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Public Citizen v. United States Department of Health & Human Services

United States District Court, District of Columbia

October 4, 2013

PFIZER INC. and PURDUE PHARMA L.P., Intervenors-Defendants

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For PFIZER INC., Intervenor Defendant: Ronald J. Tenpas, LEAD ATTORNEY, David M. Kerr, MORGAN, LEWIS & BOCKIUS LLP, Washington, DC.

For PURDUE PHARMA L.P., Intervenor Defendant: Lee Calligaro, EPSTEIN, BECKER & GREEN, P.C., Washington, DC.


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BERYL A. HOWELL, United States District Judge.

The plaintiff, Public Citizen, has requested, under the Freedom of Information Act (" FOIA" ), 5 U.S.C. § 552, annual reports that were required to be submitted by two companies, Pfizer, Inc. (" Pfizer" ) and Purdue Pharma L.P. (" Purdue" ), to the Office of Inspector General (" OIG" ) of the United States Department of Health and Human Services (" HHS" ), as part of the companies' compliance with settlement agreements arising from the companies' illegal off-label promotion of drugs reimbursed by federal health care programs. [1] Between forty and one hundred times each year over the last decade, HHS' OIG has participated in such settlement agreements by entering into Corporate Integrity Agreements (" CIAs" ) with companies seeking to resolve civil and administrative health care fraud cases and avoid costly exclusion from participation in Federal health care programs. See Declaration of Gregory E. Demske, Asst. Inspector General for Legal Affairs, OIG, HHS, (" Demske Decl." ) ¶ ¶ 1-2, ECF No. 22-1. In return for these benefits, under the CIA, the companies must agree to enhanced compliance measures, subject to auditing by an outside independent party and monitoring by the OIG. Id. ¶ 2.

Public Citizen is a " nonprofit public interest organization," which has, inter alia,

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" fought for safe, effective, and affordable drugs and medical devices; responsible controls over the delivery of health care; consumer access to health care information," and issued publications on these topics. Declaration of Sidney Wolfe, M.D., Public Citizen Health Research Group Director, (" Wolfe Decl." ) ¶ 2, ECF No. 26-1. Noting that Pfizer has entered into three serial CIAs with HHS' OIG, due to the company engaging in allegedly illegal behavior at the same time it was subject to a CIA, the plaintiff filed the FOIA requests at issue in the instant suit to address " a serious question about the adequacy of OIG oversight of companies during the CIA process." Id. ¶ ¶ 11, 14; see also Declaration of Edward Nowicki, Pfizer Vice-President and Asst. General Counsel, Deputy Compliance Officer - Global Programs, (" Nowicki Decl." ) ¶ 4, ECF No. 22-1 (" The 2004 CIA expired in 2009. Since that time, Pfizer entered into a new CIA with HHS in 2009." ). The plaintiff explains that " [t]o the extent that the annual reports [required by the CIA] reveal instances of illegal activity by the companies, the public has a strong interest in knowing that OIG had access to this information and in knowing whether OIG acted forcefully in responding to it." Wolfe Decl. ¶ 14.

HHS has withheld the bulk of the requested records on grounds that they contain confidential, commercial information exempt from disclosure under FOIA Exemption 4 and private, personal information exempt from disclosure under FOIA Exemption 6. 5 U.S.C. § 552(b)(4) and (6). The plaintiff challenges HHS' withholdings for eight categories of records, as well as the adequacy of HHS' search for records pertaining to one of the companies. Pending before the Court, are cross-motions for summary judgment by HHS and the defendant-intervenors Pfizer and Purdue, and by the plaintiff. For the reasons stated below, these motions are granted in part and denied in part.


A. Annual Reports Required To Be Submitted Under Corporate Integrity Agreements With Pfizer And Purdue

In May 2004, Pfizer entered into a CIA with HHS' OIG as part of a larger settlement agreement with the United States and various States " related to Pfizer's promotional practices of a Pfizer product." Nowicki Decl. ¶ 4; see also Def.'s Mot. Summ. J., Ex. 1 (" Pfizer Corporate Integrity Agreement" ) (" Pfizer CIA" ) at 1, ECF No. 22-1. This CIA superseded a prior CIA that Pfizer had entered with HHS' OIG in October 2002. Id. " Among other things, the CIA required Pfizer to implement, update and/or review its policies and procedures relating to compliance with relevant federal regulations," and to submit to the OIG annually over the five-year period while the CIA was in force an Annual Report that addressed at least twenty enumerated items. Nowicki Decl. ¶ 4; Pfizer CIA at 24-27. Pfizer claims these annual reports " contain highly sensitive, confidential commercial information," and, consequently, marked the documents submitted as " Confidential and FOIA Exempt." Nowicki Decl. ¶ 14. The 2004 Agreement expired in 2009. [2] Id. ¶ 4.

