Cause of Action Institute v. United States Department of Justice

MOTION for Summary Judgment

D.D.C.January 18, 2017

14925910.4 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA CAUSE OF ACTION INSTITUTE, ) ) Plaintiff, ) ) v. ) Civil No. 1:16-cv-2226-RBW ) UNITED STATES DEPARTMENT ) OF JUSTICE, ) ) Defendant. ) DEPARTMENT OF JUSTICE’S MOTION FOR SUMMARY JUDGMENT CAROLINE D. CIRAOLO Principal Deputy Assistant Attorney General NELSON WAGNER Trial Attorney, Tax Division U.S. Department of Justice P.O. Box 227, Ben Franklin Station Washington, DC 20044 Tel: (202) 616-3369 Fax: (202) 514-6866 Email: Nelson.Wagner@usdoj.gov Attorney for Plaintiff the United States of America Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 1 of 21 i 14925910.4 TABLE OF CONTENTS I. Introduction .......................................................................................................................1 II. Background ....................................................................................................................1 III. Summary Judgment Standard in FOIA Cases ................................................................3 IV. Argument ........................................................................................................................4 A. The Emails Are Exempt From Disclosure Under FOIA Exemption 7(A) Because Disclosing Their Content Could Reasonably Interfere with Pending Tax Litigation............................................................4 B. The Emails Are Exempt From Disclosure Under FOIA Exemption 5 to Protect the Attorney Work Product and the Deliberative Process of DOJ attorneys. ..............................................................................6 C. The Emails Are Exempt From Disclosure Under FOIA Exemption 3 to Protect the Confidential Return Information of a Taxpayer. ..................9 D. Some Emails Are Exempt From Disclosure Under FOIA Exemptions 6 and 7(C) to Protect the Personal Privacy of Individuals......................................................................................................11 E. The DOJ Reasonably Segregated the Material and Released Information That Would Not Harm Its Operations. .......................................13 F. This Case Does Not Present The Issue Of The Definition Of A “Record.” .......................................................................................................14 V. Conclusion .......................................................................................................................15 Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 2 of 21 ii 14925910.4 TABLE OF AUTHORITIES Fed. R. Civ. P. 56(c) ..............................................................................................................3 5 U.S.C. § 552 ........................................................................................................................1 26 U.S.C. § 6103(b)(2)(A) .....................................................................................................9 ACLU v. U.S. Dep’t of Defense, 628 F.3d 612 (D.C. Cir. 2011) ...........................................3 American Immigration Lawyers v. Executive Office for Immigration Review (“AILA”), No. 15-5201, 2015 WL 4056405 (D.C. Cir. July 29, 2016) .................................14 Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) ..........................................................3 Celotex Corp. v. Catrett, 477 U.S. 317 (1986) ......................................................................3 Chamberlain v. Kurtz, 444 U.S. 842 (1979) ..........................................................................9 Church of Scientology of California v. Internal Revenue Service, 484 U.S. 9 (1987) .....................................................................................................................................10 Delaney, Midgail & Young v. Internal Revenue Service, 826 F.2d 124 (D.C. Cir. 1987........................................................................................................................................7 EPA v. Mink, 410 U.S. 73 (1973) ..........................................................................................7 Fund for Constitutional Gov’t v. National Archives & Records Serv., 656 F.2d 856 (D.C. Cir. 1981) ..............................................................................................................9 Goland v. CIA, 607 F.2d 339 (D.C. Cir. 1978) ......................................................................9 Hickman v. Taylor, 329 U.S. 495 (1947) ...............................................................................6 John Doe Agency v. John Doe Corp., 493 U.S. 146 (1989) ..................................................4 Jordan v. United States Dep’t of Justice, 591 F.2d 753 (D.C. Cir. 1978) .............................8 Judicial Watch v. Export Import Bank, Inc., 108 F.Supp.2d 19 (D.D.C. 2000) ....................8 Keys v. Department of Justice, 830 F.2d 337 (D.C. Cir. 1987) .............................................4 Landmark Legal Found., 267 F.3d 1132 (D.C. Cir. 2001) .................................................... Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 3 of 21 iii 14925910.4 Lehrfeld v. Richardson, 132 F.3d 1463 (D.C. Cir. 1998) ......................................................9 Mapother v. Dept. of Justice, 3 F.3d 1533 (D.C. Cir. 1993) .................................................10 Martin v. Office of Special Counsel, 819 F.2d 1181 (D.C. Cir. 1987) ..................................7 Matsushita Electronics Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986) ..................3 Mapother v. Dep’t of Justice, 3 F.3d 1533 (D.C. Cir. 1993) .................................................5 Mead Data Central, Inc. v. Dep’t of State, 566 F.2d 242 (D.C. Cir. 1977) ...........................13 Moorefield v. Secret Service, 611 F.2d 1021 (5th Cir. 1980) ................................................5 Russell v. Dep’t of the Air Force, 682 F.2d 1045 (D.C. Cir. 1982) ......................................8 Sears, Roebuck & Co., 421 U.S. at 154 (1975) .....................................................................7 Tax Analysts v. Internal Revenue Service, 117 F.3d 607 (D.C. Cir. 1997) ...........................6 Tax Analysts v. Internal Revenue Service, 294 F.3d 71 (D.C. Cir. 2002) .............................4 United States v. Weber Aircraft Corp., 465 U.S. 792 (1984) ................................................6 Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 4 of 21 1 14925910.4 I. Introduction In this Freedom of Information Act (“FOIA”) action, the Cause of Action Institute (COA) seeks the release of an email chain containing eight Department of Justice (“DOJ”) emails. The emails are exempt from disclosure under multiple FOIA exemptions because they consist of (i) a tip from an unsolicited source associated with a taxpayer investigated by the IRS and engaged in active litigation handled by DOJ regarding that taxpayer’s tax liabilities, and (ii) subsequent discussions solely among DOJ lawyers regarding the ramifications of the tip on ongoing litigation concerning that taxpayer, and other strategies about the case. The emails are the quintessential example of information that FOIA exempts from disclosure because such disclosure would, inter alia, reveal confidential taxpayer information; threaten the ability of the DOJ to receive information from outside voluntary sources; chill frank attorney discussions at the DOJ; invade the personal privacy of individuals; and inhibit enforcement of the internal revenue laws. For the reasons stated below, the DOJ moves for summary judgment and requests dismissal of the sole count in this action. The email chain in question constitutes six pages of material. In the interests of resolving this litigation promptly, the DOJ consents to in camera review of the materials and upon the Court’s request, it will provide the Court with an unredacted version of the emails. II. Background There are no disputes of material fact in this case. On July 15, 2016, Cause of Action Institute (“COA”) sent a FOIA request to the DOJ Tax Division (the “Tax Division”). See Compl. Ex. 1. The parties subsequently agreed that the FOIA request encompassed solely: (1) “an email chain on or about May 22, 2014 between, among others, Norah Bringer and Gretchen Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 5 of 21 2 14925910.4 Wolfinger,” and (2) “a November 2011 report entitled Current Practices for Attorney Assignments, Transfers, and Details.” See Compl. Ex. 6 (emails between DOJ and COA clarifying scope of request). The parties also agreed that the DOJ need not conduct a further search for documents. Id. The DOJ had previously—and in response to a FOIA request subject of another FOIA suit (see Compl. Ex. 4)—released the requested materials to COA but had redacted portions of the materials as non-responsive. See Compl. Ex. 2 (prior production of report) and Ex. 3 (prior release of emails). In its July 15, 2016 request, which is subject of this FOIA action, COA requested that the DOJ re-release the materials without redactions based on responsiveness. See Compl. Ex. 6. After the parties clarified the scope of the request, and before this suit commenced, the DOJ re-released one of the requested records (the November 2011 report) without redactions. See Compl. Ex. 7 (letter from DOJ attaching unredacted version of November 2011 report). That document, having been fully disclosed, is not involved in the present litigation. However, with respect to the requested email chain, the DOJ redacted the email chain in full based on non- responsiveness and on FOIA Exemptions 3and 5. Id. at pp. 2-3.1 The DOJ re-released, prior to the commencement of this action, the email chain with redaction boxes covering all portions of the emails. Id. pp. 7-12. The redactions were broken up into sections corresponding to each email in the email chain. Id.2 1 Page numbers refer to the ECF-assigned numbers printed at the top of each page. 2 The redactions inadvertently labeled nine separate emails, when in fact the chain consists of eight emails. Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 6 of 21 3 14925910.4 Following the receipt of the DOJ’s release in response to its July 15, 2016 FOIA request, COA filed the present action seeking to obtain the May 22, 2014 email chain. As discussed below, the email chain contains a tip from an informant, discussions among DOJ attorneys regarding the same, and case strategy. Accordingly, the email chain is exempt from disclosure pursuant to straightforward assertions of multiple FOIA exemptions. Contemporaneous with the filing if this motion, DOJ reprocessed and released to COA the May 22, 2014 e-mail chain such that each and every redaction is based upon multiple FOIA exemptions from disclosure. The DOJ is no longer redacting information in the materials on the basis of non-responsiveness. Therefore, the only issue before the Court is whether DOJ properly withheld information based on FOIA exemptions. III. Summary Judgment Standard in FOIA Cases Summary judgment is appropriate if there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247- 48 (1986); Matsushita Electronics Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). In FOIA cases, if an agency submits an affidavit that “describes the justifications for withholding the information with specific detail, demonstrates that the information withheld logically falls within the claimed exemption,” and “is not contradicted by contrary evidence in the record or by evidence of the agency's bad faith, then summary judgment is warranted on the basis of the affidavit alone.” ACLU v. U.S. Dep’t of Defense, 628 F.3d 612, 619. “Ultimately, an agency's justification for invoking a FOIA exemption is sufficient if it appears ‘logical or Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 7 of 21 4 14925910.4 ‘plausible.’” Id. (internal quotation marks omitted) (quoting Larson v. Dep't of State, 565 F.3d 857, 862 (D.C.Cir.2009)). Here, the facts pertinent to the plaintiff’s FOIA claim are not in dispute and the issues in this case can be decided as a matter of law. The supporting affidavit supports the straightforward proposition that the release of a tip provided by an informant, and discussion among DOJ attorneys regarding the same and concerning litigation strategy, is exempt under multiple FOIA exemptions.3 IV. Argument A. The Emails Are Exempt From Disclosure Under FOIA Exemption 7(A) Because Disclosing Their Content Could Reasonably Interfere with Pending Tax Litigation. Section 552(b)(7)(A) of Title 5 (“FOIA Exemption 7”) exempts the emails from disclosure. That section exempts from disclosure records “compiled for law enforcement purposes” whose disclosure “could reasonably be expected to interfere with enforcement proceedings.” 5 U.S.C. § 552(b)(7)(A).4 3 Ordinarily, an agency must show that its search for requested records was reasonable. However, in this case, COA has admitted that “DOJ-Tax did not need to conduct an additional search for any other records” because the FOIA request sought a specific email chain that had previously been identified by the parties and released to COA twice in redacted form. Compl. Ex. 9 p. 3. Because COA did not raise the issue of the adequacy of the search in its appeal to the DOJ, it has not exhausted its administrative remedies with respect to that issue, and this Court therefore lacks jurisdiction to decide the issue. See Judicial Watch, Inc. v. FBI, 190 F.Supp.2d 29 (D.D.C. 2002). 4 Although the DOJ did not claim Exemption 7 in its initial response to the FOIA request, an agency is permitted to raise all applicable FOIA exemptions once litigation commences, regardless of which exemptions it claimed in responding to the original request. Sinito v. DOJ, 2000 U.S. Dist. LEXIS 22504 at *25 (D.D.C. July 12, 2000) (“[A]n agency is not barred from invoking a particular exemption in litigation merely because that exemption was not cited in (continued...) Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 8 of 21 5 14925910.4 Law Enforcement Purpose In order to invoke FOIA Exemption 7, the Service must first show that the materials were compiled for a law enforcement purpose. See John Doe Agency v. John Doe Corp., 493 U.S. 146, 152 (1989). The agency need merely establish a nexus “between [its] activity” (not a particular investigation) “and its law enforcement duties.” See Keys v. Department of Justice, 830 F.2d 337, 340 (D.C. Cir. 1987). “‘Law enforcement purposes’ under Exemption 7 includes both civil and criminal matters within its scope.” Tax Analysts v. Internal Revenue Service, 294 F.3d at 77. Here, the email chain in question was plainly compiled for law enforcement purposes. DOJ-Tax handles criminal and civil enforcement matters. See Banerjee Decl. ¶ 25. The emails discuss a tip from a source regarding the tax compliance of a third party taxpayer in a civil tax suit. Id. ¶ 24-29. As a result, there can be little doubt that the records at issue in this case are “records or information compiled for law enforcement purposes” within the meaning of FOIA Exemption 7. Possible Interference With Enforcement Proceedings FOIA Exemption 7 applies to information that “could reasonably be expected to interfere with enforcement proceedings.” 