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Judicial Watch • 2011 jw-v-treasury-opp2mot4sj-02252011

2011 jw-v-treasury-opp2mot4sj-02252011

2011 jw-v-treasury-opp2mot4sj-02252011

Page 1: 2011 jw-v-treasury-opp2mot4sj-02252011

Category:Legal Document

Number of Pages:18

Date Created:March 17, 2011

Date Uploaded to the Library:July 30, 2013

Tags:Congressman, specific, person, privilege, summary, process, Civil, Street, requested, public, Freedom, Pursuant, information, documents, obtained, justice, treasury, defendant, government, document, watch, plaintiff, request, funds, federal, judicial, department, states, united, EPA, IRS, ICE, CIA


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THE UNITED STATES DISTRICT COURT 
FOR THE DISTRICT COLUMBIA 

JUDICIAL WATCH, INC.,  
Plaintiff,  
vs.  Civil Action No. :09-CV-1508 (BAH)  
U.S. DEPARTMENT THE  
TREASURY,  
Defendant.  

PLAINTIFF'S OPPOSITION DEFENDANT'S 
SUPPLEMENTAL MOTION FOR SUMMARY JUDGMENT 

Plaintiff Judicial Watch, Inc., counsel and pursuant Rule 56(c) the Federal Rules Civil Procedure, hereby submits this opposition Defendant Department Treasury's ("DOT's") supplemental motion for summary judgment. grounds therefor, Plaintiff states 
follows: 
MEMORANDUM LAW INTRODUCTION. 
The instant motion concerns the technical application several Freedom oflnformation 
Act exemptions relative handful documents. bottom however, this Freedom 
Information Act ("FOIA") case concerns Plaintiff's efforts obtain information about possible 
misuse taxpayer money from the Troubled Asset Relief Program ("TARP") assist 
financial institution favored members Congress, One United Bank ("One United"). While possible that misconduct actually occurred this matter, the public has right full 
disclosure about how and why the federal government distributed taxpayer money this troubled bank. Background TARP and OneUnited Bank. 
TARP was created shortly after Congress enacted the Emergency Economic Stabilization Act ("EESA") October 2008, response severe economic crisis. See Motion for Summary Judgment the U.S. Department Treasury, Docket No. 15, ("Def. Mot.") The EESA created the Office Financial Stability ("OFS") within DOT, which implements TARP. TARP turn authorized the government invest mortgage backed securities, corporate debt, or, the case One United Bank, stock, strengthen the capital base qualified financial institutions and increase market confidence the entire banking system. Def. Mot. (emphasis added). Through TARP, DOT ultimately purchased $12,063,000 One United Bank's preferred stock December 19, 2008. 
Defendant's summary judgment motion does adequate job explaining the creation and implementation TARP. However, the motion omits several critical facts that demonstrate that the use TARP funds purchase OneUnited stock was extremely unusual, and possibly, improper use those funds. 
First, One United was under heavy scrutiny both the FDIC and Massachusetts regulatory officials the months before received its TARP funds. Specifically, October 27, 2008, the bank was issued cease and desist order regarding executive compensation abuses including, among other things, the use new Porsche for bank executives. See Damian Paletta and David Enrich, Political Interference Seen Bank Bailout Decisions, Wall Street Journal, January 22, 2009 
Second, OneUnited received TARP funds despite being under exceptionally severe financial distress. TARP was intended encourage fundamentally healthy banks restart 
lending, whereas distressed loans One United increased 66% the 4th quarter 2008, right around the time OneUnited received its bailout. See Tim McLaughlin, One United's Bad Loans Spiked Q4, Boston Business Journal, January 29, 2009. the end 2008, the number One United loans actually delinquent nearly doubled from 2.6% 4.5%. Id. 
Third, least two politicians interceded OneUnited's behalf effort secure TARP funds for the bank. Congressman Barney Frank (D-MA) has admitted that spoke federal regulators urging that OneUnited least considered for TARP funds. Paletta and Enrich, supra; see also Michael Kranish and Ross Kerber, Frank Tried get Hub Bank Bailout, The Boston Globe, January 23, 2009. Subsequent media reports revealed that Congressman Maxine Waters (D-CA), who once owned stock OneUnited, contacted the Treasury Department September 2008 set meeting which executives One United made highly unusual request for $50,000,000 federal assistance. See Susan Schmidt, Waters Helped Bank Whose Stock She Once Owned, The Wall Street Journal, March 
12, 2009; see also Eric Lipton and Jim Ruttenberg, Representative, Her Ties and Bank Meeting, The New York Times, March 13, 2009.1 OneUnited did not receive any federal funds immediately following this September 2008 meeting, but did receive such funds several 
months later, after the creation TARP. 
Finally, One United missed seven eight the quarterly dividend payments was required make DOT pay back the funds received from TARP, including the last seven payments row. Todd Wallack, Bank Misses Seventh Dividend Payment, The Boston Globe, December 14, 2010. OneUnited's failure reimburse taxpayer bailout money thus raises further Congressman Waters's husband, Sidney Williams served OneUnited's board directors 
until early 2008, and reportedly still owns $250,000 OneUnited stock 2009. Lipton and 
Ruttenberg, supra. 
questions about whether OneUnited should have received federal assistance the first place. 
light all these facts, which are clearly great importance and interest the public, much 
information possible about the government's decision distribute TARP funds OneUnited 
Bank should made available for public scrutiny. Plaintiff's FOIA Request. furtherance its investigation into OneUnited's receipt TARP funds, January 23, 2009, Plaintiff sent Defendant, certified U.S. mail and facsimile, FOIA request seeking 
access any and all records concerning relating the following topics: 
Any and all records concerning evaluation procedures for federal banking agencies and the Treasury Department distribute/award TARP Funds (Trance Report Congress for the Period Through November 14, 2008 states page "Treasury has worked with the Federal banking agencies establish streamlined evaluation procedures;" disclosure should include copy evaluation procedures produced federal banking agencies, any correspondence between the Treasury and any federal banking agencies concerning such procedures, memos, briefing materials, etc). 
Correspondence with Congressman Barney Frank any representative his Office concerning TARP Funds and/or any bank Massachusetts. 
Any and all records concerning OneUnited Bank Boston, Massachusetts (including correspondence from any lobbyist, correspondence from any other government agency, correspondence with any elected official, correspondence directly with the Bank, the Bank's application for TARP funds, etc). 

