agency maintained that all of the
requested information is “confidential” and thus exempt from

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release under FOIA, while Consumers’ Checkbook argued
Exemption 4 did not apply or did not apply to all of the
requested information. See Mem. Order 6 (Aug. 16, 2016).
The district court initially denied the parties’ cross motions
for summary judgment. The court rejected the agency’s
position that the case was moot in light of release of the 2014
and 2015 requested information. Consumers’ Checkbook had
alleged that the delays in receiving the requested 2014 and
2015 information had interfered with its ability “to provide upto-date online tools for consumers during each annual, health
plan enrollment period.” Cmpt. ¶ 5. As for the agency’s
reliance on Exemption 4, the court found, based on letters from
insurers, that “one could conclude” actual competitive harm
could arise from releasing plan benefits data prior to the open
enrollment period. Mem. Op. 17, 21 (July 1, 2015) (citing
Niagara Mohawk Power Corp. v. U.S. Dep’t of Energy, 169
F.3d 16, 18 (D.C. Cir. 1999)). The district court adopted, by
order, the parties’ proposed schedule that called for the release
to Consumers’ Checkbook of the requested information for the
2016 plan year by September 15, 2015.
On August 16, 2016, the district court issued the
challenged order.
The district court concluded that
Consumers’ Checkbook’s most recent FOIA request in 2016,
seeking data after the “lock down” date, was “an extremely
significant change,” Mem. Order 8 (Aug. 16, 2016), which
would do two things. First, it would allow Consumers’
Checkbook more than a month to prepare its informational
materials before the ACA open enrollment period began.
Second, “no reliable evidentiary support” indicated that release
of information after the “lock down” date would cause
“substantial competitive harm” to any insurer. See id. 10–11.
The court noted that plan changes allowed by CMS after the
“lock down” date are limited and, moreover, that fluctuations

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occur even to final plans and plan lists. Further, it noted that
Consumers’ Checkbook was not seeking any sensitive data or
underlying actuarial or business assumptions. Accordingly, the
court ruled that the requested information was not protected
from disclosure under Exemption 4. See id. 9, 11. Because
there was no reason to deny Consumers’ Checkbook “what it
is entitled to,” id. 13, the district court rejected the agency’s
argument that no order of any kind should be entered, and
denied its motion for summary judgment. Upon declaring the
agency violated FOIA by withholding the requested benefits
data after the lock down/final data submission deadline, the
district court ordered “that the Government shall release the
requested benefits data each year immediately after the Lock
Down/final Data Submission Deadline.” Id. 14. The Order did
not state whether the agency was required to release the data
even if Consumers’ Checkbook did not file a FOIA request.
II.
The government does not challenge the district court’s
determination that Exemption 4 was inapplicable to the
information requested by Consumers’ Checkbook in 2013
through 2016. Rather, it challenges the district court’s order
requiring release of such information “each year,” Applt’s Br.
10–11, which it contends “essentially gives [Consumers’
Checkbook] ‘automatic access’” to data without even requiring
Consumers’ Checkbook to file a FOIA request, id. 12. It
contends, further, that FOIA does not authorize injunctions
requiring the release of documents that do not yet exist.
A.
As a threshold matter, Consumers’ Checkbook contends
that the court should decline to review the propriety of the
challenged order because the government’s appeal “rests on
arguments that it did not raise before the district court.”

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Appellee’s Br. 12. Whether viewed as a suggestion of
forfeiture or waiver, see United States v. Olano, 507 U.S. 725,
733 (1993), this contention fails.
Consumers’ Checkbook maintains that the government is
arguing for the first time on appeal that FOIA does not
authorize prospective relief, observing that Consumers’
Checkbook “has sought prospective injunctive relief from the
start of this litigation” and yet the agency “never suggested that
such relief was unavailable under FOIA.” Appellee’s Br. 9—
10. Yet in the district court the agency argued that the court
lacked authority to issue a permanent injunction compelling the
release of information in future years where the agency had not
engaged in a policy or consistent practice of unlawful
withholding. See Def.’s Mot. for Sum. Judgment at 41–42
(Dec. 4, 2015); Def.’s Combined Reply at 11 (Jan. 20, 2015);
Def.’s Combined Cross-Mot. for Sum. Judgment at 2, 21–22
(Dec. 15, 2014).
This objection suffices to preserve the government’s
challenge for there is no basis to conclude that the government
waived its objection to the unexpected nature of relief provided
by the district court’s order. Although the 2014 complaint
sought prospective, automatic release of insurance plan data,
Consumers’ Checkbook’s subsequent pleadings are less clear
about whether it was seeking an injunction to prevent the
agency from refusing to disclose this information in response
to future requests or to require release even in the absence of a
new FOIA request. See Pl.’s Opp’n to Def.’s Mot. for Sum.
Judgment at 1–2 (Jan. 25, 2016). Underscoring the lack of
clarity, Consumers’ Checkbook suggests that if a prior request
for information is required, then the order should be read to
require it. Appellee’s Br. 11–12. These are not the
circumstances of either waiver or forfeiture. See Olano, 507

