Cuban v. Securities and Exchange Commission

• Court: District Court, District of Columbia
• Decided: September 22, 2010
• Docket: Civil Action No. 2009-0996
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA _______________________________________ ) MARK CUBAN, ) ) Plaintiff, ) ) v. ) Civil Action No. 09-0996 (RBW) ) SECURITIES AND EXCHANGE ) COMMISSION, ) ) Defendant. ) _______________________________________)

MEMORANDUM OPINION

The plaintiff, Mark Cuban, brings this action against the defendant, the Securities and

Exchange Commission (the "SEC"), pursuant to the Freedom of Information Act, 5 U.S.C. § 552

(2006) ("FOIA") and the Privacy Act, 5 U.S.C. § 552a (2006), challenging the adequacy of the

defendant's searches for responsive records and seeking to compel the release of several records

the defendant has completely withheld from disclosure. Complaint ("Compl.") ¶ 1. This matter

is currently before the Court on the parties' cross-motions for partial summary judgment pursuant

to Federal Rule of Civil Procedure 56 that address their respective positions concerning the

reasonableness of the searches the defendant conducted for responsive records and the disclosure

of documents made by the defendant to the plaintiff. See Defendant's Motion for Partial

Summary Judgment ("Def's. Mot."); Plaintiff’s Memorandum of Law in Opposition to Defendant

Securities and Exchange Commission’s Motion for Partial Summary Judgment and in Support of

Plaintiff's Cross-Motion for Summary Judgment ("Pl.'s Mot."). The defendant has processed

seventeen of the plaintiff's twenty requests and the summary judgment motions pertain to those

seventeen requests. As to the remaining three requests, the defendant seeks thirty-six additional months in order to complete the processing and these requests. See Defendant's Motion to

Bifurcate and Stay Proceedings ("Def.'s Mot. to Stay"). The plaintiff opposes the defendant's

motion for a thirty-six-month extension and seeks immediate production of all responsive

records. See Plaintiff Mark Cuban's Memorandum of Law in Opposition to Defendant Securities

and Exchange Commission's Motion to Bifurcate and Stay Proceedings ("Pl.'s Opp'n to Stay").

For the reasons set forth below, the Court must grant in part and deny in part both parties' cross-

motions for partial summary judgment and deny without prejudice the motion to bifurcate and

stay these proceedings. 1 Also, for the reasons set forth below, the parties shall appear before the

Court at a hearing at which the Court will determine an appropriate timeline by which the

defendant must complete processing the plaintiff's remaining three requests. In addition, if the

defendant continues to rely upon Exemption 7(A) as grounds for refusing to produce responsive

documents, at that same hearing the defendant shall be prepared to provide representations to the

Court regarding the status of the ongoing investigation. 2

1 The Court also considered the following submissions in ruling on the motions: Defendant's Memorandum of Law in Support of Its Motion for Partial Summary Judgment ("Def.'s Mem."); Plaintiff's Memorandum of Law in Opposition to Defendant Securities and Exchange Commission's Motion for Partial Summary Judgment and in Support of Plaintiff's Cross-Motion for Summary Judgment ("Pl.'s Mem."); Defendant's Reply to Plaintiff's Response to Defendant's Motion for Partial Summary Judgment and Response to Plaintiff's Cross Motion for Summary Judgment ("Def.'s Reply"); Plaintiff's Reply to Defendant Securities and Exchange Commission's Response to Plaintiff's Cross-Motion for Summary Judgment ("Pl.'s Reply); Notice of Filing of Defendant's Statement of Material Facts as to Which There is No Genuine Issue, Pursuant to Local Rule 7(h) in Support of Defendant's Motion for Partial Summary Judgment ("Def.'s Stmt."); Plaintiff's Statement of Material Facts as to Which There is No Genuine Issue ("Pl.'s Stmt."); Plaintiff Mark Cuban's [Proposed] Statement of Genuine Issues in Response to the SEC's Statement of Material Facts and in Opposition to the SEC's Motion for Partial Summary Judgment; Response of the Securities and Exchange Commission to Plaintiff's Statement of Material Facts as to Which There is No Dispute; Memorandum of Points an Authorities in Support of Defendant's Motion to Bifurcate and Stay Proceedings ("Def.'s Mem. re Stay"); Plaintiff Mark Cuban's Memorandum of Law in Opposition to Defendant Securities and Exchange Commission's Motion to Bifurcate and Stay Proceedings; and Defendant's Reply to Plaintiff's Opposition to Defendant's Motion to Bifurcate and Stay Proceedings. 2 If necessary, the Court will obviously permit government counsel to make these representations to the Court ex parte.

2 I. BACKGROUND

On December 19, 2008, the plaintiff, through counsel, requested from the defendant the

production of twenty categories of records pursuant to the FOIA and the Privacy Act. The

plaintiff submitted this request in two letters. Specifically, in the letter pursuant to the FOIA

exclusively, the plaintiff sought thirteen categories of records relating to several businesses and

individuals, including several requests for records related to potential internal SEC

investigations. 3 Def.'s Mem., Ex. 1 (Decl. of Margaret Celia Winter) ("Winter Decl."), Attach. A

(Dec. 19, 2008 Letter from David M. Ross to SEC) ("Request Ltr. I") at 1-3. Similarly, in the

letter that requested disclosure pursuant to both the FOIA and the Privacy Act, the plaintiff

sought seven categories of records related to himself, and various businesses, persons, and

potential internal SEC investigations. Id., Ex. 1 (Winter Decl.), Attach. B (Dec. 19, 2008 Letter

from David M. Ross to SEC ("Request Ltr. II")) at 1-3. The defendant received both letters on

December 23, 2008, and assigned them a single internal tracking number. Id., Ex. 1 (Winter

Decl.), Attach. I (June 29, 2009 Letter from Richard M. Humes to David Ross) at 1, n.1.

The defendant initially informed the plaintiff that it possessed no responsive records

relating to the first four categories of Request Letter I and the third category of Request Letter II

Id., Ex. 1 (Winter Decl.), Attach. C (Jan. 30, 2009 Letter from Mark P. Siford to David Ross) at

1-3. As to categories 7 and 11-13 of Request Letter I, the defendant indicated in its initial

January 30, 2009 response that it possessed "no means to conduct a reasonable search for [that]

type of information," Id., Ex. 1 (Winter Decl.), Attach. C at 2, and as to category 6 of Request

Letter I, the defendant further stated that the only information it had included public records from

3 Although not numbered, the categories of records sought will be referred to in the order in which they were set forth in the request letters.

3 a judicial proceeding directly available to the plaintiff from the court. Id. As to the remainder of

the plaintiff's requests, the defendant stated that it was "consulting with other Commission staff

regarding information that may be responsive," and it would "advise [the] plaintiff of [its]

findings as soon as [it] receive[d] a response" from its staff. Id., Ex. 1 (Winter Decl.), Attach. C

at 3.

A series of letters from the defendant updating the plaintiff as to the progress of its search

followed. On February 5, 2009, the defendant advised the plaintiff by letter that it did not have

any responsive records related to category 5 of Request Letter I, and that it was withholding

records responsive to categories 1, 2, 4 and 5 of Request Letter II under Exemption 7(A). Id.,

Ex. 1 (Winter Decl.), Attach. D (Feb. 5, 2009 Letter from Mark P. Siford to David Ross) at 1-2.

On March 5, 2009, the defendant informed the plaintiff that it was relying on the deliberative

process protection of Exemption 5 of the FOIA to withhold records responsive to category 3 of

Request Letter II. Id., Ex. 1 (Winter Decl.), Attach. F (Mar. 5, 2009 Letter from Mark Siford to

David Ross) at 1-2. In a March 16, 2010 letter, the defendant stated that it was withholding

records responsive related to category 6 of Request Letter I because they fell within the law

enforcement classification of Exemption 7(A). Id., Ex. 1 (Winter Decl.), Attach. G (Mar. 16,

2009 Letter from Mark Siford to David Ross) at 1-2. On July 2, 2009, the defendant indicated

that it was withholding records related to category 9 of Request Letter I under Exemption 6, and

records responsive to categories 8 and 10 of Request Letter I and 6-7 of Request Letter II under

Exemption 7(A). Id., Ex. 1 (Winter Decl.), Attach. K (July 2, 2009 Letter from Mark P. Siford

to David Ross) at 1. In a July 9, 2009 letter, the defendant informed the plaintiff that while it

once may have had records relating to categories 1-5 of Request Letter I and category 3 of

Request Letter II, any responsive records had not been retained. Id., Ex. 1 (Winter Decl.),

4 Attach. L (July 9, 2009 Letter from Richard M. Humes to David Ross) at 1; see also id., Ex. 1

(Winter Decl.), Attach. I at 3-4. The defendant also indicated in the July 9, 2009 letter that it was

the defendant's position that "internal administrative records used to track staff assignments and

inquires are not responsive to th[e] request," but even if they were responsive, the defendant was

relying on Exemption 2 to withhold these records, as well as Exemptions 6 and 7(C) to withhold

the names of any staff or other names contained within those records. Id. On September 17,

2009, the defendant wrote to the plaintiff, referencing a telephone conversation between the

parties in which the plaintiff purportedly agreed to redefine the scope of his category 6 request in

Request Letter I. Id., Ex. 1 (Winter Decl.), Attach. M (Sept. 17, 2009 Letter from Juanita C.

Hernández to Lyle Roberts) at 1. The defendant indicated that due to the narrowing of the scope

of that category, some additional records previously located were now unresponsive, but other

records located were, in fact, still responsive and would be processed for release. Id. The

defendant also suggested that if the plaintiff was willing to narrow the scope of other requests,

specifically category 10 of Request Letter I by subject matter and time frame, that it would

reduce the burden on the defendant to search for responsive records, and therefore presumably

hasten the final response time. Id. On September 22, 2009, the defendant reported that it may

have located responsive records related to one of the entities regarding which the plaintiff sought

records and sought the plaintiff's permission to incur processing costs to review and redact the

records. Pl.'s Mem., Declaration of David M. Ross in Support of Plaintiff's Opposition to

Defendant Security and Exchange Commission's Motion for Partial Summary Judgment and in

Support of Plaintiff's Cross-Motion for Summary Judgment ("Ross Decl."), Ex. 4 (Sept. 22, 2009

Letter from Mark P. Siford to David M. Ross) at 1. 4 Finally, on January 14, 2010, the defendant

4 The plaintiff promptly authorized the defendant to incur the cost of processing and reviewing the records (continued . . . ) 5 wrote to the plaintiff to state that it was no longer relying upon Exemption 7(A) as grounds for

withholding records responsive to category 10 of Request Letter I and category 1 of Request

Letter II. Def.'s Mem., Ex. 1 (Winter Decl.), Attach. N (Jan. 14, 2010 Letter from Mark P.

Siford to David Ross) at 2. The defendant also stated that, relying on Exemptions 5, 6, and 7(C),

it would be producing only redacted records responsive to category 3 of Request Letter II. Id.

The plaintiff also sent a series of communications to the defendant. In addition to

negotiating the scope of categories 6 and 10 of Request Letter I, see Def.'s Reply, Ex. 8

(Supplemental Declaration of Margaret Celia Winter) ("Winter Suppl. Decl."), Attach. B (Sept.

21, 2009 Letter from Lyle Roberts to Juanita C. Hernández) at 1; id., Ex. 8 (Winter Suppl.

