Dong, Margaret v. Smithsonian Inst

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 5, 1997 Decided October 17, 1997

No. 96-5303

Margaret Dong,

Appellee

v.

Smithsonian Institution, Hirshhorn

Museum & Sculpture Garden,

Appellant

Appeal from the United States District Court

for the District of Columbia

(No. 94cv00628)

Nancy R. Page, Assistant U.S. Attorney, argued the cause

for appellant. With her on the brief was Eric H. Holder, Jr.,

U.S. Attorney at the time the brief was filed, and R. Craig

Lawrence, Assistant U.S. Attorney.

Joseph Kaplan argued the cause for appellee. With him on

the brief was John P. Mahoney.

Before: Williams, Ginsburg and Henderson, Circuit

Judges.

Opinion for the Court filed by Circuit Judge Williams.

Williams, Circuit Judge: Margaret Dong brought this

action against her employer, the Smithsonian Institution, for

damages under the Privacy Act, 5 U.S.C. s 552a. The dis-

trict court found the Smithsonian liable and awarded plaintiff

$2,500 in compensatory damages. Dong v. Smithsonian In-

stitution, 943 F. Supp. 69 (D.D.C. 1996). The Smithsonian

appeals from the district court's determination that it is an

"agency" subject to the Privacy Act. Dong v. Smithsonian

Institution, 878 F. Supp. 244 (D.D.C. 1995). Alternatively, it

argues that even if it is covered by the Act, its conduct

toward plaintiff was not "intentional or willful" as required for

imposition of damages under the Act. 5 U.S.C. s 552a(g)(4).

We reverse.

* * *

Plaintiff began working at the Hirshhorn Museum and

Sculpture Garden in 1985. She currently holds the position

of Museum Registration Specialist, which means that her

duties include serving as a courier for works of art the

Hirshhorn lends to other museums. Museum procedures

require employees to obtain permission from the director of

the Hirshhorn before acting as a courier. In September

1993, without seeking permission, plaintiff took annual leave

and accompanied the painting Circus Horse by Joan Miro

from Barcelona to the Museum of Modern Art ("MOMA") in

New York City. At trial she testified that she deliberately

failed to request approval for her trip, even though she had

never had such a request denied in the past. Apparently her

purpose was to avoid friction with a co-worker, who in her

view made trouble when plaintiff was away on courier duty,

but not when she simply took annual leave.

Rumors of plaintiff's unauthorized journey soon reached

the administrator of the Hirshhorn, Beverly Pierce, and

plaintiff's immediate supervisor, Douglas Robinson. Through

conversations with the registrar at MOMA and an employee

of New York's Metropolitan Museum of Art who had worked

at MOMA at the time of plaintiff's trip, Pierce and Robinson

eventually substantiated the story. Both supervisors testified

that they telephoned New York (rather than directly confront

plaintiff) because they were aware of tensions in the Hirsh-

horn office where plaintiff worked, and wanted to put the

rumors to rest without creating any additional workplace

difficulties. When the rumors proved true, Pierce and Robin-

son approached plaintiff, who admitted taking the trip. She

was suspended for five days.

In March 1994 plaintiff instituted this action against the

Smithsonian under the Privacy Act, which requires federal

agencies, when gathering information that may lead to an

adverse determination about an individual, to obtain that

information directly from the individual "to the greatest

extent practicable." 5 U.S.C. s 552a(e)(2); see Waters v.

Thornburgh, 888 F.2d 870 (D.C. Cir. 1989). Damages are

available under the Privacy Act for "intentional or willful"

violations. 5 U.S.C. s 552a(g)(4). The Smithsonian defended

on the theory that it is not an "agency" subject to the Act.

In the alternative, it contended that its conduct could not be

described as intentional or willful given its reasonable belief

that the Act did not apply to it. Finally, the Smithsonian

argues that even if the Privacy Act applied and even if its

understanding to the contrary were not exculpatory, Pierce

and Robinson's decision not to obtain information from the

plaintiff in the first instance stemmed from a good faith belief

that intra-office tensions rendered such a direct confrontation

impracticable.

