Health Law Daily Wrap Up, GENERAL HEALTH CARE NEWS—D.C. Cir.: FOIA permits discovery of communications between agencies and Congress on health care reform, (May 20, 2024)

By Robert B. Barnett Jr., J.D.

The decision aligns with prior decisions in the Sixth, Ninth, and Tenth circuits on the meaning of “intra-agency” in FOIA Exemption 5.

In a case in which American Oversight made Freedom of Information Act (FOIA) requests for communications between Republican members of Congress and the Trump administration about efforts to repeal the Patient Protection and Affordable Care Act (ACA), Pub. L. No. 111-148, the District of Columbia Circuit Court of Appeals has reversed the lower court and ruled that such communications are subject to discovery under FOIA because the “consultant corollary” exception to FOIA does not apply when the non-agency party (in this case, Congress) has an independent stake in the outcome of the discussions. Thus, while agency communications with a disinterested third party would not be discoverable, such communications with an interested third party are discoverable, under the rules established in 2001 by the U.S. Supreme Court in Department of the Interior v. Klamath Water Users Protective Association, No. 99-1871 (D.C. Cir. Mar. 5, 2001). The dissent would have reached the opposite result (American Oversight v. HHS, No. 22-5281 (D.C. Cir. May 17, 2024)).

Background. In early 2017, amid House Republican efforts to repeal the ACA, American Oversight filed two FOIA requests, one with HHS and the other with the Office of Management and Budget (OMB). The requests sought communications relating to health care reform between either agency and Congress. When neither agency responded, American Oversight filed suit in federal district court.

The court ordered the agencies to comply. They did, but only for a while. At that point, they refused to supply any further documents, citing FOIA Exemption 5, which protects “intra-agency memorandums or letters” (5 U.S.C. §552(b)(5)). Both parties filed motions for summary judgment. The government argued that the exemption applied because Congress and the Trump administration shared the same goal of repealing the ACA. American Oversight acknowledged the existence of the “consultant corollary,” which extends the reach of intra-agency communications to third parties, but it argued that the corollary did not apply to these facts. Separately, American Oversight challenged HHS’s search process as inadequate.

The district court agreed with the government, ruling that the consultant corollary was applicable, and, thus, the government had the right to withhold the communications under Exemption 5. The court also ruled for HHS on the charge that its search process was inadequate. American Oversight appealed both rulings.

FOIA. Under FOIA Exemption 5, communications are protected if they meet two conditions: (1) the communications involve inter-agency or intra-agency memorandums and letters and (2) the litigation protection rules would apply. Under these facts, the parties agreed that the litigation protection rules applied and that the communications were not inter-agency. Thus, the appeal revolved around whether the communications that American Oversight sought qualified as “intra-agency” communications under Exemption 5.

Intra-agency. On its surface, the communications would seem clearly not to be “intra-agency” given that the party communicating with HHS and OMB was Congress rather than another agency. A corollary, however, exists to the definition of “intra-agency.” Under that corollary, when an agency consults with a third party, communications with that third party consultant will still be considered to be “intra-agency,” and thus protected from discovery, when the agency is seeking the third-party consultant’s special expertise or opinion. The question for the appellate court, therefore, was whether Congress qualified as a third-party consultant under the consultant corollary. The government argued that it did because the Trump administration and Congressional Republicans were aligned on the issues.

In Department of the Interior v. Klamath Water Users Protective Association, No. 99-1871 (D.C. Cir. Mar. 5, 2001), the U.S. Supreme Court ruled that the consultant corollary has limits. In that case, FOIA requests were made regarding communications between the Department of the Interior and the Klamath Tribe regarding a discussion of water rights. The Supreme Court ruled that Exemption 5 did not apply because the tribe was not a disinterested third-party consultant. Rather, it had an important stake in the outcome of the water-rights decision. As a result, the Court allowed the communications to be made public.

This was the first case since Klamath before the D.C. Circuit on the specific question of whether the consultant corollary extends to members of Congress and their staffs. Applying Klamath, the D.C. Circuit ruled that the corollary did not extend to Congress because Congress was not disinterested; it had an independent stake in the outcome of health care reform. The D.C. Circuit went on to note that the Sixth, Ninth, and Tenth Circuits have all reached similar conclusions under similar facts. No circuit court, the D.C. Circuit said, has reached a contrary result.

The appellate court went on to note that, although the facts could be such that members of Congress or their staffs would qualify for the corollary, such situations would be rare because Congress had a “particular institutional stake in the legislative process.” Under these facts, it was clear, the appellate court said, that both sides had independent stakes in the outcome. For example, the agencies admitted that they sought to “influence and shape pending legislation by discussing, consulting, and negotiating with Congressional personnel.”

In rejecting the government’s argument that Congress was not self-interested because Congressional Republicans and the Trump administration were like-minded on ACA repeal, the appellate court concluded that this argument “misunderstands the inquiry.” The question was not whether the two entities shared a common goal. Rather, the question was whether the outside third-party was disinterested in the matter, just as Klamath had decreed. The fact that their interests might be aligned would not automatically disqualify them from the corollary. What disqualifies them is their stake in the outcome. Under these facts, the D.C. Circuit ruled, the Republican members of Congress and their staffs clearly had a stake in the outcome independent of the agencies’ stakes in the outcome. Thus, the appellate court said, American Oversight was entitled under FOIA to obtain the communications.

Search adequacy. The D.C. Circuit also reversed the lower court on the adequacy of HHS’s search. HHS used the following three search terms: health care reform, ACA, and AHCA. The appellate court agreed with American Oversight that this was inadequate. The likelihood that one of those three terms would be contained in every relevant communication was low. The D.C. Circuit believed that the search should have been broader, to ensure that all relevant documents were discovered. Thus, HHS should have used additional terms that included the names of the laws without the acronyms, as well as “Obamacare” and “repeal and replace.” The fact that these additional terms might have added to HHS’s discovery burden was insufficient to justify HHS’s failure to include those terms.

In its arguments to justify its search terms, the government sought to justify its use of the three search terms, but without ever addressing why it failed to include the additional terms. Thus, the government failed to justify its use of only three search terms.

The appellate court, therefore, reversed the district court’s grant of summary judgment on the applicability of Exemption 5 to the records at issue, and it also reversed the grant of summary judgment on the adequacy of HHS’s search.

Dissent. Judge Wilkins filed a partial dissent, referring to the majority’s reading of FOIA as “quite breathtaking.” He would have ruled that Exemption 5 protects all communications between agencies and Congress regarding potential legislation. In his view, Klamath did not reach a contrary ruling.

The case is No. 22-5281.

Judge: Garcia, B.

Attorneys: Jessica Morton (Democracy Forward Foundation) for American Oversight. Benjamin M. Shultz, U.S. Department of Justice, for U.S. Department of Health and Human Services and Office of Management and Budget.

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