Decl.), Attach. C (Sept. 25, 2009 Letter from Juanita C. Hernández to Lyle Roberts), the plaintiff

administratively appealed the adequacy of the defendant's searches with respect to the categories

of records for which the defendant stated that it had no responsive records, as well as the

defendant's reliance on Exemption 7(A) to withhold records responsive to categories 1, 2, and 4-

6 of Request Letter I, Def.'s Mem., Ex. 1 (Winter Decl.), Attach. E (Feb. 17, 2009 Letter from

David Ross to the SEC) at 1-2; id., Ex. 1 (Winter Decl.), Attach. H (Mar. 31, 2009 Letter from

David Ross to SEC) at 1-3; Exemption 5 to withhold records responsive to categories 3 of

Request Letter II, id., Ex. 1 (Winter Decl.), Attach. H (Mar. 31, 2009 Letter from David Ross to

SEC) at 1-3; and the overall failure of the defendant to respond to the plaintiff's request for

records pursuant to the Privacy Act, id.; see also Pl.'s Mem., Ross Decl., Ex. 1 (Feb. 19, 2009

Letter from Celia L. Jacoby to David M. Ross), Ex. 2 (Apr. 2, 2009 Letter from SEC to David

Ross), & Ex. 3 (Apr. 9, 2009 Letter from Celia L. Jacoby to David M. Ross).

( . . . continued) on September 25, 2009. Pl.'s Mem., Ross Decl., Ex. 5 (Sept. 25, 2009 Letter from David M. Ross to Mark P. Siford).

6 The defendant granted in part and denied in part the plaintiff's administrative appeals.

Def.'s Mem., Ex. 1 (Winter Decl.), Attach. I (June 29, 2009 Letter from Richard M. Humes to

David Ross) & Attach. J (June 29, 2009 Letter from Richard M. Humes to David Ross). The

administrative appeals were denied in regards to the withholding to the investigative and

enforcement records that had been withheld pursuant to the Privacy Act. Id., Ex. 1 (Winter

Decl.), Attach. I at 2-3 & Attach. J at 2. However, the defendant granted the plaintiff's appeal

with respect to the adequacy of the defendant's search for records, finding that while the initial

search was reasonable, it ultimately was determined to be incomplete and therefore additional

searches would have to be conducted. 5 Id., Ex. 1 (Winter Decl.), Attach. I at 3-5 & n.7. In

addition, the defendant concluded that the initial searches that it had conducted and its reliance

on Exemptions 2, 5, 6, 7(A) and 7(C) to withhold records it had located responsive to those

searches were adequate and statutorily compliant. 6 Id., Ex. 1 (Winter Decl.), Attach. I at 3-6 &

Attach. J at 2-5. The defendant also rejected the plaintiff's position that it needed to produce a

Vaughn index as part of the administrative process. Id., Ex. 1 (Winter Decl.), Attach. J at 3.

Meanwhile, as the correspondence between the parties was ongoing, the plaintiff filed

this action on May 28, 2009, seeking the immediate production of the records denied to him and

maintaining that the defendant's search efforts were inadequate and reliance on the exemptions

invoked by the defendant was improper. See generally Compl. The defendant answered the

complaint on July 2, 2009, denying the plaintiff's allegations that its search efforts were

5 It was the July 29, 2009 remand for further searching that prompted the additional potentially responsive records identified by the defendant in its September 22, 2009 letter. See Pl.'s Mem., Ross Decl., Ex. 4; see also Def.'s Mem., Ex. 1 (Winter Decl.), Attach. N. 6 Upon appeal, the defendant also concluded that its previous reliance under Exemption 7(A) to withhold records pertaining to one investigatory matter was no longer viable given that the investigation had concluded, but the defendant indicated that it would still review the records to determine if other Exemptions applied. Id., Ex. 1 (Winter Decl.), Attach. J at 3-4

7 inadequate and maintaining that its reliance on the identified Exemptions was proper. The filing

of the parties' cross-motions for partial summary judgment and the defendant's motion to

bifurcate and stay this action as it relates to the categories of the request that the defendant has

yet to produce followed.

II. STANDARD OF REVIEW

Under Rule 56, summary judgment is appropriate if “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). When ruling on a Rule 56 motion, the Court must view the evidence in the light most

favorable to the non-moving party. Holcomb v. Powell, 433 F.3d 889, 895 (D.C. Cir. 2006)

(citing Reeves v. Sanderson Plumbing Prods., 530 U.S. 133, 150 (2000)). The Court must

therefore draw “all justifiable inferences” in favor of the non-moving party and accept the non-

moving party's evidence as true. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).

The non-moving party, however, cannot rely on “mere allegations or denials,” Burke v. Gould,

286 F.3d 513, 517 (D.C. Cir. 2002) (quoting Anderson, 477 U.S. at 248) (internal quotation

marks omitted), because “conclusory allegations unsupported by factual data will not create a

triable issue of fact,” Pub. Citizen Health Research Grp. v. FDA, 185 F.3d 898, 908 (D.C. Cir.

1999) (internal brackets and quotation marks omitted). If the Court concludes that “the

nonmoving party has failed to make a sufficient showing on an essential element of [his] case

with respect to which [he] has the burden of proof,” then the moving party is entitled to summary

judgment. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).

8 A. The Defendant's Search Obligations

An agency that is responding to a FOIA request must make “a good faith effort to

conduct a search for the requested records, using methods which can be reasonably expected to

produce the information requested.” Baker & Hostetler LLP v. U.S. Dep't of Commerce, 473

F.3d 312, 318 (D.C. Cir. 2006) (citation and internal quotation marks omitted); see also

Steinberg v. U.S. Dep't of Justice, 23 F.3d 548, 551 (D.C. Cir. 1994) (stating that “[an] agency

must demonstrate that it has conducted a search reasonably calculated to uncover all relevant

documents”) (internal quotation marks omitted). While “an agency cannot limit its search to

only one record system if there are others that are likely to turn up the information requested,”

Campbell v. U.S. Dep't of Justice, 164 F.3d 20, 28 (D.C. Cir. 1998) (internal quotation marks

omitted), the search “need not be perfect, only adequate, and adequacy is measured by the

reasonableness of the effort in light of the [plaintiff's] specific request,” Meeropol v. Meese, 790

F.2d 942, 956 (D.C. Cir. 1986); see also id. at 953 (stating that “[i]t would be unreasonable to

expect even the most exhaustive search to uncover every responsive file”).

Thus, “[t]here is no requirement that an agency search every record system” in which

responsive documents might conceivably be found. Oglesby v. U.S. Dep't of the Army, 920 F.2d

57, 68 (D.C. Cir. 1990). Rather, an agency must demonstrate the adequacy of its search by

providing a “reasonably detailed affidavit, setting forth the search terms and type of search

performed, and averring that all files likely to contain responsive materials . . . were searched.”

Id. “Once the agency has shown that its search was reasonable, the burden shifts to [the

plaintiff] to rebut [the defendant's] evidence . . . either by contradicting the defendant's account

of the search procedure or by raising evidence of the defendant's bad faith.” Moore v. Aspin,

916 F. Supp. 32, 35-36 (D.D.C. 1996) (citing Miller v. U.S. Dep't of State, 779 F.2d 1378, 1383-

9 84 (8th Cir. 1985)). “Agency affidavits are accorded a presumption of good faith, which cannot

be rebutted by purely speculative claims about the existence and discoverability of other

documents.” SafeCard Servs., Inc. v. SEC, 926 F.2d 1197, 1200 (D.C. Cir. 1991) (internal

quotation marks omitted).

B. The Defendant's Record Production Obligations

The FOIA requires a federal agency to release all records responsive to a request for

production, 5 U.S.C. § 552(a)(3)(A), unless such records falls within one of the well-defined

exemption categories listed in § 552(b). The Court is authorized under the FOIA “to enjoin [a

federal] agency from withholding agency records or to order the production of any agency

records improperly withheld from the complainant.” § 552(a)(4)(B); see also Kissinger v.

Reporters Comm. for Freedom of the Press, 445 U.S. 136, 139 (1980). When a FOIA requester

files a civil action, the agency has the burden of proving that “each document that falls within the

class requested either has been produced, is unidentifiable, or is wholly exempt from the Act's

inspection requirements.” Goland v. CIA, 607 F.2d 339, 352 (D.C. Cir. 1978), cert. denied, 445

U.S. 927 (1980) (internal citation and quotation marks omitted); accord Maydak v. Dep't of

Justice, 218 F.3d 760, 764 (D.C. Cir. 2000) (holding that government has the burden of proving

each claimed FOIA exemption). The Court may award summary judgment to an agency solely

on the basis of information provided in affidavits or declarations when they sufficiently describe

“the documents and the justifications for nondisclosure with reasonably specific detail,

demonstrate that the information withheld logically falls within the claimed exemption, and are

not controverted by either contrary evidence in the record nor by evidence of agency bad faith.”

Military Audit Project v. Casey, 656 F.2d 724, 738 (D.C. Cir. 1981); see also Vaughn v. Rosen,

484 F.2d 820, 826 (D.C. Cir. 1973), cert. denied, 415 U.S. 977 (1974).

10 III. LEGAL ANALYSIS

A. Adequacy of the Defendant's Searches for Responsive Records

Initially in its motion, the defendant took the position that the plaintiff had failed to

appeal the defendant's responses as to categories 7, 11, 12, and 13 of Request Letter I, and thus

by not exhausting the administrative remedies available to him, the plaintiff could not now

litigate the defendant's responses regarding those categories. Def.'s Mem. at 6-7. The plaintiff

responded that because the defendant never informed him of his right to appeal those categories,

his administrative remedies were constructively exhausted. Pl.'s Mem. at 7-9. Regardless of

these positions, it appears that before the briefing on the parties' cross-motions was complete, the

defendant did, in fact, represent that it conducted a search for records responsive to categories

11, 12, and 13 of Request Letter I, and no responsive records were found. Def.'s Reply at 4-5;

id., Ex. 13 (Supplemental Declaration of Noelle L. Frangipane) ("Frangipane Suppl. Decl.") ¶¶

3-5. As to category 7, which seeks information regarding trades in Copernic securities by any

SEC personnel, the defendant maintains that based on the manner in which it maintains its files,

a search for responsive records would be overly burdensome and unreasonable because it would

involve reviewing each file manually. Def.'s Reply at 4-5; id., Ex. 14 (Declaration of William

Lenox) ("Lenox Decl.") ¶ 5.

While the Court does not condone the defendant's delay in conducting these searches, as

timely searches might have limited or avoided altogether litigation of the adequacy of these

searches, the Court will not focus on whether those searches were untimely now that they have

11 been conducted, but will assess whether they satisfy the defendant's search obligations. 7 The

defendant's declarations do not convince the Court that it has.

The defendant was obligated to demonstrate the adequacy of its search by providing a

“reasonably detailed affidavit, setting forth the search terms and type of search performed, and

averring that all files likely to contain responsive materials . . . were searched.” Oglesby, 920

F.2d at 68. Instead, the supplemental declaration of Noelle L. Frangipane, who conducted the

search of the Office of the Inspector General ("OIG"), merely states that the declarant

"conducted a search" by reviewing "indices of investigations" based on familiarity with internal

SEC investigations and "determined that the OIG possessed no documents responsive to these

requests." 8 Def.'s Reply, Ex. 13 (Frangipane Suppl. Decl.) ¶¶ 4-5. This declaration is woefully

lacking of the detail necessary for the Court to assess the adequacy of the search; it merely

concludes that a search was conducted and it was adequate. While the Court must presume the

good faith of the declarant, the Court need not defer to the declarant on the ultimate question of

the adequacy of the search.