The district court rejected all of the Smithsonian's argu-

ments. It found that the Smithsonian "has sufficient federal

ties and control, as well as independent authority, to compel a

finding of agency status under the Act." Dong, 878 F. Supp.

at 248. The district court also held that the Smithsonian had

intentionally or willfully violated the Act, saying that the

institution was put on notice of its subjection to the Privacy

Act by a 1992 district court opinion, Cotton v. Adams, 798

F. Supp. 22, 24 (D.D.C. 1992), which found it to be an agency

for the purposes of the Freedom of Information Act

("FOIA"), a statute whose definition of "agency" also governs

the Privacy Act.

Because we hold that the district court erred in finding the

Smithsonian to be an "agency" under the Privacy Act, we

reverse without reaching its "intentional or willful" defenses.

* * *

The Privacy Act requires "[e]ach agency that maintains a

system of records" to gather information about a person

directly from that person, to the greatest extent practicable.

5 U.S.C. s 552a(e)(2). The other requirements of the Act

similarly apply to "agencies." See ss 552a(b), (c), (d), (f).

Through s 552a(a)(1), the Act borrows the definition of

"agency" found in FOIA, 5 U.S.C. s 552(f).1 That definition

in turn reads as follows:

For purposes of this section, the term "agency" as de-

fined in section 551(1) of this title includes any executive

department, military department, Government corpora-

tion, Government controlled corporation, or other estab-

lishment in the executive branch of the Government

(including the Executive Office of the President), or any

independent regulatory agency.

5 U.S.C. s 552(f). Section 552a(a)(1) cross-references 5

U.S.C. s 551(1), the definition of "agency" in the Administra-

tive Procedure Act ("APA"), but does not explicitly incorpo-

rate it. Still, as the parties recognize, the Privacy Act

encompasses not only all entities covered by s 552(f) but also

all those described by s 551(1), which embraces any "authori-

ty of the Government of the United States, whether or not it

is within or subject to review by another agency." Indeed,

the additional language of s 552(f) was added to FOIA in

1974 "to encompass entities that might have eluded the APA's

definition in s 551(1)." Energy Research Foundation v. De-

fense Nuclear Facilities Safety Board, 917 F.2d 581, 583

(D.C. Cir. 1990).

__________

1 Actually, s 552a(a)(1) refers to "agency as defined in section

552(e) of this title," but s 552(e) has since been redesignated

s 552(f).

Hence, to be an agency under the Privacy Act, an entity

must fit into one of the categories set forth either in s 552(f)

or s 551(1). Because we cannot see how the Smithsonian fits

into any of them, we hold that it is not an agency for Privacy

Act purposes.

Of the categories listed in s 552(f), the only ones that

might be thought to cover the Smithsonian are "establish-

ment in the executive branch" and "Government controlled

corporation." It is plain that the Smithsonian is not an

establishment in the executive branch. To begin with, nine of

the seventeen members of its governing Board of Regents are

appointed by joint resolution of Congress, 20 U.S.C. s 43, and

six of the remaining eight are members of Congress, 20

U.S.C. s 42. (The other two are the Vice President and the

Chief Justice of the United States, id.) Moreover, there is no

evidence that the Secretary of the Smithsonian answers to

the President, or that the institution administers federal

statutes, prosecutes offenses, promulgates rules and regula-

tions (other than with respect to its own buildings and

grounds), or engages in any other typically executive activity.

Indeed, if the Smithsonian were to wield executive powers,

the method by which its Regents are appointed would appear

to violate the Constitution's separation of powers principles.

See U.S. Const., art. II, s 2, cl. 2; Buckley v. Valeo, 424 U.S.

