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Hodes v. U.S. Dep't of Housing and Urban Development

January 31, 2008


The opinion of the court was delivered by: Colleen Kollar-kotelly United States District Judge


This is a FOIA case brought by attorney Scott Hodes ("Hodes") against the United States Department of Housing and Urban Development ("HUD"). Hodes is seeking disclosure of certain information contained in the Ginnie Mae Unclaimed Funds List, a database listing individuals and commercial entities who are owed monies as a result of their investments in Ginnie Mae-backed securities but who cannot be located for one reason or another. The Parties have filed Cross-Motions for Summary Judgment on the dispositive issue of whether HUD was correct to withhold the requested information based on FOIA Exemptions 3, 4, and 6. After a thorough review of the Parties' submissions and attachments thereto, applicable statutory authority and case law, the Court shall grant in part and deny in part Defendant's [9] Motion for Summary Judgment and grant in part and deny in part Plaintiff's [11] Motion for Summary Judgment, for the reasons that follow.


The Government National Mortgage Association ("Ginnie Mae") is a wholly-owned corporate instrumentality within HUD. See Def.'s Mot. for Summ. J., Ex. 1 ¶ 1 (Declaration of Theodore Foster dated April 27, 2007) (hereinafter, "Foster Decl."). Ginnie Mae operates a "Mortgage-Backed Securities Program" ("MBS Program") designed to "attract new sources of private capital into federally insured or guaranteed residential lending programs, thereby increasing funds available for the purchase of low- and moderate-income housing." Id. ¶ 2. Pursuant to the MBS Program, private lenders are permitted to issue securities backed by mortgages or other home loans insured or guaranteed by Ginnie Mae ("Issuers"). Id.; 12 U.S.C. § 1721(g) (authorizing associations to guarantee principal and interest on trust certificates and other securities). In the event of a default, Ginnie Mae has the right to terminate and extinguish the rights of any Issuer and to "make such payment as and when due in cash." Id. ¶ 5; 12 U.S.C. § 1721(g).

Purchasers of Ginnie Mae-backed securities ("Security Holders") consist of both persons and commercial entities. Id. ¶ 13. When an Issuer can no longer locate a Security Holder over a period of six months, payments that are due and information identifying the Security Holder are sent by the Issuer to Ginnie Mae's Central Paying and Transferring Agent ("CPTA"). Id. ¶ 8. The funds are then "recorded into the CPTA's database and transferred to Ginnie Mae's accounts at the Department of Treasury." Id. The information concerning the Security Holders is aggregated into the Unclaimed Funds List. Id. ¶ 9.

On December 14, 2004, Hodes submitted a request under the Freedom of Information Act ("FOIA"), seeking to obtain from HUD a "copy of the payee names, dollar amounts; check numbers issue dates and payee addresses contained in the Ginnie Mae Unclaimed Funds System."*fn1 Pl.'s Mot. for Summ. J., Ex. 1 at 1 (Hodes FOIA Request). HUD responded by letter dated April 18, 2005, indicating that the information was exempt from disclosure under FOIA Exemptions 4 and 6. Id., Ex. 2 at 1 (HUD Denial). Hodes filed an administrative appeal on June 8, 2005. Id., Ex. 3 at 1 (Hodes Appeal). By letter dated March 17, 2006, HUD affirmed its denial of Hodes's request. Id., Ex. 4 at 1 (HUD Second Denial). This lawsuit followed on January 23, 2007.


In reviewing Motions for Summary Judgment under FOIA, the Court must conduct a de novo review of the record. See 5 U.S.C. § 552(a)(4)(B). In the FOIA context, "de novo review requires the court to 'ascertain whether the agency has sustained its burden of demonstrating that the documents requested are not "agency records" or are exempt from disclosure under the FOIA.'" Assassination Archives & Research Ctr. v. Cent. Intelligence Agency, 334 F.3d 55, 57 (D.C. Cir. 2003) (quoting Summers v. Dep't of Justice, 140 F.3d 1077, 1080 (D.C. Cir. 1998)).

Summary judgment is proper when "the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). A genuine issue of material fact exists only when there is sufficient evidence such that a reasonable juror could find for the party opposing the motion. Anderson v. Liberty Lobby Inc., 477 U.S. 242, 251-42 (1986).