7 Given that the SEC's correspondence with the plaintiff are arguably vague as to whether the plaintiff was appraised that he had the right to appeal – the plaintiff was advised that he had "the right to appeal the adequacy of [the] search or finding of no responsive information" but not specifically that he could appeal the defendant's determination that it "[had] no means to conduct a reasonable search for [records referenced in categories 7, 11, 12, and 13 of Request Letter I]," Def.'s Mem., Winter Decl., Attach. C at 2—and also given that the defendant subsequently responded to those production requests, albeit in the highly disfavored manner of responding in its reply brief, the Court may, under these circumstances, nonetheless decide the merits of the plaintiff's FOIA claims even though he did not appeal the defendant's initial failure to search for the records. Wilbur v. CIA, 355 F.3d 675, 677 (D.C. Cir. 2004) (indicating that exhaustion is a "prudential consideration," not "a jurisdictional prerequisite," and it may be excused where the case "presents no risk of undermining the purposes and policies underlying the exhaustion requirement, namely, to prevent premature interference with agency processes, to give the parties and the courts benefit of the agency's experience and expertise and to compile an adequate record for review"). 8 Explaining why the search was limited to "whether the OIG had any documents responsive to Request Nos. 1-7, 9, 11, 12, and 13" of Request Letter II, the declarant also indicates that she was not "aware of any other source within the OIG that is likely to contain any additional information or documents responsive to these requests." Def.'s Reply, Ex. 13 (Frangipane Suppl. Decl.) ¶¶ 4-5.

12 Nor does the declaration of William Lenox fare any better. This declarant states that

based on his familiarity with the SEC's recordkeeping as to the security trading of its employees,

which "are not organized or categorized by security," "searching for records potentially

responsive to this request would entail performing a page-by-page review of thousands of

documents submitted by over 3,800 Commission employees to ascertain which, if any, of these

records related to Copernic securities." Def.'s Reply, Ex. 14 (Lenox Decl.) ¶ 5. The declarant

states that "it is not possible to perform an electronic search of these records for specific

securities," id., and further that it is the SEC's "policy to keep employees' reports of security

transactions confidential as they contain information in which employees have a privacy interest,

id. ¶ 6. This declaration too is not sufficient as it does not indicate with specificity how the

employee files are maintained, how they could be searched, and why an electronic search of the

files is not even feasible. The Court does not dispute that searches "impos[ing] an unreasonable

burden on [an] agency" need not be compelled, Nation Magazine v. U.S. Customs Serv., 71 F.3d

885, 892 (D.C. Cir. 1995), but it cannot conclude that the plaintiff's search request would pose

such an unreasonable burden based on the sparse representations that the defendant has

provided. 9 The defendant does not actually indicate how its files regarding securities trading by

SEC personnel are maintained, indicating simply that the records "are not organized or

categories by security, and cannot be searched electronically for specific securities." Def.'s

Reply at 4. It must be remembered that an agency's obligation is to make a good faith search

using methods reasonably anticipated to produce responsive information, Oglesby, 920 F.2d at 9 Moreover, while the Court finds the defendant's explanation concerning the adequacy of this search insufficient and therefore need not reach the question of whether the SEC's employees' privacy interest in their securities trades trumps the plaintiff's right to disclosure of this information, it does seem odd for the defendant to claim that its employees have a privacy interest in their securities ownership when the SEC publishes the names of certain shareholders of public companies through its Electronic Data Gathering, Analysis, and Retrieval System (commonly referred to as "EDGAR"). But that explanation will be left for a later date.

13 68, even though an agency need not establish that it has searched far and wide to produce "all

responsive documents," Nation Magazine, 71 F.3d at 892 n.7 (emphasis in original). Here, the

defendant's declarations leave the Court uncertain as to whether another manner of searching for

these records could produce the records that the plaintiff seeks. Presumably, as the plaintiff

states, Pl.'s Reply at 7, the records have to be searchable in some manner to allow the defendant

to utilize them for their own recordkeeping purpose to ensure that abuse and conflicts of interest

do not occur. And based on these declarations, the Court is unable to conclude that the

defendant made "a good faith effort to conduct a search for the requested records, using methods

which can be reasonably expected to produce the information requested." Baker & Hostetler,

473 F.3d at 318 (citation and internal quotation marks omitted). Indeed, whether there are any

reasonable search methods the defendant could employ is a complete mystery, as is the manner

in which it files can, in fact, be searched. The Court therefore agrees with the plaintiff that the

defendant's post-litigation declarations are too conclusory and lack the requisite detail to merit

awarding summary judgment to the defendant, and therefore summary judgment must be

awarded to the plaintiff as to the adequacy of the defendant's search for records responsive to

categories 7, 11, 12, and 13 of Request Letter I. Whether or not the defendant determines that it

must re-conduct its search to alleviate the identified inadequacies, the defendant must provide

more detail-specific declarations in order for the Court to reassess the adequacy of the

defendant’s search efforts.

B. The Exemptions Relied Upon by the Defendant for Its Non-Production of Responsive Documents

As indicated, because the FOIA presumes that responsive records are to be disclosed, a

government agency relying on a statutory exemption to withhold certain records or portions of

14 records from a requester bears the burden of establishing that its reliance on those exemptions is

warranted. Goland, 607 F.2d at 352 (internal citation and quotation marks omitted); accord

Maydak, 218 F.3d at 764. This burden is very important because the question for the Court

becomes whether the defendant has justified its withholding of records pursuant to the cited

exemptions, not whether the plaintiff is entitled to the records or whether the plaintiff can cite a

good reason for access to them. Here, the defendant relies upon Exemptions 2, 5, 6, 7(A) and

7(C) to withhold 80 documents withheld in their entity. Def.'s Reply, Ex. 9. Each exemption

will be addressed in turn, with an indication of the records in the defendant's Vaughn index to

which the exemptions were invoked.

1. Exemption 2

Exemption 2 of the FOIA shields from disclosure information that is “related solely to the

internal personnel rules and practices of an agency.” 5 U.S.C. § 552(b)(2). It applies if the

information in question meets two criteria: First, such information must be “used for

predominantly internal purposes,” Crooker v. Bureau of Alcohol, Tobacco and Firearms, 670

F.2d 1051, 1073 (D.C. Cir. 1981); see also Nat'l Treasury Emps. Union v. U .S. Customs Serv.,

802 F.2d 525, 528 (D.C. Cir. 1986); and second, the agency must show either that “disclosure

may risk circumvention of agency regulation,” or that “the material relates to trivial

administrative matters of no genuine public interest,” Schwaner v. Dep't of the Air Force, 898

F.2d 793, 794 (D.C. Cir. 1990) (citations and internal quotation marks omitted). "Predominantly

internal documents that deal with trivial administrative matters fall under [what is referred to as]

the 'low 2' exemption." Schiller v. NLRB, 964 F.2d 1205, 1207 (D.C. Cir. 1992); see also

Founding Church of Scientology, Inc. v. Smith, 721 F.2d 828, 830-31 n.4 (D.C. Cir. 1983)

(finding low 2 exemption automatically covers trivial administrative matters of no genuine

15 public interest). The defendant here is relying upon the low 2 exemption to withhold what it

characterizes as administrative matters. See Def.'s Mem. at 9; Def.'s Reply at 5.

The defendant maintains that it can withhold records 78-80 under Exemption 2 because

these records "concern internal SEC administrative matters that are not of any genuine public

interest and contain names of staff members involved in [SEC] investigations, and their phone

numbers and e[-]mail addresses." Def.'s Mem., Ex. 3 (Declaration of Kenneth H. Hall) ("Hall

Decl.") ¶ 6; see also Def.'s Reply, Ex. 9. One of the defendant's declarants, the Assistant Chief

Counsel in the Division of Enforcement in the Office of the Chief Counsel at the SEC, represents

that these documents "are internal records of closed [matters under inquiry] pertaining to

'Shareslueuth.com,'" one of the entities regarding which the plaintiff sought records, and are

"primarily internal tracking records" comprised of "nineteen pages, including three file covers,

four pages of internal data entry forms, five pages of . . . summaries and seven pages of e[-

]mails." Def.'s Mem., Ex. 3 (Hall Decl.) ¶¶ 6-7. According to the declarant, the summaries

consist of purely "internal reports used by Enforcement supervisory staff to administer and

manage cases," id. ¶ 8, the data entry forms "are also internal reports used by Enforcement

supervisory staff to manage and administer investigations," id. ¶ 9, and the e-mails include

"automated messages that show that a request was made to open or close a matter that has been

submitted into Enforcement's case management system," including "the name of [the] SEC staff

who submitted data and show[ing] that a request for action has been submitted and provid[ing]

the name given to the matter," id. ¶ 11. According to the declarant, the collection of e-mails

being withheld also contains one e-mail from a complainant that can be disclosed with

redactions, and several "internal e[-]mails primarily concern[ing] administrative routine matters

about the logistics of opening [an investigative matter]." Id. ¶¶ 12-13.

16 The plaintiff contends that the defendant's reliance on Exemption 2 is improper because

documents 78-80 "pertain[] to informal SEC investigations," i.e. "the core function of the

agency," and therefore the documents "cannot be [considered] 'routine housekeeping matters' in

which the public would presumably lack interest." Pl.'s Mem. at 14. The plaintiff maintains that

the type of information in the documents "is a matter of genuine public interest because it sheds

light on how the SEC conducts its activities or carries out its statutory responsibilities." Pl.'s

Reply at 9-10.

While it appears that records may be “used for predominantly internal purposes,”

Crooker, 670 F.2d at 1073, and the staff names and contact information may fall within

Exemptions 2, 6, and 7(C) and thus are shielded from disclosure, the defendant has not shown

that “the material relates to trivial administrative matters of no genuine public interest,”

Schwaner v. Dep't of the Air Force, 898 F.2d 793, 794 (D.C. Cir. 1990) (citations and internal

quotation marks omitted). "[T]he general thrust of . . . exemption [2] is simply to relieve

agencies of the burden of assembling and maintaining for public inspection matter in which the

public could not reasonably be expected to have an interest." Dep't of the Air Force v. Rose, 425

U.S. 352, 369-70 (1976). It is axiomatic that matters that the SEC determines worthy of

investigation are not trivial, especially when it is the function of the defendant to ferret out fraud.

And indeed, even trivial information may not be withheld from disclosure "simply because it

manifests an agency practice of collecting the information." Schwaner, 898 F.2d at 779

(emphasis in original). Moreover, the defendant has expressed a willingness to produce a

redacted version of an e-mail complaint (redacting the identifying information of the

complainant of course), and has provided redacted versions of similar records in response to

other FOIA requesters, see, e.g., Gavin v. SEC, Civ. No. 04-4522 (PAM/JSM), 2007 WL

17 2454156 at *6 (D. Minn. Aug. 23, 2007) (upholding administrative management related

redactions under Exemption 2, but denying reliance on Exemption 2 where full withholding

made it impossible to "discern whether the documents contain purely trivial, administrative

information"), so its position seems untenable here. Why redacted versions cannot also be

disclosed in this case is simply not clear on the basis of the defendant's representations. See

Stolt-Nielsen Transp. Grp., Ltd. v. United States, 534 F.3d 728, 734 (D.C. Cir. 2008) ("'[a]ny

reasonably segregable portion of a record shall be provided to a person requesting such record

after deletion of the portions which are exempt'" (alteration in original, citation omitted and

emphasis added)). Accordingly, the records encompassed by the defendant's Exemption 2 claim

must be redacted and produced with the following caveat.