See Exhibit the Declaration Joseph Samarias, attached Def. Mot. Exhibit ("Samarias Dec."). letter dated February 11, 2009, Defendant acknowledged receipt Plaintiff's FOIA 
request and granted itself ten (10) day extension time respond the request. See 
Complaint March 31, 2009, approximately weeks after Defendant's response was 
due, Plaintiff sent Defendant letter inquiring about the status Plaintiff's January 23, 2009 FOIA request. See Complaint Defendant acknowledged receipt Plaintiffs March 31, 2009 letter April 2009. However, the letter did not include any responsive documents, nor did state when Plaintiff could expect receive substantive response. Id. Plaintiff was forced file this lawsuit when Defendant failed respond Plaintiffs request August 11, 2009 and gave indication Plaintiff when could expect receive substantive 
response. 
After this lawsuit was filed, the parties entered into negotiations regarding document production. Pursuant these negotiations and the Court's November 18, 2009 Minute Order, Defendant produced approximately 596 pages responsive documents whole part Plaintiff December 2009. Def. Mot. 7-8. Defendant made subsequent, discretionary release additional pages documents February 23, 2010. Id. After further negotiations, the parties narrowed the scope documents issue specific documents totaling approximately pages. Defendant then moved for summary judgment June 2010. September 13, 2010, after Defendant's initial motion for summary judgment had been fully briefed, Defendant informed Plaintiff that had discovered additional pages responsive records, which released Plaintiff with some information redacted. See Defendant's Supplemental Motion for Summary Judgment ("Def. Supp. Mot.") Further negotiations between the parties narrowed six the number pages remaining dispute. 

