United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued November 12, 1998 Decided March 9, 1999
No. 96-5082
Niagara Mohawk Power Corporation,
Appellant
v.
United States Department of Energy, et al.,
Appellees
Consolidated with
No. 96-5246
Appeals from the United States District Court
for the District of Columbia
(No. 95cv00952)
William J. Mertens argued the cause for appellant. With
him on the briefs was Robert V. Zener.
Claire Whitaker, Assistant U.S. Attorney, argued the cause
for appellee United States Department of Energy. With her
on the brief were Eric H. Holder, Jr., U.S. Attorney, and
John D. Bates, Assistant U.S. Attorney, both at the time the
brief was filed, R. Craig Lawrence, Assistant U.S. Attorney,
and Thomas Kemp, Attorney, U.S. Department of Energy.
Curtis P. Lu argued the cause for appellee Independent
Power Producers of New York, Inc. With him on the brief
were W. Harrison Wellford and John C. Marchese.
Before: Williams, Ginsburg and Henderson, Circuit
Judges.
Opinion for the Court filed by Circuit Judge Williams.
Williams, Circuit Judge: A cogeneration plant produces
not only electric power but also steam or other thermal
energy that can be used for various industrial or commercial
purposes. 16 U.S.C. s 796. To encourage this source of
energy, the Public Utilities Regulatory Policies Act of 1978,
16 U.S.C. s 824a-3 ("PURPA"), imposed a requirement on
electric power utilities to purchase power from any qualifying
facility ("QF")--a cogeneration plant that meets PURPA's
QF standards. See 18 CFR ss 292.101(b)(1), 292.203(b).
The utility must pay for the power at a rate no greater than
its "avoided cost"--the cost it would incur to generate an
equivalent amount of power itself. See 16 U.S.C.
s 824a-3(b); 18 CFR ss 292.304(a), 292.101(b)(6). Although
the phrase "avoided cost" has the ring of an economically
sound price, it was suggested without contradiction at oral
argument that it has not so proved.
Niagara, a producer and seller of electricity in upstate New
York and subject to the PURPA mandate, suspected that
some of the facilities from which it buys may not actually
qualify for QF status, and to pursue the matter filed a
request with the Department of Energy ("DOE") in 1995
under the Freedom of Information Act ("FOIA"), seeking
information collected by DOE on forms that these facilities
are required to file with DOE's Energy Information Adminis-
tration--Forms EIA-867. DOE disclosed some but withheld
other information, invoking FOIA's Exemption 4, 5 U.S.C.
s 552(b)(4), which covers "trade secrets and commercial or
financial information obtained from a person and privileged or
confidential." The information withheld relates particularly
to quantities of fuel consumed and power generated, from
which, given market prices for fuel, outsiders could go far to
calculating a facility's unit cost of power.
Niagara sued in district court to compel release of the
withheld data. Independent Power Producers of New York,
Inc., a trade group, and Sithe Energy Inc. ("QF Intervenors"
collectively) intervened in support of DOE. Both DOE and
the QF Intervenors moved for summary judgment, support-
ing the motion with affidavits describing the QF industry.
Niagara moved for discovery, and on the district court's
denial of its motion filed an opposition to the motion for
summary judgment, attaching an affidavit depicting the in-
dustry in rather different terms. The district court granted
summary judgment. It held that Niagara had failed to raise
an issue of material fact against DOE's position that the
information was exempt because its release (1) would cause
substantial competitive harm to the entities submitting the
information (the QFs), and (2) would impair the agency's
ability to collect this information in the future. The court
also rejected Niagara's claim that no FOIA exemption could
apply because the information was already publicly available.
* * *
The language of Exemption 4 protects from disclosure
"commercial information" obtained from a non-government
source, so long as it is "privileged or confidential." The only
dispute here is over the last phrase. In National Parks &
Conservation Ass'n v. Morton, 498 F.2d 765, 770 (D.C. Cir.
