Argus Leader Media v. United States Department of Agriculture

Filing 38

ORDER denying 12 Motion for Discovery; granting 18 Motion for Summary Judgment. Signed by Chief Judge Karen E. Schreier on 9/27/2012. (KC)

UNITED STATES DISTRICT COURT
DISTRICT OF SOUTH DAKOTA
SOUTHERN DIVISION
ARGUS LEADER MEDIA,
d/b/a Argus Leader,
Plaintiff,
vs.
UNITED STATES DEPARTMENT
OF AGRICULTURE,
Defendant.

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CIV. 11-4121-KES

ORDER GRANTING
DEFENDANT’S MOTION FOR
SUMMARY JUDGMENT

Plaintiff, Argus Leader Media, d/b/a Argus Leader, brought this claim
under the Freedom of Information Act (FOIA) to obtain information in the
possession of defendant, the United States Department of Agriculture (USDA).
Docket 1. After USDA provided some, but not all, of the requested information,
Argus Leader requested that a Vaughn Index be filed to explain why USDA did
not provide the withheld information. Docket 12. USDA resists that motion and
claims that a Vaughn Index is not necessary because USDA offered detailed
affidavits that sufficiently explained its decision to withhold the information.
Docket 15. USDA also moves for summary judgment and argues that its
decision to withhold redemption data was appropriate in this case because the
material was protected under exemption 3 to the FOIA and should not be
released. Docket 18. Argus Leader resists that motion and requests that the
redemption data be disclosed because that information is not what Congress

meant to exempt under the claimed statute. Docket 33. For the following
reasons, USDA’s motion for summary judgment is granted.
BACKGROUND
The relevant facts of this dispute, viewed in the light most favorable to
the nonmoving party on the motion for summary judgment, Argus Leader
Media, d/b/a Argus Leader, are as follows:
On February 1, 2011, Argus Leader emailed a request for specific records
to the email address for the Food and Nutrition Service (FNS), which is an
agency of the USDA. USDA enforces the Food and Nutrition Act of 2008 (FNA or
the Act) in addition to other statutes. The information that Argus Leader
requested related to the Supplemental Nutrition Assistance Program (SNAP), or
what was formerly known as the food stamp program. The request sought SNAP
retail store records from 2005 through 2010 that included: each store’s
identifier or unique ID number, the store name, the store address, the store
type, and the yearly redemption amounts or Electronic Benefit Transfer (EBT1)
sales figures for each participating store. Docket 22 ¶ 11.
While FNS administers the FNA and its regulations and standards, the
Benefit Redemption Division (BRD) is the component within FNS that oversees