1, 138-39 (1976) (officeholders appointed by Congress may act

only "in an area sufficiently removed from the administration

and enforcement of the public law to permit their being

performed by persons not 'Officers of the United States' ");

Metropolitan Washington Airports Authority v. Citizens for

the Abatement of Aircraft Noise, 501 U.S. 252, 275-76 (1991).

Nor is the Smithsonian a "Government controlled corpora-

tion" within the meaning of the Privacy Act. There is much

force to the Smithsonian's argument that the plain terms of

the phrase itself simply do not encompass it. In particular,

the Smithsonian contends that it is not "government-

controlled" in the day-to-day sense required by our cases, see

Rocap v. Indiek, 539 F.2d 174, 177 (D.C. Cir. 1976), and that

it is not a "corporation," but rather a testamentary trust res

denominated an "establishment" by Congress in 1846, 20

U.S.C. s 41. We find it unnecessary to address these argu-

ments, however. Section 552(f) first identifies four specific

categories--"any executive department, military department,

Government corporation, Government controlled corpora-

tion"--and then uses a catch-all phrase to encompass similar

entities not precisely fitting any of the four specific molds:

"or other establishment in the executive branch" (emphasis

added). Thus Congress evidently viewed the four specified

classes as examples of "establishments in the executive

branch," so that an entity clearly outside the executive branch

would not qualify even if it could otherwise be shoehorned

into the concept of a "Government controlled corporation." 2

This is the most logical reading of the statute; for those who

collect canons of construction it might be termed an applica-

tion of "reverse ejusdem generis (where the general term

reflects back on the more specific rather than the other way

around), [so] that the phrase 'A, B, or any other C' indicates

that A is a subset of C." United States v. Williams-Davis,

90 F.3d 490, 508-09 (D.C. Cir. 1996).3 In short, then, because

__________

2 A 1993 report of the House Committee on Government Opera-

tions takes the same view of the first four entities listed in s 552(f).

In a "Citizen's Guide" to FOIA, under the heading "The Scope of

the Freedom of Information Act," it says:

The Federal Freedom of Information Act applies to documents

held by agencies in the executive branch of the Federal Gov-

ernment. The executive branch includes cabinet departments,

military departments, government corporations, government

controlled corporations, independent regulatory agencies, and

other establishments in the executive branch.

"A Citizen's Guide on Using the Freedom of Information Act and

the Privacy Act of 1974 to Request Government Records," H.R.

Rep. No. 103-104, at 5 (1993).

3 Congress's decision to place the so-called independent regulato-

ry agencies after the catch-all phrase confirms this interpretation, in

view of the uncertain constitutional status of such agencies vis--vis

the executive branch. Compare Wiener v. United States, 357 U.S.

349, 353 (1958) (President may freely remove officials who are "part

of the Executive establishment," as opposed to "those whose tasks

the Smithsonian is not an establishment in the executive

branch, it cannot fall into any of the conceivably applicable

s 552(f) categories.

Plaintiff proposes that we read the word "includes" in

s 552(f) as an invitation to extend agency status to entities

that do not belong among the types enumerated but have

something in common with them. In support of this idea, she

points to legislative history indicating that s 552(f) was in-

tended to broaden FOIA's scope so that it would embrace

entities "which perform governmental functions and control

information of interest to the public." H.R. Rep. No. 876, 93d

Cong., 2d Sess. 8 (1974). But Congress did not back this

observation with any statutory text remotely matching its

scope, such as "governmental entity," and accordingly we

stick to the text as enacted.

We recognize, of course, that the word "includes" normally

does not introduce an exhaustive list but merely sets out

examples of some "general principle." Federal Land Bank of

St. Paul v. Bismarck Lumber Co., 314 U.S. 95, 100 (1941).

