Competitive Enterprise Institute v. United States Department of the Treasury

• Court: District Court, District of Columbia
• Decided: April 2, 2018
• Docket: Civil Action No. 2012-1838
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

) COMPETITIVE ENTERPRISE ) INSTITUTE, ) ) Plaintiff, ) ) v. ) Civil Case No. 12-1838-RMC ) UNITED STATES DEPARTMENT ) OF THE TREASURY, ) ) Defendant. ) )

MEMORANDUM OPINION

The Competitive Enterprise Institute, a public policy research and education

organization, filed two identical Freedom of Information Act requests with the United States

Department of the Treasury seeking all “copies of any and all record(s) . . . using the word

‘carbon’ which were produced, sent or received by the Office of the Deputy [sic] Sercretary for

Environent and Energy [and the Office of Legislative Affairs] during 2012, from January 1, 2012

until the date you process this request.” Abigail Demopulos Decl. [Dkt. 30-3] ¶ 3. Dissatisfied

with Treasury’s response, CEI has sued. Treasury moves for summary judgment, which CEI

opposes. For the reasons stated below, the Court will grant Treasury’s motion in part and deny it

in part. For a subset of records, Treasury will be required to produce further information

concerning the “deliberative” nature of the proceedings for which it claims an exemption.

BACKGROUND

On August 8, 2012, CEI sent two materially similar FOIA requests to two

constituent components of Treasury: (1) the Office of the Deputy Assistant Secretary for

Environment and Energy (Environment and Energy); and (2) the Office of Legislative Affairs 1 (Legislative Affairs). Am. Compl. [Dkt. 8] ¶¶ 23, 24. These requests sought any and all records

“using the word ‘carbon’” produced, sent, or received between the offices during the calendar

year 2012 up until the date the FOIA requests were processed. Id. After negotiations, the parties

agreed to limit CEI’s search request to the following terms: “carbon tax”; “carbon levy”;

“carbon fee”; “carbon charge”; “carbon cap”; “price on carbon”; and “tax on carbon.” Joint

Status Report [Dkt. 15].

Using those search terms, Treasury electronically searched the hard drives, email

accounts, and shared drives of all employees in Environment and Energy. See Demopulos Decl.

[Dkt. 30-3] ¶ 7. This search located 4,163 pages of responsive records. Id. Treasury also

searched the hard drives, email accounts, and shared drives of employees in Legislative Affairs

whose assigned responsibilities, as Treasury determined, made it likely the employee might have

responsive records. Gail Harris-Berry Decl. [Dkt. 30-4] ¶ 6. Treasury manually searched a

number of PDF files whose format made electronic searching impossible. The combined

searches in Legislative Affairs returned no unique, non-duplicative records when compared to

the 4,163 located in Environment and Energy. Id. ¶ 7. Of the 4,163 responsive pages, 2,464

pages were released, in whole or in part. Treasury withheld 1,699 pages in their entirety.

CEI filed its initial Complaint in this case on November 13, 2012, and filed an

Amended Complaint November 27, 2012. After negotiations over search terms, searches, and

production, Treasury moved for summary judgment on November 2, 2015. In a Minute Order

dated July 1, 2015, the Court denied Treasury’s initial motion for summary judgment and

ordered Treasury to prepare a more detailed Vaughn Index. See Vaughn v. Rosen, 484 F.2d 820

(D.C. Cir. 1973). Treasury has now filed a Renewed Motion for Summary Judgment [Dkt. 30]

2 that includes a revised Vaughn Index. CEI opposes Treasury’s Motion, see Opp’n [Dkt. 31], and

Treasury has replied, see Reply [Dkt. 33]. The matter is now ripe for the Court’s review.

VENUE AND JURISDICTION

Section 552(a)(4)(B) of the U.S. Code grants this Court subject matter jurisdiction

over all actions brought under FOIA, and makes this an appropriate forum for venue purposes. 5

U.S.C. § 552(a)(4)(B) (“On complaint, the district court of the United States in the district in

which the complainant resides, or has his principal place of business, or in which the agency

records are situated, or in the District of Columbia, has jurisdiction to enjoin the agency from

withholding agency records and to order the production of any agency records improperly

withheld from the complainant.”); see Jones v. Nuclear Regulatory Comm’n, 654 F. Supp. 130,

131 (D.D.C. 1987).

