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Judicial Watch • 2011 jw-v-fhfa-appellantreplybrief-03212011

2011 jw-v-fhfa-appellantreplybrief-03212011

2011 jw-v-fhfa-appellantreplybrief-03212011

Page 1: 2011 jw-v-fhfa-appellantreplybrief-03212011

Category:Legal Document

Number of Pages:13

Date Created:March 21, 2011

Date Uploaded to the Library:July 30, 2013

Tags:directive, stand, peterson, orfanedes, control, table, subject, legal, Street, requested, information, Congress, Counsel, service, justice, watch, plaintiff, request, records, federal, judicial, department, James, states, Washington, united, court, EPA, IRS, ICE, CIA


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SCHEDULED FOR ORAL ARGUMENT MAY 10, 2011] NO. 10-5349 THE 
UNITED STATE COURT APPEAL 
FOR THE DISTRICT COLUMBIA CIRCUIT 

JUDICIAL WATCH, INC. 

Plaintiff-Appellant, 
FEDERAL HOUSING FINANCE AGENCY 

Defendants-Appellees. APPEAL FROM THE U.S. DISTRICT COURT 
FOR THE STRICT COLUMBIA 

REPLY BRIEF APPELLANT 

Paul Orfanedes 
James Peterson 
JUDICIAL WATCH, INC. 
425 Third Street, S.W., Suite 800 
Washington, 20024 
(202) 646-5172 

Counsel for Plaintiff-Appellant 

TABLE CONTENTS 
TABLE CONTENT

....	......... ............................. 

TABLE AUTHORITIES .......................................... INTRODUCTION ... ........ ............ ....... ....... .......... ARGUMENT ............................ 	FHF Has Both Custody and Control the Requested Records 
II. 	Application FOIA the Requested Records Entirely Appropriate
....	........................................ 

CONCLUSION
.....	....... .............. ..... .................... 

CERTIFICATE COMPLIANCE CERTIFICATE SERVICE 

TABLE AUTHORITIES 

Cases 
Consolidated Rail Corp. United States, 
896 F.2d 574 (D.C. Cir. 1990) ................................... 

Consumer Fed'n Am. Dep Agric., 
455 F.3d 283 (D.C. Cir. 2006) ................................... 

*Department Justice Tax Analysts, 
492 U.S. 136 (1989) ......................................... 

United Stand Am., Inc. IRS, 359 F.3d 595 (D.C. Cir. 2004) ................................... Authorities chiefly relied upon are marked with asterisk. 
Statutes and Other Authorities U.S.C.  552(b ................................................ U.S.C.  552(b )(8) ................................................ U.S.C.  4617 ................................................... U.S.C.  4617(b)(2)(A)(i) ........................................ U.S.C.  4617(b)(2)(A)(ii) ..................................... U.S.C.  4617(t) ................................................. Rep. No. 813, 89th Cong., 1st Sess., (1965) .......................... 

INTRODUCTION demonstrated Judicial Watch's opening brief, the requested records this FOIA case were transferred clear statutory directive the custody and control the Federal Housing Finance Agency ("FHF A"). response, the agency offers host reasons purportedly demonstrating why the statute transferring the records does not mean what actually says. None these arguments have merit provide sufficient reason for the Court look beyon the plain language the statutory provisions issue. 
ARGUMENT FHFA Has Both Custody and Control the Requested Records. uncontested that, pursuant plain statutory directive, FHF has full management and operational control over Federal National Mortgage Association ("Fannie Mae") and Federal Home Loan Mortgage Company ("Freddie Mac"). 
U.S.C.  4617. addition, FHFA has "all rights, titles, powers, and privileges [Fannie Mae and Freddie Mac], and any stockholder, officer, director .... Id.  4617(b )(2)(A)(i). And most significantly, FHFA has "title the books, records, and assets any other legal custodian of' Fannie Mae and Freddie Mac. U.S.C.  4617(b)(2)(A)(ii). Because these plain statutory directives, the requested records have been transferred law the custody and control FHF Furthermore, because the records were the custody and control FHFA the time Plaintiffs FOIA request, the records are "agency records" subject FOIA. 
FHF argues that the plain language these statutes does not mean what says, asserting that the statutes not transfer ownership, but only provide "mere right access" the requested records. Brief for the Appellee ("App. Br.") 16, 25. Again, the plain language these statutes provides far more than right access, provides that title the books and records the enterprises passed FHF The agency has full legal custody the requested records "obtained" all the enterprises records the plain terms the statute granting title the records the enterprises. Dep Justice Tax Analysts, 492 U.S. 136, 144-45 (1989); U.S.C.  4617(b)(2)(A)(ii). 
FHF next asserts that, despite the plain language the statute, does not exercise "control" over the requested records. App. Br. 18. The agency claims that records the enterprises "did not automatically convert" into agency records. Id. 19-20. Judicial Watch has demonstrated, however, every meaningful way and this unique circumstance, FHF lawfully control the requested records. 
Even if, FHP claims, agency employees have "not read relied" the requested records -the third prong the Court's four-part test-this alone far from dispositive. App. Br. 19-21; United Stand Am., Inc. IRS, 359 F.3d 595, 599 (D.C. Cir. 2004). demonstrated Judicial Watch's opening brief (pp. 8-1 3), agency use the records only one the four factors the four-part test, the other three which weigh heavily favor finding the records are under "agency control."' Most significantly, however, and undisputed FHFA, none the cases applying the four-part test involve records that had been transferred agency the plain language statute. Consumer Fed Am. Dep Agric., 455 F.3d 283, 287 (D.C. Cir. 2006) (noting that the court's totality the circumstances test seeks vindicate Congress' purpose "to open agency action the light public scrutiny") (internal quotation omitted). plain statutory directive, lawful control the requested records was transferred FHF 
For the first time appeal, FHFA claims that this plain statutory language transferring title FHFA actually means something else. App. Br. 28. The agency asserts that the latter part the provision transferring "title the books, difficult understand how the agency could have put end political activities the enterprises, claims, without least once consulting the records their activities. minimum, has acknowledged issuing directives the enterprises the same subject matter Judicial Watch's request. 
records, and assets any other legal custodian, refers back the books and records some other unspecified custodian. Id. This reading the statute was never argued FHF before the district court, nor did either the representatives the enterprises submitting declarations behalf the agency suggest such interpretation. 22-27. Nor was this interpretation plausible enough that the district court even considered issue. any event, when read the full context U.S.C.  4617(b)(2), clear that the "Agency" "shall ... succeed ... (ii) title the books, records, and assets any other legal custodian such regulated entity." (Emphasis added.) This section, together with the prior clause (12 U.S.C.  4617(b)(2)(A)(i)), cleary sets forth the general authority FHFA, and confirms that title the records passes FHF wherever the records may found. This the natural reading this provision and FHF offers sufficient reason for the Court look beyond it. 
II. Application FOIA the Requested Records Entirely Appropriate. 
Looking beyond the plain statutory directive, FHF asserts several reasons that Congress could not actually have intended for the records the formerly independent government sponsored enterprises subject FOIA. FHF claims that Congress had intended FOIA apply the requested records 
would surely have said so. App. Br. 31. did say so. The language 