But behind s 552(f)'s enumeration there appears to be no

general principle in sight other than the one set out in

s 551(1); indeed, plaintiff points to no alternative general

principle. Moreover, as we have just said, s 552(f)'s struc-

ture indicates that Congress did perceive a unifying theme in

the four specific kinds of entity mentioned before the catch-all

clause--a theme (belonging to the executive branch) not

manifest in the Smithsonian. Accordingly, we now turn to

s 551(1).

Plaintiff asserts that the Smithsonian fits s 551(1)'s core

phrase, "authority of the Government of the United States."

In support of this proposition she marshals an impressive

array of links between the Smithsonian and the federal

government. To list the main ones: the Smithsonian oper-

ates under a federal charter granted by Congress in 1846;

__________

require absolute freedom from Executive interference") with Morri-

son v. Olson, 487 U.S. 654, 687-92 (1988) (Congress may place some

limits on President's discretion to remove officials exercising execu-

tive functions).

most of its employees--some 70% according to plaintiff, Brief

for Appellee at 16 n.3--are considered federal civil service

employees; its Regents, as mentioned, are federal officials or

are selected by federal officials; it receives extensive federal

funding and must submit a detailed annual statement of its

expenditures to Congress, 20 U.S.C. s 49; it is subject to the

audit and reporting requirements of the Government Ac-

counting Office; "[a]ll moneys recovered by or accruing to

[the Smithsonian are] paid into the Treasury of the United

States, to the credit of the Smithsonian bequest, and sepa-

rately accounted for," 20 U.S.C. s 53; it enjoys federal

immunity from taxes and libel actions; it receives representa-

tion (as in this case) from the Department of Justice; and it

publishes rules and notices in the Code of Federal Regula-

tions and the Federal Register. See Dong, 878 F. Supp. at

248-49; Cotton v. Adams, 798 F. Supp. at 24.

We have already held that factors like these justify classify-

ing the Smithsonian as an "independent establishment of the

United States" for purposes of the Federal Tort Claims Act.

See Expeditions Unlimited Aquatic Enterprises, Inc. v.

Smithsonian Institution, 566 F.2d 289, 296 (D.C. Cir. 1977)

(en banc). But the statute in question here uses narrower

language; an entity may be deeply entwined with the federal

government without being an "authority of the Government of

the United States." Ultimately, then, as we said in rejecting

a similar claim, plaintiff's litany of links between the Smithso-

nian and the federal government is "like Homer's catalogue of

ships--exhaustive but quite beside the point." Meyer v.

Bush, 981 F.2d 1288, 1294 (D.C. Cir. 1993).

The term "authority" is not self-defining. At the very

least, however, it seems logical that for an entity to be an

authority of the government it must exercise some govern-

mental authority. Scholars of the APA appear to agree. As

one commentator put it, an "agency" for APA purposes is

a part of government which is generally independent in

the exercise of [its] functions and which by law has

authority to take final and binding action affecting the

rights and obligations of individuals, particularly by the

characteristic procedures of rule-making and adjudica-

tion.

James O. Freedman, "Administrative Procedure and the Con-

trol of Foreign Direct Investment," 119 U. Pa. L. Rev. 1, 9

(1970) (internal quotations omitted) (cited in Irwin Memorial

Blood Bank v. American National Red Cross, 640 F.2d 1051,

1053 (9th Cir. 1981)). See also 1 Kenneth Culp Davis &

Richard J. Pierce, Jr., Administrative Law Treatise s 1.2, at

4 (3d ed. 1994) (focusing on whether "the entity has, or lacks,

authority to take binding action"); Washington Research

Project, Inc. v. Dep't of Health, Education and Welfare, 504

F.2d 238, 248 & n.15 (D.C. Cir. 1974) (citing legislative history

of APA in support of a requirement of "final and binding

action"); J.H. Miles & Co., Inc. v. Brown, 910 F. Supp. 1138,

1159 (E.D. Va. 1995) (holding that quasi-government fisheries

council "is not an 'authority' of the U.S. Government because

it has no 'authority' to do anything").

