How secret is secret?
The Federal Trade Commission is in a hot fight with several state attorneys general over that issue, and at stake is some of the most confidential data of some of the nations's largest companies. The commission won the first court enounter, but on Nov. 26, in Lieberman v. FTC, the U.S. District Court in Hartford, Conn., sided with the state enforcers.
The immediate issue is whether the state attorneys general can get their hands on the extensive insider information that the commission examined earlier this year in approving two big oil industry mergers between Gulf and Standard Oil of California and between Texaco and Getty. The state officials want to see the confidential data to decide whether to move against the mergers on state antitrust grounds. Since every corporation involved in a sizable merger has to give the FTC and Justice Department similar secret data, the outcome of the current arguments will affect the secrets of hundreds of companies.
Congress, when it drafted the law requiring companies contemplating big mergers to give advance information to the antitrust authorities, knew that much of the material would be sensitive. The lawmakers included provisions saying that the corporate data submitted in such circumstances cannot be disclosed in response to Freedom of Information Act requests and that "no such information or documentary material may be made public," except in trying a government suit to block the deal.
The current disagreement is over just what "made public" means.
The state officials insist that they are representatives of a government, and that letting them use the information is not the same as making it public, especially when the attorneys general routinely couple their requests with signed pledges of confidentiality. But the FTC, in the oil merger cases, reads the law as requiring that the material not go beyond commission staffers. In August, U.S. District Judge James R. Nowlin in San Antonio, Tex., said he would defer to the FTC's interpretation, and turned down a bid by Texas to get the backup material on the Gulf-Socal deal.
But in the more recent Hartford ruling, involving a bid by Rhode Island, Connecticut, Pennsylvania and Minnesota for information on Texaco and Getty, Senior District Judge M. Joseph Blumenfeld refused to accept that reading of the premerger notification act. He said that state attorneys general who promise to keep the material confidential are not members of the public, and so there is no bar to their obtaining the private filings. Blumenfeld decided he did not have to give great weight to the FTC's interpretation of the law because the agency itself has been inconsistent. Before the oil merger cases, requests from state attorneys general for corporate data were routinely granted by FTC staffers without the matter ever coming before the commissioners themselves. That was a key point cited by the two dissenters in the two 3-to-2 commission votes to deny the states the companies' information.
In other cases, courts ruled that:
Attorneys can collect bigger fees for victories over the government in employment discrimination cases. In general, no court can order the federal government to pay money damages unless the government has waived its sovereign immunity against such awards. But the 1964 Civil Rights Act contains such a waiver, saying that when a lawyer wins a race or sex discrimination case against the federal government, Washington "shall be liable for the costs the same as a private person." The government admitted that clause obligates it to pay for the plaintiff's lawyer, but insisted that a court could not increase attorneys' fees to compensate for any delay in payment, in essence adding on interest. The U.S. Court of Appeals in Washington, however, ruled that since private companies that lose antidiscrimination suits must pay interest, so must Uncle Sam. (Shaw v. Library of Congress, Nov. 6)