The Court’s jurisdiction under FOIA extends only to claims arising from the

improper withholding of agency records. See 5 U.S.C. § 552(a)(4)(B); see also Lazaridis v. U.S.

Dep’t of Justice, 713 F. Supp. 2d 64, 66 (D.D.C. 2010) (citing McGehee v. CIA, 697 F.2d 1095,

1105 (D.C. Cir. 1983)).

LEGAL STANDARDS

FOIA “represents a balance struck by Congress between the public’s right to

know and the government’s legitimate interest in keeping certain information confidential.” Ctr.

for Nat’l Sec. Studies v. U.S. Dep’t of Justice, 331 F.3d 918, 925 (D.C. Cir. 2003). Under FOIA,

federal agencies must release records to the public upon request, unless one of nine statutory

exemptions apply. See NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 136 (1975); 5 U.S.C.

§ 552(b). To prevail in a FOIA case, a plaintiff must show that an agency has improperly

withheld agency records. See Odland v. FERC, 34 F. Supp. 3d 1, 13 (D.D.C. 2014). The

3 defending agency must demonstrate that its search for responsive records was adequate, that any

cited exemptions actually apply, and that any reasonably segregable non-exempt information has

been disclosed after redaction of exempt information. See id.

FOIA cases are typically and appropriately decided on summary judgment. See

Sanders v. Obama, 729 F. Supp. 2d 148, 154 (D.D.C. 2010). Under Rule 56 of the Federal Rules

of Civil Procedure, summary judgment must be granted when “the pleadings, the discovery and

disclosure materials on file, and any affidavits, show that there is no genuine issue as to any

material fact and that the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P.

56(c)(2); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986). The party moving for

summary judgment “bears the initial responsibility . . . [to] demonstrate the absence of a genuine

issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). In ruling on a

motion for summary judgment, a court must draw all justifiable inferences in favor of the

nonmoving party and accept the nonmoving party’s evidence as true. See Anderson, 477 U.S. at

255. The nonmoving party, however, must provide more than a “mere existence of a scintilla of

evidence . . . . [T]here must be evidence on which the jury could reasonably find for the

[nonmoving party].” Id. at 252.

ANALYSIS

CEI challenges the adequacy of Treasury’s search, as well as Treasury’s

designation of some records as exempt under Exemption 5, which protects “inter-agency or intra-

agency memorandums or letters which would not be available by law to a party . . . in litigation

with the agency.” 5 U.S.C. § 552(b)(5).

4 A. Adequacy of the Search

The adequacy of an agency search is measured by its reasonableness, which quite

naturally depends on the individual circumstances of each case. See Sanders, 729 F. Supp. 2d at

154 (quoting Truitt v. U.S. Dep’t of State, 897 F.2d 540, 542 (D.C. Cir. 1990)). Under FOIA,

any “requester dissatisfied with the agency’s response . . . may challenge the adequacy of the

agency’s search by filing a lawsuit in the district court after exhausting any administrative

remedies.” Valencia-Lucena v. U.S. Coast Guard, 180 F.3d 321, 326 (D.C. Cir. 1999); see also

5 U.S.C. § 552(a)(4)(B). The agency then bears the burden of demonstrating “beyond material

doubt that its search was reasonably calculated to uncover all relevant documents.” Nation

Magazine, Wash. Bureau v. U.S. Customs Serv., 71 F.3d 885, 890 (D.C. Cir. 1995).

An agency may show that its search was reasonable, such that summary judgment

in its favor is warranted, through an affidavit by a responsible agency official, “so long as the

declaration is reasonably detailed and not controverted by contrary evidence or evidence of bad

faith.” Sanders, 729 F. Supp. 2d at 155. Accordingly, affidavits that include “search methods,

locations of specific files searched, descriptions of searches of all files likely to contain

responsive documents, and names of agency personnel conducting the search are considered

sufficient.” Citizens for Responsibility & Ethics v. Nat’l Archives & Records Admin., 583 F.

Supp. 2d 146, 168 (D.D.C. 2008) (quoting Ferranti v. BATF, 177 F. Supp. 2d 41, 47 (D.D.C.