1

The term food stamps is the label for SNAP benefits that is most familiar to
the public. Docket 21 ¶ 7. Many store owners or clients also know or
understand their benefits as “EBT,” and FNS often uses SNAP-EBT in its
publications and information. Food stamps, SNAP, and SNAP-EBT all mean the
same thing. Docket 21 ¶ 7.
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the EBT system. Through the EBT system, SNAP recipients receive an EBT
debit card that keeps track of their monthly benefits and is the object that gives
them access to food and other qualifying items under SNAP. BRD also ensures
that only those retailers that qualify to participate in SNAP do so, and it
regulates the retailers who are not in compliance with the regulations and
policies designated under the program. BRD is responsible for maintaining the
EBT system in a manner that ensures it is responsive to its clients, the states it
serves, and the federal government.
The specific requested data still at issue is redemption data—all other
data was provided to Argus Leader or was deemed nonessential by Argus
Leader. Redemption data is the dollar amount of goods that each retailer sells
to SNAP beneficiaries and subsequently redeems from the federal government
in a given year. It is one type of information that is generated and stored in a
technology system overseen by BRD, which is called the Store Tracking and
Redemption System (STARS). Redemption data is “only obtained when a retailer
is authorized to accept SNAP cards and processes a SNAP transaction.” Docket
21 ¶ 20. Redemption data, however, is only generated for each retailer during
the time frame that the retailer would be authorized to participate in SNAP. For
instance, if a SNAP retailer is authorized to participate in the program but
makes no EBT sales, then the redemption data amount is $0. Docket 21 ¶ 21.
After receiving Argus Leader’s request, FNS contacted BRD to collect the
data that Argus Leader sought. BRD conducted a search within the STARS
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database and gathered records that were pertinent to the request but not
subject to a FOIA exemption. BRD produced a CD that contained 321,988
SNAP files viewable on a Microsoft Excel worksheet. FNS sent that CD and a
letter to Argus Leader and explained that the agency was not including some of
the requested information (like redemption data) because those records were
exempt from disclosure pursuant to the Freedom of Information Act
Exemptions 3 and 4 and 5 U.S.C. § 552(b)(3) and (b)(4). Docket 22 ¶ 15. FNS
also informed Argus Leader of its right to appeal. Argus Leader contacted a
representative for FNS and stated that it had received the letter, but the CD
only contained 65,536 retailer records. Argus Leader also requested that FNS
resend the information in a text format.
On March 3, 2011, Argus Leader submitted its appeal of FNS’s decision
to withhold the redemption data, which was filed with the FNS Freedom of
Information Act Service Center within the Information Management Branch.
The appeal worked its way through internal departments and eventually was
submitted for legal review on April 13, 2011. On June 13, 2011, FNS received a
letter from Argus Leader stating that it would initiate legal action under FOIA if
it did not receive a response to its appeal within ten days. Docket 22 ¶ 26. On
July 19, 2011, Argus Leader received an unofficial response from FNS via email
that attempted to clarify why the requested information was withheld.
Meanwhile, the appeal denial was working its way through the federal system

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and was prepared for final signatures from those who could officially deny the
appeal.
Argus Leader filed its complaint on August 26, 2011, and the denial of
Argus Leader’s appeal was never sent. Docket 1. Argus Leader moved for a
Vaughn Index on March 5, 2012. Docket 12. USDA responded to that motion
and stated that its reasons for the denial of specific discovery were already
expressed in the documents submitted in this case, and a Vaughn Index was
not necessary. Docket 15. USDA also moved for summary judgment on the
issue of whether it needed to provide FNS numbers and redemption totals to
Argus Leader. Docket 18. The parties reached a stipulation that the issue of
FNS numbers was no longer relevant, and the only issue before the court was
whether USDA had to provide Argus Leader with the redemption data for the
five years requested. Docket 31. The court approved the stipulation. Docket 32.
On May 23, 2012, Argus Leader filed its opposition to the motion for summary
judgment and claimed that the redemption data was not the type of information
that was intended to be withheld under exemption 3. Docket 33.
STANDARD OF REVIEW
“One of the principal purposes of the summary judgment rule is to isolate
and dispose of factually unsupported claims or defenses[.]” Celotex Corp. v.
Catrett, 477 U.S. 317, 323-24 (1986). Summary judgment is proper “if the
movant shows that there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a); Celotex
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Corp., 477 U.S. at 323 (“[A] party seeking summary judgment always bears the
initial responsibility of . . . demonstrat[ing] the absence of a genuine issue of
material fact.” (internal quotations omitted)). The moving party must inform the
court of the basis for its motion and also identify the portion of the record that
shows that there is no genuine issue in dispute. Hartnagel v. Norman, 953 F.2d
394, 395 (8th Cir. 1992) (citation omitted).
Once the moving party has met its initial burden, the nonmoving party
must establish “that a fact . . . is genuinely disputed” either “by citing to
particular parts of materials in the record,” or by “showing that the materials
cited do not establish the absence . . . of a genuine dispute.” Fed. R. Civ. P.
56(c). “The nonmoving party may not ‘rest on mere allegations or denials, but
must demonstrate on the record the existence of specific facts which create a
genuine issue for trial.’ ” Mosley v. City of Northwoods, Mo., 415 F.3d 908, 910
(8th Cir. 2005) (quoting Krenik v. Cnty. of Le Sueur, 47 F.3d 953, 957 (8th Cir.
1995)). For purposes of summary judgment, the facts, and inferences drawn
from those facts, are “viewed in the light most favorable to the party opposing
the motion.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574,
587 (1986) (quoting United States v. Diebold, Inc., 369 U.S. 654, 655 (1962)).
On a motion for summary judgment in a Freedom of Information Act
case, the record is still viewed in the light most favorable to the nonmoving
party to determine if issues of material fact remain in dispute to determine if
“the moving party is entitled to judgment as a matter of law.” Mo. Coal. for the
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Env’t Found. v. U.S. Army Corps of Eng’rs, 542 F.3d 1204, 1208 (8th Cir. 2008)
(citations omitted). In FOIA cases, the agency has the burden to prove “ ‘that it
has fully discharged its obligations under FOIA.’ ” Id. (quoting Miller v. U.S.
Dep’t of State, 779 F.2d 1378, 1382 (8th Cir. 1985) (citing Weisberg v. U.S. Dep’t
of Justice, 705 F.2d 1344, 1350 (D.C. Cir. 1983))). “Summary judgment is the
procedural vehicle by which nearly all FOIA cases are resolved.” Mace v.
E.E.O.C., 37 F. Supp. 2d 1144, 1146 (E.D. Mo. 1999) (citations omitted). See
also Nielsen v. U.S. Bureau of Land Mgmt., 252 F.R.D. 499, 503 (D. Minn. 2008)
(“Summary judgment is the preferred procedural vehicle for resolving FOIA
disputes.”) (citing Evans v. U.S. Dep’t of Personnel Mgmt., 276 F. Supp. 2d 34,
37 (D.D.C. 2003)).
DISCUSSION
Argus Leader first argues that it is entitled to a Vaughn Index to
understand USDA’s explanation for the withholding of redemption data. USDA
claims that the affidavits and other supporting documents have sufficiently
stated its reasoning for denying the FOIA material, that the exemption being
claimed is clear, and that an index is unnecessary. Argus Leader also claims
that exemption 3 does not apply in this case because USDA cannot show that
the claimed statute is a withholding statute or that the redemption data is the
type of information that Congress meant to withhold under the claimed statute.
USDA argues that § 2018(c) is clearly a withholding statute and that

