!R! CALL BCA; EXIT; _______________________________________________ DISCOVERY ORDER: August 10, 1995 _______________________________________________ GSBCA 12823-COM UNISYS CORPORATION, Appellant, v. DEPARTMENT OF COMMERCE, Respondent. Michael R. Charness of McDermott, Will & Emery, Washington, DC; and J. Eric Andr of Howrey & Simon, Washington, DC, counsel for Appellant. Jerry A. Walz, Steven Carrara, Roxie Jamison Jones, Terry Hart Lee, and Cecilia Carson, Office of the Assistant General Counsel for Finance and Litigation, Department of Commerce, Washington, DC, counsel for Respondent. BORWICK, Board Judge. ORDER Genesis of claim of deliberative process privilege Respondent, Department of Commerce, has submitted to this Board sixty-five documents from its Office of Inspector General (OIG) for in camera review, claiming that the deliberative process privilege shields them in whole or in part from production. The claim of deliberative process privilege arises from OIG inspection and investigation of purchase of spare parts under the NEXRAD (Next Generation Weather Radar) contract. According to the Inspector General (IG), in March and April of 1993 his office was informed that respondent might be paying too high a price for spare parts under that contract. The spare parts were purchased through Unisys, the prime contractor, from Concurrent Computer Corporation (Concurrent), a subcontractor. Affidavit of Francis D. DeGeorge, Inspector General, Department of Commerce (DeGeorge Affidavit) (Dec. 14, 1994) 4. As part of its review, the OIG's Systems Evaluation Division (SED) conducted an inspection of the respondent's procurement of spare parts from the NEXRAD program. DeGeorge Affidavit 4. This inspection resulted in SED Report 5979-4-001, Missed Opportunities for Significant Savings in the Acquisition of NEXRAD Spare Parts (the SED report). Id. at 2 n. 1. Auditors from the OIG's Denver Regional Office of Audits and a procurement analyst from the SED assisted the contracting officer for the NEXRAD contract in determining fair and reasonable prices for spare parts, covered by Modifications 77, 111, and 122. Id. 4. The auditors' and analysts' findings are contained in an audit report DEN-5757-4- 0001, Unisys Corporation: Review of NEXRAD Spare Parts Pricing, NOAA Contract 50-DMNW-8-00032 (the audit report). Id. at 2 n. 2. Finally, on October 17, 1993, the OIG's Office of Investigations opened an investigation into Concurrent's sale of spare parts "to the Government." Id. The SED report The SED report is an examination of problems with the administration of the NEXRAD contract, and contains recommended solutions for the problems. Respondent's In Camera Exhibit 60. The executive summary of the SED report made six observations. (1) The Join Systems Program Office (JSPO)[foot #] 1 had not paid adequate attention to logistics planning, and had been resistant to breaking out (i.e., competitive procurement) of spare parts. Id. at ii. (2) JSPO had not given breakout the priority it deserves. Id. at iii. (3) JSPO and the contractor had not paid enough attention to configuration management, i.e., knowledge and control of the functional and physical characteristics of the system. Id. (4) Long term logistics roles and responsibilities were well defined, but problems existed, i.e., there was not a consistent approach among organizations for incorporating parts use data into the number and types of spare parts needed at sites and the depot. Id. (5) Contractual flaws and weak contract administration could inflate spare parts cost. Id. This observation involved slow turnaround times by the contractor on some parts being repaired under contract warranty; the slow turnaround time resulted in emergency procurements under the Interim Contractor Support portion of the contract, inflating costs. (6) The contract clause for discontinuance of equipment was awkward and potentially very expensive. Id. The report contained seven recommendations: (1) that the Deputy Under Secretary for Oceans and Atmosphere appoint a senior manager to manage all aspects of spare parts planning and procurement. Respondent's In Camera Exhibit 60 at 17. That the Systems Program Office be directed to: (2) promptly identify and resolve outstanding NEXRAD configuration management issues; (3) ----------- FOOTNOTE BEGINS --------- [foot #] 1 JSPO is responsible for acquisition and deployment of NEXRAD systems. SED Report at i. ----------- FOOTNOTE ENDS ----------- determine the source and extent of revision level incompatibilities and formulate a solution to those incompatibilities; (4) clarify criteria for Class I and II engineering changes, and direct DPRO to consult with operational support facility representatives before accepting engineering change proposals from Unisys; (5) ensure the quality of system allocation documents; (6) ensure that parts usage data are appropriately and consistently used in determining the number and type of spare parts to be procured while systems are being