5 U.S.C. § 552(b)(7)(A). It is properly invoked when release of a document would hinder an agency’s ability to control or shape an investigation. Swan v. SEC, 96 F.3d 498, 500 (D.C. Cir. 1996). If release of the document might enable targets of (… continued) responding to the request at the administrative level.”). This rationale also applies to the discussion of additional exemptions below. Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 9 of 21 6 14925910.4 investigations to elude detection, Moorefield v. Secret Service, 611 F.2d 1021, 1026 (5th Cir. 1980), or to suppress or fabricate evidence, Mapother v. Dept. of Justice, 3 F.3d 1533, 1543 (D.C. Cir. 1993), withholding is proper under FOIA Exemption 7(A). Premature revelation of evidence or strategy in the government’s case will also support withholding under the exemption. Here, disclosure of the confidential tip, or the DOJ attorneys’ discussion of it or their litigation strategy, would plainly hinder enforcement proceedings. See Banerjee Decl. ¶¶ 23-29. Sources and their revelations must be protected. The emails at issue here are particularly noteworthy because they took place in the context of then ongoing, and still pending, litigation involving the subject of the source’s tip. Id. Disclosing sources and the information they provide could jeopardize the DOJ-Tax’s ability to receive information from sources, discuss it internally, and act upon it. Id. Moreover, disclosing the e-mail contents could also hinder future civil court proceedings by chilling disclosures by sources and frank discussions by DOJ-Tax attorneys. Id. DOJ-Tax attorneys must be free to receive such tips and discuss their legal ramifications. Id. B. The Emails Are Exempt From Disclosure Under FOIA Exemption 5 to Protect the Attorney Work Product and the Deliberative Process of DOJ attorneys. The emails are also exempt under 5 U.S.C. § 552(b)(5) (“FOIA Exemption 5”). That section protects from disclosure “inter-agency or intra-agency memorandums or letters which would not be available by law to a party other than an agency in litigation with the agency.” 5 U.S.C. § 552(b)(5). The FOIA thus incorporates those privileges that the government enjoys in pretrial discovery under relevant statutes and case law. See United States v. Weber Aircraft Corp., 465 U.S. 792, 799 (1984). The emails fall within two well-established common law Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 10 of 21 7 14925910.4 privileges: the attorney work product doctrine and the governmental deliberative process privilege. Cf. Tax Analysts v. Internal Revenue Service, 294 F.3d 71, 76 (D.C. Cir. 2002) (FOIA Exemption 5 incorporates the work product and deliberative process privileges). Attorney Work Product Privilege The Supreme Court first extended protection to attorney work product in Hickman v. Taylor, 329 U.S. 495 (1947). There, the Court held that a party could not obtain from the opposing party, without a showing of necessity, written statements obtained by the opposing party’s attorney and the attorney’s mental impressions formed in anticipation of litigation. Id. at 509-13. The touchstone of work product it whether it was prepared in anticipation of litigation. Id. FOIA Exemption 5 incorporates the attorney work product doctrine, and therefore protects, at a minimum, memoranda prepared by a government attorney in anticipation of litigation setting forth the attorney’s mental impressions regarding the case. Sears, Roebuck & Co., 421 U.S. at 154; see also Delaney, Midgail & Young v. Internal Revenue Service, 826 F.2d 124 (D.C. Cir. 1987). FOIA Exemption 5 applies regardless of whether the applicable material is deliberative or factual, Martin v. Office of Special Counsel, 819 F.2d 1181, 1185-86 (D.C. Cir. 1987). As set forth in the Banerjee Declaration, DOJ-Tax has properly withheld the redacted portions of the emails as attorney work product. See Banerjee Declaration at ¶¶ 30-32. The emails were prepared by DOJ attorneys involved in active litigation with the subject of the unsolicited informational tip. See Banerjee Decl. at ¶¶ 30, 31. They were thus created not only in “reasonable anticipation” of litigation, but in direct relation to active litigation. Id. at ¶ 31. Thus, these attorney-to-attorney communications are quintessential examples of attorney work product exempt from disclosure under § 552(b)(5) and the work product privilege. Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 11 of 21 8 14925910.4 Deliberative Process Privilege The emails are also exempt under FOIA Exemption 5 in conjunction with the governmental deliberative process privilege. FOIA Exemption 5 exempts from disclosure any records subject to the governmental deliberative process privilege. Sears, Roebuck & Co., 421 U.S. at 150; EPA v. Mink, 410 U.S. 73, 87 (1973). The privilege protects “records ‘reflecting advisory opinions, recommendations and deliberations comprising part of a process by which governmental decisions and policies are formulated.’” Sears, Roebuck & Co., 421 U.S. at 150 (quoting Carl Zeiss Stiftung v. V.E.B. Carl Zeisee, Jena, 40 F.R.D. 318, 324 (D.D.C. 1966)). The scope of the privilege includes records reflecting the author’s personal opinions prior to agency adoption of a policy. Tax Analysts, 294 F.3d at 80. The rationale of the privilege is to protect records whose disclosure could inhibit “frank discussion of legal or policy matters,” leading to weaker decisions and policies. Sears, Roebuck & Co., 421 U.S. at 150; see also, Mink, 470 U.S. at 87; Tax Analysts, 294 F.3d at 80. In determining whether the governmental deliberative process privilege protects a particular document, that document must be (i) predecisional and (ii) deliberative in nature. Mapother v. Department of Justice, 3 F.3d 1533, 1537 (D.C. Cir. 1993); Judicial Watch v. Export Import Bank, Inc., 108 F.Supp.2d 19, 35 (D.D.C. 2000). The portions of the materials described in ¶ 33-35 of the Banerjee Declaration were properly withheld under the deliberative process privilege because they are both pre-decisional and deliberative in nature. See Banerjee Decl. ¶ 33-35. Predecisional means “antecedent to the adoption of an agency policy.” Jordan v. United States Dep’t of Justice, 591 F.2d 753, 774 (D.C. Cir. 1978) (en banc). Here, the redacted Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 12 of 21 9 14925910.4 portions are pre-decisional because they were created prior to the DOJ deciding how to proceed with its then-ongoing civil litigation involving the subject of the unsolicited tip. See Banerjee Decl. ¶ 33-35. The term “deliberative” encompasses deliberative discussions and factual communications that would expose publicly the agency’s deliberative process. Russell v. Dep’t of the Air Force, 682 F.2d 1045, 1048 (D.C. Cir. 1982). Here, the materials marked as deliberative process privileged protected are deliberative because they contain DOJ attorneys’ thoughts and considerations of legal issues involving a specific ongoing tax litigation. See Banerjee Decl. ¶ 34-35. Accordingly, the portions of the email chain marked as deliberative process privileged constitute quintessential examples of “frank discussion of legal . . . matters.” Sears, Roebuck & Co., 421 U.S. at 150. Ms. Banerjee conducted a segregation analysis and released information. Banerjee Decl. ¶¶ 18, 21, 35. The applicable e-mailswere thus properly withheld under FOIA exemption 5. C. The Emails Are Exempt From Disclosure Under FOIA Exemption 3 to Protect the Confidential Return Information of a Taxpayer. The emails are exempt from disclosure under 5 U.S.C. § 552(b)(3) (“FOIA Exemption 3”) because they contain tax return information of third-parties. FOIA Exemption 3 exempts from disclosure information prohibited from disclosure by another statute under certain circumstances. 5 U.S.C. § 552(b)(3). Under this exemption, if the Court determines that a qualifying statute exists and that any of the withheld information is within the statute’s scope, the material must be withheld. See Fund for Constitutional Gov’t v. National Archives & Records Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 13 of 21 10 14925910.4 Serv., 656 F.2d 856, 868 n.29 (D.C. Cir. 1981); Goland v. CIA, 607 F.2d 339, 350 n. 65 (D.C. Cir. 1978). Here, the relevant statute is 26 U.S.C. § 6103 (“Section 6103”), which prohibits disclosure of tax returns and “return information.” Section 6103 is an exempting statute within the meaning of FOIA Exemption 3; thus, records protected under § 6103 are exempt from disclosure under FOIA. Chamberlain v. Kurtz, 444 U.S. 842 (1979); Lehrfeld v. Richardson, 132 F.3d 1463, 1466 (D.C. Cir. 1998); Tax Analysts v. Internal Revenue Service, 117 F.3d 607, 611 (D.C. Cir. 1997). Section 6103's prohibitions are clear. The section provides that tax returns and “return information” are to be kept confidential, unless disclosure is permitted by Title 26. Church of Scientology of California v. Internal Revenue Service, 484 U.S. 9 (1987). The term “return information” is broadly defined to include: [A] taxpayer's identity, the nature, source, or amount of his income, payments, receipts, deductions, exemptions, credits, assets, liabilities, net worth, tax liability, tax withheld, deficiencies, overassessments, or tax payments, whether the taxpayer's return was, or is being examined, or subject to other investigation or processing, or any other data, received by, recorded by, prepared by, furnished to, or collected by the Secretary with respect to a return or with respect to the determination of the existence, or possible existence of liability (or the amount thereof) of any person under this title for any tax, penalty, interest, fine, forfeiture, or other imposition or offense[.] 