2001)).

CEI complains that Treasury found no non-duplicative responsive records in its

search in Legislative Affairs. See Opp’n at 36-42. In its view, the fact that Treasury initially

stated that it had found “no responsive records” and then said that it found “no non-duplicative

5 responsive records” is evidence of bad faith. Id. at 39. CEI further argues that it is unrealistic

that Legislative Affairs would hold no unique responsive records. Id. at 41.

CEI fails to present evidence sufficient to establish bad faith on the part of the

agency. The operative question is not whether further records could conceivably exist, or

whether other possible search avenues were available, but whether Treasury’s searches were

“reasonably calculated to uncover all relevant documents.” Nation Magazine, 71 F.3d at 890.

CEI identifies no evidence that suggests that any records were intentionally withheld, that the

files of likely record custodians were not searched, or that any responsive records held by

Legislative Affairs were not duplicative of those found at Environment and Energy. CEI’s

argument is fundamentally speculative. See Mobley v. CIA, 806 F.3d 568, 581 (D.C. Cir. 2015)

(“Agency affidavits—so long as they are ‘relatively detailed and non-conclusory’—are

‘accorded a presumption of good faith, which cannot be rebutted by purely speculative claims

about the existence and discoverability of other documents.’” (quoting SafeCard Servs. Inc. v.

SEC, 926 F.2d 1197, 1200 (D.C. Cir. 1991)). Based on the declarations submitted by Treasury,

the Court concludes that Treasury’s searches were adequate.

B. Reliance on Exemption 5

While Treasury withheld some records, in whole or in part, based on FOIA

Exemptions 1, 5, and 6. CEI challenges only the reliance on Exemption 5. See Joint Mot. to

Modify Briefing Schedule [Dkt. 22] at 2; Opp’n at 3. Exemption 5 protects “inter-agency or

intra-agency memorandums or letters which would not be available by law to a party . . . in

litigation with the agency.” 5 U.S.C. § 552(b)(5). Described as “the deliberative process

privilege,” Exemption 5 “rests on the obvious realization that officials will not communicate

candidly among themselves if each remark is a potential item of discovery . . . .” U.S. Dep’t of

6 Interior v. Klamath Water Users Protective Ass’n, 532 U.S. 1, 8-9 (2001). “[I]ts object is to

enhance the quality of agency decisions by protecting open and frank discussion among those

who make them within the Government.” Id. (internal quotations and citation omitted).

Not all internal agency records—such as those that merely restate existing

policy—are covered by FOIA Exemption 5. See Pub. Citizen, Inc. v. OMB, 598 F.3d 865, 876

(D.C. Cir. 2010). When considering whether a record is appropriately withheld under

Exemption 5, the Court looks to whether “the document is ‘predecisional,’ [i.e.,] whether it was

generated before the adoption of an agency policy[,] and whether it is ‘deliberative,’ [ i.e.,]

whether it reflects the give-and-take of the consultative process.” Coastal States Gas Corp. v.

U.S. Dep’t of Energy, 617 F.2d 1565, 1569 (D.C. Cir. 1987). “To establish that a document is

predecisional, the agency need not point to an agency final decision, but merely establish what

deliberative process is involved, and the role that the documents at issue played in that process.”

Judicial Watch, Inc., v. Export-Import Bank, 108 F. Supp. 2d 19, 35 (D.D.C. 2000). The agency

is in the best position “to know what confidentiality is needed to ‘prevent injury to the quality of

agency decisions.’” Chemical Mfgrs Ass’n v. Consumer Prod. Safety Comm’n, 600 F. Supp.

114, 118 (D.D.C. 1984) (quoting NLRB v. Sears, 421 U.S. at 151). Therefore, “[t]here should be

considerable deference to the [agency’s] judgment as to what constitutes . . . ‘part of the agency

give-and-take—of the deliberative process—by which the decision itself is made.” Id. (quoting

Vaughn v. Rosen, 523 F.2d 1136, 1144 (D.C. Cir. 1989)).