deployed; and (7) ensure that interim contractor support task orders are properly administered and spare parts purchased under this contract are identified and costs tracked. Id. The OIG released the SED report to the Deputy Undersecretary for Oceans and Atmosphere, with copies to five other senior officials: the Under Secretary for Oceans and Atmosphere, the NEXRAD program manager, the Assistant Administrator, National Weather Service (NWS), the Director, NWS Office of Systems Operations and the Director of the Systems Program Office. Respondent's In Camera Exhibit 60. Unisys states that respondent has released draft and final versions of the SED report and the audit report to Unisys. Unisys s Response to Respondent s Assertion of Deliberative Process Privilege at 8. Respondent does not dispute that these documents have been released. Documents which respondent claims should be withheld in their entirety Respondent had originally presented its claim of deliberative process privilege for sixty-five documents. Documents 1 to 42, 43 to 51, 52-55, 56-59, 62-65 and 67 are OIG documents which served to provide facts or information used in the creation of SED Report 5979 or DEN 5757. Respondent's Reply to Appellant's Response to Respondent's Assertion of Deliberative Process Privilege (Respondent's Reply) at 8. While the OIG affidavit referenced withholding in their entirety documents 1- 42, respondent has refined its claim to seek the entire withholding of documents numbered 3, 5-13, 16-17, 23-24, 26, 28, 31, 37. For those documents, the IG claims that they should be withheld in their entirety because: the above referenced documents, which contain pre- decisional analysis, advice, opinions, comments, conclusions and recommendations, consist in large part of notes taken by OIG inspectors of conversations they had with various NOAA officials as they were doing the field work which ultimately resulted in SED Report 5979-4-001. The credibility of the OIG and its ability to gather information depends on the OIG's ability to protect its sources of information. Judith Gordon, Assistant Inspector General for Systems Evaluation, has told me that her staff members routinely tell the DOC employees with whom they meet during the course of inspection work that anything the employees tell the OIG will be confidential. In the case of [the SED report] such promises of confidentiality were necessary in order to allay any fear of retribution that NOAA officials interviewed by the inspection team might have had if they spoke candidly with the OIG and criticized the way in which the Department was then acquiring spare parts for the NEXRAD program. Without a free exchange of ideas and information between the NOAA officials involved in the procurement of NEXRAD spare parts and the OIG inspection team, the inspection team would not have been able to adequately assess the Department's acquisition of spare parts for the NEXRAD program and would therefore have been unable to fulfill its mission by formulating recommendations to improve that process. DeGeorge Affidavit 8. We have reviewed the documents in camera and briefly summarize each document respondent seeks to withhold in its entirety. Document three Document three is an OIG summary of salient points of meetings and/or phone conferences with NOAA officials in connection with the preparation of SED Report 5979-4-001. Document five Document five is the OIG's handwritten notes of conversations with NOAA officials as to deficiencies in administering the NEXRAD contract. The individuals criticize NEXRAD program offices for failing to enforce contract clauses and for lack of configuration control in contract administration. Document six Document six is the OIG's handwritten notes of conversations with NEXRAD program officials who criticize inadequate system documentation, and lack of documentation except for revision level problems. This document reflects a dispute over whether revision levels of parts is a significant issue in administering the NEXRAD contract. Document seven Document seven is the OIG's handwritten notes of conversations with NOAA officials, concerning areas of contract administration: i.e., the difficulty of determining what parts are in the field, whether "breakout" of spare parts could help with the revision level problems, the difficulty in determining what constituted a part failure, staff workloads as a result of contract and procurement cycles, budget problems, the treatment of Concurrent in light of the aforementioned problems, and the circumstances of the issuance of modification 122. Document eight Document eight is the OIG's typed notes of meetings and phone conversations with personnel from a NEXRAD office concerning that office's plans for purchases of spare parts. Document nine Document nine, entitled "NEXRAD Spare Parts Breakout Planning and Analysis, is a series of questions and answers as to the steps to be taken to manage the breakout of spare parts. This document identifies Concurrent