In May 2007, Purdue entered into a CIA with HHS " contemporaneously with a settlement agreement between Purdue and the United States which resolved an investigation by the U.S. Attorney . . . over Purdue's marketing of OxyContin(r)

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Tablets." Decl. of Bert Weinstein, Purdue Vice President of Corporate Compliance, (" Weinstein Decl." ) ¶ ¶ 1, 4, ECF No. 22-2. " Purdue has been required to . . . submit[] its Annual Reports to HHS each year since 2007" as part of its obligations under the CIA. Id. ¶ 1. Purdue also claims these reports contain " highly confidential and proprietary information," and, consequently, marked the Annual Reports at issue as " Confidential and FOIA Exempt." Id. ¶ ¶ 1, 9.

Both Pfizer and Purdue agreed to the terms set forth in their respective CIAs with the OIG " as part of the resolution of civil and administrative health care fraud cases." Demske Decl. ¶ 2. They both contain the standard provisions that " the OIG agrees not to seek an exclusion of that entity from participation in Federal health care programs," on condition that the company subject to the CIA " adopts measures designed to promote compliance," with Federal laws and regulations, including " hiring [] a compliance officer, establish[ing] a code of conduct and policies and procedures, employee training, confidential disclosure mechanisms, and reporting of violations of law." Id. Also, both CIAs require review of the company's compliance with these measures by an independent party, called an Independent Review Organization (" IRO" ), which submits annually to the company a report " addressing the requirements of the CIA and including the results of the audits and reviews." Id. ¶ 3. The IRO Report is later submitted to the HHS as part of the company's Annual Report, along with any responses to IRO Report's findings from the company. Id. ; Purdue CIA at 28; Pfizer CIA at 25. The CIAs themselves are posted on the HHS website. Demske Decl. ¶ 3.

As part of the CIAs, the companies are given the opportunity to " clearly identify any portions of its submissions that it believes are trade secrets, or information that is commercial or financial and privileged or confidential, and therefore potentially exempt from disclosure under the Freedom of Information Act (FOIA), 5 U.S.C. § 552." Def. Mot. Summ J., Ex. 6 (" Corporate Integrity Agreement between the [OIG] of the [HHS] and Purdue Pharma L.P." ) (" Purdue CIA" ) at 30, ECF No. 22-2; see also Pfizer CIA at 28. At the same time, the CIAs direct that the company " shall refrain from identifying any information as exempt from disclosure if that information does not meet the criteria for exemption from disclosure under FOIA." Id. HHS is not obligated to accept the companies' designation of any document as FOIA exempt. Indeed, based on the materials released, HHS disagreed with the companies' designations, at least in part, with respect to certain documents, which have been partially released to the plaintiff. See, e.g., Declaration of Julie A. Murray, Counsel for Public Citizen, (" Murray Decl." ) Ex 3 Attachs. A, D, E, F, G, H, ECF No. 26-3 (released documents bearing legend " Confidential and FOIA Exempt." ). [3]

B. The Plaintiff's FOIA Request

On November 12, 2009, the plaintiff submitted a FOIA request to HHS seeking

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" all annual reports submitted to the [OIG] by Purdue Pharma L.P. pursuant to the May 2007 Corporate Integrity Agreement between OIG and Purdue Pharma L.P," and " by Pfizer, Inc. pursuant to the May 2004 Corporate Integrity Agreement between OIG and Pfizer." Decl. of Robin R. Brooks, HHS OIG FOIA Officer, (" Brooks Decl." ) Ex. A at 1, ECF No. 22-1. [4] In response, HHS conducted a search of its CIA database and " the Compliance File room where active compliance case files and Implementation and Annual Reports are maintained." Brooks Decl. ¶ 13. HHS's FOIA liaison also " confirmed with the attorneys monitoring the CIA's [sic] that all responsive records had been accounted for." Id.