transferring title the records the entities FHF quite specific. There reason look beyond the plain language these statutes. Consolidated Rail Corp. United States, 896 F.2d 574, 578 (D.C. Cir. 1990) ("The plain meaning legislation should conclusive, except the 'rare' cases [in which] the literal application statute will produce result demonstrably odds with the intention its drafters.") (citations omitted). Significantly, the burden remains all times agency establish that documents are not agency records. Tax Analysts, 492 U.S. 142 n.3 ("The burden the agency demonstrate, not the requestor disprove, that the materials sought are not 'agency records' ... (citing Rep. No. 813, 89111 Cong., l81 Sess., 965)). FHFA has not done so. 
FHF also points "variety statutorily mandated reports and data from the enterprises" suggest that Congress intended limit the scope information available the public concerning the enterprises. App. Br. 32-34. addition being entirely speculative, this argument simply cannot correct. Many federal agencies are tasked with issuing regular reports other information the public. This does not mean that all other records the agency are therefore exempt from FOIA. agency record subject disclosure unless specific exemption applies. FHF cannot point any such exemption here. 
FHF next argues FOIA cannot apply because would "expose all the corporate records" and "business strategies" the enterprises. App. Br. 17, 36. The agency claims, with great hyperbole, that the requested records this case are "agency records," will "lay open forty years the enterprises' business records and proprietary business information for inspection lenders, competitors, and others." Id.at 36. the contrary, ruling that the records are "agency records" will only mean that the agency must process Judicial Watch's FOIA request. with any FOIA request, the agency will have ample opportunity assert any proper exemptions necessary protect just such information. See, e.g., FOIA Exemption U.S.C.  552(b)(4))(protecting trade secrets and commercial and financial information); Exemption U.S.C.  552(b )(8))(protecting information "contained related examination, operating, condition reports prepared by, behalf of, for the use agency responsible for the regulation supervision financial institutions"). FHFA's entirely exaggerated claim the harm that results from its sensitive business information being exposed nothing more than red herring. 
FHFA's claim that responding Judicial Watch's FOIA request would pose "significant expense these struggling companies" otherwise interfere with its role conservator should rejected outright. App. Br. 37. simply idle speculation for FHF assert that simple document search too "expensive" for the agency and its multi-billion dollar wards. The records sought Judicial Watch concern political activities that FHFA itself claims have ceased. See (Def.'s Statement Material Facts, Exh Hence, complying with Judicial Watch's FOIA request can hardly said risk interference with any ongoing attempt stabilize Fannie Mae and Freddie Mac. 
Finally, FHFA's claim that this Court barred from applying FOIA this case the basis that would interfere with the conservatorship particularly misplaced. App. Br. 38-39 (citing U.S.C.  4617(f)). FHFA cannot choose unilaterally exempt itself from FOIA, any more than FHF can choose ignore any other law happens believe contrary its goals. 
CONCLUSION 
For the reasons above and its opening brief, Judicial Watch respectfully requests that the Court reverse the district court's decision below, enter judgment favor Judicial Watch, and remand this matter for further proceedings. March 21, Respectfully submitted, Isl Paul Orfanedes Isl James Peterson 

JUDICIAL WATCH, INC. 425 Third Street, S.W., Suite 800 Washington, 20024 
(202) 646-5172 
Counsel for Plaintiff-Appellant 
CERTIFICATE COMPLIANCE certify that pursuant F.R.App.P. 32(a)(7)(c) and D.C. Cir. Rule 32(a)(2), the attached principal brief proportionally spaced, has typeface points and contains 1,992 words, counted the word-processing system used prepare the brief. 
March 21, 2011 Isl James Peterson 
CERTIFICATE SERVICE hereby certify that March 21, 2011, the foregoing REPLY BRIEF 
APPELLANT was filed via the CM//ECF system and served the CM/ECF 
system and first-class U.S. mail (two copies), postage prepaid, the 
following: 
Mark Freeman Mark Stern 
U.S.Department Justice Civil Division, Appellate Staff 950 Pennsylvania Avenue, Room 7228 Washington, 20530 
/s/ James Peterson



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