It is unclear based on the declarant's representation whether the several "internal e[-

]mails primarily concern[ing] . . . the logistics of opening [an investigative matter]" might reveal

the defendant's internal rules and practices. Def.'s Mem., Ex. 3 (Hall Decl.) ¶¶ 12-13. To the

extent that the information contained within the records concerns internal rules and practices,

that information may be redacted, but to the extent that the tracking records include such items as

dates, requests to open and close these investigations, stock type, and case status, such

information is not necessarily trivial for purposes of Exemption 2 simply because it is factually

based and is a necessary part of carrying out the investigation. See Schwaner, 898 F.2d at 779.

Because the exemptions are information-specific and not record-type based, the defendant must

provide some rationale for distinguishing the information contained within the records – not

simply referencing the records as a whole – that truly reveals the defendant's internal rules and

practices and not just factually based information inherently collected during an investigation.

See Rose, 425 U.S. at 370 (finding that case summaries of ethics hearings are not protected by

18 Exemption 2 because they have more than internal significance, "do not concern only routine

matters," and "[t]heir disclosure entails no particular administrative burden" (emphasis added)).

Therefore, for purposes of these cross-motions for summary judgment, because the defendant has

not made the requisite showing, at this junction it is the Court's finding that these records cannot

be withheld in their entirety pursuant to Exemption 2, and, at minimum, redacted versions must

be produced pursuant to 5 U.S.C. § 552(b).

2. Exemption 5

Exemption 5 of the FOIA provides that the “inter-agency or intra-agency memorand[a] or

letters which would not be available by law to a party other than an agency in litigation with the

agency” are not subject to disclosure under the FOIA. 5 U.S.C. § 552(b)(5). “To qualify [for

non-disclosure under Exemption 5], a document must thus satisfy two conditions: its source must

be a Government agency, and it must fall within the ambit of a privilege against discovery under

judicial standards that would govern litigation against the agency that holds it.” U.S. Dep't of the

Interior & Bureau of Indian Affairs v. Klamath Water Users Protective Ass'n, 532 U.S. 1, 8

(2001). The threshold issue that must therefore be addressed when Exemption 5 is asserted is

whether the records in question qualify as “inter-agency or intra-agency memorand[a].” Judicial

Watch, Inc. v. U.S. Dep't of Commerce, 90 F. Supp. 2d 9, 13 (D.D.C. 2000).

“With respect to the secondary consideration under Exemption 5 – whether such

materials would not be ‘available by law in litigation with the agency,’” id. – “the parameters of

Exemption 5 are determined by reference to the protections available to litigants in civil

discovery . . . [,]” Burka v. U.S. Dep't of Health & Human Servs., 87 F.3d 508, 516 (D.C. Cir.

1996). Thus, if a document requested pursuant to the FOIA would normally be subject to

disclosure in the civil discovery context, it must also be disclosed under the FOIA. Id.

19 Conversely, information that is routinely not subject to disclosure in the civil discovery process

is exempt from disclosure under Exemption 5. Id. Accordingly, “to justify nondisclosure under

Exemption 5, an agency must show that the type of material it seeks to withhold is generally

protected in civil discovery for reasons similar to those asserted by the agency in the FOIA

context.” Id. at 517. Thus, courts have incorporated three traditional civil discovery privileges

into Exemption 5: (1) the deliberative process privilege; (2) the attorney-client privilege; and (3)

the attorney work-product privilege. NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 148-49

(1975); Coastal States Gas Corp. v. Dep't of Energy, 617 F.2d 854, 862, 866 (D.C. Cir. 1980).

The defendant relies on all three aspects of Exemption 5 to withhold almost all of the 80

records on its Vaughn index, see Def.'s Mem. at 10, so the Court must evaluate each assertion of

privilege in turn.

a. Deliberative Process Privilege

The deliberative process privilege may be relied upon by an agency if the information

sought to be withheld from disclosure contains predecisional information that was part of the

deliberative process, i.e., that there was a "'deliberative process . . . involved, and the role played

by the documents at issue [was] in the course of that process,'" Heggestad v. Dep't of Justice, 182

F. Supp. 2d 1, 7 (D.D.C. 2000) (quoting Coastal States, 617 F.2d at 868), and the records contain

"'recommendations or expresse[d] opinions on legal or policy matters,'" id. (quoting Vaughn v.

Rosen, 523 F.2d 1136, 1143-44 (D.C. Cir. 1975)). "To qualify under Exemption 5, a document

must also be a direct part of the deliberative process in that it makes recommendations or

expresses opinions on legal or policy matters. A document that does nothing more than explain

an existing policy cannot be considered deliberative." Pub. Citizen, Inc. v. Office of Mgmt. &

20 Budget, 598 F.3d 865, 876 (D.C. Cir. 2010) (citation and internal quotation marks omitted).

Further, an agency may not rely on Exemption 5 to withhold records containing

existing policy . . . 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. Only those portions of a predecisional document that reflect the give and take of the deliberative process may be withheld.

Id. (citations omitted). Similarly, "portions of predecisional and deliberative documents that

contain factual information that does not 'inevitably reveal the government's deliberations'" must

be produced under the FOIA. Id. (citations omitted).

The defendant asserts that records 1-3, 9, 11, 13-15, 17, 19, 21-22, 25-29, 32-35, 37-46,

48-57, 59-64, 69, 71, and 73-76 may be withheld pursuant to the deliberative process protection

of Exemption 5. Def.'s Mem. at 16. The defendant represents that the records withheld consist

of "internal e[-]mails and handwritten notes regarding an internal investigation on a personnel

matter," and the records "reflect deliberations regarding the proposed discipline of an employee

including whether the employee engaged in misconduct, what discipline is appropriate for any

misconduct, and what procedures should be followed in imposing discipline." Id.; see also Def.'s

Reply at 8; id., Ex. 10 (Supplemental Declaration of David M. Pinansky) ("Pinansky Suppl.

Decl.") ¶ 6. A declarant for the defendant, a Senior Special Counsel in the Office of the General

Counsel of the Securities and Exchange Commission, represents without elaboration that all of

the records withheld pursuant to the deliberative process privilege related a "personnel matter"

and "reflect internal agency deliberations regarding the proposed discipline of an employee."

Def.'s Reply, Ex. 10 (Pinansky Suppl. Decl.) ¶ 6. The defendant contends that the disclosure of

this information will have a "chilling effect on future predecisional discussion and debate that

21 would harm the SEC's deliberative process." Def.'s Mem. at 16; see also Def.'s Reply, Ex. 10

(Pinansky Suppl. Decl.) ¶ 7.

The plaintiff contends that through its representations the defendant has not met its

burden to withhold documents as deliberative process records under Exemption 5 because "[t]he

SEC's Vaughn Index and declarations are insufficient to determine whether any of the documents

withheld actually qualify for protection as deliberate process materials." Pl.'s Mem. at 21; see

also Pl.'s Reply at 17. According to the plaintiff, the defendant's assertions "lack sufficient detail

and contain only conclusory statements regarding alleged 'pre-decisional deliberations,'" failing

to identify any specifics that would allow the Court and the plaintiff to assess the propriety of the

defendant's claims. Pl.'s Mem. at 21-22. Moreover, the plaintiff contends that the deliberative

process privilege cannot be invoked "to cover a routine personnel matter." Pl.'s Reply at 17.

The Court agrees with the premise upon which the defendant's position is based: that its

officers must be allowed to make discretionary judgments and consider policy choices in an

environment protected from public scrutiny and unnecessary disclosures or it “would tend to

‘discourage candid discussion within an agency.’” Petroleum Info. Corp. v. U.S. Dep't of the

Interior, 976 F.2d 1429, 1434 (D.C. Cir. 1992) (quoting Access Reports v. Dep't of Justice, 926

F.2d 1192, 1195 (D.C. Cir. 1991)). However, the defendant has not made the necessary showing

to justify that its withholdings are within the protective realm in which deliberative discussions

get safe haven. Again, the defendant's declaration completely lacks any detail regarding any

particular record and does nothing more than generally state that Exemption 5 is satisfied. The

Court must be able to conclude that the defendant's position is the correct one to sustain the

defendant's withholding of these records, and summary judgment in the defendant's favor cannot

be obtained on the defendant's bare contention that it has satisfied the legal standard.

22 In making a determination of whether a record is properly withheld under Exemption 5,

"courts frequently examine whether 'the document is so candid or personal in nature that public

disclosure is likely in the future to stifle honest communication within the agency.'" Wilderness

Soc. v. U.S. Dep't of the Interior, 344 F. Supp. 2d 1, 15 (D.D.C. 2004) (quoting Coastal States,

617 F.2d at 866). "However, in cases where there is no identifying information that would link

an individual to a document, this potential is unlikely." Id. The defendant bears the burden of

demonstrating, with respect to each its records, that it was candid or personal in nature, that

individuals can be linked to the record, and that the information discussed in the record does

more than just describe existing policy. The Court cannot discern in any regard whether records

1-3, 9, 11, 13-15, 17, 19, 21-22, 25-29, 32-35, 37-46, 48-57, 59-64, 69, 71, and 73-76 contain

such candid and personal communications.

In addition, it is not disputed that the categories of records that might qualify as

predecisional and deliberative is great. See Klamath Water Users Protective Ass'n, 532 U.S. at 8

("deliberative process covers documents reflecting advisory opinions, recommendations and

deliberations comprising part of a process by which governmental decisions and policies are

formulated" (citation and internal quotation marks omitted)). But just because numerous forms

of records can qualify does not mean they do qualify in their entirety. Even if these records

indexed by the defendant contain such deliberations, which the defendant has not established

merely by its own conclusion, the Court cannot discern from the defendant's representations how

these records could be completely withheld under Exemption 5. Indeed, "agencies must disclose

those portions of predecisional and deliberative documents that contain factual information that

does not 'inevitably reveal the government's deliberations.'" Pub. Citizen, 598 F.3d at 876

(quoting In re Sealed Case, 121 F.3d 729, 737 (D.C. Cir. 1997)). And the defendant has not met

23 this burden because neither the defendant's declarations nor its descriptions in the Vaughn index

state specifically why the wholesale redaction of these records is warranted. Without a more

detailed description upon which the Court can rely, it can only conclude that any candid

communications (if, in fact, any are within these records) can be selectively redacted in a manner

that protects the confidentiality of the recommendations and individuals involved, but still allows

any factual information to be produced. Because Exemption 5 is one of the exemptions that

"covers only those portions of the documents that are both predecisional and deliberative," id. at

876 (emphasis added), the defendant, based on the information currently before the Court, must

redact and disclose these records in the manner indicated above.

b. Attorney-Client Privilege

In the context of Exemption 5, "the [attorney-client] privilege . . . functions to protect

communications between government attorneys and client agencies or departments, as evidenced

by its inclusion in the FOIA, much as it operates to protect attorney-client communications in the

private sector." In re Lindsey, 158 F.3d 1263, 1269 (D.C. Cir. 1998). "Thus, when the

Government is dealing with its attorneys as would any private party seeking advice to protect

personal interests, and needs the same assurance of confidentiality so it will not be deterred from

full and frank communications with its counselors, [Exemption 5] applies." Id. (quoting Coastal

States, 617 F.2d at 863). Accordingly, “[t]o invoke the [attorney-client] privilege, an agency

must demonstrate that the document it seeks to withhold (1) involves 'confidential

communications between an attorney and his [or her] client’ and (2) relates to 'a legal matter for

which the client has sought professional advice.'" Judicial Watch, Inc. v. U.S. Postal Serv., 297

F. Supp. 2d 252, 267 (D.D.C. 2004) (quoting Mead Data Cent., Inc. v. Dep't of the Air Force,

566 F.2d 242, 252 (D.C. Cir. 1977)). However, the attorney-client privilege does not give the

24 agency the ability "to withhold a document merely because it is a communication between the

agency and its lawyers." Id. (emphasis added) (citation omitted). The agency must show that the

information provided to its lawyers was intended to be confidential and was not disclosed to a

third party. Id. (citation omitted).

