Court finds disclosure benefits can outweigh privacy interests

D.C. CIRCUIT–A federal appeals panel in early January altered the balancing test of public and private interests invoked by the government to determine whether it should invoke the privacy exemption to the Freedom of Information Act.

The court ruled unanimously that Robert Lepelletier Jr., an independent ‘money finder’ who is seeking individuals owed monies by the Federal Deposit Insurance Corporation, may be able to obtain their names and addresses under the FOI Act so that he can inform them that they are entitled to unclaimed deposits they own at three banks now in FDIC receivership.

Reversing a September 1997 decision of the federal District Court in Washington D.C., the panel wrote that it is “overly paternalistic” to insist upon protecting an individual’s privacy interest “when there is good reason to believe that he or she would rather have both the publicity and the money than have neither.”

The court said that any FOI Act analysis under the privacy exemption to the FOI Act (Exemption 6) must “include consideration of any interest the individual might have in the release of the information.”

The appeals court first noted U.S. Supreme Court rulings that the only public interest that can be considered in the privacy and public interest balancing test is whether release of the information would tell the public what the government is “up to.” Under that standard there is no public interest in disclosure of the names Lepelletier sought, the appeals court said. It also noted some privacy interest of the individuals in avoiding release of their names and addresses.

But for Lepelletier’s case it rejected its holding in previous cases that the privacy exemption must be invoked even for minimal privacy interests, if there is no public interest found for disclosure.

Under an agreement with the FDIC in 1994, Lepelletier advised the agency how to recover funds belonging to three failed banks. After the agreement ended he sought names of depositors with unclaimed deposits at the three banks through the FOI Act. The agency refused to give him those names unless the deposits belonged to governmental entities or deceased individuals.

Lepelletier sued in the federal District Court in Washington, D.C. It ordered the FDIC to provide him with corporate depositors’ records but ruled that the privacy exemption protected names of individual depositors.

The appeals court sent the case back to the federal District Court to determine whether Lepelletier’s location of the individuals would provide them their first notice of entitlement to monies held by the agency. Individuals might have a privacy interest in avoiding repeated notification of the matter, but learning for the first time that monies are owed them would “outweigh” any privacy interest, the court said. (Lepelletier v. FDIC; Counsel: Amicus counsel appointed to assist Lepelletier: Allison Zieve, Washington, D.C.)