Treasury describes “five categories of documents” that it withheld as subject to

Exemption 5. These categories are: (1) multiple drafts of a proposed list of Environment and

Energy priority projects for 2012; (2) drafts of proposed policy initiatives and internal emails

discussing such draft proposals; (3) email correspondence among its staff commenting and

7 providing recommendations on how a public document might play a role in the agency’s future

policy initiatives; (4) proposed talking points, planned policy actions, or issues of possible

discussion regarding a conference or public meeting; and (5) staff comments on how past policy

proposals may inform plans for future policy initiatives. Reply at 6-7.

CEI challenges multiple aspects of Treasury’s reliance on Exemption 5. Its

complaints fall into two broad categories, namely: (1) Treasury claims Exemption 5 concerning

subjects for which it is not entitled to claim that exemption; and (2) Treasury fails its burden of

production because the justifications found on its Vaughn Index are missing names, explanations,

or other vital information.

CEI’s first objection comes in two logical subparts: (1) Treasury has no statutory

authority to regulate carbon and, therefore, (2) Treasury cannot on cite Exemption 5 at all for

records dealing with carbon taxes. Opp’n at 20. In support, CEI points to Weissman v. CIA,

which held that the CIA, which is statutorily prohibited from engaging in domestic law

enforcement, could not invoke FOIA Exemption 7, which exempts records on law enforcement

grounds. 565 F.2d 692, 696 (D.C. Cir. 1977).1 CEI argues that Treasury simply has no authority

to impose any carbon tax, and has disavowed any intention to do so, and therefore cannot assert a

deliberative process privilege relating to a carbon tax. Opp’n at 20.

This argument, and Weissman, are inapposite to this case. Even if Weissman’s

reasoning applied beyond FOIA Exemption 7—and several courts have declined to expand it,

1 CEI also cites Tax Reform Research Group v. IRS, 419 F. Supp. 415, 426 (D.D.C. 1976), which holds that agencies may not use the deliberative process to exempt records where the agency engaged in significant misconduct. This “misconduct exemption” applies only “in circumstances of extreme government wrongdoing.” ICM Registry, LLC v. U.S. Dep’t of Commerce, 538 F. Supp. 2d 130, 134 (D.D.C. 2008). CEI alleges no misconduct on Treasury’s part that would rise to the “nefarious” level necessary to trigger the misconduct exemption, and the exception does not apply here. Id. 8 see, e.g., ACLU v. CIA, 892 F. Supp. 2d 234, 244 (D.D.C. 2012)—Weissman concerned an

explicit congressional limitation on agency authority. Treasury’s authority vel non to impose a

carbon tax is not nearly as clear. Agency deliberations may be necessary to determine whether it

has authority to promulgate a particular tax or policy. Even if CEI correctly describes Treasury’s

authority, the need for staff to speak candidly and confidentially is perhaps most important when

the discussion concerns unmapped and unexplored terrain at the border of agency authority. The

Court cannot conclude, based on CEI’s submissions, that Treasury is categorically unable to

assert Exemption 5 for records that discuss a carbon tax.

The remaining issues concern CEI’s objections to the adequacy of Treasury’s

Vaughn Index. See Vaughn, 484 F.2d at 826. The purpose of a Vaughn Index is “to enable the

court and the opposing party to understand the withheld information in order to address the

merits of the claimed exemptions.” Judicial Watch, Inc. v. FDA, 449 F.3d 141, 150 (D.C. Cir.

2006). A Vaughn Index is adequate to the task if it allows the Court to “fulfill its duty of ruling

on the applicability of the exemption, and [to] enable[ ] the adversary system to operate by

giving the requester as much information as possible, on the basis of which he can present his

case to the trial court.” Keys v. U.S. Dep’t of Justice, 830 F.2d 337, 349 (D.C. Cir. 1987).

Agencies supplement their Vaughn Index with supporting affidavits, which are entitled to a

presumption of good faith. See SafeCard Servs., 926 F.2d at 1200 (“Agency affidavits are

accorded a presumption of good faith.”). The question, then, is not whether an agency’s Vaughn

Index is flawless, but rather whether the agency has “supplied the [Court] with sufficient

information to allow [it] to make a reasoned determination that [the agency was] correct.”

Coastal States Gas Corp. v. U.S. Dep’t of Energy, 617 F.2d 854, 861 (D.C. Cir. 1980).

