TAMM, Circuit Judge:
The appellants in this action are steamship operators doing business pursuant to Title VI of the Merchant Marine Act of 1936 (49 Stat. 1985, 46 U.S.C. §§ 1171-1183a (1964)). The Act allows American shipowners to apply to the United States Government for financial aid in the operation of vessels which are to be used in an essential service in the foreign commerce of the United States. This financial aid is termed "operating-differential subsidies." Succinctly, these subsidies represent the percentage by which the estimated fair and reasonable cost of operation of a United States flag vessel with an American crew exceeds the estimated cost of operation of the same vessel with a foreign crew. 46 U.S.C. §§ 1171, 1173 (1964). The Secretary of Commerce is statutorily empowered to administer this "operating-differential subsidy program." At present, the program is administered by the Maritime Administration, the Maritime Administrator, and the Maritime Subsidy Board of the Department of Commerce. See Department of Commerce Order 117-A, 31 Fed.Reg. 8087 (1966). In the specific context of this case Chairman Gulick is also contemporaneously serving as the Acting Maritime Administrator. These parties will hereinafter be referred to jointly as "the Board."
The appellants operate nine ships (C-4 conventional design vessels) which are the subject of this litigation. These vessels began operation at various times between 1961 and 1965 and are all currently in operation. Pursuant to the aforementioned statute appellants had been receiving subsidies for the operation of their ships. At all times prior to this litigation these ships were operated by fifty-eight man crews. The crew size is determined by a procedure which involves the ship owners submitting applications of "vessel manning scales," which must be approved by the Board.
In an attempt to formulate a meaningful argument in their petition for reconsideration the appellants on May 7, 1968, requested a statement of the Board's reasons for its decision and a summary of the evidence before it (J.A. 46-49). This request was denied by letter of May 16, 1968 (J.A. 56-58). Later, on May 21, 1968, appellants filed with the Board an "application to inspect records" and included in the alternative a renewed request for the reasons for and a summary of the evidence upon which the Board based its ruling (J.A. 12-13). This request was denied by letter on May 29, 1968, but the Board in this letter offered to and later did provide appellants with "extensive records" dealing with "vessel manning scales" (J.A. 57-63, 52-53, district court transcript at 6, Reply Brief for Appellants at 8).
I DISTRICT COURT PROCEEDINGS
Appellants precipitated this action in the district court by filing a pleading entitled "complaint for injunction against withholding, and for order giving access to, Government information." This complaint was based solely upon the Freedom of Information Act and did not ask for relief independently of the Act upon due process grounds. Subsequently, on June 7, 1968, appellants filed a "motion for preliminary injunction" together with a "memorandum of points and authorities in support of plaintiffs' motion for preliminary injunction." In this pleading appellants did urge, in a cursory paragraph, that the injunction be granted on due process grounds independent of the Act. The Government's responsive motion, id est, "motion to dismiss or for summary judgment and opposition to plaintiffs' motion for preliminary injunction," dealt with the case solely upon the
It is important to note that appellants only peripherally argue for relief independent of the Act. The Government does not treat this issue at all and in fact it stated below that "[t]he complaint is based solely upon 5 U.S.C. § 552" (memorandum of points and authorities in support of motion to dismiss or for summary judgment at 2). The due process ground was not mentioned in oral argument below and appellants presented no authority for such relief to the learned trial judge upon which a due process right could have been bottomed; consequently, we do not consider this ground for reversal here on appeal.
We note in passing that the district court, of course, is invested with general equity powers which it could utilize to require an administrative agency to give reasons for its decision. The party requesting such action, however, must meet all the criteria for the issuance of an injunction. See generally Terrace v. Thompson, 263 U.S. 197, 44 S.Ct. 15, 68 L.Ed. 255 (1923); Champlin Refining Co. v. Corp. Comm'n of Oklahoma, 286 U.S. 210, 52 S.Ct. 559, 76 L.Ed. 1062, 86 A.L.R. 403 (1932); Virginia Petroleum Jobbers Association v. FPC, 104 U.S.App.D.C. 106, 259 F.2d 921 (1958); Daigle v. Continental Oil Co., 277 F.Supp. 875 (W.D.La.1967).
II FREEDOM OF INFORMATION ACT
The Freedom of Information Act was promulgated in 1966 (80 Stat. 250) with a stipulation that it would not take effect until July 4, 1967, (81 Stat. 54) and it is now codified in 5 U.S.C. § 522 (Supp. III. 1965-1967). An exploration of the legislative history behind this enactment reveals that the premier purpose of the Act was to elucidate the availability of Government records and actions to the American citizen. In addition, Congress sought to eliminate much of the vagueness of the old law (section three of the Administrative Procedure Act of 1946, 60 Stat. 238).