The defendant asserts that records 11, 13, 21, 25-26, 29, 32, 34-35, 37, 39, 41-44, 53, 55,

57, 59, and 61-63 may be withheld pursuant to the protection of attorney-client privilege under

Exemption 5. Def.'s Mem. at 12. The defendant's declarant, again a Senior Special Counsel in

the Office of the General Counsel, states that these records include "internal e[-]mail and other

internal communications and meetings among OGC attorneys and either one or more [Office of

Human Resources] staff members or SEC supervisors regarding [a] personnel matter," and

"include legal advice and recommendations." Id., Ex. 4 (Declaration of David M. Pinansky)

("Pinansky Decl.") ¶ 8. Specifically, the defendant maintains that the

documents are either (1) attorney communications containing legal advice, primarily e[-]mails or memoranda, with [Human Resources] staff and/or SEC managers regarding the handling of an internal personnel matter, or (2) e[-]mails and handwritten notes reflecting those communications. To the extent a document is not to or from an attorney, it is a document that describes a communication with an attorney on that matter.

Id., Ex. 10 (Pinansky Suppl. Decl.) ¶ 4. The defendant also submitted two additional

declarations, one from the Senior Special Counsel just referenced and the second from a non-

attorney Employee and Labor Relations Specialist in the Office of Human Resources, wherein

they represent that they "have no information that would lead [them] to believe that the

documents withheld under Exemption 5 have been released outside of the Commission." Id., Ex.

10 (Pinansky Suppl. Decl.) ¶ 3; id., Ex. 11 (Supplemental Declaration of Nancy Ellen Tyler)

("Tyler Suppl. Decl.") ¶ 4.

25 In its opposition filing, the plaintiff maintain that the defendant's representations do not

satisfy its burden of establishing that the records may be withheld pursuant to Exemption 5

because the defendant has failed to establish that the communications were confidential when

created and have since retained their confidential status. Pl.'s Mem. at 16. Nor, the plaintiff

maintains, has the defendant relied on anything more than "[n]aked assertions that documents are

covered by the [attorney-client] privilege." Id. The plaintiff points out that "e[-]mails sent to an

[Office of Human Resources] attorney are not privileged unless they convey confidential

information for the purpose of obtaining legal advice," and therefore the defendant's assertion

that the records are e-mail communications and thus shielded from disclosure is not

determinative. Id. at 17; see also Pl.'s Reply at 14. Finally, the plaintiff points out that no single

declarant can represent that the communications have not been disseminated outside of the

agency because a declarant cannot speak for everyone at the agency and therefore cannot

possibly know if such an assertion is true. Pl.'s Reply at 13.

The Court agrees with the plaintiff that the declarations submitted are too conclusory for

the Court to render summary judgment for the defendant on the basis of the attorney-client

privilege. "A blanket assertion of the privilege will not suffice." In re Lindsey, 148 F.3d 1100,

1106 (D.C. Cir. 1998). "Like all privileges . . . the attorney-client privilege is narrowly

construed and is limited to those situations in which its purposes will be served." Coastal States,

617 F.2d at 862. Simply, the defendant cannot meet its burden without "'prov[ing] that each

document that falls within the class requested either has been produced, is unidentifiable, or is

wholly exempt from the Act's inspection requirements.'" Founding Church of Scientology v.

NSA, 610 F.2d 824, 836 (D.C. Cir. 1979) (emphasis added) (citation omitted); see also Senate of

Puerto Rico v. U.S. Dep't of Justice, 823 F.2d 574, 585 (D.C. Cir. 1987) ("We have

26 simultaneously cautioned that 'conclusory assertions of privilege will not suffice to carry' the

agency's burden.") (citation omitted). The attorney-client privilege is not applicable just because

the defendant states that it applies, and a review of the defendant's declaration reveals that the

defendant offers nothing more than conclusory assertions and blanket affirmations. See Def.'s

Mem., Ex. 4 (Pinansky Decl.) ¶ 8; see also Def.'s Reply, Ex. 10 (Pinansky Suppl. Decl.) ¶¶ 3-4;

id., Ex. 11 (Tyler Suppl. Decl.) ¶¶ 3-4. Simply, the defendant must provide more information

from which the Court can assess whether the attorney-client privilege was properly asserted.

In other words, "[t]he burden is on the agency to demonstrate that confidentiality was

expected in the handling of these communications, and that it was reasonably careful to keep this

confidential information protected from general disclosure," not just within the agency, but also

among any other individuals outside the agency who needed access to the information. Coastal

States, 617 F.2d at 863. The declarants' assertions that they lack any reason to believe that the

records were "released outside of the Commission," Def.'s Reply, Ex. 10 (Pinansky Suppl. Decl.)

¶ 3 (emphasis added); see also id., Ex. 11 (Tyler Suppl. Decl.) ¶ 4, do not address the issue of

whether those communications were "circulated no further than among those members 'of the

organization who are authorized to speak or act for the organization in relation to the subject

matter of the communication.'" Coastal States, 617 F.2d at 863 (citation omitted); see Mead Data

Cent., 566 F.2d at n.24 (“Where the client is an organization, the privilege extends to those

communications between attorneys and all agents or employees of the organization who are

authorized to act or speak for the organization in relation to the subject matter of the

communication.”). To the extent that any information, including factual information contained

within the records, was relayed to anyone outside the sphere of those who needed to know the

information within the organization, that information cannot be withheld, and the records must

27 be produced completely or in a redacted form if another exemption justifies the withholding. See

Mead Data Cent., 566 F.2d at 254-55 (stating that where "the background facts provided [in the

records] could easily be information which is not restricted to the [agency] personnel directly

responsible for the negotiations . . . [that information was] therefore not confidential for purposes

of th[e attorney-client] privilege"); see also Coastal States, 617 F.2d at 863 ("If facts have been

made known to persons other than those who need to know them, there is nothing on which to

base a conclusion that they are confidential."). Accordingly, the defendant must provide more

proof that the privilege applies if it desires to shield these records from production based on an

assertion of the attorney-client privilege.

c. Attorney Work Product

"The work-product doctrine shields materials 'prepared in anticipation of litigation or for

trial by or for another party or by or for that other party's representative (including the other

party's attorney, consultant, surety, indemnitor, insurer, or agent).'" Judicial Watch, Inc. v. Dep't

of Justice ("Judicial Watch I"), 432 F.3d 366, 369 (D.C. Cir. 2005) (citation omitted). "The work

product doctrine protects such deliberative materials but it also protects factual materials

prepared in anticipation of litigation." Tax Analysts v. IRS, 117 F.3d 607, 620 (D.C. Cir. 1997).

This means that "'[a]ny part of [a document] prepared in anticipation of litigation, not just the

portions concerning opinions, legal theories, and the like, is protected by the work product

doctrine and falls under exemption 5.'" Judicial Watch I, 432 F.3d at 371 (alterations in original)

(quoting Tax Analysts, 117 F.3d at 620). Therefore, unlike the attorney-client privilege, "factual

material is itself privileged when it appears within documents that are attorney work product,"

and if a record may be withheld under the attorney work-product protection of Exemption 5,

"then segregability is not required." Id. Moreover, "Exemption 5, attorney work-product is

28 exempt from mandatory disclosure without regard to the status of the litigation for which it was

prepared." FTC v. Grolier Inc., 462 U.S. 19, 28 (1983). However, if the records were prepared

by attorneys "in the ordinary course of business or for other nonlitigation purposes," the agency

cannot rely upon the work product privilege under Exemption 5. In re Sealed Case, 146 F.3d

881, 887 (D.C. Cir. 1998) ("Of course, not all work undertaken by lawyers finds protection in the

work-product privilege.").

The defendant asserts that records 10-11, 13-15, 18-29, 31-46, 48-64, and 77 may be

withheld pursuant to the attorney work-product privilege conferred by Exemption 5. Def.'s

Mem. at 14. The declarant for the defendant on this subject, a Senior Special Counsel in the

Office of the General Counsel, states that "all of these documents for which the SEC asserts

Freedom of Information (FOIA) Exemption 5 concern internal Commission legal and personnel

matters, and I believe are privileged as attorney work product . . . . [because the documents] were

prepared in anticipation of litigation by or at the direction of an attorney." Def.'s Mem., Ex. 2

(Pinansky Decl.) ¶¶ 3, 10; see also Def.'s Reply, Ex. 10 (Pinansky Suppl. Decl.) ¶ 5 (indicating

that "[s]ome of the[] documents also include legal analysis and strategy"). The declarant also

states: "Because serious discipline of this employee was a possibility at all times we were

addressing the personnel problem, we recognized from the beginning of the process that

litigation was possible and that we needed to prepare for that situation." Def.'s Mem., Ex. 2

(Pinansky Decl.) ¶ 10. The declarant further states that he, as an attorney, "addressed litigation

issues with all of the [Office of Human Resources] staff and supervisors involved in that matter,

and to address issues [he] raised, they raised issues, gathered information and prepared

memoranda in light of these issues." Id.

29 The plaintiff counters that the defendant's assertion of the attorney work-product

privilege lacks the necessary details to support it. Pl.'s Mem. at 16. The plaintiff asserts that it

"defies logic and belief" that "every record withheld regarding this [personnel] matter was

prepared by or at the direction of an attorney in anticipation of litigation." Id. And the defendant

opines that because the defendant "has identified no litigation between it and the employee who

was the subject of the disciplinary matter," the records "appear to have been created for some

other purpose than to assist in reasonably foreseeable litigation." Id. at 17. The plaintiff notes

that the defendant's Vaughn index "entries make no reference to being prepared by or at the

direction of an attorney or that they were prepared in anticipation of litigation . . . . [and posit]

they therefore do not reflect the mental impressions of an attorney prepared in anticipation of

litigation." Pl.'s Reply at 18.

While the "[work-product] doctrine should be interpreted broadly and held largely

inviolate," and often there is no necessity to segregate information within work-product records,

Judicial Watch I, 432 F.3d at 369, 371 (indicating that "[a]ny part of [a document] prepared in

anticipation of litigation, not just the portions concerning opinions, legal theories, and the like, is

protected by the work product doctrine and falls under exemption 5" (citation omitted)), the

Court again cannot award summary judgment to the defendant based on its current

representations. The defendant's representations are simply too cursory for the Court to ensure

that it is making an accurate assessment and not just giving the defendant more deference,

beyond the good faith deference that it is due, in making withholding determinations under

Exemption 5. The defendant must submit additional evidence that establishes that all of the

communications were created with litigation in mind. The plaintiff's position that all personnel

actions do not automatically trigger the attorney work-product privilege is correct, but this reality

30 does not compel the defendant to demonstrate that litigation actually resulted from this personnel

dispute. See In re Sealed Case, 146 F.3d at 887 ("[W]here . . . lawyers claim they advised clients

regarding the risks of potential litigation, the absence of a specific claim [that the client

potentially faced litigation] represents just one factor that courts should consider in determining

whether the work-product privilege applies."). "For a document to meet this standard, the lawyer

must at least have had a subjective belief that litigation was a real possibility, and that belief

must have been objectively reasonable." Id. at 884. There are any number of tasks that an

attorney could undertake on behalf of or communications that an attorney could have with the

human-resources component of an agency – likely even in the contents of an employee's

termination – that never trigger the attorney work-product protection because litigation was not

objectively reasonable. And the converse is equally true. These determinations cannot be

assessed on the existing record, and the defendant must supply greater detail to satisfy its burden

to receive the protection of the attorney work-product privilege.