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U.S. at 733 (quoting Johnson v. Zerbst, 304 U.S. 458, 464
(1938)).
B.
In challenging the district court’s order, the government
relies on the opinions of this court and the Supreme Court in
Tax Analysts v. United States Dep’t of Justice. 845 F.2d 1060
(D.C. Cir. 1988) (“Tax Analysts I”); 492 U.S. 136 (1989) (“Tax
Analysts II”). These opinions discussed the definition of a
record subject to FOIA, noting that FOIA challenges require
showing “that an agency has (1) improperly; (2) withheld; (3)
agency records.” Tax Analysts I, 845 F.2d at 1064 (quoting
Kissinger v. Reporters Comm. for Freedom of the Press, 445
U.S. 136, 150 (1980)). In affirming Tax Analysts I, the
Supreme Court noted that “the agency must be in control of the
requested materials at the time the FOIA request is made.” Tax
Analysts II, 492 U.S. at 145. The government maintains that
these cases “ma[k]e clear” that “[t]he district court could not
properly order the release of records that do not currently
exist.” Applt’s Br. 13.
Although excerpts from the Tax Analysts cases can be read
to support the government’s position, these cases were not
focused on the propriety of injunctive relief but instead
addressed which among existing documents constitute
“records” for FOIA purposes. That is not an issue here, and as
Consumers’ Checkbook points out, this court has twice
addressed the question of prospective relief and concluded it is
available in certain circumstances.
In Payne Enterprises v. United States, 837 F.2d 486 (D.C.
Cir. 1988), petitioners regularly made FOIA requests to the Air
Force and the Air Force repeatedly declined to disclose
information to petitioners notwithstanding that the Air Force
acknowledged it was “following an ‘impermissible practice’ in

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evaluating FOIA requests.” Id. at 491 (quoting Better Gov’t
Ass’n v. Dep’t of State, 780 F.2d 86, 91 (D.C. Cir. 1986)). This
court, acknowledging that “FOIA imposes no limits on courts’
equitable powers in enforcing its terms,” id. at 494 (citing
Renegotiation Bd. v. Bannercraft Clothing Co., 415 U.S. 1,
19—20 (1974)), remanded the case to the district court with
instructions to award declaratory relief to Payne and also to
“consider the propriety of injunctive relief” after “evaluat[ing]
the likelihood that the Air Force will return to its illicit practice
of delay in the absence of an injunction,” id. at 494—95. The
court suggested new affidavits from the parties could assist the
district court in making its assessment and noted that the
district court “should evaluate the likelihood” the Air Force
would comply in light of its stated intent to do so but continued
“reservations about the applicability” of two FOIA
exemptions. Id. at 495. Last Term, the court in Citizens for
Responsibility and Ethics in Washington v. United States Dep’t
of Justice, 846 F.3d 1235 (D.C. Cir. 2017) (“CREW”),
reaffirmed that “a plaintiff may challenge an agency’s policy
or practice where it will impair the party’s lawful access to
information in the future,” and that district courts “possess[]
authority to grant . . . a prospective injunction with an
affirmative duty to disclose.” Id. at 1242 (internal quotation
omitted) (italics in original).
The government acknowledges that prospective relief is
available in the FOIA context but interprets our precedent to
limit that relief to circumstances where the agency has been
“delinquent.” Reply Br. 2–3, 4 (quoting CREW, 846 F.3d at
1246, and citing Payne, 837 F.2d at 494–95). Maintaining that
there is no reason FOIA’s ordinary remedies would not be
adequate, the government points out that the district court made
no finding of “delinquency or recalcitrance” and that there was
no reason for the district court to conclude that the government
would continue to invoke Exemption 4 once that legal theory