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redemption data is information within the purview of 7 U.S.C. § 2018(c);
therefore, the requested data was properly withheld under exemption 3.
I.

Vaughn Index
Argus Leader argues that it is entitled to a Vaughn Index, which is a

detailed list or index of the material withheld by USDA and usually contains a
precise rationale of the reasons for withholding. Vaughn v. Rosen, 484 F.2d 820
(D.C. Cir. 1973), cert. denied, 415 U.S. 977 (1974). “Although there are
instances where Vaughn index may be necessary for proper review, a Vaughn
index is not required as a matter of course.” May v. I.R.S., Civ. No. 90-1123,
1991 WL 328041, at *2 (W.D. Mo. 1991) (citing Barney v. I.R.S., 618 F.2d 1268,
1272 (8th Cir. 1980)). See also Minier v. Cent. Intelligence Agency, 88 F.3d 796,
804 (9th Cir. 1996) (“[W]hen the affidavit submitted by an agency is sufficient to
establish that the requested documents should not be disclosed, a Vaughn
index is not required . . . Moreover, when a FOIA requester has sufficient
information to present a full legal argument, there is no need for a Vaughn
index.”).
The typical Vaughn Index:
provides a specific factual description of each document sought by
the FOIA requester. Specifically, such an index includes a general
description of each document’s contents, including information
about the document’s creation, such as date, time, and place. For
each document, the exemption claimed by the government is
identified, and an explanation as to why the exemption applies to
the document in question is provided.