26 U.S.C. §6103(b)(2)(A) (emphasis added).5 Information that identifies a taxpayer who is “being examined, or subject to other investigation or processing” is quintessential return 5 Under the Internal Revenue Code, a person is broadly defined and includes individuals, corporations, and trusts. See 26 U.S.C. § 7701(a)(1). Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 14 of 21 11 14925910.4 information protected from disclosure under section 6103. See Church of Scientology of Cal., 484 U.S. at 12-17; Landmark Legal Found., 267 F.3d 1132,1137 (D.C. Cir. 2001). Here, the materials described in ¶ 21-24 of the Banerjee Declaration are properly withheld under §6103(a). The information contained in the withheld emails would identify the taxpayer who is the subject of a civil tax case being handled by DOJ-Tax. See Declaration of Carmen Banerjee (“Banerjee Decl.,” filed herewith) ¶¶ 36-41. Specifically, the subject line of all emails reveals the name of the taxpayer. The content of the e-mails by themselves or in the aggregate would expressly or implicitly identify the taxpayer. The emails, in discussing the nature and source of the taxpayer’s tax liability, contain information that would reveal the taxpayer that is subject of a case involving its federal tax liability. Id. at ¶ 38. The withheld information also reveals the identity of another taxpayer that is associated with the subject taxpayer, thus indirectly revealing the subject taxpayer. Id. at ¶ 39. Thus, this information constitutes tax return information of third parties as defined in §6103(b)(2)(A), and is exempt from disclosure under FOIA. D. Some Emails Are Exempt From Disclosure Under FOIA Exemptions 6 and 7(C) to Protect the Personal Privacy of Individuals. The Tax Division has properly withheld parts of records responsive to COA’s request because they contain personal identifying information that is properly withheld under FOIA Exemptions 6 and 7(C). FOIA Exemption 6 FOIA Exemption 6 exempts from disclosure personnel, medical, and “similar files” where the disclosure of such information would constitute a clearly unwarranted invasion of privacy. 5 U.S.C. § 552(b)(6); see Dep’t of State v. Washington Post Co., 456 U.S. 595, 599-603 Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 15 of 21 12 14925910.4 (1982); Multi Ag Media LLC v. USDA, 515 F.3d 1224, 1228 (D.C. Cir. 2008). To qualify under Exemption 6, information must meet two criteria. Multi Ag Media, 515 F.3d at 1228. First, it must be personal information contained in personnel and medical or “similar files.” Id. The Supreme Court has broadly interpreted “similar files” as any information that “applies to a particular person.” Washington Post, 456 U.S. at 602. Second, disclosing the information at issue must compromise a substantial privacy interest. Multi Ag Media, 515 F.3d at 1228. A court must balance the privacy of the individual identified in the files against the public interest in disclosure. Associated Press v. DOD, 554 F.3d 274, 291 (2nd. Cir. 2009). Courts have found that individuals have a sufficient interest in the privacy of their names, addresses, finances, and similar personal information to justify withholding under Exemption 6. See, e.g., Associated Press, 549 F.3d at 65; Multi Ag Media, 515 F.3d at 1230. Here, entirety of the earliest initial e-mail, which is the e-mail from the source, and portions of the e-mails following the earliest (except for the most recent e-mail) are exempt under Exemption 6. See Banerjee Decl. ¶ 42. These e-mails name several individuals, and certain personal information, the disclosure of which would be an unwarranted invasion of the personal privacy of the source of the information and of certain individuals identified by the source. Id. at ¶¶ 42, 44. FOIA Exemption 7(C) Similarly, FOIA Exemption 7(C) authorizes the withholding of information compiled for law enforcement purposes, the release of which could be reasonably expected to constitute an unwarranted invasion of personal privacy. In applying the personal privacy exemptions under FOIA, the courts must balance the private and public interests involved. Under the balancing Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 16 of 21 13 14925910.4 test, a FOIA plaintiff is required to show that a “substantial public interest” in disclosure outweighs the privacy interests involved. Becker v. IRS, 34 F.3d 398, 404-05 (7th Cir. 1994). The public’s interest is limited to the statutory purposes of FOIA, namely, to “shed light on an agency’s performance of its statutory duties.” See U.S. Dep’t. of Justice v. Reporters Committee for Freedom of Press, 489 U.S. 749, 773 (1989). Here, the entirety of the earliest initial e-mail, which is the e-mail from the source, and portions of the e-mails following the earliest (except for the most recent e-mail) are exempt from disclosure under Exemption 7(C) to withhold the same information withheld under Exemption 6 because disclosing such information could reasonably be expected to invade the privacy of the source and of the individuals referenced by the source in the earliest initial e-mail. See Banerjee Declaration at ¶ 43. DOJ balanced the private interests against the public interests in asserting Exemptions 6 and 7(C); it determined that the personal private information withheld has no public interests. Banerjee Decl. at ¶¶ 42, 43. The Division asserted FOIA Exemptions 6 and 7(C) and appropriately withheld the redacted information as pertaining to individuals and having no substantial value to the public. E. The DOJ Reasonably Segregated the Material and Released Information That Would Not Harm Its Operations. Where an agency claims an exemption, it must release any “reasonably segregable” portion of a record. 