1974) ("National Parks I"), this court adopted a narrow
reading of the word "confidential," saying that information
was confidential within the meaning of Exemption 4 only if its
disclosure was likely to (1) impair the government's ability to
obtain necessary information in the future, or (2) cause
substantial harm to the competitive position of the person
from whom the information was obtained. The district court
found here that DOE had satisfied both alternatives.
In support of its claim that release would impair govern-
ment interests, DOE offered two conclusory affidavits, claim-
ing that disclosure would impair the EIA's ability to collect
such information in the future. See Walton Decl.pp 39-43;
Grutsch Decl., p 10. The claim is inherently weak where, as
here, the agency has secured the information under compul-
sion. Critical Mass Energy Project v. NRC, 975 F.2d 871,
878 (D.C. Cir. 1992) (en banc). Yet DOE and the QF
Intervenors offer nothing but Walton's speculative opinion
that QFs may not be forthcoming in the data they submit if
DOE allows disclosure, see Walton Decl., p 41, and Grutsch's
terse and self-serving statement that as an executive of
various QFs he would "attempt to minimize the scope and
specificity of the information provided." See Grutsch Decl.,
p 10. But the agency has the burden of showing that re-
questing information comes within a FOIA exemption, Na-
tional Parks & Conservation Ass'n v. Kleppe, 547 F.2d 673,
679 (D.C. Cir. 1976) ("National Parks II"), and we have more
than once held that such conclusory and generalized asser-
tions are not enough to establish the requisite risk of impair-
ment. Id. at 680; Washington Post Co. v. Dep't of Health
and Human Serv., 690 F.2d 252, 269 (D.C. Cir. 1982).
DOE insists that summary judgment is proper because
Niagara did not controvert the assertions of impairment.
But on a summary judgment motion, "[f]acts not conclusively
demonstrated, but essential to the movant's claim, are not
established merely by his opponent's silence; rather, the
movant must shoulder the burden of showing affirmatively
the absence of any meaningful factual issue." See National
Assoc. Of Gov't Employees v. Campbell, 593 F.2d 1023, 1027
(D.C. Cir. 1978). A paper asserting the affiant's intention to
sail as close to the wind as possible is hardly enough for this
case--especially as the data sought appears to take the form
of hard, cold numbers on energy use and production, the
fudging of which may strain all but the deliberately menda-
cious. As the DOE and QF Intervenor affidavits are in these
circumstances too vague, the grant of summary judgment on
this issue was unjustified.
DOE fares no better in its effort to show that there is no
genuine issue of material fact on the likelihood of substantial
competitive harm. In National Parks II, we held that for the
government to preclude disclosure based on a competitive
injury claim, it must prove that the submitters "(1) actually
face competition, and (2) substantial competitive injury would
likely result from disclosure." 547 F.2d. at 679. Here,
DOE's assertions of the existence of competition are some-
what conclusory. See Walton Decl. WW 22-31. But assuming
arguendo that DOE met its initial burden of proving that QFs
were engaged in competition, Niagara's response was ade-
quate to raise genuine issues of material fact. The affidavit
submitted by Niagara, from James Cifaratta, its Director of
Unregulated Generation, flatly disputes the assertions of
competition. For example, so far as competition by QFs in
the sale of power is concerned, Cifaratta asserts that arrange-
ments under which QFs sell electricity in an unregulated
market (i.e., outside the shelter of the PURPA mandate) are
uncommon and "truly exceptional." See Cifaratta Decl.
pp 11-12. He further says that the long term contracts that
QFs have with their steam hosts--buyers of the thermal
energy produced by cogeneration--preclude competition
among the QFs for such hosts. Id. p 13. This theoretically
leaves competition among the QFs as contracts expire. But
our decision in National Parks II, that the district court was
clearly erroneous in finding that certain concessionaires faced
substantial competitive harms in contract renewal when the
contracts were for long periods and thus renewal competition
would only occur infrequently, 547 F.2d at 681-82, suggests
that a competitive injury is too remote for purposes of
Exemption 4 if it can occur only in the occasional renegotia-
tion of long-term contracts. Niagara's response thus puts in
dispute whether there is a likelihood of substantial competi-
tion among QFs in contract renegotiation with their steam
hosts.