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Mo. Coal., 542 F.3d at 1209-10 (quoting In re Dep’t of Justice, 999 F.2d 1302,
1306 (8th Cir. 1993)). Vaughn indices serve two purposes: (1) “to ensure an
‘effectively helpless’ party’s right to information ‘is not submerged beneath
governmental obfuscation and mischaracterization,’ ” and (2) “to ‘permit the
court system effectively and efficiently to evaluate the factual nature of
disputed information.’ ” Mo. Coalition, 542 F.3d at 1209 (citing Vaughn, 484
F.2d at 826).
“Generally, a more substantial Vaughn index-one that provides for each
document requested a specific explanation as to why an exemption applies–is
preferable to a bare bones index.” Mo. Coalition, 542 F.3d at 1210. Although
courts routinely conduct an in camera review of the documents at issue, such
inspection should be limited because it is “ ‘contrary to the traditional judicial
role of deciding issues in an adversarial context upon evidence openly produced
in court.’ ” Barney, 618 F.2d at 1272 (quoting Cox v. U.S. Dep’t of Justice, 576
F.2d 1302, 1311 (8th Cir. 1978)). “If the material is fairly described and the
reason for nondisclosure is adequately stated and supported by the law, the
agency’s position should be upheld without in camera inspection.” Mo. Coalition,
542 F.3d at 1210 (citation omitted).
When analyzing whether an exemption to FOIA applies:
A court’s primary role . . . is to review the adequacy of the affidavits
and other evidence presented by the Government in support of its
position . . . . If the Government fairly describes the content of the
material withheld and adequately states its grounds for
nondisclosure, and if those grounds are reasonable and consistent
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with the applicable law, the district court should uphold the
Government’s position. The court is entitled to accept the
credibility of the affidavits, so long as it has no reason to question
the good faith of the agency.
Barney, 618 F.2d at 1272 (citing Cox, 576 F.2d at 1312). A Vaughn Index is not
mandatory, but “[i]f the Court cannot evaluate the propriety of the claimed
exemptions on the record before it, it may order the agency to submit more
detailed affidavits or a Vaughn index, or even review documents in camera.”
Gavin v. U.S. Sec. & Exch. Comm’n, Civ. No. 04-4522, 2006 WL 2975310, at *2
(D. Minn. Oct. 16, 2006) (citing Barney, 618 F.2d at 1272; Maricopa Audubon
Soc’y v. U.S. Forest Serv., 108 F.3d 1089, 1093 n.2 (9th Cir. 1997); N.L.R.B. v.
Robbins Tire & Rubber Co., 437 U.S. 214, 224 (1978)). “Boilerplate or
conclusory affidavits, standing alone, are insufficient to show that no genuine
issue of fact exists as to the applicability of a FOIA exemption.” Mo. Coalition,
542 F.3d at 1210 (citation omitted).
The affidavits submitted in this case by Susan Modine, Jennifer
Weatherly, and Andrea Gold described redemption data in detail—how it is
gathered, used, and why it should remain withheld. USDA specifically stated
which exemptions to FOIA prevented disclosure and also discussed 7 U.S.C.
§ 2018, the statute that enumerates why the redemption data must be
protected. And the remaining data associated with the redemption data, like
store name and other identifiers, was already provided to Argus Leader.
Moreover, this is the type of case where a Vaughn Index would not improve

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Argus Leader’s specific factual understanding of the documents sought because
both parties know what is sought, and the redemption information is not a
mystery to the agency or the requester. The information is a monetary amount
that is redeemed each year for the grocery or wholesale food store in question.
This is not the sort of information where a Vaughn Index would give the
requester useful information that would help with the litigation because the
information is a number and nothing more.2
The affidavits and briefs in support of USDA’s motion were sufficient
information for Argus Leader to make its legal argument and sufficient to aid
the court in its legal determinations in this case. See Mo. Coalition, 542 F.3d at
1210 (“Such an index allows both the district court and the requesting party to
evaluate the decision to withhold records and ensure compliance with FOIA.”);
see also Miller, 779 F.2d at 1387 (finding that an agency meets its burden by
offering affidavits that explain why the documents were subject to an
exemption). For these reasons, Argus Leader’s request for a Vaughn Index is
denied because it is unnecessary and duplicative in this case.

2

Because the information requested, redemption data, is one number for
each store, the court finds that this information is not the type that is
segregable. “In every case, the district court must make an express finding on
the issue of segregability.” Missouri Coalition, 542 F.3d at 1212 (citations
omitted). The court finds that USDA already provided to Argus Leader the
information that could be separated without triggering protection under the
exemption and that the redemption data was reasonably separated from the
remainder of the information at that time.
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Now the court will analyze whether USDA properly withheld the
redemption data under exemption 3, whether 7 U.S.C. § 2018 is properly
classified as a withholding statute, and if redemption data is intended to be
withheld under that statute.
II.