9 With that framework in mind, the Court turns to CEI’s objections. CEI objects

that Treasury “fails to list all senders and recipients of withheld documents, rendering its

withholdings facially inadequate.” Opp’n at 2. Similarly, CEI objects to certain withheld

records on the grounds that Treasury has not established that such records are actually “intra” or

“inter-agency” records. Because Treasury has not identified all senders and recipients, CEI

argues, it is impossible to determine whether some of these records actually reflect the kind of

“internal deliberations” Exemption 5 is meant to exempt.

Such omissions are not as problematic as CEI contends. Treasury has submitted

supporting affidavits that attest to the fact that such communications were intra- or inter-agency.

See Demopulos Decl. ¶ 11 (“In all cases, exemption (b)(5) was applied solely to intra-agency or

intra-governmental communications; none of these communications [was] with third parties

outside of the federal government.”). These declarations are entitled to a presumption of good

faith and CEI has not given any reason to question that presumption here.

CEI next complains that Treasury based its claims of deliberative process

privilege on “vague, boilerplate” language, and “unjustifiably withholds documents without

tying them to policy at all.” Opp’n at 9, 26. CEI’s arguments here raise some greater concerns.

Treasury is correct in asserting that an agency need not “identify a specific decision in

connection with which a memorandum is prepared.” NLRB v. Sears, 421 U.S. at 151 n.18.

However, that exception simply acknowledges the reality that not every deliberative agency

action will result in a definable agency decision, nor will every agency employee know ahead of

time which of his statements will result in a decision. See Access Reports v. U.S. Dep’t of

Justice, 926 F.2d 1192, 1196 (D.C. Cir. 1991) (“Any requirement of a specific decision after the

creation of the document would defeat the purpose of the exemption. At the time of writing the

10 author could not know whether the decisionmaking process would lead to a clear decision,

establishing the privilege, or fizzle, defeating it.”). The fact that information may be exempt

from FOIA disclosure under Exemption 5 even if no specific “decision” resulted does not mean

that an agency is entitled to withhold otherwise non-exempt information to identify a specific

decision or policy determination that is known.

However, for the most part Treasury’s Vaughn Index provides sufficient

information to allow the Court to find that it properly claimed applicability of Exemption 5. For

example, Treasury withheld a large number of “draft memorand[a] consist[ing] of [a] policy

proposal that was prepared at staff level and was never finalized,” as well as email discussions of

those drafts. See Vaughn Index [Dkt. 29-1] at 1. This description makes clear that agency staff

were sharing their individual views concerning a predecisional agency action in a deliberative

process. The Court can determine that the records are appropriately withheld under Exemption 5

without further information about the particular policy proposal at issue. See Exxon Corp. v.

U.S. Dep’t of Energy, 585 F. Supp. 690, 698 (D.D.C. 1983) (“Draft documents, by their very

nature, are typically predecisional and deliberative.”). The large majority of entries in the

Vaughn Index likewise provide a similarly sufficient level of detail.

The exceptions are the records CEI identifies in Parts IV and V of its Opposition

as, respectively, records lacking any nexus to policymaking and “media-related withholdings.”

Opp’n at 26, 32.2 Records that take the form of draft policy memoranda or draft office priorities

can be reliably grounded in a predecisional and deliberative process without further inquiry. See

Exxon Corp., 585 F. Supp. at 698. However, a number of records withheld by Treasury are

2 These records are, collectively: 1; 7; 61-63; 72; 74; 78; 101-103; 161; 162; 186; 189; 231; 248; 254-256; 261; 268-270; 278; 281-282. 11 described as staff commentary on news articles, public comments by non-agency officials, and

other media originating outside the Department. The lack of substantive detail in the Vaughn

Index prevents the Court from assessing what “deliberative process” was taking place. Not

every discussion by agency staff that touches on agency matters is protected by Exemption 5; if

that were the case, Exemption 5 could conceivably cover almost any internal agency

communication. See Judicial Watch v. Reno, 154 F. Supp. 2d 17, 18 (D.D.C. 2001) (“It is not

enough to say that a memorandum ‘expresses the author’s views’ on a matter. The role played

by the document in the course of the deliberative process must also be established.”). Further,

statements that merely restate existing policies or neutral facts are not exempt under Exemption

5. See Public Citizen v. OMB, 598 F.3d at 367. (“A document that does nothing more than

explain an existing policy cannot be considered deliberative.”).

