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Competitive Enterprise Institute v. Department of Treasury

United States District Court, District of Columbia

August 9, 2018




         Granting Defendant's Motion for Summary Judgment


         Competitive Enterprise Institute (“Competitive Enterprise”) brings this action against the Department of Treasury pursuant to the Freedom of Information Act (“FOIA”) concerning its request for a two-page letter (the “Letter”) exchanged between the Governor of the Bank of England and former Treasury Secretary Jack Lew. Neither party contests that the Letter contains potentially sensitive information regarding the economic policies of the United States government. They do dispute, however, whether FOIA requires the disclosure of that information.

         The Department of Treasury declined to disclose the Letter under FOIA Exemption 1, which exempts from disclosure information classified in the interest of national defense or foreign policy. Competitive Enterprise argues that the Letter does not fall within the scope of Exemption 1 because it was improperly classified. It also requests that the Court conduct an in camera review of the Letter, asserting that the declaration provided by the Department of Treasury is not specific enough for the Court to reach a determination on the Letter's status, and that the Department's handling of the classification process and FOIA requests indicate agency bad faith or sloppiness.

         For the reasons explained below, the Court finds that the Letter was properly classified and that the Department of Treasury's Exemption 1 withholding is justified. Accordingly, the Court grants the Department of Treasury's motion for summary judgment.


         In September 2014, the Governor of the Bank of England, Mark Carney, sent the Letter to then-Secretary of the Treasury Jack Lew. Def.'s Statement of Material Facts (“Def.'s Statement”) ¶ 1, ECF No. 12. To date, the contents of the Letter have not been made public or disclosed by the Department of Treasury, but Competitive Enterprise contends that the Letter inquired why the reinsurance subsidiary of a large and influential American company, Berkshire Hathaway, was not included in the United States Financial Stability Board's list of “systemically important financial institutions.” Id. ¶ 4; see Compl. ¶ 1, ECF No. 1. After the Letter was sent, the Bank of England requested that the Letter be given confidential treatment. Def.'s Statement ¶ 2.

         In April 2015, a series of online reports were published regarding Berkshire Hathaway's alleged absence from the Financial Stability Board's list. See Pl.'s Mem. Opp'n Def.'s Mot. Summ. J. (“Pl.'s Opp'n”) at 7, ECF No. 14; Pl.'s Opp'n. Attach. A. ECF No. 14-4. Later that month, Elizabeth Festa, who is not a party to this action, submitted a FOIA request for the Letter. See Id. Attach. B., ECF No. 14-5. The Department of Treasury denied Ms. Festa's request, claiming that the Letter was a “foreign record” not releasable by the agency. Id. Attach. C., ECF No. 14-6. Two years later, in April 2017, the Department of Treasury decided to classify the Letter pursuant to § 1.4(b), (d), and (e) of Executive Order 13, 526, on the grounds that the Letter contained “foreign government information, ” information damaging to the “foreign relations or foreign activities of the United States, ” and information concerning “scientific, technological, or economic matters relating to the national security.” Def.'s Statement ¶¶ 5-8; Decl. Michael Mason (“Mason Decl.”) ¶ 8, ECF No. 12-1.

         That month, Competitive Enterprise submitted its own FOIA request for the Letter. Pl.'s Opp'n at 1. The Department of Treasury informed Competitive Enterprise that the requested Letter had been properly classified “in accordance with Executive Order 13, 526, ” and it accordingly denied the request under FOIA Exemption 1, which protects against the disclosure of classified information. Id. Attach. F., ECF No. 14-9; Def.'s Statement ¶ 5; see 5 U.S.C. § 552(b)(1). In June 2017, the Department of Treasury similarly informed Ms. Festa of the Letter's classification, noting that though the Letter was not a “foreign record, ” as it had previously been characterized, it nonetheless remained protected from disclosure. Pl.'s Opp'n. Attach. E. ECF No. 14-8.

         In August 2017, Competitive Enterprise filed this action seeking to compel the Letter's disclosure. It argues primarily that the Letter was improperly classified, and thus cannot be withheld under FOIA Exemption 1. See generally Compl. The Department of Treasury's motion for summary judgment is now ripe and pending before the Court.


         A. Freedom of Information Act

         FOIA “sets forth a policy of broad disclosure of Government documents in order ‘to ensure an informed citizenry, vital to the functioning of a democratic society.'” FBI v. Abramson, 456 U.S. 615, 621 (1982) (quoting NLRB v. Robbins Tire & Rubber Co., 437 U.S. 214, 242 (1978)). “[D]isclosure, not secrecy, is the dominant objective of [FOIA].” U.S. Dep't of Air Force v. Rose, 425 U.S. 352, 361 (1976). FOIA mandates the release of properly requested federal agency records, unless the materials fall squarely within one of nine statutory exemptions. Milner v. U.S. Dep't of Navy, 562 U.S. 562, 565 (2011); Students Against Genocide v. U.S. Dep't of State, 257 F.3d 828, 833 (D.C. Cir. 2001) (citing 5 U.S.C. § 552(a)(3)(A), (b)).

         B. Summary Judgment

         “FOIA cases typically and appropriately are decided on motions for summary judgment.” Defs. of Wildlife v. U.S. Border Patrol, 623 F.Supp.2d 83, 87 (D.D.C. 2009) (citing Bigwood v. U.S. Agency for Int'l Dev., 484 F.Supp.2d 68, 73 (D.D.C. 2007)). The agency is entitled to summary judgment if no material facts are genuinely in dispute and the agency demonstrates “that its search for responsive records was adequate, that any exemptions claimed actually apply, and that any reasonably segregable non-exempt parts of records have been disclosed after redaction of exempt information.” Competitive Enter. Inst. v. EPA, 232 F.Supp.3d 172, 181 (D.D.C. 2017). The Court may grant summary judgment based solely on an agency's declarations when the declarations “demonstrate that the information withheld logically falls within the claimed exemption and are not controverted by other evidence in the record or by evidence of agency bad faith.” Larson v. U.S. Dep't of State, 565 F.3d 857, 862 (D.C. Cir. 2009). Such declarations are afforded a presumption of good faith. SafeCard Servs., Inc. v. SEC, 926 F.2d 1197, 1200 (D.C. Cir. 1991).

         To carry its burden, the agency must provide “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.” Elec. Privacy Info. Ctr. v. DEA, 192 F.Supp.3d 92, 103 (D.D.C. 2016) (quoting Mead Data Cent., Inc. v. U.S. Dep't of Air Force, 566 F.2d 242, 251 (D.C. Cir. 1977)). This Court reviews the agency's explanations de novo, and will endorse an agency's decision to withhold information if the justification for invoking a FOIA exemption “appears ‘logical' or plausible.'” Pinson v. DOJ, 245 F.Supp.3d 225, 239 (D.D.C. 2017) (quoting Wolf v. CIA, 473 F.3d 370, 374-75 (D.C. Cir. 2007)). Nonetheless, “exemptions from disclosure must be narrowly construed . . . and conclusory and generalized allegations of exemptions are unacceptable.” Morley v. CIA, 508 F.3d 1108, 1114-15 (D.C. Cir. 2007) (citation and internal quotation marks omitted). Finally, in conducting its review, a court may rely on its own in camera examination of disputed documents to determine whether they were properly ...

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