Freedom of Information Act
“ ‘Congress intended FOIA to permit access to official information long

shielded unnecessarily from public view.’ ” Hulstein v. Drug Enforcement Admin.,
671 F.3d 690, 694 (8th Cir. 2012) (quoting Milner v. Dep’t of Navy, ___ U.S.
____, 131 S. Ct. 1259, 1262 (2011)). “FOIA generally mandates broad disclosure
of government records.” Cent. Platte Nat. Res. Dist. v. U.S. Dep’t of Agric., 643
F.3d 1142, 1146 (8th Cir. 2011) (citations omitted). FOIA requires that an
agency offer records upon request unless they are the sort of records protected
by one of the nine exemptions under the Act. Milner, 131 S. Ct. at 1262. The
exemptions “are to be narrowly construed to ensure that disclosure, rather
than secrecy, remains the primary objective of the Act.” Mo. Coalition, 542 F.3d
at 1208 (citations omitted). The district court engages in a de novo review of an
agency’s decision to deny a request for information under FOIA, and the
burden3 is upon the agency to show that the specific exemption applies. 5
U.S.C. § 552(a)(4)(B); In re Dep’t of Justice, 999 F.2d 1302, 1305 (8th Cir. 1993).

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The agency retains the burden of justifying its decision to withhold any
documents in light of the purposes of FOIA and to promote public access to
government documents. U.S. Dep’t of State v. Ray, 502 U.S. 164, 173 (1991)
(citations omitted).
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The exemption presently at issue is commonly known as FOIA
exemption 3. This exemption exempts from disclosure matters that are
precluded from release by another statute, if that statute either:
(A)(i) requires that the matters be withheld from the public in such
a manner as to leave no discretion on the issue; or
(ii) establishes particular criteria for withholding or refers to
particular types of matters to be withheld[.]
5 U.S.C. § 552(b)(3)(A). “When determining whether FOIA exemption 3 is
applicable, the court first decides if a statute is a withholding statute and then
determines ‘whether the information sought after falls within the boundaries of
the non-disclosure statute.’ ” Cent. Platte, 643 F.3d at 1146 (quoting Ass’n of
Retired R.R. Workers, Inc. v. U.S. R.R. Ret. Bd., 830 F.2d 331, 332 (D.C. Cir.
1987)). “Exemption 3 is different from other FOIA exemptions because ‘its
applicability depends less on the detailed factual contents of specific
documents; the sole issue for decision is the existence of a relevant statute and
the inclusion of withheld material within that statute’s coverage.’ ” Id. (citing
Goland v. C.I.A., 607 F.2d 339, 350 (D.C. Cir. 1978)).
USDA argues that 7 U.S.C. § 2018, which discusses the approval of
retailers’ participation in SNAP, is the withholding statute applicable to this
case. The Eighth Circuit Court of Appeals has not expressly ruled upon
whether § 2018 qualifies as an exempting or withholding statute under the twopart criteria mandated by § 552(b)(3), nor have any other district courts within

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the Eighth Circuit or elsewhere. First, the court must determine whether
§ 2018 is properly characterized as a withholding statute.
A.

