Corporate Accountability

Supreme Court To Consider Whether Corporations Have “Personal Privacy” Rights

On Wednesday, January 19, the Supreme Court will hear argument in one of the most important business cases that the Court is hearing this Term, FCC v. AT&T, a case with potential ramifications beyond the corporate sector.  In FCC, the Court will decide whether corporations are entitled to “personal privacy” under the Freedom of Information Act (FOIA).

The facts are relatively simple: after a government investigation into whether AT&T was overcharging schools for telecommunications services, one of AT&T’s competitors sought disclosure under FOIA of some of the corporate documents that the government had obtained from AT&T as part of its investigation.  AT&T objected, and the Federal Communications Commission (FCC) agreed to protect from disclosure certain documents that would have exposed trade secrets or other sensitive corporate information, or invade the privacy of AT&T’s employees and customers.  However, the FCC refused to apply FOIA Exemption 7(C), which protects against public disclosure of law enforcement records that “could constitute an unwarranted invasion of personal privacy,”  to give corporations a right of privacy, and refused  to shield from disclosure certain additional documents that AT&T wanted withheld.  The FCC ruled that corporations do not qualify for personal privacy rights because they are not natural born persons.  Only document invading the personal privacy of AT&T’s employees and customers were properly exempt from disclosure under Exemption 7(C).  On appeal, the U.S. Court of Appeals for the Third Circuit overruled the FCC, holding instead that corporations do qualify for personal privacy rights, at least for the purposes of the FOIA exemption in question, Exemption 7(C).

In the face of corporate claims of  a right to “personal privacy”—an interest that most of us think of as applying only to living, breathing human beings—it is difficult not to recall the Court’s monumentally wrong decision last year in Citizens United, which gave corporations—never mentioned in the Constitution—the same constitutional right as “We the People” to spend money to influence the outcome of candidate elections.  Will the five-Justice majority from Citizens United go a step further and find that corporations have the same “personal privacy” interests that natural born persons do?

There is good reason to hope that they won’t. 

First, as devastating as Citizens United is for American elections and our nation’s political health, the Court’s decision in Citizens United did not overturn the many prior rulings indicating that corporations do not, in fact, have precisely the same constitutional rights as individual Americans do. For example, in Braswell v. United States (1998), the Court held that the Fifth Amendment’s Self-Incrimination Clause does not protect corporations because corporations do not have the inherent dignity interests protected by the Clause.  Such cases are still good law, and given that conservative Justices like Chief Justice John Roberts and Justice Samuel Alito claim fealty to existing precedent, these cases should provide strong support for the FCC’s argument that the concept of “personal privacy” does not include the commercial interests of artificial, corporate entities.  “Personal privacy,” like the privilege against self-incrimination, is an individual dignity interest that corporations are not capable of possessing.

Second, while AT&T points out that the Administrative Procedure Act (APA), of which FOIA is a part, defines the term “person” to include corporations, there are strong statutory arguments made by the Solicitor General and amici that the term “personal privacy” has a distinct meaning.  While the Court may very well decide this case based solely on the text, structure and drafting history of FOIA and the APA, it might also be helped to the correct decision by looking to the way it has dealt with similar issues under the Constitution throughout our nation’s history.

As a brief filed by CAC explains, the Constitution, like the APA, uses the term “persons” (not “corporations”), and the Court, like Congress, has held in a number of contexts that corporations can be treated as “persons” for some purposes related to their legitimate business interests.  But, throughout our history, the Court has also treated corporations as fictional persons—qualitatively different from human beings—and consistently held that only living, breathing human beings possess the dignity interests protected by privacy rights.  FOIA, like our Constitution, protects corporations and human beings differently, and for different reasons.

The Freedom of Information Act empowers ordinary citizens to access federal government records, enhancing accountability and transparency.  It would be a shame if FOIA were used as a vehicle to once again privilege corporations over individual Americans.  As purely artificial entities, corporations have no “personal privacy”—they do not have fear or shame, or feel embarrassment (although maybe some of them should); instead of personal, intimate life details they have trade secrets (which are already protected from disclosure).  At oral argument on Wednesday, we hope that when the Justices hear AT&T’s counsel assert “corporate personal privacy” interests, they find this concept as oxymoronic as we here at CAC do.