FOIA generally requires complete disclosure requested agency information unless the information falls into one FOIA's nine clearly delineated exemptions. U.S.C.  552(b); see also Department the Air Force Rose, 425 U.S. 352, 360-61 (1976) (discussing the history and purpose FOIA and the structure FOIA exemptions). light FOIA's goal promoting general philosophy full agency disclosure, the exemptions are construed narrowly. United States Dep Justice Tax Analysts, 492 U.S. 136, 151 (1989). "[T]he strong presumption favor disclosure places the burden the agency justify the withholding any requested documents." United States Dep State Ray, 502 U.S. 164, 173 (1991). FOIA litigation, all litigation, summary judgment appropriate only when the pleadings and declarations demonstrate that there genuine issue material fact and that the moving party entitled judgment matter law. Anderson Liberty Lobby, Inc., 
U.S. 
242, 248 (1986); Fed.R.Civ.P. 56(c). FOIA cases, agency decisions "withhold disclose information under FOIA are reviewed nova." Judicial Watch, Inc. US. Postal Service, 297 Supp.2d 252, 256 (D.D.C. 2004). reviewing motion for summary judgment under FOIA, the court must view the facts the light most favorable the requester. Weisberg 
UnitedStates Dep Justice, 745 F.2d 1476, 1485 (D.C. Cir. 1984). 