as the subcontractor responsible for revision level problem in parts. Document ten Document ten is the OIG's handwritten notes of an August 9, 1993, meeting with NOAA officials regarding staffing for breakout of spare parts, the lack of documentation of revision level problems save for the optical disk controller and logistics and maintenance expenditures for parts. Document eleven This handwritten note of conversations with named individuals, who identify Concurrent as the "biggest culprit" with revision level problems, and the type I, II, and III subassemblies as major problems with the configuration management plan. The note discusses tracking changes to the baseline NEXRAD system, and efforts to develop alternative sources for spare parts. Document twelve This document sets forth a series of contract management issues--configuration management, revision level problems, processes for contract changes--and identifies problem parts of the NEXRAD to be addressed. Document thirteen This handwritten note of telephone conversations with named individuals documents issues of funding for spares and volatility of design as affecting the ability to break out procurement of spare parts. Documents sixteen and seventeen Document sixteen contains hand-written notes of conversations with named individuals who discuss contractor performance regarding system allocation documents, configuration management, and reasons for certain NEXRAD offices' resistance to breakout of procurement of spare parts. Document seventeen is handwritten notes which served as a basis for compiling document sixteen. Documents twenty-three and twenty-four Document twenty-three is type-written notes of conversations with named individuals discussing contractor performance regarding configuration management and repair times. The note also reflects criticism of certain NEXRAD offices for lack of attention to revision levels. Document twenty-four is handwritten notes serving as a backup for document twenty-three. Document twenty-six Document twenty-six is an exit interview discussing the contractor s improvement in revision level problems and the possibility of a NEXRAD program office assisting the contractor in classification. Document twenty-eight Document twenty-eight is hand-written notes discussing lack of structure in the chain of command of certain NEXRAD offices, the contractor s configuration management plan, and breakout as a help to revision level problems. Document Thirty-one This consists of hand-written notes discussing problems in budgeting the breaking out of spare parts, potential sources of parts other than Concurrent, criticism of JSPO for not developing a breakout plan, and criticism of the contractor for not qualifying a second source. Document Thirty-seven This document consists of hand-written notes discussing development of a breakout plan, the necessity of obtaining accurate data for NEXRAD systems, and whether there are any sources of supply other than Concurrent. Unisys s procedural objections to the deliberative process privilege Unisys objects to respondent s assertion of the privilege because the Inspector General and not the Secretary of Commerce invoked the privilege. Unisys s Objection to Deliberative Process Privilege at 4. To assert the privilege, the Government must follow a specific procedure. Walsky Construction Co. v. United States, 20 Cl. Ct. 317, 320 (1990). The responsible department head or subordinate official of high delegated authority must submit an affidavit based on actual personal consideration, specifying with particularity the documents for which the protection is sought and explaining why the documents are privileged. United States v. Reynolds, 345 U.S. 1, 7-8 (1953). Given the Office of Inspector General s independent status within the Department of Commerce, 5 U.S.C. app. 3 (1988)[foot #] 2, we conclude that the Inspector General s affidavit submitted here is sufficient. Xerox Corp. v. Government Printing Office, GSBCA 12322-P, 93-3 BCA 25,936, 1993 BPD 89 (affidavit of Department of Defense Inspector General accepted, without comment, by GSBCA for purposes of invoking deliberative process privilege). Deliberative process privilege as applied to the above documents The executive privilege, based on the constitutional doctrine of separation of powers, exempts the executive from disclosure requirements applicable to the ordinary citizen or organization where such exemption is necessary to the discharge of highly important executive responsibilities involved in maintaining governmental operations. Carl Zeiss Stiftung v. V.E.B. Carl Zeiss, Jena, 40 F.R.D. 318, 324 (D.D.C. 1966), aff'd per curiam, 384 F.2d 979 (D.C. Cir.), cert. denied, 389 U.S. 952 (1967).