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through error or misunderstanding by the agency, the degeneration of FOIA into an organized, legitimate and anonymous "espionage" facility makes any assessment most difficult. Requests for documents through FOIA, although available to us through various organizations established to peddle such information, are in many cases blind requests. And even the incidences of which we are aware will seldom receive public notice, for we would not want it publicly known how important or critical the information was to us. Anyway, dissipation of our trade secrets to one competitor is better than dissipation to two or more competitors.

Nor do we known the effect of trade secret loss on our licensing activities. I know of one case in which a Japanese firm was negotiating for unpatented technology from a major U.S. chemical company and suddenly withdrew its request for a license. Subsequently, the U.S. company learned that the Japanese firm had simply met its needs through an FOIA request and required no further information as a dues-paying licensee.

It is a self-proving proposition that valuable trade secrets are lost through FOIA. This follows inevitably from a knowledge of how FOIA is used, the wide variations between regulatory statutes and, accordingly, the implementing agency policies and regulations, and the mani

fest disregard for rights of the submitters of information.

6. Philosophical and Procedural Problems of FOIA

We acknowledge the necessity for delivering our technical information to various regulatory agencies, and even the propriety of making this information available, under adequate safeguards, for noncompetitive purposes in assessing the functions of our government agencies. But we earnestly urge that a balancing of the rights between submitters and requesters is necessary to make the law work as

it should.

The requester, being the one who initiates the request, is aware of the pendency of that request in the agency. The submitter, however, is not, unless the agency chooses to tell him. There is need to provide, as a uniform practice among the agencies, for prompt and adequate notice of the request to the submitter.

If the agency denies the request for disclosure, the requester can argue his position to the agency. There is corresponding need for oportunity for the submitter to present his objections to disclosure.

Where the subject matter involves trade secrets,

there is need for a hearing at the agency level for a

The

direct interchange on the question of confidentiality. requester, of course, should not participate in the hearing, for sensitive matters will be discussed.

The requester, having the timing and sequence of events either within his control or his knowledge, can go to court to press his request against the agency. Unless the submitter, even at this late date, learns of the pending court action, he does not even have a chance to participate. There is need for prompt notice and opportunity for the submitter to press his position on the court. True, a court action to enforce a request means that the agency is resisting disclosure. But the resources and diligence of the agency in protecting the submitter's interests will inevitably be subject to the lesser motivation of the agency in protecting the information. After all, the agency is merely defending a policy decision.

ox that is up for goring.

It is the submitter's

The requester can go to court as a matter of right to compel disclosure; the submitter likewise deserves his day. However, the submitter's case should not be limited to arguing the basis of the record made in the agency, for that record will not reflect the considerations most relevant to the submitter's interest or contain information only

the submitter could supply concerning the reasons for confidentiality and the consequences of improvident disclosure. The submitter therefore needs a de novo review in the court, where he can supplement the agency's record with testimony and data of his own.

We have seen that there was no attempt in the Act to balance the rights of the private submitter against the rights of the requester.

Ultimate discretion for assessing

the legitimacy of the plea of the submitter for nondisclosure was left with the agency, and Exemption Four, designed to give the submitter at least an opportunity to persuade the agency against disclosing, really gave the submitter no significant recourse.

We noted that the requester can go to court to compel disclosure where an agency refuses to give the information, but unless the submitter is advised of the request he has no opportunity to intervene. Once advised, however, submitters have resorted to "reverse" FOIA suits to enjoin agency disclosure. And then came the decision of the

Supreme Court in Chrysler v. Brown, 441 U.S. 281 (1979), in which the submitter was denied standing to sue the agency and get a pre-release de novo review of the submitter's contentions respecting nondisclosure. Judicial recourse for

submitters was thereby limited to challenging an accom

plished release as an abuse of an agency employee's discretion under the virtually moribund Trade Secret Act, 18 U.S.C. 1905. Even then, review was to be based only on the agency's record made in the agency's consideration of the matter. Anyway, it is of little solace to the submitter what happens to the gatekeeper after he has opened the gate!

The first test of disclosure applied by the courts after FOIA became the law in 1966 was whether the information would "customarily be released to the public." The Senate report, appearing as Senate No. 813, 89th Congress, 1st session (1965), described the purpose of the Fourth Exemption covering trade secrets as follows:

This exception [to release] is necessary
to protect the confidentiality of informa-
tion which is obtained by the government
through questionnaires or other inquiries,
but which would customarily not be released
to the public by the person from whom it
was obtained. (Emphasis added.)

However, subsequent judicial interpretation eroded this test to one in which release was to be withheld only if it would be "harmful to the private interest" of the submitting party. Finally, recent decisions have adopted the

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