For agency prevail claim exemption, must "prove that each document that falls within the class requested either has been produced, unidentifiable, wholly exempt from the Act's inspection requirements." Goland Central Intelligence Agency, 607 F.2d 339, 352 (D.C. Cir. 1978). "Reliance 'agency affidavits warranted the affidavits 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 either contrary evidence the record nor evidence agency bad faith."' Sciba Board Governors, 2005 U.S. Dist. LEXIS 45686, (D.D.C. Nov. 2005) (quoting Military Audit Project Casey, 656 F.2d 724, 738 (D.C. Cir. 1981)). The court may require camera inspection the withheld documents "insure that agencies not misuse the FOIA exemptions conceal non-exempt information." Carter US. Dep Commerce, 830 F.2d 388, 393 (D.C. Cir. 1987) (quoting Allen Central Intelligence Agency, 636 F.2d 1287, 1298 
(D.C. Cir. 1980)). 
Finally, agency must demonstrate that, even where particular exemptions properly apply, all non-exempt information has been segregated and disclosed. Sussman US. Marshals Service, 494 F.3d 1106, 1116 (D.C. Cir. 2007); Shurberg Broadcasting Hartford Federal Communications Commission, 617 Supp. 825, 828 (D.D.C. 1985). segregability determination absolutely essential any FOIA decision. See Summers Dep Justice, 140 F.3d 1077, 1081 (D.C. Cir. 1998). Defendant Improperly Withheld Information Pursuant Exemption 
FOIA Exemption permits the withholding "trade secrets and commercial financial information obtained from person that privileged confidential." U.S.C.  552(b)(4). order determine whether information was privileged confidential, courts look whether its production was compulsory whether was provided the government voluntarily. the provision the information was compulsory, "it will not considered confidential unless the submitter can show that disclosure will 'impair the government's ability obtain necessary information the future; (2) cause substantial harm the competitive position the person from whom the information was obtained."' Defenders Wildlife US. Dep the Interior, 314 Supp.2d 7-8 (D.D.C. 2004) (citing Nat'/ Parks Conservation Ass'n Morton, 498 F.2d 765, 770 (D.C. Cir. 1974) ("National Parks")). the information was provided the government voluntarily, considered confidential "if 'of kind that would customarily not released the public the person from whom was obtained."' Defenders Wildlife, 314 Supp.2d 7-8 (quoting Critical Mass Energy Project Nuclear Regulatory Comm 'n, 975 F.2d 871, 879 (D.C. Cir. 1992) (en bane)). 
Defendant purports withhold portions the following five documents part pursuant Exemption Documents Bates stamped 000815-817 and 000819-820. See Defendant's Supplemental Vaughn Index, attached Exhibit the Second Declaration Joseph Samarias ("Second Samarias Dec."). support this argument, Defendant merely makes the general assertion that OneUnited would likely suffer substantial competitive harm the withheld information were disclosed. See Second Samarias Dec. iJifl3-16; Because Defendant's competitive harm claim suffers from complete lack specificity, must fail. prevail such claim, the Defendant must "provide specific evidence substantiating assertion that release record would cause substantial competitive harm the person from whom the information was obtained." Bloomberg Board Governors the Federal Reserve System, 649 Supp.2d 262, 279 (S.D.NY 2009) (citing Public Citizen Health Research Group Food and Drug Admin, 704 F.2d 1280, 1291 (D.C. Cir. 1983)); see also Gulf Western Industries United States, 615 F.2d 527, 530 (D.C. Cir. 1979). "Conclusory and generalized allegations substantial competitive harm, course, are unacceptable and cannot support agency's decision withhold requested documents." Id. The agency must provide evidence that the requested information disclosed, competitive harm would "imminent." Bloomberg, 649 Supp.2d 279 (citing Iglesias Central Intelligence Agency, 525 Supp. 547, 559 
(D.D.C. 1981 )). The specific evidence must show that the competitive harm will result from the firmative use the information competitors the person entity from whom the information was obtained, not merely injuries that person entity's competitive position 
the marketplace "embarrassing publicity attendant upon public revelations." Id. (citing Public 
Citizen Health Research Group, 704 F.2d 1291 n.30). 
Defendant's submissions fail satisfy this exacting standard. Its supplemental Vaughn 
Index merely states the boilerplate phrase that "public release likely cause OneUnited 
substantial competitive harm." Supplemental Vaughn Index 1-2. Likewise, the Second 
Samarias Declaration simply claims that release the information "could cause substantial 
competitive harm" OneUnited. Second Samarias Dec. 13. These descriptions alleged 
harm never progress beyond mere conjecture. 14; Supplemental Vaughn Index 1-2. See 
also Def. Supp, Mot. They fail demonstrate that the alleged harm injury will happen, 
much less that will happen imminently. Bloomberg, 649 Supp.2d 279. Bloomberg, 
the Defendant's evidence insufficient satisfy its burden proof. Id. Defendant Improperly Withheld Information Pursuant Exemption 
Exemption ofFOIA allows agency withhold records information that 
"interagency intra-agency memorandums letters which would not available law 
party other agency litigation with the agency." U.S.C.  552 (b)(5). Courts have 
recognized three types Exemption withholdings: the deliberative process privilege, the 
attorney-client privilege, and the attorney work product doctrine. See Coastal States Gas Corp., Department Energy, 617 F.2d 854, 862 (D.C. Cir. 1980). Defendant purportedly invokes the 
deliberative process privilege. Def's Supp. Mot. 3-5. Defendant Improperly Withheld Information Pursuant the Deliberative Process Privilege. 
Portions documents Bates stamped 000816, and 000819-821 are purportedly withheld pursuant the deliberative process privilege. See Def. Supp. Mot. 3-5; Second Samarias Dec. 8-11. order withhold information pursuant the deliberative process privilege, agency must demonstrate that the information would "reveal 'advisory opinions, recommendations and deliberations comprising part process which governmental decisions and policies are formulated."' Sealed Case, F.3d 729, 737 (D.C. Cir. 1997). Further, the information must "predecisional and must deliberative" and "not shield documents that simply state explain decision the government has already made protect material that purely factual, unless the material inextricably intertwined with the deliberative sections documents that its disclosure would inevitably reveal the government's deliberations." Id. (citations omitted). 