Treasury will be ordered to supplement its Vaughn Index with more detailed

information concerning the deliberative process for these records. Treasury may petition to

submit this information in camera if such supplementation would necessarily disclose the

information the agency seeks to protect.

SEGREGABILITY

Finally, CEI challenges Treasury’s withholding of 87 records in their entirety

rather than releasing them in redacted form. Opp’n at 18. While an agency may properly

withhold records or parts of records under FOIA exemptions, it must release “any reasonably

segregable portions” of responsive records that do not contain exempted information.

Schoenman v. FBI, 575 F. Supp. 2d 136, 155 (D.D.C. 2008); see also 5 U.S.C. § 552(b). An

agency bears the burden of demonstrating that all reasonably segregable portions of a record

have been disclosed, and may do so by “offering an affidavit with reasonably detailed

12 descriptions of the withheld portions of the documents and alleging facts sufficient to establish

an exemption.” Pac. Fisheries, Inc. v. United States, 539 F.3d 1143, 1148 (9th Cir. 2008).

Treasury has submitted a declaration asserting that it has released “all reasonably

segregable non-exempt information.” Demopulos Decl. ¶ 14. It states that “[a]ll information

withheld either was exempt from disclosure pursuant to a FOIA exemption or was so intertwined

with protected material that segregation was not possible without revealing the underlying

protected material.” Id. Agency declarations are entitled to a presumption of good faith with

regards to segregability. See ACLU v. CIA, 892 F. Supp. 2d at 250. Treasury states that “the

majority of the remaining [unredacted] documents are ‘draft memoranda’ of policy proposals or

e-mail correspondence discussing the drafts.” Reply at 17.

The Court agrees with Treasury that “‘[d]raft documents, by their very nature, are

typically pre-decisional and deliberative.’” Id. (quoting Exxon Corp., 585 F. Supp. at 697-98).

However, the D.C. Circuit has held that an agency may not “avail itself of Exemption 5 to shield

existing policy from disclosure simply by describing the policy in a document that as a whole is

predecisional, such as a memo written in contemplation of a change in that very policy.” Public

Citizen v. OMB, 598 F.3d at 367. In such a situation, “[o]nly those portions of a predecisional

document that reflect the give and take of the deliberative process may be withheld.” Id.

Treasury’s declarations do not indicate whether it reviewed the withheld draft

memoranda to ensure that no existing policy information or neutral facts were contained therein

that could be released under the test of Public Citizen. Treasury will be ordered to provide more

detail concerning its efforts to ensure that no such information could be released in redacted form

without revealing protected material. The Court is satisfied that Treasury has met its burden that

13 the remaining fully-withheld correspondence, such as internal emails, contain no reasonably-

segregable information.3

CONCLUSION

For the reasons above, Treasury’s Motion for Summary Judgment will be granted

in part and denied in part. Treasury will be ordered to supplement its Vaughn Index with more

detailed information for records 1; 7; 61-63; 72; 74; 78; 101-103; 161; 162; 186; 189; 231; 248;

254-256; 261; 268-270; 278; 281-282 and will be ordered to provide the Court with further

information regarding its segregability analysis for records 10; 19; 22-25; 30; 38-41; 45; 48-49;

52; 66; 69-70; 80; 84-85; 90; 95; 97; 100; 106; 108; 120-21; 133; 158; 159; 161-64; 168-69;

171; 179; 180; 218; 248; 254; 255; 264; 265; 279; 293.

Date: April 2, 2018 /s/ ROSEMARY M. COLLYER United States District Judge

3 Based on Treasury’s Vaughn Index, the records containing draft policy materials not subject to release are the following: 10; 19; 22-25; 30; 38-41; 45; 48-49; 52; 66; 69-70; 80; 84-85; 90; 95; 97; 100; 106; 108; 120-21; 133; 158; 159; 161-64; 168-69; 171; 179; 180; 218; 248; 254; 255; 264; 265; 279; 293. 14