3. Exemption 6

Exemption 6 of the FOIA permits the government to withhold "personnel and medical

files and similar files the disclosure of which would constitute a clearly unwarranted invasion of

personal privacy." 5 U.S.C. § 552(b)(6). The phrase "similar files" has been "broadly defined to

include any 'Government records on an individual which can be identified as applying to that

individual.'" Judicial Watch of Fla. v. U.S. Dep't of Justice ("Judicial Watch II"), 102 F. Supp.

2d 6, 16 (D.D.C. 2000) (citing U.S. Dep't of State v. Wash. Post Co., 456 U.S. 595, 601-02

(1982)). As construed by the District of Columbia Circuit: "Exemption 6 permits the

withholding of information only when two requirements have been met: first, the information

must be contained in personnel, medical, or 'similar' files, and second, the information must be of

31 such a nature that its disclosure would constitute a clearly unwarranted invasion of personal

privacy." Wash. Post, 456 U.S. at 598. This "exemption [was] intended to cover detailed

Government records on an individual which can be identified as applying to that individual." Id.

at 602 (alteration in original) (citation omitted). However, Exemption 6 should only be

employed when the privacy interest at stake outweighs the public interest in disclosure.

Therefore, the Court must "balance the 'individual's right of privacy' against the basic policy of

opening 'agency action to the light of public scrutiny," U.S. Dep't of State v. Ray, 502 U.S. 164,

175 (1991) (quoting Dep't of the Air Force v. Rose, 425 U.S. 352, 372 (1976)), always "tilt[ing]

the balance (of disclosure interests against privacy interests) in favor of disclosure," Wash. Post

Co. v. U.S. Dep't of Health & Human Servs., 690 F.2d 252, 261 (1982) (citation omitted).

However, "[t]he weight of the public's interest in disclosure depends on the degree to which

disclosure would shed light on an agency's performance of its statutory duties and its compliance

with the law." Judicial Watch II, 102 F. Supp. 2d at 17 (citing Reed v. NLRB, 927 F.2d 1249,

1252 (D.C. Cir. 1991)). "Information that 'reveals little or nothing about an agency's own

conduct' does not further the statutory purpose; thus the public has no cognizable interest in the

release of such information." Beck v. Dep't of Justice, 997 F.2d 1489, 1493 (D.C. Cir. 1993)

(citation omitted).

Just as it did with Exemption 5, the defendant relies on Exemption 6 to withhold almost

all of the 80 records included in the Vaughn index. Specifically, the defendant states that

Exemption 6 justifies its withholding of records 1-22, 25-57, and 59-80, see Def.'s Reply, Ex. 9,

because all but the excluded records "relate to an internal investigation of an employee and

address issues related to the potential discipline of the employee," Def.'s Mem. at 18, and

"contain names, phone numbers, and e[-]mail addresses of individuals" who "have at least some

32 privacy interest in not making public their involvement in an SEC investigation," Def.'s Mem. at

19-20; id., Ex. 3 (Hall Decl.) ¶ 6. One of the defendant's declarants, again the Senior Special

Counsel in the Office of the General Counsel, states that the records pertain to "personnel

matters and address issues in which one or more SEC employees would have a privacy interest,"

and "[i]nformation pertaining to internal personnel matters is very sensitive; especially to the

extent it concerns possible misconduct and potential discipline for that misconduct." Id., Ex. 4

(Pinansky Decl.) ¶¶ 3, 5. Another declarant, an Employee and Labor Relations Specialist, adds

that the information in records 1-77 relates to a "personnel situation [that] involved numerous

internal discussions, meetings and communications with SEC supervisors [and others within the

SEC]." Id., Ex. 5 (Declaration of Nancy Ellen Tyler) ("Tyler Decl.") ¶ 4. The defendant also

maintains that the employee's identity will not be protected by mere redactions of the employee's

name and personally identifiable information "because other information in the documents, along

with information that is publicly available, could be used to identify the employee" and thus the

individual's privacy interests would be harmed. Id., at 18; see id., Ex. 5 (Tyler Decl.) ¶ 7; Def.'s

Reply, Ex. 10 (Pinansky Suppl. Decl.) ¶ 7. The defendant also contends that the names and

personally identifiable information of other persons involved in the investigation, not just the

target of the investigation, is also subject to Exemption 6, Def.'s Mem. at 18, and that no amount

of redaction will conceal the identity of the individuals involved, in part because the plaintiff's

requests ask for records related to certain individuals, so the production of any information

would necessarily identify those individuals, Def.'s Reply at 9. The defendant states that the

plaintiff's interest in the production of these records arises from "a personal desire to conduct a

fishing expedition for information," and that he does not have "a legitimate public interest in any

information." Def.'s Reply at 11.

33 The plaintiff contends that the defendant's reliance on Exemption 6 is misplaced. He

maintains that the records are not the type of "personnel, medical, or similar files" governed by

Exemption 6, and there has been no showing that an "unwarranted invasion of personal privacy"

will result under 5 U.S.C. § 552(b)(6) from their disclosure. Pl.'s Mem. at 23. The plaintiff

opines that if the identifying information was redacted from these records, any privacy intrusion

would be mitigated. Id. He adds that in weighing the importance of public disclosure, it should

be remembered that only if the target of the investigation is identifiable in the records is

Exemption 6 applicable, and even if the target becomes identifiable after appropriate redactions

are made, the public interest in disclosure still outweighs those privacy concerns because the

person most likely to be the subject of the investigation (an individual the plaintiff identifies by

name) personally communicated with the plaintiff and accusing the plaintiff of being a "traitor"

and "unpatriotic." Id. at 25.

There appears little question that the types of files the defendant seeks to protect under

Exemption 6 fall within the scope of this exemption, as they are personnel-related and their

content – the investigation of alleged wrongdoing by an SEC employee – implicates "substantial

privacy concerns" of the subject of the investigation. Dep't of State v. Wash. Post Co., 456 U.S.

595, 602 (1982) ("[E]xemption [6] [was] intended to cover detailed Government records on an

individual which can be identified as applying to that individual." (citation and internal quotation

marks omitted)). The only question then is "whether release of the information would constitute

a clearly unwarranted invasion of that person's privacy." Id. The plaintiff contends that the

target of the investigation (an investigation which presumably relates to feisty e-mail

communications sent to the plaintiff and the then-Chairman of the SEC by one of the defendant's

trial counsel) is a public employee and his communications have been published in the press.

34 Pl.'s Mem. at 25. That being the case, posits the plaintiff, "the public has an interest in knowing

whether [that employee's] actions were in any way connected to the SEC’s investigation of [the

plaintiff]," in part considering that the employee's official government e-mail address was used.

Id. at 25-26. The defendant responds that trial counsel referenced by the plaintiff is a non-

managerial employee of the defendant, Def.'s Reply, Ex. 10 (Pinansky Suppl. Decl.) ¶ 8, and the

plaintiff has not "provide[d] any reason to believe that [the employee] made any such statements

in the context of conducting Commission business or that [the employee] ever worked on any

matter relating to [the p]laintiff," Def.'s Reply at 12.

Against this backdrop, the Court must conclude that the public has some interest in

knowing whether the defendant will take action if one of its employees, whose work is funded

from the public coffers and utilized government resources to communicate with the plaintiff and

the SEC Chairman, is utilizing his position to purportedly further private interests or harass

private citizens. This case is not a situation where a requester is merely trying to acquire

information regarding another private individual. And an important factor to bear in mind is that

the defendant appears to want to have things both ways – relying on the one hand on the

extensive media attention this litigation and the underlying basis for it have received as support

for its position that the privacy of the investigated employee warrants non-disclosure of the

documents, Def.'s Mem. at 19, while ignoring on the other hand the clear indication that the

extent of the media coverage demonstrates the public interest in these matters. There is a

compelling public interest in knowing whether the defendant conducts investigations free of

misconduct by its employees and how alleged transgressions by its employees are addressed; the

disclosure sought by the plaintiff would assuredly "shed light on an agency's performance of its

statutory duties and its compliance with the law." Judicial Watch II, 102 F. Supp. 2d at 17

35 (citation omitted). That said, the individuals involved do have privacy interests in keeping

personal details out of the public eye, which is the impetus for Exemption 6, but that is also why

redaction is used as a safeguard in such situations.

While these are the competing interests that are at play, the concern for the Court is not

whether Exemption 6 applies to information contained within these records, because even on the

scant representations of the defendant it would seem to apply to portions of the record, see Def.'s

Mem., Ex. 3 (Hall Decl.) ¶ 12; id., Ex. 4 (Pinansky Decl.) ¶ 6; id., Ex. 5 (Tyler Decl.) ¶ 6, but

whether the public interest favors disclosure of some parts of the records. And that balancing

cannot be properly conducted based upon the vague assertions provided by the defendant, as

greater detail concerning the content of each record is needed to determine whether that

information is exempted from disclosure. This particularized examination is required because

Exemption 6 is not one of the exemptions that inherently shields records in their entirety, see,

e.g., Billington v. U.S. Dep't of Justice, 233 F.3d 581, 586 (D.C. Cir. 2000) (remanding for a

segregability determination concerning records over which the agency claimed Exemption 6

protection), and information that does not pertain just to any individuals involved in an

investigation, but rather to the logistics of an investigation (such as routing numbers, dates, stock

types involved, and event dates), which the defendant acknowledges is included in these records,

see Def.'s Mem., Ex. 3 (Hall Decl.) ¶¶ 7-12, is not protected from disclosure, see Billington, 233

F.3d at 586 (remanding for inquiry as to whether Exemption 6 applied to the records in their

entirety because it was "uncertain that personal identifying information so permeates the

document that no part of it can be released"). The defendant thus far only speculates that

"[d]isclosure of such information [as is contained in records 1-77] could amount to an invasion

of privacy of the individuals identified," id., Tyler Decl. ¶ 5 (emphasis added), but the defendant,

36 who carries the burden, must do more than that to demonstrate a "clearly unwarranted invasion

of personal privacy." 5 U.S.C. § 552(b)(6).

Therefore, with respect to records 78-80, while the Court again does not dispute that the

names of the individuals involved in the investigations, as well as their contact information may

be withheld for privacy reasons, the defendant has failed to establish that the withheld records

contain exclusively such information, or that no other information in the records can be

segregated from the personally identifying information in order that redacted disclosures can be

made. Upon the representations currently before the Court, the only conclusion the Court can

reach in light of the presumption in favor of disclosure is that redacted versions of the records

must be disclosed.

4. Exemption 7(A)

Under the FOIA, agencies are authorized to withhold “records of information compiled

for law enforcement purposes, but only to the extent that production of such law enforcement

records or information could reasonably be expected to interfere with enforcement proceedings.”

5 U.S.C. § 552(b)(7)(A). In order to justify the withholding of records an agency must show that

(1) a law enforcement proceeding for which the records were compiled is pending or reasonably

prospective and (2) that the release of the information could reasonably be expected to cause

some articulable harm. In crafting this Exemption, “Congress recognized that law enforcement

agencies had legitimate needs to keep certain records confidential, lest the agencies be hindered

in their investigation or placed at a disadvantage when it came time to present their cases.”

Alyeska Pipeline Serv. Co. v. EPA, 856 F.2d 309, 313 (D.C. Cir. 1988) (quoting NLRB v.