Further, though implicitly accepting DOE's and the QF
Intervenors' assumption that QFs' competition with their
steam hosts for the division of rents (quite apart from the
long terms of the contracts) qualifies as "competition" for
purposes of National Parks, Niagara contests the claim that
they actually do so. See Cifaratta Decl. p 14. ("[T]he ar-
rangements between QFs and their steam hosts typically are
not determined by ordinary market-based concerns ... QFs
often provide steam to their hosts at very low rates, some-
times for free. Some QFs, in fact, subsidize their steam hosts
in order to secure PURPA and PSL s 66-c benefits for
themselves."). While this struggle-free relation may seem
unlikely, the contention directly contradicts the assertions on
which the district court relied.
DOE's other arguments relating to competitive injury are
legally inadequate under the National Parks standard. For
example, DOE argues that the QFs may face future or
potential competition. But the test explicitly requires proof
that the submitters face actual competition. National Parks
II, 547 F.2d at 679. DOE also insinuates that Niagara's
interest in challenging the regulatory entitlement of QFs
shows a competitive relationship between the QFs and Niaga-
ra. The argument would make sense only if a producer's
regulatory entitlement to governmentally administered prices
could be said to put the producer in "competition" with the
involuntary purchaser. But if National Parks I embraced
any such expansive idea of competition, the case would have
come out differently. There the court recognized that the
private sources of the disputed data, park concessionaires,
enjoyed monopoly contracts with the Park Service, contracts
that by statute were to be renewed so long as the concession-
aires performed satisfactorily. 498 F.2d at 770 n.20. The
data sought to be collected bore on that performance. If the
court thought that a firm's interest in protecting such an
entitlement from the outsider scrutiny qualified as a competi-
tive interest, it would have affirmed the district court's appli-
cation of Exemption 4.
As each legally sound theory offered by DOE is plagued by
factual disputes, summary judgment was improper. On re-
mand the district court will want to consider the Supreme
Court's observation that "categorical decisions may be appro-
priate and individual circumstances disregarded when a case
fits into a genus in which the balance characteristically tips in
one direction," Dep't of Justice v. Reporters Committee for
Freedom of the Press, 489 U.S. 749, 776 (1989); see also
Critical Mass, 975 F.2d at 879. Thus, a finding that QFs as a
class generally do or do not have competitive interests that
would be injured by release of the information on Form EIA-
867 Form may be suitable.
Niagara also claimed that Form EIA-867 information is
already in the public domain--a proposition that if true would
give victory to Niagara independent of the matters discussed
above. Niagara's position here is a little odd: if the informa-
tion is publicly available, one wonders, why is it burning up
counsel fees to obtain it under FOIA? But the logic of FOIA
compels the result: if identical information is truly public,
then enforcement of an exemption cannot fulfill its purposes.
See Davis v. Dep't of Justice, 968 F.2d 1276, 1279 (D.C. Cir.
1992) (Exemptions 7(C) & 7(D)); CNA Financial Corp. v.
Donovan, 830 F.2d 1132, 1154 (D.C. Cir. 1987) (Exemption 4);
Afshar v. Dep't of State, 702 F.2d 1125 (D.C. Cir. 1983)
(Exemptions 1 & 3). On this issue the party favoring disclo-
sure has the burden of production, for otherwise the party
opposing disclosure would theoretically have to identify all
public sources not reproducing the information. Id. at 1130.
Niagara has sought to meet the burden with the argument
that the data on Form EIA-867 is substantially equivalent to
the data the QFs are required to file on Form 556 in their
applications to the Federal Energy Regulatory Commission
for QF certification, which is publicly available.