With this noble purpose we wholeheartedly agree. Unfortunately, none of the
The Maritime Subsidy Board took such action on April 11, 1968, in which it ordered (by letter of April 12, 1968) appellants to refund approximately $3,300,000 in subsidy payments. This administrative decision had a direct and immediate effect upon appellants. More specifically, the April 11 determination read as follows (J.A. 65);
The above referred to "recommendations" were then reprinted in letters sent to appellants on April 12, 1968, which stated in pertinent part (J.A. 7-11):
The above quoted excerpts make it readily apparent that the agency issued its April 11 ruling based substantially upon a thirty-one page memorandum prepared
We feel compelled to note at the outset of our discussion that we do not consider the Board's action in this case either a usual or commendable administrative practice. It is indeed a unique case, and must be dealt with as such.
In order to reach the determination that we do a threshold ambiguity must be resolved. The first sentence of 5 U.S.C. § 552(a) (3) does not indicate clearly whether judicial enforcement is available for paragraphs (1) and (2) of subsection (a) as well as for paragraph (3). Paragraph (3) states in pertinent part:
We interpret this paragraph as meaning that except with respect to records the agency has made available under paragraphs (1) and (2) in compliance with that portion of this Act, the agency must make all other identifiable records available (unless exempted by subsection (b)) or face judicial compulsion to do so. In other words, if the agency refuses to comply with paragraphs (1) or (2) it is then subject to suit under the processes spelled out in paragraph (3). The only viable interpretation of this paragraph is that the judicial process is available to compel the disclosure of agency records not made available under paragraphs (1) and (2) as well as the agency records referred to in paragraph (3). Congressional intent (although not spelled out directly anywhere) seems to have been that judicial review would be available for a violation of any part of the Act, not merely for subsection (3).
We feel that Congress was merely trying to distinguish between two different types of agency records, not attempting to limit judicial review; otherwise, Congress would have created a right without a remedy. In so construing this statute we recognize that the last sentence in paragraph (2) does contain a sanction, but we feel it was not meant to be an exclusive one.
The Act specifically states that the agency must disclose to any person upon request all "final opinions * * * as well as orders, made in the adjudication of cases" (5 U.S.C. § 552(a)(2) (A)). Appellants contend that the April 11 decision, transmitted by the letter of April 12, constituted an order to them. Further, they assert that the Board, by stating in unqualified terms that its action was based upon a certain specified memorandum, thereby incorporated that memorandum into its administrative decision of April 11-12. We agree with appellants' contention.
It is important to note here that under this Act the burden of proof is not upon the appellants; rather, the Act provides that "[i]n such a case the court shall determine the matter de novo and the burden is on the agency to sustain its action * * *" (5 U.S.C. § 552(a)(3)). In particular, the Maritime Subsidy Board has failed to meet this burden. Neither in its brief nor upon oral argument did it show that its April 11 ruling did not have immediate operative effect. Appellants were ordered to refund approximately $3,300,000 and this order was stayed only pending the Board's decision on reconsideration. We need not reach consideration, however, of the much contested issue of whether the April 11 ruling was final,
In order to avoid discovery under this subsection of the Act appellee must show that the memorandum was not incorporated into its action because it was and is an "intra-agency memorandum." Indeed, appellee urges that it is exempt from discovery because it is an "intra-agency memorandum(s) * * * which would not be available by law to a party other than an agency in litigation with the agency" under 5 U.S.C. § 552 (b)(5). We find this contention unpersuasive. This exemption involved
We do not feel that appellee should be required to "operate in a fishbowl," but by the same token we do not feel that appellants should be required to operate in a darkroom. If the Maritime Subsidy Board did not want to expose its staff's memorandum to public scrutiny it should not have stated publicly in its April 11 ruling that its action was based upon that memorandum, giving no other reasons or basis for its action. When it chose this course of action "as a matter of convenience" (Brief for Appellee at 9) the memorandum lost its intra-agency status and became a public record, one which must be disclosed to appellants. Thus, we conclude that the Board's April 11 ruling clearly falls within the confines of 5 U.S.C. § 552(a)(2)(A) and consequently it must be produced for public inspection.
Another aspect of this controversy merits discussion. Appellants argue that even if this memorandum is an intra-agency one it is one which would "be available by law to a party other than an agency in litigation with the agency" (5 U.S.C. § 552(b)(5)). Since we hold today that this memorandum is no longer "intra-agency" we need not and do not reach consideration of this allegation.
Appellee urges one final contention. It argues that we are bound by this court's earlier decision in Freeman v. Seligson, 132 U.S.App.D.C. 56, 405 F.2d 1326, decided June 28, 1968. We find, however, that this case is not controlling.
While this opinion was in the printing process (over one month after oral argument) the appellees filed a "motion to dismiss as moot." The basis of this motion was that the Maritime Subsidy Board had issued on November 18, 1968, a "final opinion and order" denying appellants' petition for reconsideration and setting forth the reasons for such denial in a forty-three page decision. Appellants, of course, filed a "reply to motion to dismiss as moot." We hereby deny appellees' motion.