5 U.S.C. § 552(b). The Complaint claims that the DOJ did not reasonably segregate the email chain. See Compl. ¶35. Although the Complaint provides no details regarding this allegation, COA’s appeal before the DOJ appears to take the position that the DOJ Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 17 of 21 14 14925910.4 should have tailored its redactions to exclude salutations and signature blocks. See Compl. Ex. 8 p. 6. The segregability of materials “depends entirely on what the information is in a document and how it is presented.” Mead Data Central, Inc. v. Department of State, 566 F.2d 242, 261 (D.C. Cir. 1977). An agency need not tailor its redactions so minutely that de minimis passages containing no information content are disclosed to the requestor. See Mead Data Central, 566 F.2d 242 at n. 55 (D.C. Cir. 1977) (since the focus of the FOIA is “not simply words which the Government has written down,” a court “may decline to order an agency to commit significant time and resources to the separation of disjointed words, phrases, or even sentences which taken separately or together have minimal or no information content.”) Where the percentage of non- exempt information is low, and “the result would be an essentially meaningless set of words and phrases,” the information may not be reasonably segregable. Id. at 261. Here, COA is requesting that DOJ tailor its redactions to include salutations and signature blocks—in essence, a “meaningless set of words and phrases.” Segregation at this level of detail is not reasonable and not required by FOIA. Nonetheless, in the interests of mooting this issue in its entirety, the DOJ has produced a highly-segregated version of the email chain to COA. See Banerjee Decl. ¶ 18-19. The redacted portions contain no reasonably segregable non-exempt information. Id. ¶ 21. F. This Case Does Not Present The Issue Of The Definition Of A “Record.” The Complaint and COA’s administrative appeal claim that the DOJ has improperly characterized each email in the email chain in question as a separate record. See Compl. ¶28-30 and Ex. 7 at p. 7. COA claims that this characterization violates a D.C. Circuit decision handed Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 18 of 21 15 14925910.4 down in July 2016, which holds that an agency cannot withhold portions of a “record” based solely on non-responsiveness. American Immigration Lawyers v. Executive Office for Immigration Review (“AILA”), No. 15-5201, 2015 WL 4056405, at *8 (D.C. Cir. July 29, 2016). But the definitional issue is moot. The DOJ is not withholding any information based on responsiveness; instead, it is withholding information solely based on FOIA exemptions. COA admits that portions of records may be withheld based on exemptions. See Compl. ¶31-33. Thus, it is irrelevant whether the email chain constitutes one record or several records. Simply put, because the DOJ is standing solely on FOIA exemptions, not responsiveness, this case does not present to the Court the issue of whether an email chain constitutes one “record” or many “records” under ALIA. V. Conclusion For the reasons stated above, the DOJ’s withholding of the requested emails is justified. Accordingly, based upon the undisputed facts, the DOJ is entitled to judgment as a matter of law. The DOJ therefore respectfully requests that this Court grant its motion for summary judgment, dismiss the FOIA claim with prejudice, and deny the plaintiffs any attorneys’ fees or costs associated with their FOIA claim. Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 19 of 21 16 14925910.4 Dated: January 18, 2017 Respectfully Submitted, CAROLINE D. CIRAOLO Principal Deputy Assistant Attorney General /s/ Nelson Wagner NELSON WAGNER Trial Attorney, Tax Division U.S. Department of Justice P.O. Box 227, Ben Franklin Station Washington, DC 20044 Tel: (202) 616-3369 Fax: (202) 514-6866 Email: Nelson.Wagner@usdoj.gov Attorney for Defendant the United States Department of Justice Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 20 of 21 17 14925910.4 CERTIFICATE OF SERVICE I certify that I served a true and correct copy of the foregoing motion on all parties of record through the Court’s ECF system on January 18, 2017. /s/ Nelson Wagner NELSON WAGNER Case 1:16-cv-02226-RBW Document 12 Filed 01/18/17 Page 21 of 21 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA CAUSE OF ACTION INSTITUTE, Plaintiff, v. UNITED STATES