Our cases have followed the same approach, requiring that

an entity exercise substantial independent authority before it

can be considered an agency for s 551(1) purposes. It is

quite true that, apart from its roots in the language of

s 551(1) and its legislative history, our "substantial indepen-

dent authority" test both originated in a case involving an

entity in the Executive Office of the President, Soucie v.

David, 448 F.2d 1067 (D.C. Cir. 1971) (Office of Science and

Technology), and has most often been applied in the case of

such entities, see Armstrong v. Executive Office of the Presi-

dent, 90 F.3d 553 (D.C. Cir. 1996) (National Security Council);

Meyer, 981 F.2d at 1291-98 (Task Force on Regulatory

Reform); Rushforth v. Council of Economic Advisers, 762

F.2d 1038, 1040-43 (D.C. Cir. 1985) (Council of Economic

Advisers); Pacific Legal Foundation v. Council on Environ-

mental Quality, 636 F.2d 1259, 1263 (D.C. Cir. 1980) (Council

on Environmental Quality); cf. Sweetland v. Walters, 60 F.3d

852 (D.C. Cir. 1995) (Executive Residence of the President,

deemed "analogous" to a unit of the Executive Office of the

President). In such cases, naturally, much of the focus was

on the independence aspect of the formula, since obviously

the President exercises authority, and those who have his ear

must at a minimum possess some degree of derivative author-

ity. But the requirement of authority derives both from the

statutory language itself and from legislative history charac-

terizing the requisite type of authority ("final and binding,"

see H.R. Rep. No. 1980, 79th Cong., 2d Sess., at 19 (1946),

cited in Washington Research Project, 504 F.2d at 248-49

n.15), and we have applied the requirement in at least two

cases not involving presidential power at all. In Energy

Research Foundation we applied it to the Defense Nuclear

Facilities Safety Board, 917 F.2d at 584-85 (finding it covered

because of its investigative and evaluative powers), and in

Washington Research Project we held that "initial research

groups," scholars appointed by the National Institute of

Mental Health primarily from outside NIMH to conduct peer

review of grant applications, were not agencies under the

FOIA definition precisely because of their lack of authority

even to make government grants, 504 F.2d at 248.

Washington Research Project might be read to imply that

the "initial research groups," had they in fact possessed the

power to decide how federal grant money was spent, would

have been considered agencies for FOIA purposes. But we

have already warned against such a reading of that case.

"We held [in Washington Research Project] that because the

organization in question had no authority to make decisions it

was not a government agency, but the converse of that

proposition may not always be true; that an organization

makes decisions does not always mean that it is a government

agency." Public Citizen Health Research Group v. Dep't of

Health, Education and Welfare, 668 F.2d 537, 543 (D.C. Cir.

1981). In addition, in Washington Research Project we noted

that the body that was empowered to determine the allocation

of the grants in question, the National Advisory Mental

Health Council ("NAMHC"), derived this power directly from

a statute which "empower[ed] the Secretary [of Health, Edu-

cation & Welfare] to make grant awards if (and only if) the

NAMHC so recommends." Id. at 248. Plaintiff has identi-

fied no comparable delegation of authority to the Smithsonian

to control the allocation of federal research dollars, and we

know of none. To the extent that the Smithsonian devotes

part of its own budget to funding grants and fellowships, it

appears to be no different from any private research universi-

ty which receives federal funds and enjoys some control over

their use.

The Smithsonian is a cultural and research institution,

established in 1846 pursuant to a trust bequest of James

Smithson, and dedicated to "the increase and diffusion of

knowledge among men." 20 U.S.C. s 41. It does not make

binding rules of general application or determine rights and

duties through adjudication. It issues no orders and per-

forms no regulatory functions. Plaintiff's efforts to demon-

strate that the Smithsonian exercises authority focus mainly

on Congress's delegation to the institution of limited police

powers, including arrest powers, on its own grounds. See 40

U.S.C. ss 193n, 193v, 193t. She also notes that Congress has

authorized the Smithsonian to promulgate regulations in sup-

port of its power to maintain safety and order on its premises.

