Law360, Nashville (November 14, 2017, 7:15 PM EST) --
Sikorsky Aircraft Corp. told a California federal court Monday that the U.S.
Department of Defense was mistaken to release previously redacted
information from a company subcontracting plan under the Freedom of Information
Act, saying a FOIA exemption should have applied but that it would not sue to
stop the release.
Despite the company’s objections, the DOD on Nov. 10 released to the American
Small Business League a new copy of Sikorsky’s 2013 comprehensive
subcontracting plan as part of the FOIA suit filed by ASBL, with “significantly
fewer” redactions than a previously released version of the plan, the company
said in a notice to the court.
While it has decided against filing a so-called reverse FOIA action to block
release of the information, Sikorsky said it believes that the newly released
information should have remained exempt from disclosure under FOIA Exemption 4,
which covers trade secrets, arguing the government had gone against the Ninth
Circuit’s interpretation of that exemption.
That new information includes, for example, the names of small business
contractors the company uses to comply with a government small business
subcontracting test program, details of confidential projects that make use of
those subcontractors, and what Sikorsky does to set and meet its small business
subcontracting goals, Sikorsky claimed.
“The disclosure of such information is likely to give Sikorsky’s competitors a
significant competitive advantage over Sikorsky,” it said.
For example, competitors could use it to identify and poach Sikorsky’s proven
base of small business suppliers and glean information from what the company
chooses to make against what it chooses to buy, according to the company.
Any justifications for the release of the new information based on publicly
available information are also incorrect, as although some subcontractors have
been publicly revealed as Sikorsky suppliers, their specific roles in meeting
its subcontracting goals and the company's methods for recruiting them had not
been, Sikorsky argued.
ASBL President Lloyd Chapman told Law360 on Tuesday that he continues to believe
the requested documents should be released to ASBL completely unredacted and that he will push for a trial if need be,
arguing data on Sikorsky’s suppliers is available from government databases and
other public sources — including Sikorsky’s own press releases — and is not a
trade secret. He also claimed that the company may be acting disingenuously in
redacting certain purported personal information from the plan documents.
Noting he had yet to fully analyze the newly unredacted
information released to ASBL, Chapman said that an initial review of that
information “seemed to indicate” that some of the firms Sikorsky has claimed
are small business suppliers may in fact be larger businesses, which he argued
may be indicative of a larger issue.
“If the Pentagon allowed Sikorsky to report rewards to large multi-nationals as
small business awards and there was no oversight on that ... It would be my
assumption that the Pentagon is allowing all of the major contractors who
participate in this program to do the same thing,” he said.
The DOD does not typically comment on pending litigation.
ASBL filed its suit in 2014 after a related FOIA request was effectively
rejected by the DOD. It has claimed the Sikorsky subcontracting plan will
reveal whether small businesses are receiving DOD subcontracts from large
defense contractors, as required by law, or not.
Specifically, the group believes that the DOD’s Comprehensive Subcontract Plan
Test Program, created in 1989 as a test program for DOD prime contractors to use
general, companywide subcontracting plans instead of the more specific
per-contract plans required by other agencies, has been used to “cheat small
business out of hundreds of billions in subcontracts.” Sikorsky, now owned by Lockheed Martin Corp.,
is a major manufacturer of military helicopters.
A district court in November 2014 ordered the
DOD and Sikorsky to cough up the company’s subcontracting
plan, unredacted, before the Ninth Circuit in January
reversed that decision, saying FOIA exemptions 4 and
6, which covers personal privacy, applied to certain redacted information in
Once back before the district court, the DOD on Oct. 12 said it intended to
release some previously redacted information to ASBL, a move the group has
claimed stems from discovery in the suit running counter to Sikorsky’s claims
about needing to protect its trade secrets.
A further hearing in the case is set for Wednesday.
ASBL is represented by Robert E. Belshaw of Belshaw Law, and Jonathan W. Cuneo,
Charles Tiefer and Matthew E. Miller of Cuneo Gilbert & LaDuca LLP.
The DOD is represented by Brian J. Stretch, Sara Winslow, Ellen London and
Kimberley Friday of the U.S. Attorney’s
Office for the Northern District of California.
Sikorsky is represented by Rex. S. Heinke and Jessica
W. Weisel of Akin
Gump Strauss Hauer & Feld LLP.
The case is American Small Business League v. U.S. Department of Defense, case
number 3:14-cv-02166, in the U.S. District Court for the Northern
District of California.
For the full story, click here: https://www.law360.com/articles/985032/sikorsky-complains-over-dod-document-release-in-foia-suit