Under Executive Order 12,600, HHS was required to " notify submitters of records containing confidential commercial information . . . when those records are requested under the [FOIA]." 52 Fed. Reg. 23,781 § 1 (June. 23, 1987). HHS regulations also require such a " predisclosure notification." See 45 C.F.R. § 5.65(d); Brooks Decl. ¶ 24. Consequently, HHS notified Pfizer and Purdue of the plaintiff's request and consulted with them " regarding the release of their information." Brooks Decl. ¶ 24.

On June 22, 2010, HHS notified the plaintiff that it had " located 1177 pages of records responsive" to the Purdue portion of the FOIA request. Brooks Decl. Ex. J. Of those pages, 1,093 were withheld in their entirety under FOIA Exemptions 4 and 6, see 5 U.S.C. § § 552(b)(4), (b)(6), while 84 pages were partially released with portions redacted under the same exemptions. Id. With respect to the Pfizer portion of the FOIA request, HHS notified the plaintiff, on September 21, 2010, that 9,432 pages of responsive records had been located, with 5,216 pages withheld in their entirety as well as portions of 4,216 pages, under FOIA Exemptions 4 and 6. Brooks Decl. Ex. L; see also Fed. Def.'s Combined Reply Supp. Def.'s Mot. Summ. J. and Opp'n to Pl.'s Cross Motion for Summ J. (" Def.'s Reply" ) at 2, ECF No. 29 (noting that search " netted more than 9000 pages of records and more than 4,200 of those pages were released to the plaintiff, with portions withheld under Exemptions 4 and 6" ). The plaintiff appealed these withholding determinations under Exemptions 4 and 6 to HHS. See Brooks Decl. Exs. K, M. On April 12, 2011, HHS denied the plaintiff's appeal of the Purdue withholdings and redactions. Brooks Decl. Ex. N. " A decision was not made on the appeal regarding Pfizer's documents prior to the filing of this lawsuit." Brooks Decl. ¶ 20.

C. Procedural History

The plaintiff filed the instant lawsuit on September 16, 2011, against HHS. See Compl. ¶ 1. The unopposed motions of Pfizer and Purdue to intervene were granted on November 18 and December 7, 2011, respectively. See Minute Orders dated November 18, 2011 and Dec. 7, 2011. HHS thereafter filed two Vaughn indices, one pertaining to Pfizer and one pertaining to Purdue, on March 7, 2012. See Vaughn Index of Withheld Pfizer Inc. Documents (" Pfizer Vaughn Index" ), ECF No. 18; Vaughn Index of Withheld Purdue Pharma L.P. Documents (" Purdue Vaughn Index" ), ECF No. 19.

The plaintiff now challenges the adequacy of HHS's search for " Pfizer IRO responses and corrective action plans," which the plaintiff claims " were not clearly identified in the Vaughn Index of withheld

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Pfizer documents." Pl.'s Mem. Supp. Pl.'s Mot. Summ. J. and Opp'n to Def.'s and Def.-Intervenor's Mots. Summ. J. (" Pl.'s Mem." ) at 38, ECF No. 26. In addition, the plaintiff challenges HHS's withholdings under Exemptions 4 and 6 of the following eight categories of records included in the Annual Reports: (1) " Reportable Events" ; [5] (2) Disclosure Log summaries; [6] (3) screening and removal of Ineligible Persons; [7] (4) summaries of government investigations or legal proceedings; (5) communications with the Food and Drug Administration (" FDA" ) about off-label promotion; (6) portions of Pfizer's off-label findings and detailing sessions; [8] (7) portions of IRO reports pertaining to, inter alia, the IRO's findings and recommendations, the companies' compliance programs, " corrective action taken by the company," and the " IRO's description of the company's systems, policies, procedures, and practices," Pl.'s Mem. at 28-29; [9] and (8) Purdue's supplement, dated June 18, 2009, to its first Annual Report, which was submitted on September 25, 2008 (" 2009 Purdue Supplement" ). [10] See Pl.'s Mem. at 9-13 & n.3, ECF No. 27.

