Racal-Milgo Government Systems, Inc. v. Small Business AdministrationRacal-Milgo Government Systems, Inc. v. Small Business Administration
MEMORANDUM OPINION
In this frеedom of information lawsuit, the plaintiff seeks disclosure of the prices by unit charged the Government for lease or purchasе of computer equipment. The Government and plaintiff have filed cross-motions for summary judgment.
The Government insists that the governing legal test
1
for exemption 4
2
of the Freedom of Information Act (the Act),
Close examination of the cases cited by the Government reveals thаt they shielded information different from that sought here. The Government has not offered relevant facts to show that disclosure of thesе prices will likely impair the Government’s ability to obtain necessary information in the future, or cause substantial harm to the compеtitive position of the company supplying the equipment. Therefore, the Court grants plaintiff’s motion, subject to a final disposition оf plaintiff’s bid protest; denies the Government’s motion; and dismisses the case.
I.
The plaintiff is a computer company. In August 1980, plaintiff submitted an unsolicited proposal to improve defendant’s data communications system. Several other companies also filed proposals upon learning of defendant’s interest in revamping the data system. Defendant determined that only Codex Corporatiоn, the supplier of the price information sought in this lawsuit, could provide the desired system. Defendant entered into a sole sourcе negotiated contract with Codex.
When plaintiff learned that the contract had been awarded to Codex, it requested a сopy of the contract. The contract incorporated by reference the bid proposal. Defendant released the contract with substantial deletions. Plaintiff seeks disclosure of the computer equipment prices to allow it to determinе the cost efficiency of the contract.
Since filing this lawsuit, plaintiff has dropped its demand for disclosure of workforce data, equipment capabilities and configuration systems. It now seeks only the prices by unit for computer equipment under thе contract.
The cases defendant cites which apply the recognized test for confidential commercial or financial information under exemption 4 shielded information much more sensitive than mere prices. They shielded audits of private conсessions in national parks; 3 technical proposals for development of a system to analyze gases generated by рetroleum refineries; 4 general selling prices, inventory balances, profit margins, purchase activity, freight charges, costs of gоods sold, and customer names, obtained from a utility in the course of a government investigation; 5 appraised value for customs duty аssessment purposes of imported machinery parts; 6 design recommendations, design concepts, a customer list, and biographical data on key employees; 7 and computer usage, manpower allocation, travel costs, biographical data on employees, and detailed cost data from a contract with the Government. 8
The Government contends that disclosure of the prices for computer equipment would allow a competitor to calculate the supplier’s manufacturing costs. Declaration of James E. McNeece, paragraph 8, and declaration of Charles M. Denton, paragraph 7. This contention is plainly inconsistent with the Government’s simultaneous assertion that disclosure would give a competitor insight into the suppliеr’s pricing strategy or pricing structure. Id. Pricing strategy refers to the use of differing prices for the same piece of equipment, depending on the particular contract.
Even accepting these inconsistent positions, however, the record does not indicate that revelation of prices charged for pieces of computer equipment will likely cause substantial competitive harm to the supplier or deter the presentation of price information to the Government in the future. Disclosure of prices charged the Government is a cost of doing business with the Government. It is unlikely that companies will stop competing for Governmеnt contracts if the prices contracted for are disclosed. The Freedom of Information Act was intended to assure public access to all governmental records whose disclosure would not significantly harm specific governmental interests.
Soucie v. David,
The disclosures of the aggregate prices for listed equipment by the regional offices of defendant is insufficient to evaluate the cоst efficiency to the Government of this contract, because computer systems vary greatly and proper analysis requires knowledge of unit prices. That the supplier and the Government intended the price information to remain confidential is not determinаtive.
National Parks and Conservation Ass’n. v. Morton,
The plaintiff has withdrawn claims for workforce data, equipment capabilities, and configuration systems diagrams, the type of infоrmation protected from disclosure under exemption 4 of the Act. Prices paid by the Government in an ordinary contract such аs here are not matters subject to
Notes
. The test was first enunciated in
National Parks and Conservation Ass’n v. Morton,
(C)ommercial or financial matter is “confidential” for purposes of the exemption if disclosure of the information is likely to have eithеr of the following effects: (1) to impair the Government’s ability to obtain necessary information in the future; or (2) to cause substantial harm to the competitive position of the person from whom the information was obtained.
. Exemption 4 shields from disclosure matters that аre “trade secrets and commercial or financial information obtained from a person and privileged or confidential.”
. National Parks and Conservation Ass’n. v. Morton, supra at note 1.
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Orion Research, Inc. v. E.P.A.,
.
Braintree Elec. Light Dept. v. Department of Energy,
.
Timken Co. v. United States Customs Serv.,
.
Audio Technical Services v. Department of the Army,
. Fidell v. United States Coast Guard, No. 80-2291 (D.D.C., March 3, 1981 memorandum opinion).