Court rules that store-level data is confidential

WASHINGTON — The U.S. Supreme Court ruled in the Food Marketing Institute’s favor on Monday, backing the trade group’s efforts to protect the confidentiality of the store-level data of retailers that participate in the Supplemental Nutrition Assistance Program.

The case involved a Freedom of Information Act (FOIA) request made by the Argus Leader newspaper in 2011, seeking the names and addresses of stores that participate in the SNAP program, along with each store’s annual SNAP redemption data from the fiscal years 2005 to 2010. The USDA declined to provide the store-level data, citing FOIA’s Exemption 4, which shields onfidential trade secrets and commercial or financial information from disclosure.

The Argus Leader sued the USDA, and the District Court sided with the paper, citing the standard that private information would not be deemed “confidential” unless its disclosure would cause “substantial competitive harm.”

On Monday the Supreme Court rejected that approach.

“At least where commercial or financial information is both customarily and actually treated as private by its owner and provided to the government under an assurance of privacy, the information is ‘confidential’ within the meaning of Exemption 4,” the Court ruled. In a 6-3 decision written by Associate Justice Neil Gorsuch, the Court concluded that the store-level SNAP data qualifies as “confidential” under this standard.

“We agree with the U.S. Supreme Court’s ruling today that a forty-five-year-old interpretation of what constitutes ‘confidential commercial and financial information’ required reexamination,” FMI president and CEO Leslie Sarasin said in a statement.  “Our industry’s commitment to the shopper remains constant amidst seismic marketplace shifts. The nation’s grocery stores have long kept confidential the amount consumers spend at individual stores whether through payment by cash, credit, debit or the Supplemental Nutrition Assistance Program, or SNAP. This store-level sales data undoubtedly must be considered confidential because its release would provide an unfair advantage to competitors. Legislative history tells us the Freedom of Information Act, or FOIA, was created to shine a light on actions by the government, not on that of private parties, and the Court’s expressed desire to refer our case back to the lower courts demonstrates that our case sets an important precedent well beyond disclosing store-level SNAP sales in grocery.  We respect the Supreme Court’s decision and we thank our amici partners and our members for their support and counsel throughout this legal journey. We appreciate the opportunity for a clear interpretation of confidentiality regarding private businesses’ commercial data.”

FMI was represented at the Supreme Court by a team from the Austin office of Baker Botts L.L.P.

“We are pleased that the Supreme Court agreed with our argument that Exemption 4 should be read according to its plain text,” said Baker Botts partner Gavin Villareal, who served as lead counsel for FMI.

Cory Myers, news director for the Sioux Falls, S.D., paper, said he was disappointed in the Court’s decision.

“This is a massive blow to the public’s right to know how its tax dollars are being spent, and who is benefiting,” he said.