Robbins Tire & Rubber Co., 437 U.S. 214, 224 (1978)). Nonetheless, this exemption is not

meant to be a “blanket exemption” for any files or records that are relevant to an investigation –

37 their disclosure must be reasonably expected to interfere in a “palpable, particular way” with the

investigation. North v. Walsh, 881 F.2d 1088, 1100 (D.C. Cir. 1989). And a document that is

merely “useful” to a requester who is (or was) the subject of an investigation is insufficient to

merit disclosure under the FOIA. Id. at 1099-1100.

The defendant maintains that documents 9 and 16-18 are exempt from disclosure

pursuant to Exemption 7(A). See Def.'s Reply, Ex. 9. According to the Vaughn index, these

records consist of e-mails between employees of the defendant related to employment leave

requests, an internal investigation, and a recommendation for employee discipline. Id. The

defendant contends that it is justified in withholding these records because they derive from "the

Division of Enforcement's and the OIG's active and ongoing investigations." Def.'s Mem. at 21;

see also id., Ex. 6 (Riewe Decl.) ¶¶ 5-11; id., Ex. 7 (Declaration of Noelle L. Frangipane)

("Frangipane Decl.") (Frangipane Decl.) ¶ 11. The defendant has categorized the records and

describes generally how disclosure of each category could cause harm to the defendant's

investigatory interests. Id., Ex. 7 (Frangipane Decl.) ¶ 9.

The plaintiff counters that the defendant has not carried its burden under Exemption 7(A)

because an internal audit of the defendant's practices concluded that the defendant overuses

Exemption 7(A) to withhold records from FOIA requesters. Pl.'s Mem. at 29. The plaintiff

contends that the categories of the withheld documents designated by the defendant are arbitrary,

overbroad, and lack the requisite specificity to warrant their non-production. Id. at 33. The

plaintiff asserts that the defendant has not sufficiently articulated "any potential nexus between

disclosure and any potential harm to an enforcement proceeding" sufficient to justify the

withholding of records in their entirety. Id. at 34. Finally, the plaintiff contends that because the

defendant produced documents related to him during the discovery process in ongoing litigation

38 between the parties in Texas, see SEC v. Cuban, 634 F. Supp. 2d 713 (N.D. Tex. 2009), but

those same documents have not been produced to him in this FOIA litigation based on the

defendant's claim that all records related to the plaintiff are shielded from production by 7(A),

the defendant's claims of accurate processing and its reliance on Exemption 7(A) "are, at a

minimum, incorrect and unreliable" and therefore must be rejected. Pl.'s Reply at 20-23.

Exemption 7(A) only justifies withholding records compiled for law enforcement

purposes for a limited time while an investigation is ongoing. 5 U.S.C. § 552(b)(7)(A). And it is

with respect to Exemption 7(A) that the defendant makes its most detailed submission in support

of its non-production of responsive records. Whatever the merits to the plaintiff's assertions that

the defendant has in the past overused its reliance on Exemption 7(A), it cannot be assumed that

such past practice casts doubt upon its reliance on Exemption 7(A) in this case. It also cannot be

concluded, as the plaintiff urges, that because records produced in the Texas litigation might be

the same records as those that were not produced here renders the defendant's reliance on

Exemption 7(A) irrational. As the Court indicated in its earlier discussion regarding the

adequacy of the defendant's search, the law is clear that an agency's search “need not be perfect,

only adequate, and adequacy is measured by the reasonableness of the effort in light of the

[plaintiff's] specific request,” Meeropol, 790 F.2d at 956. The Court therefore declines to reject

the defendant's reliance on Exemption 7(A) because it may be the case that records, which may

or may not be part of the defendant's investigatory file, were not produced. To do otherwise

would result in the Court acting on pure speculation, which obviously it cannot do.

Indeed, the Court finds that because the investigation is ongoing Exemption 7(A) may be

properly relied upon by the defendant to withhold records 9 and 16-18; the defendant's showing

is sufficient even though it has not specifically described the basis for the non-disclosure in each

39 instance, because extensive specificity is not required for Exemption 7(A) where providing such

detail would undermine the precise reason for the non-disclosure. Juarez v. Dep’t of Justice, 518

F.3d 54, 59 (D.C. Cir. 2008) (“‘the release of information in investigatory files prior to the

completion of an actual, contemplated enforcement proceeding was precisely the kind of

interference that Congress continued to want to protect against’” in approving Exemption 7(A)

(quoting NLRB v. Robbins Tire & Rubber Co., 437 U.S. 214, 236 (1978))). The defendant has

therefore described in sufficient detail the nature of the records it has withheld and the harm that

could befall the agency if these records are prematurely released. See Def.'s Mem., Ex. 6 (Riewe

Decl.) ¶¶ 7-12; id. Ex. 7 (Frangipane Decl.) ¶ 9. The Court also accepts the defendant's

representations that release of the records 9 and 16-18 might reveal its investigative strategy and

findings concerning the investigation before they are finalized. However, this justification for

withholding the records is only temporary and the defendant must be prepared to make a

continuing showing to justify its continued withholding of the Exemption 7(A) records in full.

5. Exemption 7(C)

Exemption 7(C) is designed to protect the personal privacy interests of individuals named

or identified in “records or information compiled for law enforcement purposes,” to the extent

that their disclosure “could reasonably be expected to constitute an unwarranted invasion of

personal privacy.” 5 U.S.C. § 552(b)(7)(C); 10 see also U.S. Dep't of Justice v. Reporters Comm.

for Freedom of the Press, 489 U.S. 749, 756 (1989). In order to determine whether a

10 It bears noting that while similar, the reach of the privacy interest protected under Exemption 7(C) is much broader that the reach of Exemption 6. See Nat'l Archives & Records Admin. v. Favish, 541 U.S. 157, 165-66 (2004) ("This provision [of Exemption 7(C)] is in marked contrast to the language in Exemption 6, pertaining to 'personnel and medical files, where withholding is required only if disclosure would constitute a clearly unwarranted invasion of personal privacy.' The adverb 'clearly,' found in Exemption 6, is not used in Exemption 7(C). In addition, 'whereas Exemption 6 refers to disclosures that would constitute an invasion of privacy,' Exemption 7(C) encompasses any disclosure that 'could reasonably be expected to constitute such an invasion.'" (citations and internal quotation marks omitted)).

40 withholding by an agency is proper, an individual's right to privacy must be weighed against the

public's right to disclosure. Sussman v. U.S. Marshals Serv., 494 F.3d 1106, 1115 (D.C. Cir.

2007); Davis v. Dep't of Justice, 968 F.2d 1276, 1281 (D.C. Cir. 1992). Where a legitimate

privacy interest is implicated, the requester must "[(1)] show that the public interest sought to be

advanced is a significant one, an interest more specific than having the information for its own

sake, and [(2)] show the information is likely to advance that interest." Nat'l Archives &

Records Admin. v. Favish, 541 U.S. 157, 158 (2004).

Stated in alternative terms: "[W]hether disclosure of a private document under Exemption

7(C) is warranted must turn on the nature of the requested document and its relationship to 'the

basic purpose of the Freedom of Information Act to open agency action to the light of public

scrutiny,' rather than on the particular purpose for which the document is being requested."

Reporters Comm., 489 U.S. at 772 (citation and internal quotation marks omitted). And that

purpose cannot have as its objective use of the FOIA as a means for a requester to spy on another

private citizen; rather, the request must have the objective of obtaining a response that "sheds

light on the conduct of [a] Government agency or official." Id. at 773. Thus, a request that seeks

"information that would explain how the disciplinary procedures actually functioned" is

permissible, id., but a request seeking information regarding "private citizens that happens to be

in the warehouse of the Government," such as one's criminal history, is not the proper subject for

a FOIA request. Id. at 774.

The defendant maintains that documents 9, 16-18, and 78-80 are exempt from disclosure

pursuant to Exemption 7(C). See Def.'s Reply, Ex. 9. These records consist of e-mails authored

by employees of the defendant concerning employment leave requests, an internal agency

investigation, and a recommendation for employee discipline. Id. According to the defendant, it

41 has properly withheld these records pursuant to Exemption 7(C) because the records are "law

enforcement records, either from an OIG investigation or from a securities enforcement

investigation," and the privacy interests of the persons involved outweigh any interest in public

disclosure of the records. Def.'s Mem. at 21. According to the defendant's declarant, the Deputy

Inspector General in the Office of Inspector General of the Securities and Exchange

Commission, who is familiar with these records, the internal SEC e-mail communications were

withheld because their disclosure could interfere with an ongoing investigation by informing

someone external to the investigation of the identity of individuals who have been interviewed,

what documents have been requested, what sources of information exist, and what information

the agency considers relevant to the investigation. Def.'s Mem., Ex. 7 (Frangipane Decl.) ¶ 9(B).

The declarant states that records 9 and 16-18 were withheld because they contain information

related to an ongoing OIG investigation into internal misconduct by SEC employees. 11 Id. ¶ 11.

The plaintiff contends that the defendant's reliance on Exemption 7(C) to withhold these

records in their entirety is improper because it has not shown that its investigation includes

anything other than ordinary monitoring of its employees, Pl.'s Mem. at 28, nor has the defendant

established that any resulting invasion of privacy is "clearly unwarranted" when balanced against

the public interest as required by 5 U.S.C. § 552(b)(6), Pl.'s Reply at 18. The plaintiff further

contends that the defendant has not made a showing that any information in the records exempt

from disclosure under Exemption 7(C) cannot be segregated from the remainder of the records.

Pl.'s Mem. at 28.

11 Records 9 and 16-18 do not relate to an investigation conducted by the Office of Human Resources. Def.'s Reply, Ex. 11 (Tyler Suppl. Decl.) ¶ 4.

42 The first point to consider is that the request in this case involves one individual seeking

records regarding another individual. But what distinguishes the facts in this case from those in

Reporters Committee, where a requester sought the disclosure of the rap-sheet (the criminal

record) of another private individual, 489 U.S. at 751, and the Supreme Court concluded the

privacy interest under Exemption 7(C) in such circumstances "is in fact at its apex," 489 U.S. at

780, is that the subject of the plaintiff's request there was not a government official who

allegedly committed improper acts while performing his official duties. Here, the subject of the

plaintiff's FOIA request is a government employee who, if the plaintiff's allegations are correct,

was utilizing the government e-mail system to harass the plaintiff. Pl.'s Mem. at 25.

Accordingly, here, disclosing the information sought by the plaintiff could accord him and the

public in general insight into how the defendant addresses allegations of employee misconduct

and misuse of government resources, information of unquestionable public interest. However, it

is equally clear that the identities of the subject of the investigation and those involved in the

investigative process is not nearly as significant as the actions (or lack thereof) taken by the

defendant, and the disclosure of the identities of these individuals would likely compromise their

privacy interests. Weisberg v. U.S. Dep't of Justice, 745 F.2d 1476, 1491 (D.C. Cir. 1984)

(holding that the names of cooperators, investigators, and other "'third persons mentioned in the

documents'" were properly withheld under Exemption 7(C) (citation omitted)). But even if the

Court accepts the defendant's representations that the identify of persons connected with the

investigation should not be disclosed for the reasons the defendant offers, Def.'s Mem., Ex. 7

(Frangipane Decl.) ¶ 9(B), including "the stigma of being associated with any law enforcement

investigation," Amuso v. U.S. Dep't of Justice, 600 F. Supp. 2d 78, 97 (D.D.C. 2009) (citing

43 Reporters Comm., 489 U.S. at 773-75), the issue of whether Exemption 7(C) has been properly

relied upon can not yet be resolved on the existing record.