[foot #] 3 ----------- FOOTNOTE BEGINS --------- [foot #] 2 That section provides in part: There shall be the head of each Office an Inspector General who shall be appointed by the President, by and with the advice and consent of the Senate, without regard to political affiliation . . . . Each Inspector General shall report to and be under the general supervision of the head of the establishment involved or, to the extent such authority is delegated, the officer next in rank below such heads . . . . Neither the head of the establishment nor the officer next in rank below such head shall prevent or prohibit the Inspector General from initiating, carrying out, or completing any audit or investigation. . . . [foot #] 3 The privilege extends to certain presidential activities, United States v. Nixon, 418 U.S. 683, 703 (1974), to ______________________ military and diplomatic secrets, United States v. Reynolds, 345 __________________________ U.S. 1, 7 (1953), as well as to documents integral to an appropriate exercise of the executive's domestic decisional and policy making functions, i.e., those documents reflecting advisory opinions, recommendations and deliberations comprising part of a process by which governmental decisions and policies are formulated. Kaiser Aluminum & Chemical Corp. v. United ______________________________________________ States, 157 F. Supp. 939, 944 (1958). ______ (continued...) ----------- FOOTNOTE ENDS ----------- Deliberative Process Privilege The deliberative process privilege is a subtype of the executive privilege. The deliberative process privilege encourages open, frank intra-agency expression and discussion among those responsible for formulating and adopting agency policy and decisions. Carl Zeiss Stiftung, 40 F.R.D. at 324. The standards are not different than the executive privilege, indeed, the two terms are used interchangeably. See Walsky Construction Co., 20 Cl. Ct. at 320. To maintain the privilege, the claim must first identify the policy matter for which the privilege is claimed. See Walsky Construction Co., 20 Cl. Ct. at 321; Federal Data Corp., DOTCAB 2381, et al., 91-3 BCA 24,063. Furthermore, the privilege does not cover recommendations that the agency chooses expressly to adopt or incorporate by reference in its ultimate decision. U.S. West Information Systems, Inc., GSBCA 9103-P, 87-3 BCA 20,204, at 102,346. The privilege is narrowly construed and does not encompass "factual material, summaries or commentaries on past administrative determinations or investigations of past agency acts." U.S. West Information Systems, Inc., 87-3 BCA at 102,345 (Board denied agency's executive privilege claim and ordered release of two reports containing the agency's candid views about its past performance and recommendations to improve its performance). The fact that an agency uses documents during policy discussions does not trigger the privilege. Evaluation reports that provide information or raw data are not themselves part of the decisional process. Thus, investigations conducted to evaluate agency performance are not necessarily privileged. To qualify for protection, an evaluation must directly recommend courses or prescribe options for a specific agency decision or policy change. Walsky Construction Co., 20 Cl. Ct. at 321. The matters which the deliberative process privilege protects are advisory opinions on legal and policy matters. Ingalls Shipbuilding Division, ASBCA 17717, 73-2 BCA 10,205, at 48,100. The documents which respondent seeks to withhold in their entirety--3, 5-13, 16-17, 23-24, 26, 28, 31, 37--reflect speakers candid assessments of NEXRAD offices contract administration, contractor and subcontractor performance, budget problems, and the willingness of NEXRAD officials to take corrective action in the area of contract administration. The contents of these notes anticipate the future title of the SED report--"missed opportunities"; the notes describe past ----------- FOOTNOTE BEGINS --------- [foot #] 3 (...continued) ----------- FOOTNOTE ENDS ----------- occurrences, chiefly factual matters, rather than policy recommendations for future conduct. While the notes may have been used as supporting information for the recommendations in the SED report, they are not themselves policy discussions or recommendations. In neither its submissions nor the IG's affidavit has respondent described the policy issue that allegedly is subject to the deliberative process privilege. One recurring subject in those documents which might be classified as a policy issue is the desirability of breaking out the procurement of spare parts. However, the notes focus on the difficulties of breaking out procurement of spare parts, rather than the pros and cons of breaking out their procurement as a policy matter. Furthermore, the breakout issue was discussed in the draft and final SED reports, which have been produced to Unisys. The deliberative process privilege has thus been waived as to those materials. Xerox Corp., GSBCA 12322-P, 93-3 BCA at 18,994. Respondent has produced documents 15, 18, 19, 30, 32, 42, 47, and 52 to Unisys with redactions of some statements or notations of opinion, suggestion or an inspector s or auditor s impression or recommendations. Respondent s Reply to