Renegotiation Bd. v. Grumman Aircraft, 421 U.S. 168 (1975)

Renegotiation Bd. v. Grumman Aircraft Engineering Corp.

No. 73-1316

Argued January 14, 1975
Decided April 28, 1975
421 U.S. 168

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Syllabus

Pursuant to the Government contract renegotiation process in effect under the Renegotiation Act of 1951 for so-called Class A cases (those in which the contractor reported profits of more than $800,000 on the relevant contracts) during the period involved in this case, if the Regional Board made a recommendation as to the amount of excessive profits in the year in issue, rather than recommending a clearance, i.e., a unilateral determination that a contractor realized no excessive profits during the year in issue, the case, if the contractor declined to enter into an agreement, would be reassigned to the Renegotiation Board (Board). The case file, including the Regional Board Report, was then transmitted to the Board and assigned to a division of the Board, usually consisting of three of its five members, which, in due course, would make its own decision and submit to the full Board a Division Report, including a recommendation for final disposition of the case. If the Regional Board concluded that no excessive profits had been realized and that a clearance should therefore issue, a "final recommendation" that a clearance be issued was sent to the Board, which considered the case on the basis of the Regional Board Report. Respondent brought an action pursuant to the Freedom of Information Act (FOIA), 5 U.S.C. § 552, seeking disclosure of certain Regional Board Reports resulting in a recommendation of clearance and Board approval, and of Division Reports in other cases, all related to and issued during renegotiation proceedings involving 14 other companies during the period 1962-1965. The District Court ultimately granted relief on the grounds that both the Regional Board and Division Reports were "final opinions" within the meaning of § 552(a)(2)(A), which requires a Government agency to make available to the public "final opinions, including concurring and dissenting opinions, as well as orders, made in the adjudication of cases," and were not exempt from disclosure under § 552(b)(5) (Exemption 5) as "inter-agency or intra-agency memorandums . . . which would not be available by law to a party other than an agency in litigation with the agency." The Court of Appeals affirmed, further holding that, even if the Regional Board Report were not "final opinions" of the Board, they were disclosable as final opinions of the Regional Board, which was to be considered an "agency" for purposes of the FOIA.

Held: Neither the Regional Board nor Division Reports are final opinions, and they do fall within Exemption 5, since (1) only the full Board has the power by law to make the decision whether excessive profits exist; (2) both types of reports are prepared prior to that decision, and are used by the Board in its deliberations; and (3) the evidence fails to support the conclusion that the reasoning in the reports is adopted by the Board as its reasoning, even when it agrees with a report’s conclusion. Pp. 183-190.

(a) The Regional Board Reports, being prepared long before the Board reached its decision and being used by it as a basis for discussion, are precisely the kind of pre-decisional deliberative advice and recommendations contemplated by Exemption 5 which must remain uninhibited, and thus undisclosed, in order to supply maximum assistance to the Board in reaching its decision. Regardless of whether the Regional Boards are agencies for Class A purposes, so that their final recommendations are inter-agency memoranda, or are not agencies separate from the Board, so that their recommendations are intra-agency memoranda, the Regional Boards’ total lack of decisional authority brings their reports within Exemption 5 and prevents them from being "final opinions." Pp. 185-188.

(b) Since the Division Reports were prepared before the Board reached its decision and to assist it in its deliberations, and were used by the full Board as a basis for discussion, the Board should not be deprived of such a thoroughly uninhibited version of this valuable deliberative tool by making such reports public on the unsupported assumption that they always disclose the final views of at least some Board members. Pp. 189-190.

157 U.S.App.D.C. 121, 482 F.2d 710, reversed.

WHITE, J., delivered the opinion of the Court, in which BURGER, C.J., and BRENNAN, STEWART, MARSHALL, BLACKMUN, and REHNQUIST, JJ., joined. DOUGLAS, J., dissented. POWELL, J., took no part in the consideration or decision of the case.