The deliberative process privilege exists prevent injury agency decision making. NLRBv. Sears RoebuckCo., 421 U.S. 132,151 (1975). However,such harmcannot merely presumed. Mead Data Central, Inc., Department the Air Force, 566 F.2d 242, 258 (D.C. Cir 1977). Rather, the agency must show specific and detailed proof that disclosure would defeat, rather than further, the purposes the FOIA. Id. See also Judicial Watch U.S. Postal Service, 297 Supp. 252, 259 (D.D.C. 2004). 
Finally, the deliberative process privilege "qualified privilege and can overcome sufficient showing need." Sealed Case, 121 F.3d 737. 
Plaintiff first notes that with several documents Defendant's first motion for
summary judgment, Document 000821 withheld almost its entirety. The document simply states "Conclusion and Recommendation" the top the page, and the rest the page See Plaintiffs Opposition Defendant's Motion for Summary Judgment, Docket No. 17, 12. 
blacked out. Defendant's supplemental brief and Vaughn Index reveal virtually nothing about this document. Defendant states only that discusses background and supervisory information obtained about One United Def. Supp. Mot. Second Samarias Dec. ifif8-9. Plaintiff respectfully submits that this brief explanation does not point any specific decisionmaking process policy that would harmed the information were released. Nor does 
Defendant adequately explain why none the information this document segregable. 
Regarding Document 000816, only few words are redacted pursuant Exemption (b)(5). This information appears factual and appears refer final decision made another agency. Since the information does not appear predecisional deliberative, much less the predecisional deliberative materials Defendant, must released. 
Documents 000819 and 000820 are described simply "Memorandum." See Supplemental Vaughn Index The headings the document are "Brief Summary and Description One United Bank" Document 000819 and "Additional Background and Supervisory Information Provided the FDIC" Document 000820. The contents both pages appear consist primarily factual information, some which released and some which inexplicably withheld. general matter, agency has duty disclose any reasonably segregable, responsive, factual information. Mead Data Central, Inc. 566 F.2d 
260. While courts have recognized the possibility that the disclosure certain factual information can "expose agency's decision-making process such way discourage candid discussion within the agency and thereby undermine the agency's ability perform its functions," courts have construed this exception narrowly. Quarles Dep the Navy, 893 F.2d 390, 392 (D.C. Cir. 1990). issue Quarles were certain cost estimates that the Court found were not really facts all, but instead information "derive[ from complex set judgments -projecting needs, studying prior endeavors and assessing possible suppliers." Id. 92-93. "They partake just that elasticity that has persuaded courts provide shelter for opinions generally." Id.; see also Petroleum Information Corp. US. Dep the Interior, 976 F.2d 1429, 1435 (D.C. Cir. 1992) ("To fall within the deliberative process privilege, materials must bear the formulation exercise agency policy-oriented judgment") (emphasis original). 
Here, contrast, Defendant has once again failed demonstrate that disclosure the factual information issue --a description and background information about One United
will reveal any deliberations judgment calls DOT officials deciding provide TARP 
funds One United. Therefore, the withheld information must released. Defendant Improperly Withheld Information Under FOIA Exemption 
Exemption provides that agency may withhold information that "contained related the examination, operating condition reports prepared by, behalf of, for the use agency responsible for the regulation supervision financial institutions." U.S.C.  552(b)(8). While Exemption was crafted broadly, broad application the exemption does not eliminate agency's obligation provide relatively detailed justification, specifically identifying the reasons why particular exemption relevant and correlating those claims with the particular part withheld document which they apply." King US. Dep Justice, 830 .2d 210, 219 (quoting Mead Data Central, Inc., Department the Air Force, 566 .2d 242, 251 (D.C. Cir 1977). other words, simply making Exemption assertion not sufficient. 
Defendant invokes Exemption for portions Documents Bates stamped 000815-817 and 000819-820 Def. Supp. Mot. 9-10. With respect each these documents, Defendant merely parrots the legal standard regarding Exemption offering boilerplate language that fails specifically identify why the exemption should apply. Defendant's Vaughn Index only states that the redacted information "relates communications regarding the condition OneUnited."See Supplemental Vaughn Index 1-2. Nowhere does Defendant identify any report, much less specific report, which any piece withheld information allegedly relates. short, rather than relating the redacted information from the disputed documents actual report, appears that Defendant continuing claim that any financial information obtains its supervisory capacity from about any financial institution necessarily constitutes relates "report" for purposes Exemption Such construction the term "report" not consistent with the plain meaning Exemption See Hammontree Nat Labor Relations Board, 894 F.2d 438, (D.C. Cir. 1990) (citing Chevron US.A. Inc. Nat'! Resources Defense Council, 467 U.S. 837, 842-43 (1984)). Defendant's Exemption claims should therefore rejected. 
III. Conclusion. 
For all the foregoing reasons, Defendant's Motion for Summary Judgment should denied and Plaintiff respectfully submits that Defendant should ordered turn over the remaining information responsive Plaintiffs January 23, 2009 FOIA request immediately. 
Dated: February 25, 2011 
Respectfully submitted, 
JUDICIAL WATCH, INC. 
Isl Jason Aldrich 
D.C. 
Bar No. 495488 Pau Orfanedes 

