Commerce Interpreting FOIA, ECRA Too Broadly in Withholding Entity List Documents, Firm Says

The government defended its denials in its own motion for judgment, saying the withheld materials were exempt from disclosure for national security reasons.

Law firm Husch Blackwell said it filed two standard FOIA requests to obtain the Commerce Department’s final proposal to the End-User Review Committee to place two exporters, Yangtze Memory Technologies Company and Yangtze Memory Technologies Company (Japan), on the Entity List. What followed, it said, was “protracted U.S. Government noncompliance, continuing to this day.”

Commerce initially withheld all 533 pages of responsive records, the government said in its filing. When the agency later provided some of those documents, they were “all but indecipherable, littered with redactions often covering entire pages,” Husch Blackwell said.

Commerce provided some records on appeal, but it held out on handing over a large number until it was “under the pressure” of summary judgment in the court, for which the court told Commerce to provide its final determination in Husch Blackwell’s administrative appeal and the “corresponding documents,” the firm said.

While it did finally provide some of the records, Commerce also failed to fulfill its statutory duty to explain why it was refusing to disclose each withheld document, instead merely “parroting” the language of FOIA and the ECRA, the firm said. It also clearly “made no serious attempt to segregate and disclose non-exempt information,” and it didn’t provide a Vaughn Index -- a document prepared by agencies to justify not disclosing information under FOIA.

The U.S. included a Vaughn Index in its motion for judgment. It also claimed that one of its employees had conducted a line-by-line review of the withheld documents to ensure they couldn’t be segregated from nonexempt documents.

Husch Blackwell also said, during the judicial review, the government has failed procedurally on “every single account."

The government asked for an extension to file its summary judgment motion to April 15, 2025, the firm said. Four days before that deadline, it submitted a “so-called determination letter” that it called Commerce’s “final decision.” To give Husch Blackwell time to properly review the letter, the court moved the summary judgment deadline back to May 16, 2025 -- but on May 15, as the parties both said, the agency provided more responsive documents and another letter that it called the Bureau of Industry and Security's “final determination letter.”

This new communication “provided zero insight as to why a second ‘final’ letter was warranted or whether anymore ‘final’ letters were on the horizon,” Husch Blackwelll said.

The U.S. defended its refusal to provide the records in its own motion under Exemptions 1, 3, 5 and 6. Exemption 1 allows the government to withhold documents that could endanger national security; Exemption 3 exempts documents as defined by other statutes, such as ECRA; Exemption 5 exempts documents that would be non-disclosable in litigation under the attorney-client, work product or deliberative process privileges; and Exemption 6 exempts personal information.

Under Exemption 3, it withheld documents that were “central to the operations” of the End-User Review Committee (ERC), including discussions between staff regarding potential new entries to the Entity List, it said.

This was the exemption the government relied on “most heavily,” Husch Blackwell claimed. It also did so incorrectly, failing to tie these “operations” to the “specific categories enumerated in 4820(h)(1)(B)(i)-(v),” the firm said.

And the department read the statute to include anything even “tangentially” related to the operations of ECRA, it said, even though FOIA is supposed to be construed narrowly.

In particular, it said, ECRA appears to require a two-part test: First, information must be “submitted or obtained in connection with a license or other authorization to export” products to the U.S. under the law. Second, the information must fall into one of the categories described in 4820(h)(1)(B)(i)-(v).

Specifically, the law states that documents “including” those described by 4820(h)(1)(B)(i)-(v) are exempt. But the word “including” should be read to mean “consists of” -- in other words, as preceding an exhaustive, not illustrative, list. Finding otherwise would grant the government “limitless withholding authority,” it said.

Under Exemption 5, meanwhile, the government withheld communications between BIS and its legal counsel, such as proposed edits, and “information prepared by BIS attorneys in reasonable anticipation of litigation because additions to the Entity List are routinely challenged through litigation.” It also refused to disclose predecisional deliberative documents, it said.

Husch Blackwell argued that it was looking for the final proposal submitted to ERC, “not the deliberations leading up to it,” and said the U.S. hadn’t provided enough explanation to demonstrate why the withheld documents were exempt.

The government also said that the one document withheld under Exemption 1 was classified as top secret. Husch Blackwell called this unsupported as well.

And under Exemption 6, it withheld a staff-level BIS employee’s phone number and email addresses of National Security Council and Executive Office of the President employees, it said. Husch Blackwell said it wasn’t disputing these exemptions.