Withholding Statute

Because the court must determine whether the statute is a withholding
statute that meets the requirements of exemption 3, the focus is whether there
is clear language within § 2018 that “requires that the matters be withheld
from the public in such a manner as to leave no discretion on the issue” or
provides criteria for withholding the information. 5 U.S.C. § 552(b)(3)(A)(i)-(ii).
“To determine whether a statute is a withholding statute that prohibits
disclosure, the court looks at the language of the statute on its face.” Zanoni v.
U.S. Dep’t of Agric., 605 F. Supp. 2d 230, 236 (D.D.C. 2009) (citing Reporters
Comm. for Freedom of Press v. U.S. Dep’t of Justice, 816 F.2d 730, 735 (D.C. Cir.
1987)). The language of the statute at issue provides:
(c) Information submitted by applicants; safeguards, disclosure to
and use by State agencies
Regulations issued pursuant to this chapter shall require an
applicant retail food store or wholesale food concern to submit
information, which may include relevant income and sales tax
filing documents, which will permit a determination to be
made as to whether such applicant qualifies, or continues to
qualify, for approval under the provisions of this chapter or the
regulations issued pursuant to this chapter. The regulations
may require retail food stores and wholesale food concerns to
provide written authorization for the Secretary to verify all relevant
tax filings with appropriate agencies and to obtain corroborating
documentation from other sources so that the accuracy of
information provided by the stores and concerns may be verified.
Regulations issued pursuant to this chapter shall provide for
safeguards which limit the use or disclosure of information
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obtained under the authority granted by this subsection to
purposes directly connected with administration and
enforcement of the provisions of this chapter or the regulations
issued pursuant to this chapter, except that such information may
be disclosed to and used by Federal law enforcement and
investigative agencies and law enforcement and investigative
agencies of a State government for the purposes of administering or
enforcing this chapter or any other Federal or State law and the
regulations issued under this chapter or such law, and State
agencies that administer the special supplemental nutrition
program for women, infants and children, authorized under section
17 of the Child Nutrition Act of 1966 [42 U.S.C.A. § 1786], for
purposes of administering the provisions of that Act [42 U.S.C.A.
§ 1771 et seq.] and the regulations issued under that Act. Any
person who publishes, divulges, discloses, or makes known in
any manner or to any extent not authorized by Federal law
(including a regulation) any information obtained under this
subsection shall be fined not more than $1,000 or imprisoned
not more than 1 year, or both. The regulations shall establish the
criteria to be used by the Secretary to determine whether the
information is needed. The regulations shall not prohibit the audit
and examination of such information by the Comptroller General of
the United States authorized by any other provision of law.
7 U.S.C. § 2018(c) (emphasis added).
The specific section that states that “[a]ny person who publishes,
divulges, discloses, or makes known . . . any information obtained under this
subsection shall be fined . . . or imprisoned[,]” directs that disclosure of
information is prohibited and gives little discretion to the agency as to how the
information can be disseminated. 7 U.S.C. § 2018(c). Further, the language
that gives the agency authority to promulgate regulations purports “to provide
for safeguards which limit the use or disclosure of information obtained under
the authority granted by this subsection[.]” Additionally, the only time that it is
acceptable to release information obtained under the statute is if it is either for
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administrative or enforcement purposes or to investigate criminal activity. That
restriction and the statutory language that discusses safeguarding or
punishment for releasing information is the type of language that, on its face, is
indicative of a withholding statute. See 5 U.S.C. § 552(b)(3) (requiring “that the
matters be withheld from the public in such a manner as to leave no discretion
on the issue; or establishes particular criteria for withholding or refers to
particular types of matters to be withheld[.]”).
Additionally, Argus Leader does not specifically deny that § 2018 qualifies
as a withholding statute; rather, its focus is that redemption data is not the
type of information that was meant to be withheld under § 2018. Argus Leader
admits that the language within § 2018 “arguably suffices to cross the
Exemption 3's threshold.” Docket 33 at 8. This admission, coupled with the
plain language of the statute, leads to the conclusion that § 2018 would qualify
as a withholding statute under exemption 3. The next inquiry is whether the
yearly redemption data is the sort of information that Congress meant for
USDA to withhold under the plain language of § 2018.
B.