Simply, the defendant has not justified withholding the remainder of the information

likely contained in the records. Nothing in the defendant's proffer assists the Court in assessing

why redacting the names and any other identifying characteristics of the persons involved in the

OIG investigations will not adequately protect the privacy interests at stake, a finding that the

Court must be able to make to sanction a complete withholding. See Stolt-Nielsen Transp. Grp.

Ltd., 534 F.3d at 734 (indicating that the district court must pass on the question of the

segregability of the records withheld). The defendant's representation that its reliance on

Exemption 7(C) is justified are not convincing, and how the Exemption applies to records 9 and

16-18 is addressed in only one short paragraph in the Deputy Inspector General's statement. The

Court is essentially left to rely on the vague descriptions provided in the Vaughn index, which

are nothing more than conclusory. On these submissions, the defendant has not met its burden of

providing the Court with information from which it can confidently conclude that the privacy

rights of the individuals referenced in the records can be protected only by the non-production of

all of the records in their entirety, when weighed against the public's right to disclosure.

C. The Privacy Act

The Privacy Act authorizes individuals to bring suit to challenge an agency's refusal "to

comply with an individual request" for the production of records concerning the requester.

5 U.S.C. § 552a(b), (g)(1). The defendant's Privacy Act regulations require an agency to either

grant or deny access to the record(s) requested "within 30 days," and if a request is denied, to

communicate that denial to the requester. 17 C.F.R. § 200.304(c)-(d) (2007).

44 The defendant contends that the plaintiff "has no right of access to the documents he

seeks under the Privacy Act" because they are investigative records exempt from disclosure

pursuant to 17 C.F.R. §200.313, and therefore the defendant did not waive its right to withhold

the records even if it failed to respond to the plaintiff's request. See Def.'s Mem. at 33; Def.'s

Reply at 17. The plaintiff responds that because the defendant "never acknowledged [his]

Privacy Act request, never responded to his Privacy Act request, never informed him that access

to his records under the Privacy Act was denied or why access was denied, and never advised

him of his right to appeal the SEC’s denial of access," it cannot now for the first time and in the

midst of litigation raise its objections to production of the records requested. Pl.'s Mem. at 37.

Because the plaintiff contends that the defendant's objection to production was untimely and

therefore waived, he asks the Court to compel the defendant's compliance.

While it does appear that the defendant's compliance with the Privacy Act was less than

clear, the defendant did state that it was withholding records responsive to the categories that the

plaintiff sought in his request letter pursuant to the FOIA and the Privacy Act, see, e.g., Def.'s

Mem., Ex. 1 (Winter Decl.), Attach. D (Feb. 5, 2009 Letter from Mark P. Siford to David Ross)

at 1 (indicating the defendant was withholding records responsive to categories 2 ("[r]ecords

which mention or relate to Mr. Cuban") and 5 ("[r]ecords relating to Mr. Cuban's Wells

Submission dated September 21, 2007") of the plaintiff's Request Letter II). Although the Court

does not condone evolving positions seemingly formulated during the course of litigation that

surprises the opponent, given the state of the record the defendant's position does not appear to

vary materially from its original stance taken during the administrative process. Thus, even

though it appears that the defendant did not explicitly rely upon 17 C.F.R. §200.313, as it now

does, the agency is nonetheless entitled to refine its position. See Barnard v. Dep't of Homeland

45 Sec., 598 F. Supp. 2d 1, 25 n.16 (D.D.C. 2009) ("there is no requirement that an agency

administratively invoke [a Privacy Act] exemption in order to later rely on it in federal court");

accord Young v. CIA, 972 F.2d 536, 538 (4th Cir. 1992) ("[A]n agency does not waive FOIA

exemptions by not raising them during the administrative process."). The Court will therefore

consider the merits of any future challenges raised by the plaintiff to the defendant's assertion

that a withholding of records is sanctioned by the Privacy Act.

D. The Defendant's Request to Bifurcate and Stay the Plaintiff's Remaining Three Requests

Under the FOIA, an agency receiving a request must determine whether to comply with

the request within 20 working days. See 5 U.S.C. § 552(a)(6)(A)(i). The Court may, however,

"allow the agency additional time to complete its review of the records" upon a showing that

"exceptional circumstances exist and that the agency is exercising due diligence in responding to

the request." § 552(a)(6)(C)(i). The defendant here seeks three additional years to respond to

the plaintiff's request, which involves the review of 107 boxes of documents. Def.'s Mot. to Stay

at 2. The plaintiff, understandably, takes the position that the request for a three-year stay is

unreasonable and unsupported by the record. Pl.'s Opp'n to Stay at 2.

The defendant has explained in great detail the extent of the demands it is experiencing

responding to the plaintiff's requests and requests like it from other requesters. See generally

Def.'s Mot. to Stay, Ex. 1 (Declaration of Margaret Celia Winter). Those demands include

thousands of requests and the resultant review of large volumes of documents, a task divided

among roughly only two dozen SEC employees and forty "FOIA Liaisons within the agency's

various offices and divisions." Id. ¶¶ 6-11, 21. Requests are generally responded on a first-in,

first-out track. Id. ¶¶ 14-15. Despite these representations, three years is an extraordinarily long

46 period of time for the plaintiff to await the production of all records responsive to his FOIA

request. Also, given the time that has elapsed since this case was initiated (over fifteen months

ago) and when the defendant's motion to stay was filed (over seven months ago); the significant

progress the defendant represents it has made over the past several years in improving its

response time to FOIA requests; and the fact that the defendant's response time hinges, at least in

part, on the duration of other litigation that may or may not remain active, id. ¶¶ 53-58, the Court

will deny the defendant's motion without prejudice and conduct a status conference to assess the

current status of the defendant's processing of the plaintiff's requests to determine whether

granting the defendant additional time to fulfill its statutory obligation is appropriate. Also at

that hearing, the defendant should be prepared to present witnesses associated with the ongoing

investigation that provides the basis for its withholding of records under Exemption 7(A) of the

FOIA. If the investigation is still active, then the defendant must submit proof that another

exemption applies that justifies the complete withholding of records 9 and 16-18. The Court

further anticipates setting a timeline for the production of the redacted records versions of these

records at the hearing or entertaining alternative proposals from the parties for expeditiously

advancing this case to its final resolution. 12

12 In the event the defendant seeks reconsideration of any ruling in this Opinion with respect to the records not yet produced, and proffers additional declarations or other evidence upon which its position is based, the following observations are noted. As the Court has indicated throughout this Opinion, most of the defendant's representations were extremely limited, vague, and conclusory as to its reliance on Exemptions 2, 5 (with respect to the attorney-client privilege, the deliberative process privilege, and the attorney work-product doctrine), 6, 7(A) and 7(C), and it was the defendant's failure to provide proper justification for its withholding of records that resulted in summary judgment being partially entered for the plaintiff. For example, while two declarations submitted with respect to the adequacy of the defendant's search (an issue on which the plaintiff bore the burden of proving unreasonable) contained 157 paragraphs and 18 paragraphs respectively, the defendant's declarations with respect to the applicability of the multiple exemptions to the 80 different records listed in its Vaughn index (issues on which the defendant bore the burden to prove) ranged from 4 to 13 paragraphs (paragraphs that were frequently only a sentence or two in length, inclusive of the necessary foundational information relating to the declarant's employment status and competency). It was upon these minimally supported declarations that the defendant relied to satisfy its burden. In no way is the Court indicating that the defendant must bury the Court and the plaintiff in paper and finite (continued . . . ) 47 IV. CONCLUSION

For the foregoing reasons, the Court finds that both parties' cross-motions for summary

judgment must be granted in part and denied in part. 13 Specifically, the Court finds that the

defendant's search for records responsive to categories 7, 11, 12, and 13 of Request Letter I was

inadequate. Also, the defendant's reliance on Exemptions 2 and 6 to withhold records 78-80, and

Exemption 7(C) to withhold records 9, 16-18, and 78-80, is not sufficiently substantiated to meet

its burden to withhold these records in their entity. The same is tr+ue in regard to the assertion

of Exemption 5. The defendant has also failed to satisfy its burden of showing that records 11,

13, 21, 25-26, 29, 32, 34-35, 37, 39, 41-44, 53, 55, 57 59, and 61-63 may be withheld under the

attorney-client privilege; records 1-3, 9, 11, 13-15, 17, 19, 21-22, 25-29, 32-35, 37-46, 48-57,

59-64, 69, 71, and 73-76 may be withheld under deliberative process protection; or records 10-

( . . . continued) detail to justify its invocation of a FOIA exemption. At the same time, however, the defendant can hardly expect to meet its burden with abbreviated and uninformative information that precludes the Court from independently evaluating the merits of the defendant's positions. In many cases the defendant chose to merely group together multiple documents into general subject areas and universally asserted the applicability of exemptions to those records, rather than distinguishing the content of specific records, which is necessary to establish that redactions are unwarranted or impossible. The purpose for requiring a Vaughn index is to provide courts with more than just "conclusory and generalized allegations of exemptions," Campaign for Responsible Transplantation v. Food & Drug Admin., 511 F.3d 187, 196 (D.C. Cir. 2007) (citation omitted), because "a withholding agency must supply a relatively detailed justification, specifically identifying the reasons why a particular exemption is relevant and correlating those claims with the particular part of a withheld document to which they apply." Krikorian v. Dep't of State, 984 F.2d 461, 467 (D.C. Cir. 1993) (emphasis in original) (citation and internal quotation marks omitted). The defendant must simply put more effort into its submission to convince the Court that it is entitled to the relief it seeks. It is also worth noting that while the Court at this juncture is declining to conduct in camera review of disputed records, it may in the future decide that such review is necessary. In camera review is unnecessary at this point not because the Court can make a determination on whether the records can be released based on the descriptions provided, but because most of the defendant's descriptions are woefully inadequate. And the Court cannot permit an agency to transfer the burden of conducting the review of these records to the Court by providing inadequate descriptions of the records; that is the defendant's responsibility. It is only those situations where descriptions provided by the agency are as detailed as possible, but nonetheless fail to provide the Court with sufficient information upon which to base its determinations, when in camera review should be exercised. See id. ("We therefore leave it to the district court to determine on remand whether more detailed affidavits are appropriate or whether an alternative such as in camera review would better strike the balance between protecting sensitive foreign relations information and disclosing non-exempt information as required by the FOIA.") 13 The Court will issue an Order consistent with this Memorandum Opinion.

48 11, 13-15, 18-29, 31-46, 48-64, and 77 may be withheld under the attorney work-product

privilege. On the other hand, the Court finds that the defendant has established that records 9

and 16-18 may be withheld under Exemption 7(A) during the pendency of the ongoing

investigation; however, given the passage of time since that exemption was first invoked, at the

hearing the Court will conduct in this matter the defendant should be prepared to establish by the

testimony of representatives involved in the investigation whether the investigation is still

ongoing, as well as the anticipated duration of the investigation. Moreover, to the extent that the

Court has found that the defendant cannot rely on an exemption to withhold a record in its

entirety, the defendant is obligated by the FOIA to produce a complete or redacted version of the

record to the plaintiff, and must do so forthwith. Finally, the Court finds that it must deny

without prejudice the defendant's motion for a three-year stay of this litigation pending its

production of responsive records, and that at the hearing the Court will conduct, it will determine

how much additional time, if any, the defendant is entitled to receive to complete the processing

of the plaintiff's FOIA requests.

________/s/_______________ REGGIE B. WALTON United States District Judge