D.C. 
Bar No. 429716 

Suite 800 
425 Third Street, S.W. 
Washington, 20024 
(202) 646-5] Attorneys for Plaintiff THE UNITED STATES DISTRICT COURT 
FOR THE DISTRICT COLUMBIA 

JUDICIAL WATCH, INC.,  
Plaintiff,  
vs.  Civil Action No. 1:09-CV-1508 (BAH)  
U.S. DEPARTMENT THE  
TREASURY,  
Defendant.  

PLAINTIFF'S STATEMENT MATERIAL FACTS WHICH THERE GENUINE ISSUE AND DISPUTE FILED OPPOSITION 
DEFENDANT'S SUPPLEMENTAL MOTION FOR SUMMARY JUDGMENT 

Plaintiff Judicial Watch, Inc. ("Judicial Watch"), counsel and pursuant LCvR 56.1, submits the following Statement Material Facts Which There Genuine Issue and Dispute: 
Plaintiff denies that any documents are being properly withheld Defendant pursuant U.S.C. 552(b)(4). The documents issue are not properly being withheld pursuant Freedom oflnformation Act ("FOIA") Exemption (b)(4) because, demonstrated more detail Plaintiffs Opposition Defendant's Supplemental Motion for Summary Judgment, Defendant has failed carry its burden showing that release the requested information would divulge trade secrets and commercial financial information obtained from person that privileged confidential. 
Plaintiff denies that any documents are being properly withheld Defendant pursuant U.S.C. 552(b)(5). The documents issue are not properly being withheld pursuant Freedom oflnformation Act ("FOIA") Exemption (b)(5) because, demonstrated 

more detail Plaintiffs Opposition Defendant's Supplemental Motion for Summary Judgment, Defendant has failed carry its burden showing that release the requested information would violate the deliberative process privilege. 
Plaintiff denies that any documents are being properly withheld Defendant pursuant U.S.C. 552(b )(8). The documents issue are not properly being withheld pursuant Freedom oflnformation Act ("FOIA") Exemption )(8) because, demonstrated more detail Plaintiffs Opposition Defendant's Supplemental Motion for Summary Judgment, Defendant has failed carry its burden showing that the withheld information contained related the examination, operating condition reports prepared by, behalf of, for the use agency responsible for the regulation supervision financial institutions. Defendant's statements, Plaintiff responds follows: 
Disputed the extent that Plaintiff disputed Defendant's statements fact Plaintiffs Opposition Defendant's Motion for Summary Judgment. Undisputed. 
Disputed the extent Defendant claims the documents being properly withheld pursuant FOIA Exemptions and 
Plaintiff disputes that the documents are protected the deliberative process privilege. 
Disputed. 
Disputed. Disputed the extent Defendant claims the documents being properly withheld pursuant FOIA Exemption 
Disputed. 
Disputed. 

10. 
Disputed. 

11. 
Disputed the extent Defendant claims the documents being properly withheld 

pursuant POlA Exemption 
12. 
Disputed. 

13. 
Disputed the extent Defendant claims all segregab.le material bas been released. 

14. Disputed. Dated: February 25, Respectfully submitted, 
JUDICIAL WATCH, rNC. 
Isl Jason Aldrich 
D.C. 
Bar No. 495488 Paul Orfanedes 

D.C. 
Bar No. 429716 Suite 800 

425 Third Street, S.W. Washington, 20024 
(202) 646-5172 
Attorneys for Plaintff 
JUDICIAL WATCH, INC.,  
Plaintiff,  
vs.  Civil Action No. 1:09-CV-1508 (BAH)  
U.S. DEPARTMENT THE  
TREASURY, THE UNITED STATES DISTRICT COURT 
FOR THE DISTRICT COLUMBIA 

ORDER 
Upon consideration Plaintiffs opposition Defendant's Supplemental Motion for Summary Judgment, and the entire record herein hereby ORDERED that, Defendant's supplemental motion for summary judgment denied. ORDERED. 
DATE: 
The Honorable Beryl Howell United States District Judge



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