Appellant s Response to Respondent s Assertion of Deliberative Process Privilege at 9. We have reviewed these documents and conclude that rather than policy or legal matters, the statements concern contract administration. For example, the documents recount technical reasons for difficulty of breaking out procurement of spare parts (document 18), the difficulty NEXRAD program offices faced in conducting a breakout of procurement of spare parts (document 19), contract performance by the contractor (document 52), a strategy for initial purchase of spare parts, (document 15), and the scheduling of breakout and the administrative steps necessary to accomplish the breakout (document 18). These are matters of contract administration. It is not enough to claim, as the IG does in his affidavit, that a communication is opinion. As the Armed Services Board of Contract Appeals has stated: It may well be in a particular case, especially in connection with contract disputes, that technical experts are providing to a decision-maker (such as a contracting officer) factual input of various kinds-- e.g., engineering, audit, quality assurance. Such factual information could be characterized as opinion, in the sense that any statement of fact is actually the opinion of the person making the statement, and other persons may well hold a contrary opinion. Likewise, such factual information could be characterized as advisory, in the sense that it is provided to assist the decision-maker. The 'advisory opinions' that executive privilege is designed to protect, however, contain ideas and points of view on legal and policy matters, as distinguished from factual matters. Ingalls Shipbuilding Division, 73-2 BCA at 48,100. The affidavit of the IG, furthermore, focuses more on protecting sources of information, rather than on the type of information needing protection.[foot #] 4 If protection of sources, however, were the primary goal of the deliberative process privilege, then the exception to the privilege for factual matters and commentaries on past acts would make little sense; it would be as easy to glean the identity of sources from factual information as it would be from decisions of a legal and policy nature. The source of the information does not matter so much as the character of the information itself. The deliberative process privilege is designed not to protect sources per se, as much as it is to protect the public good by shielding the decision-making processes of government agencies, thus encouraging unfettered communication in policy deliberations. Centel Federal Systems v. Department of the Navy, GSBCA 12011-P, 93-1 BCA 25,534. We do not discern in the documents from which the statement of opinions or advice have been redacted advisory opinions on legal or policy matters.[foot #] 5 Respondent admits that documents numbered 1-2, 4, 14, 20-22, 25, 29, 33-36, 38-41, 56, 58-59, 62 and 65-67 contain predominantly factual information; these documents have been produced by respondent with the exception of names of interviewees and telephone numbers. We are not troubled by redaction of telephone numbers; however, the identity of the persons who provided the information is relevant information and, for the reasons stated above, the deliberative process privilege does not protect the identity of those individuals.[foot #] 6 Respondent s claim of deliberative process privilege for the sixty-five documents is denied. We are not insensitive, however, to respondent's concern that revelation of sources to the general ----------- FOOTNOTE BEGINS --------- [foot #] 4 Respondent has not made a case that revelation to Unisys's counsel of identities of the sources for material in the SED report would result in retribution or have a chilling effect on candid communication between the OIG and respondent's employees. [foot #] 5 Respondent has not told us what parts of the documents it had redacted when it produced the documents to appellant. These documents are relevant to the pending action. They explain why Department of Commerce officials at first granted commerciality exemptions for some contract modifications for purchase of spare parts, then changed their minds and denied others. [foot #] 6 Respondent has not relied on another privilege for the protection of sources. ----------- FOOTNOTE ENDS ----------- public might have a chilling effect on the ability of the IG to have candid communications with individuals when conducting future inspections of this type. Consequently, these documents will be produced under the protective order, and will be revealed only to those persons cleared under the terms of the protective order. Xerox Corp., 93-3 BCA at 128,994. Decision Respondent's claim of deliberative process privilege is DENIED. Respondent is to release to Unisys's counsel, under the terms of the protective order, the unredacted (save for telephone numbers) versions of the sixty-five documents at issue. ________________________________ ANTHONY S. BORWICK Board Judge