40 U.S.C. s 193r; see 36 CFR ss 504-20. Yet these limited

powers, which enable the Smithsonian to protect its own

collections and facilities, fall far short of converting the

Smithsonian into "an authority of the Government of the

United States." As we said recently, "the Smithsonian's

ability to hire its own police force carries little probative

weight in that many private museums employ their own

security personnel." Cotton v. Heyman, 63 F.3d 1115, 1122

(D.C. Cir. 1995).

Our cases, as noted, speak of "substantial independent

authority." They do not support the proposition that the

exercise of any independent authority, however confined,

converts an entity into an "authority of the Government of

the United States." For example, we affirmed a district

court decision that the National Academy of Sciences

("NAS") was not an "agency" under s 551(1) despite the fact

that it possessed the apparent authority--greater than any

possessed by the Smithsonian--to veto the Environmental

Protection Agency's suspension of auto emission standards.

Lombardo v. Handler, 397 F. Supp. 792, 794 (D.D.C. 1975),

aff'd, 546 F.2d 1043 (D.C. Cir. 1976). Like the NAS, the

Smithsonian simply is not the kind of "center of gravity in the

exercise of administrative power" to which s 551(1) refers.

Lombardo, 397 F. Supp. at 796 (citing Freedman, 119 U. Pa.

L. Rev. at 9).

In the most literal sense, of course, the Smithsonian's

broad, Congressionally-granted latitude over spending its fed-

erally allocated funds and over its own personnel and collec-

tions indicates that it possesses "authority in law to make

decisions." Cotton v. Heyman, 63 F.3d at 1122 (citing Wash-

ington Research Project, 504 F.2d at 248). But every private

organization possesses the power to order its own affairs and

carry out transactions with others within the limits set by

law. To the extent the Smithsonian exercises anything ap-

proaching public authority, that authority appears to be en-

tirely ancillary to its cultural and educational mission.4 Au-

thority must be governmental in nature to count for s 551(1)

purposes.

Finally, plaintiff points out that the Smithsonian is treated

as an agency under other federal statutes. Indeed, in ac-

knowledging plaintiff's extensive enumeration of governmen-

tal ties we cited the finding of Expeditions Unlimited, 556

F.2d at 296, that the Federal Tort Claims Act embraced the

Smithsonian, but pointed out that the FTCA defined "Federal

agency" broadly to include "independent establishments of

the United States." 28 U.S.C. s 2671. Unsurprisingly, the

Smithsonian is subject to other statutes whose language also

differs from that of the Privacy Act. Thus, Smithsonian

employees are covered by the Federal Employment Compen-

sation Act, which applies to employees of "instrumentalit[ies]

wholly owned by the United States," 5 U.S.C. s 8101(1)(A),

which the Smithsonian concedes it is, at least insofar as the

United States, as trustee, holds legal title to the original

Smithson trust property and later accretions. Similarly, it is

subject to the Inspector General Act ("IGA") not by virtue of

__________

4 In addition to the "on-campus" police powers mentioned above,

Congress has delegated to the Smithsonian control over certain

cultural and research facilities such as the National Zoo, see 20

U.S.C. s 81, and the Canal Zone Biological Area, a 4000-acre

tropical forest on Barro Colorado Island, see 20 U.S.C. s 79b.

any agency status, but because Congress has declared it a

"designated Federal entity" for IGA purposes, 5 U.S.C. App.

3, s 8G(a)(2). The Smithsonian's status under these other

statutes is therefore inapposite.

In sum, the Smithsonian lacks both the "authority" neces-

sary for it to qualify as an "authority of the government of

the United States" under s 551(1) and the executive depart-

ment status necessary under s 552(f).

The judgment of the district court is therefore

Reversed.