Information Within the Scope of Withholding Statute

Second, the court must determine whether the information sought after
falls within the boundaries of the non-disclosure statute. The language of the
statute at issue states that those food retail stores or wholesale food concerns
that wish to participate in SNAP must “submit information, which may include
relevant income and sales tax filing documents[.]” 7 U.S.C. § 2018(c). It is
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immediately following this language that the first mention of withholding of
information occurs within the statute. “Regulations issued pursuant to this
chapter shall provide for safeguards which limit the use or disclosure of
information obtained under the authority granted by this subsection to purposes
directly connected with administration and enforcement of the provisions of
this chapter . . .,” except information provided to Federal or state law
enforcement and investigative agencies. 7 U.S.C. § 2018(c) (emphasis added).
The statute then describes the criminal punishment for any person who
discloses, publishes, divulges, or makes known “any information obtained
under this subsection.”
The type of information that is to be withheld under the plain language of
the statute is any information, which can include “relevant income and sales tax
filing documents,” that the federal government receives from a SNAP participant
or a verifying agency or source. Thus, the precise question is whether
redemption data or the amount of money that each store makes through SNAP
purchases would satisfy any of these types of “information” noted in the statute
or information that was obtained from a verifying agency via § 2018 authority.
Redemption data is the amount of SNAP benefits that are redeemed at a
store in a given year, thus, the amount of money that the United States
government credits to that retailer’s bank account in a given year. SNAP
beneficiaries have an EBT card, which acts similar to a debit card to purchase
eligible food at certain stores authorized by FNS. For a transaction to occur, the
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customer swipes the EBT card in a point-of-sale device just like a debit card
and enters a four-digit personal identification number. Docket 20 ¶ 9. The retail
clerk enters the amount of the purchase into the point-of-sale device and as
long as the customer has sufficient balance to cover the cost, that amount is
deducted4 from the customer’s EBT-SNAP account.
SNAP redemption data is either gathered by state EBT vendors or by
subcontractors who provide the service. Docket 21 ¶¶ 19-20. State EBT
vendors track and monitor SNAP benefit accounts, process any transactions,
and eventually facilitate payment to the retail locations. Docket 21 ¶ 20. EBT
vendors send files of all SNAP transactions to FNS, and retailers are identified
solely by their unique FNS number. This information is loaded in the STARS
database for sorting and filing and becomes the official record or redemption
data for each retailer. Docket 21 ¶ 20. Soon after the customer’s initial
purchase, usually within two days, that same amount is credited to the
retailer’s bank account as redemption for the sale. Docket 20 ¶ 9. “This credit
to the retailer’s bank account is what” is known as redemptions. Docket 20 ¶ 9.
The way that FNS and other federal agencies use redemption data is to
monitor compliance by participating retailers because excessive redemption

4

The point-of-sale device communicates with a processor to electronically
verify that the FNS number, or the unique identifier for that retailer within the
SNAP and STARS database, is active and valid and that the customer has a
sufficient balance to cover the purchase. Docket 21 ¶ 18. If either the FNS
number is invalid or the balance is insufficient, then the transaction is denied
at the point-of-sale. If both are accepted, then the transaction is authorized.
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amounts could be indicative of potential participation violations or could be a
cause for sanctions. Docket 21 ¶ 21. FNS also uses redemption data to identify
and remove retailers that are no longer actively participating in SNAP.
“Redemption records are also an important element in the overall process of
reconciling federal funds expended for SNAP.” Docket 21 ¶ 21. Redemption data
is inherently tied to FNS numbers or the unique identifying number assigned to
retailers by FNS. All redemption data is attached to the retailer via that FNS
number and the number is needed to process the original transaction and its
subsequent repayment. Docket 21 ¶ 21.
USDA claims that “SNAP redemption data may only be disclosed as
allowed by statute and that disclosure is limited to use connected with
administration and enforcement of the provisions of the FNA or regulations
issued pursuant to the FNA.” Docket 21 ¶ 21. At specific points, the language
of § 2018 refers to any information, or information obtained under the
subsection, or “relevant income and sales tax filing documents.” Redemption
data is more than likely included under all three of those descriptions.
The language of § 2018 requires that applicants in SNAP submit
information, including relevant income and sales tax filing documents, that
allows the government to determine if the applicant qualifies or continues to
qualify for participation in the SNAP program. This type of information,
especially to determine if a retailer continues to qualify for SNAP participation,
includes the amount of income (redemption data) each retailer derived from
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SNAP and the federal government. The government also has to verify tax
information, which includes yearly income such as the redemption amount or
benefits redeemed and paid to each retailer by the government. Although
Congress has not expressly deemed redemption information as essential data to
be included under § 2018, the statutory language encompasses this type of
income and tax information because redemption data naturally falls under
either term’s broad umbrella. Because § 2018 is a withholding statute and
redemption data is the type of information reached by the plain language of the
statute, it was appropriate for USDA to withhold said data under exemption 3
in light of the fact that the Argus Leader is not a state or federal law
enforcement agency and was not conducting an internal agency audit.
Argus Leader argues that the redemption data is not included under
§ 2018 because that information is collected by state or outside businesses,
who then send it to USDA and its subsidiaries to insert into the STARS system.
Argus Leader claims that because the information is not provided by the
retailers who are applicants for new or continued participation in SNAP, it is
not included as “information” under § 2018. Argus Leader also asserts that
because there is no request for redemption data on the application form for
SNAP participation, the redemption data is outside the purview of the statute
and not exempt under exemption 3. The court disagrees. As previously
discussed, redemption data is the type of information that can be obtained
under the authority of § 2018. The amount of EBT benefits a store provides or
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for which it is reimbursed is the type of information that retailers give to the
federal government to continue its participation in SNAP or to renew its
previously expired participation.
Because Congress established narrow criteria for when information
under § 2018 could be released and redemption data is included under
Congress’s broad description of what constitutes “information” under § 2018,
the redemption data was properly withheld. There are no genuine disputes of
material fact. The court finds that USDA’s decision to withhold the requested
information was reasonable and exemption 3 applies; therefore, summary
judgment is appropriate.
C.