With the exception of the 2009 Purdue Supplement, the parties have not identified the specific documents in the Vaughn indices that are covered by each of the broad

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challenged categories and, thus, has left the Court to speculate as to which specific withheld documents are actually at issue in this lawsuit and which documents the parties agree were appropriately withheld. Certainly, the combined use Vaughn indices and detailed declarations is an acceptable practice for an agency to justify its application of an exemption. See Judicial Watch, Inc. v. FDA, 449 F.3d 141, 148 (D.C. Cir. 2006) ( agency's " decision to tie each document to one or more claimed exemptions in its index and then summarize the commonalities of the documents in a supporting affidavit is a legitimate way of serving the same functions" of the Vaughn index by " organiz[ing] the withheld documents in a way that facilitates litigant challenges and court review of the agency's withholdings" ). Nevertheless, the declarations are most helpful when tied to the specific documents described in the indices. See id. at 150 (remanding case for further explanation, noting that " [p]roving the merits of the exemption does no good if the court cannot tie the affidavits to the documents" ); Judicial Watch, Inc. v. U.S. Dep't of Justice, 800 F.Supp.2d 202, 214 (D.D.C. 2011) (finding " that the DOJ's Vaughn indices and declarations are adequate" where " declarations work in conjunction with the Vaughn indices by dividing the withheld documents into specific categories based on the nature of the document (the category numbers are cross-referenced accordingly in the Vaughn indices), linking each category (and in turn each document) to a particular FOIA exemption, and articulating what the documents in each group reflect and why they fall within the specified FOIA exemption" ). The lack of specificity in this case regarding both the identification of withheld documents in the Vaughn indices that are at issue and the precise connection between the documents discussed in the declarations and the documents listed in the Vaughn indices, has significantly complicated the Court's task of resolving the plaintiff's challenge.


Congress enacted the FOIA as a means " to open agency action to the light of public scrutiny." Am. Civil Liberties Union v. U.S. Dep't of Justice, 655 F.3d 1, 5, 398 U.S.App. D.C. 1 (D.C. Cir. 2011) (quoting Dep't of Air Force v. Rose, 425 U.S. 352, 361, 96 S.Ct. 1592, 48 L.Ed.2d 11 (1976)). As the Supreme Court has " consistently recognized [] the basic objective of the Act is disclosure." Chrysler Corp. v. Brown, 441 U.S. 281, 290, 99 S.Ct. 1705, 60 L.Ed.2d 208 (1979). At the same time, the statute represents a " balance [of] the public's interest in governmental transparency against legitimate governmental and private interests that could be harmed by release of certain types of information." United Techs. Corp. v. U.S. Dep't of Def., 601 F.3d 557, 559, 390 U.S.App. D.C. 136 (D.C. Cir. 2010) (" United Technologies " ) (internal citations omitted). Reflecting that balance, the FOIA contains nine exemptions set forth in 5 U.S.C. § 552(b), which " are explicitly made exclusive and must be narrowly construed." Milner v. U.S. Dep't of Navy, 131 S.Ct. 1259, 1262, 179 L.Ed.2d 268 (2011) (internal quotations and citations omitted) (citing FBI v. Abramson, 456 U.S. 615, 630, 102 S.Ct. 2054, 72 L.Ed.2d 376 (1982)); see also Pub. Citizen v. Ofc. of Mgmt. and Budget, 598 F.3d 865, 869, 389 U.S.App. D.C. 356 (D.C. Cir. 2010). " [T]hese limited exemptions do not obscure the basic policy that disclosure, not secrecy, is the dominant objective of the Act." Rose, 425 U.S. at 361.

The agency invoking an exemption to the FOIA has the burden " to establish that the requested information is exempt." Fed. Open Market Comm. of Fed. Reserve Sys. v. Merrill, 443 U.S. 340, 351-352, 99