Before this court, both DOE and the QF Intervenors claim
that the information on Form EIA-867 is narrower in scope
than that submitted on Form 556. But that claim is at odds
with their position before the district court. At argument on
the summary judgment motion, counsel for the QF Interve-
nors conceded that the information provided by QFs upon
initial certification was "substantially identical to that found
in form 867 and that information is public." And DOE
counsel supported this observation with equally emphatic
language: "[The information] may be absolutely totally iden-
tical, but it's projected. It's not actual, and that's the big
difference." Although obviously there is a world of difference
between projected and actual data, these positions either
assert or assume that the information on the two forms is
identical in scope.
The district court accepted DOE's argument that while the
certification information on Form 556 was only projected, the
operational and performance information on Form EIA-867
was drawn from actual experience. Niagara did not dispute
this, but countered by arguing that FERC regulations re-
quire QFs to make corrective filings once there are material
changes in a QF's operations. See 18 U.S.C. s 292.207(d)(1).
But as the district court observed, such new information is
required only when there are material changes in facts and
representations included in the initial self-certification filing.
Since these corrective filings are not necessarily made on an
ongoing and continuous basis, Niagara seems to have initially
failed to carry its burden.
But that is not the end of the story. After the district
court's holding in this case, the New York Public Service
Commission rendered a decision authorizing electric utilities
in New York to monitor the compliance standards set out in
PURPA. See Re Motion to Establish Programs for Moni-
toring Qualifying Facility Status, Nos. 96-E-0775,
95-E-0264, 1997 WL 114364 at *1 (N.Y.P.S.C. Jan. 9, 1997).
It is undisputed that this decision requires New York QFs to
provide actual current performance data of the sort required
for Form 556. Niagara claims that this requirement puts the
requested information squarely in the public domain.
In response to the specific question why in light of this
availability Niagara is still trying to obtain the Form
EIA-867 information, Niagara responds that the Public Ser-
vice Commission decision required information only from 1994
onwards, and that it wants to relieve itself (and in the end
presumably its customers) from the costs of erroneous
PURPA applications from earlier years. In fact, the time
disparity is worse than that argument suggests, because the
Federal Energy Regulatory Commission, though rejecting a
claim by New York independent power producers that the
New York decision was preempted by PURPA, denied it any
effect as to data before the New York independents were on
notice of the requirement,1 on the ground that such a man-
date would impose an undue burden on the producers. See
Independent Power Producers of New York, Inc., 80 FERC
p 61,125 at 61,399 (1997).
Before us DOE and the QF Intervenors try to undercut the
relevance of the New York decision by arguing that the scope
of information on Form EIA-867 is materially broader than
that on Form 556. But that was the scope claim that they
effectively disavowed in district court; to allow them to raise
it now for the first time on appeal would be grossly unfair to
Niagara.
But Niagara is still by no means home free on this issue.
For the period of most concern to Niagara, i.e., before the
effective date of the Public Service Commission decision as
modified by FERC, the New York mandate obviously fails to
put the data into the public domain. But even as to those
earlier data Niagara may have an argument on remand.2
Even if the district court finds that the QFs are in competi-
tion that could be adversely affected by disclosure of the
earlier data if it alone were disclosed, those data may turn out
to add so little to what is covered by the New York decision
that its public disclosure will cause no additional competitive
harm.
__________
1 It is uncertain from FERC's decision, Independent Power
Producers of New York, Inc., 80 FERC p 61,125 at 61,399 (1997),
whether it regarded the QFs as being on notice from August 30,
1996, when the New York Commission made its initial declaratory
ruling and order instituting the QF monitoring program, or from
January 13, 1995, when FERC issued order No. 575, 60 Fed. Reg.
4831 (1995), which established FERC Form 556 and its data re-
quirements, which were in turn picked up by the New York Public
Service Commission.
2 Since the New York decision issued after the judgment in this
case, the district court never had an opportunity to consider it in
evaluating Niagara's claims. Now it will.
* * *
The district court's order granting DOE's motion for sum-
mary judgment is vacated and remanded.
So ordered.