The issuance of the Board's decision does not render this cause of action moot for the simple reason that appellants lack of need for the memorandum is irrelevant to their right to obtain it under the Act. Further, because we hold that the Board's memorandum is an identifiable record made available by the Act, it is now available to any member of the public, notwithstanding his or her lack of need for it. It is also not without significance that we do not have the power under the Act to order the Board to give its reasons for its decision unless those reasons are embodied in an "identifiable record." In short, we feel that the issuance of this decision compounds the Board's lamentable administrative practices and procedures. Appellants were forced to prepare a petition for reconsideration of the Board's April 11 ruling without knowledge of any of the reasons for that ruling. Now, the Board renders its decision upon reconsideration affirming its April 11 ruling and gives reasons for such decision. It seems to us, however, that logic would dictate that the reasons for the disposition of a certain issue, id est, a determination that fifty rather than fifty-eight man crews are reasonable for certain vessels, should be given before and not after the parties are required to prepare and submit a petition for reconsideration of that determination. This court is unaware of how a party can meaningfully prepare a request for reconsideration of a decision which contains no reasons for its determination. Further, as appellants argue, the November 18 decision seems to rely upon considerations which appellants did not and could not have been expected to foresee. The backwardness of appellee's administrative procedure is appalling.
At this point it must be emphasized once again that this case is not here before us for disposition upon the merits. As we previously stated, the action was brought in our district court under the Freedom of Information Act on a very limited basis, id est, a request for disclosure of an identifiable document. This court, in this particular case, recognizes the "procedural morass" within which we are required to act. We are, however, without power to evaluate this case upon its merits. A full and complete record, brought to this court through the correct procedural process, is necessary for a disposition on the merits. As much as the administrative procedure applicable to this case seems to be in dire need of clarification, this cause of action is not the proper instance in which to illuminate this dimly lit area of the law. Thus, the memorandum must be disclosed for appellants' inspection. Its value to appellants is, of course, lessened now that the Board has chosen to issue its decision upon reconsideration before our disposition of this case.
We conclude that the Board's ruling of April 11 transmitted to appellants by letter of April 12 constitutes a decision and order within the meaning of 5 U.S.C. § 552(a)(2)(A). Moreover, we find that the "memorandum dated November 26, 1965, revised December 20, 1967," upon which the Board based its decision and order, was thereby incorporated into that agency action and must be produced for public inspection by the appellants. We therefore reverse the district court and order it to grant appellants' motion for summary judgment.
CHIEF JUDGE BAZELON would hold that, in the peculiar circumstances of this case, appellants are entitled to the staff memorandum under subparagraph (3) of 5 U.S.C. § 552(a), which
JUDGE PRETTYMAN would hold, in the first place, that the case is moot and the appeal should therefore be dismissed. The complaint, as filed in the district court, was in the alternative; plaintiffs asked for a copy of the memorandum or, in the alternative, for a statement of the Board's reasons for its action. They have been given a statement which the Board says were its reasons. Thus the complaint has been satisfied. Of course not all the questions aroused by the controversy have been answered, but this action, as pending in court, has become moot since its prayer has been satisfied. On the merits Judge Prettyman reaches the same result as does the court, but by a different route. He says (1) that, when an agency recites that it bases a certain decision upon a certain described memorandum, the memorandum ceases to be a protected intra-agency memorandum and must be shown to the interested public, and (2) that an agency must state the reasons upon which it bases so emphatic an order as a direction to refund $3,000,000 to the Government, especially when the agency asserts that it has reasons for its action and that the reasons are embodied in a certain written document. To his mind these propositions are so obvious as not to require involved reasoning for explanation or support. Surely, he says, the Freedom of Information Act, even if it goes no further, buttresses these clear propositions; it does not negate them. He concurs in the result reached in this portion of the opinion.
Reversed and remanded.
FootNotes
On January 16, 1969, Tuchinsky v. Selective Service System (N.D.Ill.1969) was decided 294 F.Supp. 803. The court held that the agency was required under 5 U.S.C.A. § 552(a) (2) to disclose and allow plaintiff to copy certain memoranda. Thus the court judicially enforced, as we do, paragraph (a) (2) of the Act. See Tuchinsky v. Selective Service System, supra, 294 F.Supp. 803.
This, of course, provides no remedy when the agency refuses to disclose part of a decision or order (or any other affirmative action it takes against a citizen) to the party affected by it or in any other way fails to comply with paragraphs (1) or (2). We recognize also that agency non-compliance with paragraphs (1) or (2) involving disclosure rather than publication in the Federal Register is unlikely and will probably involve rare situations such as the one with which we dealt today.
Comment
User Comments