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was rejected by the district court. Reply Br. 2–3. Further, the
government observes, circumstances could change and, in its
view, an agency should not be forced to seek judicial
amendment to an injunction in order to invoke a FOIA
exemption.
It suffices here to focus on the absence of a necessary
finding to support the issuance of injunctive relief. See United
States v. Regenerative Sciences, LLC, 741 F.3d 1314, 1318
(D.C. Cir. 2014). The district court made no finding that the
agency was adhering to a policy or practice that it
acknowledged as impermissible, as in Payne. Neither did the
court find the agency was likely, in the face of its ruling that
Exemption 4 was inapplicable, to continue on that basis to
impair Consumers’ Checkbook’s lawful access to the
information in the future, as contemplated by Payne and
CREW. Nor did the court find that the agency invoked
Exemption 4 solely for purposes of delay, effectively flaunting
the statutory scheme, much less that its invocation was
frivolous on its face.
Understandably, the district court sought to ensure that the
requested information would be released in a timely manner by
the agency so Consumers’ Checkbook could fulfill its
educational public purpose. Agency delays in releasing the
requested information had interfered with its public purpose.
Yet the injunction was not based on a finding of delinquency
or recalcitrance by the agency. Rather, in denying summary
judgment, the district court did not preclude the possibility that
Exemption 4 might apply in view of record evidence of
competitive concern if proposed plans were released upon
initial submission to CMS. Mem. Op. 21. Its determination
changed in view of Consumers’ Checkbook’s “extremely
significant” change in 2016, whereby the court was satisfied
that “substantial competitive harm” was unlikely to occur if the

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requested information was released after the later “lock down”
date. Mem. Order 8. FOIA contemplates agency invocation of
one or more statutory exemptions in response to a request, and
it affords the requesting person an opportunity to bring its
objection to the court when an agency fails to respond
“promptly” if matters cannot be satisfactorily resolved by the
parties. Delay ensued, but what occurred here was not the sort
of agency delinquency under FOIA that our precedent
contemplates could be appropriate grounds for injunctive
relief, or at least the district court did not so find.
Although the district court’s equitable powers are broad,
see, e.g., Brown v. Plata, 563 U.S. 493, 538 (2011), this court
has required, even in the face of conceded agency recalcitrance
in complying with FOIA, that the district court address, in
determining whether injunctive relief would be appropriate, the
likelihood of continued delinquent conduct by the agency, see
Payne, 837 F.2d at 495. A government defendant is presumed
to adhere to the law declared by the court. See SanchezEspinoza v. Reagan, 770 F.2d 202, 208 n.8 (D.C. Cir. 1985).
In Tax Analysts I, 845 F.2d at 1069 n.21, this court
contemplated a tailored remedy in which the government
retained discretion in responding to new requests. So did
Payne, 837 F.2d at 492, as to withholding documents for
reasons other than those that the court had previously rejected.
The government represents here that in responding to
Consumers’ Checkbook’s future requests for such data it would
not assert the grounds that the district court rejected, see
Applt’s Br. 15, and thus that issuance of a declaration that the
agency had violated FOIA, or an order directing the agency to
release the requested plan-year data, would have been
sufficient to ensure Consumers’ Checkbook’s lawful access to
benefits information and to avoid the prospect of relitigating
the same controversy for future years, see Reply Br. 9–10.
Further, the record reflected the parties’ agreement to a

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forward-looking procedure in 2016 and that accommodation
left no apparent ground to conclude that a permanent
“automatic access” injunction was required.
Accordingly, because the district court erred in issuing a
permanent injunction, we reverse the order granting
prospective relief.

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RANDOLPH, Senior Circuit Judge, concurring:
While I join the majority opinion in full, I think it worth
emphasizing that although equitable remedies are discretionary,
they are not left to the district court’s “inclination, but to its
judgment; and its judgment is to be guided by sound legal
principles.” United States v. Burr, 25 F. Cas. 30, 35 (C.C. Va.
1807) (No. 14,692d) (Marshall, C.J.). In FOIA cases, one such
principle demands that “[a]s with any equity case, the nature of
the violation determines the scope of the remedy.” Swann v.
Charlotte-Mecklenburg Bd. of Educ., 402 U.S. 1, 16 (1971). I
agree with the majority opinion that the FOIA decisions of this
court dealing with prospective injunctive relief are consistent
with this limiting equitable principle. Maj. Op. 8–10.

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