No Such Thing as Personal Privacy for Corporations

By Beckett, Christine | News Media and the Law, Spring 2011 | Go to article overview
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No Such Thing as Personal Privacy for Corporations


Beckett, Christine, News Media and the Law


U.S. Supreme Court makes definitive ruling in FCC v. AT&T

In a decision that many observers said stated the obvious, the U.S. Supreme Court ruled in March that AT&T does not have personal privacy rights under the federal Freedom of Information Act.

The appeal in Federal Communications Commission v. AT&T focused on the communication company's controversial claim that documents about the company "compiled for law enforcement purposes" could be withheld if disclosure "could reasonably be expected to constitute an unwarranted invasion of personal privacy."

The Court's holding in the case was decidedly uncontroversial. In an 8-0 opinion - Justice Elena Kagan recused herself because she was U.S. solicitor general when the case was moving through the lower courts - issued on March 1, the Court found that corporations have no right of personal privacy under FOIA.

Ultimately, the Court resolved what was considered by many to be an outlier case. No court had ever found corporations to have personal privacy rights before a decision by a panel of the U.S. Court of Appeals in Philadelphia (3rd Cir.), sitting in Newark, N.J., prompted the Supreme Court to take notice.

AT&T self-reported in 2004 that it overcharged the government for its participation in a federal program known as E-Rate, an initiative to provide enhanced telecommunications and information services to schools and libraries, particularly in rural and economically disadvantaged areas. The FCC launched an investigation into the incident and settled the matter with AT&T for $500,000 and the promise to institute a plan to ensure future compliance with the ?-Rate program.

CompTel, a trade association that includes some of AT&T's competitors, requested the investigative documents under FOIA in early 2005.

The FCC decided to release the requested documents to CompTel after redacting parts under Exemption 7(C), in relation to specific AT&T employees, and Exemption 4, for confidential, commercial and financial information.

AT&T filed an administrative appeal with the FCC in 2008, which found that AT&T, as a corporation, does not have personal privacy rights under Exemption 7(C) and that the documents must be released. AT&T filed suit, arguing the personal privacy rights in the exemption apply to corporations as well as to individuals.

AT&T contended that the term "personal privacy," as set forth in Exemption 7(C), applied to corporations, in addition to individuals, because the term "person" is defined in the Administrative Procedure Act as including "an individual, partnership, corporation, association, or public or private organization other than an agency." FOIAis a section within the Aabninistrative Procedures Act. Because the term "personal" is the adjective form of the defined "person," it should follow that the statutory definition of personal privacy also includes corporate entities, AT&T argued.

The Third Circuit agreed, finding that, similar to individuals, corporations can be embarrassed and stigmatized.

Therefore, the lower court held that Exemption 7(C)'s protections could be extended to include corporate interests, though the court did not go further and rule that AT&T should get the protection in this instance.

Section 7(C) requires a balancing test to determine whether records should be withheld.

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No Such Thing as Personal Privacy for Corporations
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