A CITIZEN'S GUIDE ON USING THE FREEDOM OF INFORMATION ACT
AND THE PRIVACY ACT OF 1974 TO REQUEST GOVERNMENT RECORDS
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F. 4. Exemption 4.--Confidential Business Information
The fourth exemption protects from public disclosure two types of information: Trade secrets and confidential business information. A trade secret is a commercially valuable plan, formula, process, or device. This is a narrow category of information. An example of a trade secret is the recipe for a commercial food product.
The second type of protected data is commercial or financial information obtained from a person and privileged or confidential. The courts have held that data qualifies for withholding if disclosure by the government would be likely to harm the competitive position of the person who submitted the information. Detailed information on a company's marketing plans, profits, or costs can qualify as confidential business information. Information may also be withheld if disclosure would be likely to impair the government's ability to obtain similar information in the future.
Only information obtained from a person other than a government agency qualifies under the fourth exemption. A person is an individual, a partnership, or a corporation. Information that an agency created on its own cannot normally be withheld under exemption 4.
Although there is no formal requirement under the FOIA, many agencies will notify a submitter of business information that disclosure of the information is being considered.\28\ The submitter then has an opportunity to convince the agency that the information qualifies for withholding. A submitter can also file suit to block disclosure under the FOIA. Such lawsuits are generally referred to as ``reverse'' FOIA lawsuits because the FOIA is being used in an attempt to prevent rather than to require the disclosure of information. A reverse FOIA lawsuit may be filed when the submitter of documents and the government disagree whether the information is exempt.
\28\ See Predisclosure Notification Procedures for Confidential Commercial Information, Executive Order 12600, 3 C.F.R. 235 (1988).