FOIA cases are typically and appropriately decided on motions for summary judgment. Miscavige v. Internal Revenue Serv., 2 F.3d 366, 368 (11th Cir. 1993); Rushford v. Civiletti, 485 F. Supp. 477, 481 n.13 (D.D.C. 1980). Under FOIA, all underlying facts and inferences are analyzed in the light most favorable to the FOIA requester; as such, only after an agency seeking it proves that it has fully discharged its FOIA obligations is summary judgment appropriate. Moore v. Aspin, 916 F. Supp 32, 35 (D.D.C. 1996) (citing Weisberg v. Dep't of Justice, 705 F.2d 1344, 1350 (D.C. Cir. 1983)). The agency bears the burden of demonstrating that its search was adequate and in good faith. Tarullo v. Dep't of Defense, 170 F. Supp. 2d 271, 274 (D. Conn. 2001). A good faith search effort uses methods that can be reasonably expected to produce the information requested. See Ogelsby v. Dep't of Army, 920 F.2d 57, 68 (D.C. Cir. 1990).

Congress enacted FOIA for the purpose of introducing transparency to government activities. See Stern v. Fed. Bureau of Investigation, 737 F.2d 84, 88 (D.C. Cir. 1984). Congress remained sensitive, however, to the need to achieve balance between this objective and the vulnerability of "legitimate governmental and private interests [that] could be harmed by release of certain types of information." Critical Mass Energy Project v. Nuclear Regulatory Comm'n, 975 F.2d 871, 872 (D.C. Cir. 1992); see also Summers v. Dep't of Justice, 140 F.3d 1077, 1079 (D.C. Cir. 1998). Accordingly, FOIA provides nine exemptions pursuant to which an agency may withhold requested information. See 5 U.S.C. §§ 552(a)(4)(B), (b)(1)-(9). The agency must demonstratethe validity of any exemption that it asserts. See id.; Beck v. Dep't of Justice, 997 F.2d 1489, 1491 (D.C. Cir. 1993) ("[c]onsistent with the purpose of the Act, the burden is on the agencyto justify withholding requested documents"). Summary judgment may be granted on the basis of the agency's accompanying affidavits or declarations if they describe "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 evidence of agency bad faith." Military Audit Project v. Casey, 656 F.2d 724, 738 (D.C. Cir. 1981). These affidavits may be submitted by an official who coordinated the search, and need not be from each individual who participated in the search. See SafeCard Servs. v. Sec. & Exch. Comm'n, 926 F.2d 1197, 1200 (D.C. Cir. 1991). In opposing a motion for summary judgment, a plaintiff must offer more than conclusory statements. See Broaddrick v. Exec. Office of President, 139 F. Supp. 2d 55, 65 (D.D.C. 2001) (citing Laningham v. United States Navy, 813 F.2d 1236, 1241 (D.C. Cir. 1987)).

Courts must "accord substantial weight" to an agency's affidavit regarding FOIA exemptions. 5 U.S.C. § 552(a)(4)(B) (2004); see also Carney v. Dep't of Justice, 19 F.3d 807, 812 (2d Cir. 1994), cert. denied, 513 U.S. 823 (1994) ("Affidavits submitted by an agency are 'accorded a presumption of good faith.'") (quoting SafeCard Servs., Inc., 926 F.2d at 1200). Indeed, because FOIA exemptions are narrowly construed, should an agency correctly show that FOIA does not apply to withheld material, the Court's review of the agency's decision is limited to determining whether the agency abused its discretion. Mead Data Cent. Inc. v. Dep't of Air Force, 566 F.2d 242, 259 (D.C. Cir. 1977). Therefore, should an exemption correctly apply, an agency's justification for withholding information need not allude to a specific injury. See id. at 258-59 (permitting the agency to rely upon the explanation that disclosure "would impair the deliberative process . . . by impairing the free and frank exchange of ideas among [agency] personnel").

Moreover, the agency must detail what proportion of the information in a document is non-exempt and how that material is dispersed throughout the document. Mead Data Cent. Inc., 566 F.2d at 261. Any non-exempt information that is reasonably segregable from the requested records must be disclosed. Ogelsby, 79 F.3d at 1178. In addition, district courts are required to consider segregability issues sua sponte even when the parties have not specifically raised such claims. Trans-Pac. Policing Agreement v. U.S. Customs Serv., 177 F.3d 1022, 1028 (D.C. Cir. 1999).


The Freedom of Information Act requires federal agencies, in responding to a request for information, to: (1) conduct an adequate search for that information through reasonable efforts; (2) provide the information to the requester unless it falls within a FOIA exemption; and (3) provide to a requester any material that can reasonably be segregated from the exempt information. 5 U.S.C. § 552(a)(3); 5 U.S.C. § 552(b). HUD invokes FOIA Exemptions 3, 4, and 6 as justifications for withholding the information Hodes requested. See 5 U.S.C. §§ 522(b)(3), (b)(4), and (b)(6). While Hodes does not argue that HUD's search for information was ...

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