Fried, Frank, Harris, Shriver & Jacobson, Case No. VFA-0263, February 24, 1997

Case No. VFA-0263, 26 DOE ¶ 80, 163

February 24, 1997

DECISION AND ORDER

OF THE DEPARTMENT OF ENERGY

Appeal

Name of Petitioner:Fried, Frank, Harris, Shriver & Jacobson

Date of Filing:January 24, 1997

Case Number: VFA-0263

On January 24, 1997, the law firm of Fried, Frank, Harris, Shriver & Jacobson (Fried) filed an Appeal from a determination by the Albuquerque Operations Office (AO) of the Department of Energy (DOE) on December 24, 1996. In that determination, AO partially granted a request for information issued to the Appellant made under the Freedom of Information Act (FOIA), 5 U.S.C. § 552, as implemented by the DOE in 10 C.F.R. Part 1004. In its Appeal, Fried asks that we order AO to release the withheld material.

The FOIA requires that federal agencies generally release documents to the public upon request. The FOIA, however, lists nine exemptions that set forth the types of information that an agency may withhold at its discretion. 5 U.S.C. § 552(b); 10 C.F.R. § 1004.10(b). The DOE regulations further provide that the DOE release to the public a document exempt from mandatory disclosure under the FOIA whenever the DOE determines that disclosure is in the public interest and not contrary to other laws. 10 C.F.R. § 1004.1.

I. Background

In its request for information, Fried sought copies of documents related to the DOE Request for Proposal No. RFP DE-RP04-96AL89607 (RFP). Specifically, Fried sought copies of the complete proposal submitted by Burns and Roe Enterprises, Inc., all responses to DOE questions provided by Burns and Roe, the initial and final "Best and Final Offer" submitted by Burns and Roe, and a complete copy of the contract awarded as a result of the RFP, including all modifications and supplemental agreements to the contract as of October 1, 1996. In the determination letter, AO enclosed a copy of the contract between Burns and Roe Enterprises, Inc. and the DOE. AO, pursuant to the provisions of 5 U.S.C. § 552(b)(3) (Exemption 3) and citing Subtitle B, Section 821 of the National Defense Authorization Act of 1997 (NDAA), P.L. 104-20, withheld the proposal and related information. AO stated that Section 821 of the NDAA bars release of the Burns and Roe proposal because it states that a proposal may not be made available to any person under Section 552 of Title 5 of the United States Code (the Freedom of Information Act) when the proposal has not been set forth

or incorporated by reference in the contract.(1) AO stated that since the Burns and Roe proposal has not been set forth or incorporated by reference in the contract, it must withhold the remaining requested information.

In its appeal, Fried argues that AO should release the Burns and Roe proposal because the contract that AO awarded incorporated it by reference. Fried cites the following four examples of instances where the final contract incorporated elements of the Burns and Roe proposal:

(a) All Representations, Certifications, and other statements of offeror are explicitly incorporated by reference at Paragraph H.01, page (57) of the material disclosed (page references, unless otherwise noted, are to handwritten page numbers on the bottom, middle of each page);(b) Section J, Attachment B, page (127) et seq., "Work Breakdown Structure" (Part of the Contract Work Statement, see Paragraph C.01) bears the original RFP Number and appears to be taken directly from the Burns and Roe proposal;© Section J, Attachment F, page (173) et seq., "Small Business Plan" incorporates the Burns and Roe proposal (note parenthetical heading on page (173), "Contractor's Plan is incorporated herein");(d) The Statement of Work ("SOW") Section J, Attachment A, beginning at page (90), contains numerous revision bars not present in the RFP and must represent changes from the Burns and Roe proposal.

Fried also argues that the DOE has the discretion to release the requested material. With this in mind, Fried maintains that the FOIA is a disclosure statute and that discretionary decisions not to disclose must have a rational basis. Finally, Fried states that the contract the DOE released to it contains references to a contract modification numbered 001, and an "Exhibit B," both of which the DOE did not include in the copy of the contract it sent to Fried. Fried also states that the contract is missing pages 1 through 40 and page 168. Fried requests that we order release of these missing portions of the contract.

II. Analysis

As an initial matter, AO informed us that it mistakenly did not include the contract modification number 001 when it released a copy of the contract to Fried. Accordingly, we find that AO should release the contract modification numbered 001 to Fried. AO also clarified the confusion regarding the other missing pages and "Exhibit B" not included in the contract sent to Fried. AO informed us that "Exhibit B" referred to in boxes 15c/15d/15e of Standard Form 26 is actually "Section B" included in Attachment A, Statement of Work. Fried has received this document. Finally, AO informed us that the alleged missing pages were proposal instructions from the RFP and were never a part of the final contract. Since these proposal instructions were not part of the final contract, AO informed us that these pages were not actually missing from the copy Fried received from AO. At the very least, we find that this unusual numbering system in a final contract, in which there are different handwritten and typewritten numbers on the same page, to be very confusing. Since these pages contain only proposal instructions, AO should review these pages and either release them to Fried or provide an explanation as to why they are exempt from release.

Exemption 3 of the FOIA, cited by AO, allows agencies to withhold information if specifically authorized by another federal statute. However, the withholding statute must meet strict statutory guidelines. An agency properly invokes Exemption 3 only where the withholding statute "(A) requires that the matters be withheld from the public in such a manner as to leave no discretion on the issue, or (B) establishes particular criteria for withholding or refers to particular types of matters to be withheld." 5 U.S.C. § 552(b)(3); 10 C.F.R. § 1004.10(b)(3). A statute falls within the Exemption's coverage if it satisfies either of its standards.

As stated above, Fried contends that the final contract incorporates the Burns and Roe proposal and, therefore, pursuant to the provisions of Section 821 of the NDAA, the DOE should release the proposal. In fact, AO confirmed that the awarded contract probably incorporates some proposal information. See February 20, 1997 Record of Telephone Conversation between Leonard M. Tao, OHA Staff Attorney, and Sam Espinosa and Terry Apodaca, AO. Because Section 821 of the NDAA does not bar the release of proposal information that has been incorporated into a contract, Exemption 3 does not apply in this case as a reason to withhold the proposal in its entirety. Therefore, we will remand this case to AO to either release the proposal information incorporated into the awarded contract or provide a detailed explanation for withholding any such information, including the examples Fried cites, and why Exemption 3 is applicable to them. Finally, on remand, AO may consider the applicability of other FOIA exemptions to the requested information.

It Is Therefore Ordered That:

(1) The Appeal filed by Fried, Frank, Harris, Shriver & Jacobson on January 24, 1997, is hereby granted as set forth in paragraph (2) below, and is denied in all other respects.

(2) This matter is hereby remanded to the Freedom of Information Authorizing Official of the Albuquerque Operations Office of the Department of Energy to either release copies of documents responsive to Fried, Frank, Harris, Shriver & Jacobson's September 24, 1996 request for the proposal submitted by Burns and Roe Enterprises, Inc., related to the DOE Request for Proposal No. RFP DE- RP04-96AL89607 or provide a detailed explanation for withholding any responsive information. Finally, the Freedom of Information Authorizing Official must release the contract modification numbered 001 to the appellant.

(3) This is a final order of the Department of Energy from which any aggrieved party may seek judicial review. Judicial review may be sought in the district in which the requester resides or has

a principal place of business, or in which the agency records are situated, or in the District of Columbia.

George B. Breznay

Director

Office of Hearings and Appeals

Date: February 24, 1997

(1)Section 821 of the NDAA incorporates the non-disclosure provisions described above into Section 303B of the Federal Property and Administrative Services Act of 1949, 41 U.S.C. § 253(b).