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Blackwell v. Federal Bureau of Investigation

January 15, 2010


The opinion of the court was delivered by: Rosemary M. Collyer United States District Judge


Dr. Roger Blackwell, a former college professor who is incarcerated pursuant to his conviction for various insider trading violations, alleges that he did not commit the crimes for which he was convicted and that the prosecutor withheld exculpatory material and engaged in misconduct. See Pl.'s Cross Mot. for Summ. J. [Dkt. #9] ("Pl.'s Mot.") at 6. These allegations are not germane to the claim Dr. Blackwell presents in this case - a claim against the Federal Bureau of Investigation (FBI)*fn1 and the Department of Justice seeking records under the Freedom of Information Act ("FOIA"), 5 U.S.C. § 552, and the Privacy Act, 5 U.S.C. § 552a. Dr. Blackwell seeks records relating to the criminal case against him, United States v. Blackwell, Crim. No. 02-04-134 (S.D. Ohio). The parties filed cross motions for summary judgment.*fn2 Because the FBI conducted an adequate search for records, various exemptions apply, and the FBI produced an adequate Vaughn*fn3 index, the FBI's motion for summary judgment will be granted and Dr. Blackwell's cross motion will be denied.


Prior to Dr. Blackwell's conviction, he was a Professor of Marketing at Ohio State University. Defs.' Mot. for Summ. J. [Dkt. # 5] ("Defs.' Mot."), Ex. C (Aug. 27, 2007 letter from Dr. Blackwell's attorney) at 3. He has received many awards and written many books, including a textbook on consumer behavior. Due to his work in the field of marketing, he also served as a board member for fifteen companies. In 1999, Dr. Blackwell was a member of the board of Worthington Foods. In July of that year, Kellogg Corporation began purchase discussions with Worthington. Dr. Blackwell was a party to these discussions. Worthington accepted Kellogg's offer, and the sale was announced on October 1, 1999. Id.

The National Association of Securities Dealers ("NASD") discovered that the volume and price of Worthington stock increased significantly in the weeks before the announcement was made, and passed this information to the SEC. The SEC, via the FBI, conducted an investigation, discovering that between July and October 1999, several of Dr. Blackwell's friends and family members bought stock in Worthington. United States v. Blackwell, 459 F.3d 739, 749 (6th Cir. 2006).

In 2002, Dr. Blackwell's wife, Tina Stephan Blackwell, and his in-laws, Alfred and Gertrude Stephan, testified before the SEC. They denied that Dr. Blackwell had given them any insider information before the buyout. Id. The following year, Dr. Blackwell began to have marital difficulties, and Tina Stephan Blackwell worked out an immunity agreement with the prosecutor, by which Tina Stephan Blackwell and her parents would receive immunity from prosecution in exchange for Tina Stephan Blackwell's admission to conspiracy, perjury, and insider trading and her testimony against Dr. Blackwell. Id. Dr. Blackwell's close business associate, Jack Kahl, also agreed to testify against Dr. Blackwell in exchange for immunity. Id. As a result of the investigation, Dr. Blackwell was charged with insider trading for tipping close associates and family members about the buyout and for insider trading by Dr. Blackwell's companies, Blackwell Associates and Blackjack. Defs.' Mot., Ex. C at 3-4; id., Ex. S. Dr. Blackwell contended then, and contends now, that he promoted the purchase of Worthington stock because he believed in its value, but that he did not disclose the buyout. Blackwell, 459 F.3d at 749; Defs.' Mot., Ex. C at 3-4.

On June 20, 2005, Dr. Blackwell was convicted of the following charges: one count of conspiracy to commit insider trading, 18 U.S.C. § 371; one count of conspiracy to obstruct an agency proceeding, id.; fourteen counts of insider trading, 15 U.S.C. §§ 78j and 78ff; one count of obstructing an agency proceeding, 18 U.S.C. § 1505; and two counts of making false statements in a federal matter, id. § 1001. Blackwell, 459 F.3d at 751. He was sentenced to 72 months in prison and fined $1,000,000. Id. Dr. Blackwell is currently incarcerated in the Federal Correctional Institute at Morgantown, West Virginia.

On April 19, 2007, counsel for Dr. Blackwell sent a letter to FBI Headquarters requesting records relating to the prosecution of Dr. Blackwell, including records relating to statements made by Tina Stephan Blackwell, Alfred and Gertrude Stephan, and Jack Kahl. Specifically, Dr. Blackwell requested the following records:

1. All records pertaining in any way to Alfred Stephan, Gertrude Stephan, and Tina Stephan Blackwell related to [United States v. Blackwell, No. CR 02-04-134 (S.D. Ohio)] including . . .

(a) any and all immunity agreements or proposed immunity agreements entered into or presented to any of these persons or their representatives;

(b) any and all interviews relating to Alfred Stephan, Gertrude Stephan, and Tina Stephan Blackwell including any and all correspondence, notes, transcripts, statements, memoranda, reports, recordings, videotapes, emails, faxes, telephone messages, jottings, or any other form of record or communication pertaining thereto;

(c) all correspondence, notes, telephone messages, memoranda, tape recordings, reports or other form of records prior to the end of the trial (June 20, 2005) with or regarding Alfred Stephan, Gertrude Stephan, and Tina Stephan;

2. All notes, memoranda, reports, correspondence, transcripts, statements, tape recordings, communications or any other form of record pertaining to John ("Jack") Kahl.

3. All records at any of these specified locations which reflect the costs incurred in undertaking the referenced investigation and prosecution, including any breakdowns of said costs.

4. Any and all records related in any way to any proposed settlement agreement, whether oral or written, which was in any form communicated to Dr. Blackwell's attorneys.

5. All search slips or other records reflecting the nature of the search conducted.

Please search the following locations for these records: (1) the Cincinnati, Ohio field office, (2) the Columbus, Ohio residency, and (3) FBI Headquarters. Please search both main files and cross-references at these locations for any responsive materials. Please also search your ELSUR indices at these locations. Your ELSUR search should include not only references [to] the subjects of this request . . . , but any "mentions" or "overhears" as well. Finally, please also search under all logical name variations (all "buildups and breakdowns") as well as under any known aliases or nicknames.

Defs.' Mot., Ex. A.

On September 25, 2007, FBI Headquarters notified Dr. Blackwell that it had not located any records responsive to his request in the Central Records System at Headquarters and directed Dr. Blackwell to make his request directly to the FBI field office in Cincinnati, Ohio. Id., Ex. E. Counsel for Dr. Blackwell then sent his FOIA/Privacy Act request to the Cincinnati field office. See id., Ex. F. The FBI located one file from the Cincinnati field office containing 3,319 pages that were potentially responsive to Dr. Blackwell's request. In order to expedite the processing of the request, Dr. Blackwell reduced the scope of his request to include only the following records: "All FD 302s and notes of interviews on [sic] Alfred Stephens, Gertrude Stephens, and Tina Stephens." Id., Exs. M & N.

The FBI reviewed 1,877 pages of records responsive to Dr. Blackwell's reduced request. It released 1,103 pages in full, 557 pages in part, and 209 pages were withheld entirely. Id., Ex. O. On June 5, 2009, counsel for Dr. Blackwell selected 198 pages to be included in the FBI's Vaughn declaration. Id., Ex. R. The FBI reprocessed these pages releasing 3 pages in full and 159 in part; it withheld 36 pages in their entirety. See id., Ex. S (copies of the pages released in whole or in part). The FBI asserts the following exemptions to disclosure: Privacy Act (j)(2) and FOIA ...

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