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S.Ct. 2800, 61 L.Ed.2d 587 (1979); see also Assassination Archives & Research Ctr. v. CIA, 334 F.3d 55, 57, 357 U.S.App. D.C. 217 (D.C. Cir. 2003) (holding that the agency " bears the burden of establishing the applicability of the claimed exemption" ). In order to carry this burden, an agency must submit sufficiently detailed affidavits or declarations, a Vaughn index of the withheld documents, or both, to demonstrate that the government has analyzed carefully any material withheld, to enable the court to fulfill its duty of ruling on the applicability of the exemption, and to enable the adversary system to operate by giving the requester as much information as possible, on the basis of which he can present his case to the trial court. Oglesby v. United States Dep't of the Army, 79 F.3d 1172, 1176, 316 U.S.App. D.C. 372 (D.C. Cir. 1996) (" The description and explanation the agency offers should reveal as much detail as possible as to the nature of the document, without actually disclosing information that deserves protection...[which] serves the purpose of providing the requestor with a realistic opportunity to challenge the agency's decision." ); Tax Analysts v. IRS, 410 F.3d 715, 720, 366 U.S.App. D.C. 208 (D.C. Cir. 2005) (noting that, to avoid voluminous Vaughn index submissions, court permissibly relied on a mix of deposition testimony, declarations, a Vaughn index, and in camera review to evaluate agency's withholding determinations).

A district court must review the Vaughn index and any supporting declarations " to verify the validity of each claimed exemption." Summers v. Dep't of Justice, 140 F.3d 1077, 1080, 329 U.S.App. D.C. 358 (D.C. Cir. 1998). The FOIA provides federal courts with the power to " enjoin the agency from withholding records and to order the production of any agency records improperly withheld from the complainant." 5 U.S.C. 552(a)(4)(B). Moreover, a district court has an " affirmative duty" to consider whether the agency has produced all segregable, non-exempt information. Elliott v. U.S. Dep't of Agric., 596 F.3d 842, 851, 389 U.S.App. D.C. 272 (D.C. Cir. 2010) (referring to court's " affirmative duty to consider the segregability issue sua sponte " ) (quoting Morley v. CIA, 508 F.3d 1108, 1123, 378 U.S.App. D.C. 411 (D.C. Cir. 2007)); Stolt-Nielsen Transp. Group LTD. v. United States, 534 F.3d 728, 733-735, 383 U.S.App. D.C. 1 (D.C. Cir. 2008) (" '[b]efore approving the application of a FOIA exemption, the district court must make specific findings of segregability regarding the documents to be withheld'" ) (quoting Sussman v. U.S. Marshals Service, 494 F.3d 1106, 1116, 377 U.S.App. D.C. 460 (D.C. Cir. 2007)); Trans-Pacific Policing Agreement v. U.S. Customs Serv., 177 F.3d 1022, 1027-1028, 336 U.S.App. D.C. 189 (D.C. Cir. 1999) (" we believe that the District Court had an affirmative duty to consider the segregability issue sua sponte... even if the issue has not been specifically raised by the FOIA plaintiff" ); see also 5 U.S.C. § 552(b) (" Any reasonably segregable portion of a record shall be provided to any person requesting such record after deletion of the portions which are exempt under this subsection." ).

Summary judgment is appropriate when " there is no genuine dispute as to any material fact." Fed.R.Civ.P. 56. " In FOIA cases, '[s]ummary judgment may be granted on the basis of agency affidavits if they contain reasonable specificity of detail rather than merely conclusory statements, and if they are not called into question by contradictory evidence in the record or by evidence of agency bad faith.'"

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Judicial Watch, Inc. v. U.S. Secret Serv., 726 F.3d 208, 406 U.S.App. D.C. 440 (D.C. Cir. 2013) (quoting Consumer Fed'n of Am. v. U.S. Dep't of Agric., 455 F.3d 283, 287, 372 U.S.App. D.C. 198 (D.C. Cir. 2006) and Gallant v. NLRB, 26 F.3d 168, 171, 307 U.S.App. D.C. 27 (D.C. Cir. 1994)). " Ultimately, an agency's justification for invoking a FOIA exemption is sufficient if it appears 'logical' or 'plausible.'" Judicial Watch, Inc. v. U.S. Dep't of Defense, 715 F.3d 937, 941, 404 U.S.App. D.C. 462 (D.C. Cir. 2013) (quoting ACLU v. U.S. Dep't of Defense, 628 F.3d 612, 619 (D.C. Cir. 2011)); Larson v. U.S. Dep't of State, 565 F.3d 857, 862, 385 U.S.App. D.C. 394 (D.C. Cir. 2009) (quoting Wolf v. CIA, 473 F.3d 370, 374-75, 374 U.S.App. D.C. 230 (D.C. Cir 2007)).


The plaintiff raises two issues regarding HHS's response to its FOIA request: the adequacy of the defendant's search and the appropriateness of the Exemption 4 withholdings. [11]Ea ...

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