Legislative History

The court can also consider the legislative history of § 2018 in its
consideration of whether the redemption data is the type that is meant to be
withheld under exemption 3. See N.L.R.B., 437 U.S. at 223-34 (looking to the
legislative history to confirm the court’s observation regarding the application of
an exemption to FOIA). The legislative history of § 2018, which was amended in
1994 to expand the release of otherwise withheld information to law
enforcement entities only, lends additional support to the court’s conclusion
that the redemption data was properly withheld.
Before the 1994 amendment to the Food Stamp Act of 1977, release of
information under § 2018 was extremely restrictive. The purpose of the
amendment was to “permit[] the use and disclosure of information provided by
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stores to State and Federal law enforcement and investigative agencies for the
purposes of administering or enforcing the Food Stamp Act or any other Federal
or State law and establishes penalties against persons who misuse any of the
information[.]” Food Stamp Program Improvements Act of 1994, Pub. L. No.
103-225, H.R. Rep. No. 103-352, 1994 U.S.C.C.A.N. 39, 40. Prior to the 1994
amendment, the use of any of that information was restricted “to persons
directly connected with the administration and enforcement of the Food Stamp
Program” or those who administered WIC. Id. This language further
demonstrates that all types of information that relate to tax, income, or
redemption data that is correlated with participation in SNAP is to be withheld
in all instances except internal administrative purposes or for law
enforcement’s use.
Under the plain language of § 2018, not only is the statute a withholding
statute, but Congress intended to exempt redemption data from disclosure. For
that reason, USDA has carried its burden and shown that exemption 3 applies
to this case, and the agency properly withheld information that was covered
under one of the narrow exemptions to the FOIA. See Ray, 502 U.S. at 173
(“Consistent with this purpose, as well as the plain language of the Act, the
strong presumption in favor of disclosure places the burden on the agency to
justify the withholding of any requested documents.”). There are no genuine
issues of material fact in dispute, and summary judgment is appropriate.

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CONCLUSION
Because USDA submitted detailed affidavits and briefs in support of its
motion for summary judgment that justified its denial of the release of the
redemption data records, the court finds that it is unnecessary and duplicative
to require USDA to submit a Vaughn Index under the facts of this case. USDA
has shown that § 2018 is a withholding statute under exemption 3 to the
Freedom of Information Act. The plain language of the statute and its legislative
history also indicates that redemption data is the type of information that was
meant to be withheld under § 2018. USDA’s decision to withhold the
information was proper. Accordingly, it is
ORDERED that Argus Leader’s motion for a Vaughn Index (Docket 12) is
denied.
IT IS FURTHER ORDERED that USDA’s motion for summary judgment
(Docket 18) is granted.
Dated September 27, 2012.
BY THE COURT:

/s/ Karen E. Schreier
KAREN E. SCHREIER
CHIEF JUDGE

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