DEPARTMENT OF JUSTICE, Defendant. ) ) ) ) ) ) ) ) ) ) Civil No. 1: 16-cv-2226-RBW DECLARATION OF CARMEN M. BANERJEE I, Carmen M. Banerjee, pursuant to the provisions of 28 U .S.C. § 1746, declare as follows: 1. In the above-captioned suit, Cause of Action Institute ("COA'') challenges how the Department of Justice, Tax Division ("DOJ-Tax") processed a collection of eight e-mails (the "May 2014 e-mail chain") that COA requested in a Freedom of Information Act (FOIA) request it submitted to Tax-DOJ. 2. This declaration is prepared in support of the DOJ's motion for summary judgment and it describes DOJ-Tax's re-processing of the May 2014 e-mail chain since the suit commenced, including its justification for withholding considerable portions of seven e-mails, and one e-mail in full. 3. I have been employed as an attorney in the United States Department of Justice since August 21, 2005. I joined the Department's Tax Division as Division Counsel and Trial Attorney in August 2007. 1492688~.1 Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 1 of 11 4. I am the Senior Division Counsel for FOIA and Privacy Act (PA) Matters at the Tax Division. My post of duty is Washington, District of Columbia, specifically, in the Civil Trial Section, Eastern Region ofthe Division. 5. My section is responsible, among other things, for: (I) processing all FOIA and PA requests made to the Division; and (2) defending all FOIA and PA suits involving internal revenue matters on a nationwide basis; our client agencies are usually the Internal Revenue Service and the Treasury Inspector General for Tax Administration. 6. I am delegated the authority to make final detenninations on initial FOIA and PA requests received by the Division. (A copy of the directive setting forth this authority is attached as Ex. A.) 7. I supervise the Division's FOIA/PA Unit team that is responsible for processing the FOIA requests submitted to the Tax Division; the Unit consists of non-attorney professionals trained in processing FOIA requests, including one full time Government Infonnation Specialist (GIS). 8. I also serve as Reviewer, and in that capacity, I supervise the Division's litigators who handle nationwide FOIA and PA cases, including reviewing court-related documents and providing litigation strategy guidance to such attorneys. I report to the Chief of the Section on matters pertaining to my duties. 9. I have personally reviewed and processed the May 2014 e-mail chain and I am familiar with the issues in this lawsuit. I 0. On July 15, 2016, the Tax Division received a FOIA request submitted by James Valvo on behalf of COA dated the same day. 2 14926884. 1 Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 2 of 11 11. On August 9, 2016, I requested to Mr. Valvo ofCOA that he and I have a conference call because the Tax Division needed clarification ofCOA's request, and asked that he memorialize the call after it. Mr. Valvo and I had a phone conference on August 15, 2016 to clarify the scope ofCOA's request dated July 15, 2016. 12. Moments before the call on August 15, 2016, Mr. Valvo e-mailed me copies of what he described as: (1) "an email chain on or about May 22, 2014 between, among others, Norah Bringer and Gretchen Wolfinger," and (2) "a November 2011 report entitled Current Practices for Attorney Assignments, Transfers, and Details COA's," which the Tax Division had released to COA in response to a FOIA request that is subject of the FOIA suit bearing docket number No. 1:15-0770. 13. During the call, and in Mr. Valvo's e-mail of August 15,2016 soon after the call memorializing it, COA clarified and agreed that its July 15, 2016 FOIA request sought only the May 2014 e-mail chain and the November 2011 report. 14. COA also agreed in its August 15,2016 email that DOJ-Tax need not conduct any search to locate the May 2014 e-mail chain and the November 2011 report. 15. As clarified on August 15, 2016, COA's FOIA request sought two documents that DOJ-Tax had released in part in response to a different prior FOIA request that COA had submitted. The DOJ-Tax released the records in part during the pendency of Cause of Action Institute v. Dep 't of Justice and Internal Revenue Service, No. 1:15-0770 (D.D.C), another FOIA suit against DOJ-Tax. 16. On September 20, 2016, I issued DOJ-Tax's final determination to COA in response to COA's July 15, 2016 FOIA request. As part of its response, the Tax Division 3 Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 3 of 11 released in full (i.e., without any redactions) the November 2011 report and a redacted version of the May 2014 e-mail chain. 17. The May 22, 2014 email chain (the "May 2014 Emails"), which COA also asked for in its clarified request of July 15, 2016, consists of eight em ails totaling six pages. The earliest email in the chain consists of a tip about a taxpayer previously investigated by the IRS and then referred to DOJ-Tax to litigate, from a source providing information to a DOJ-Tax attorney. At the time of the e-mail, and currently, the taxpayer subject of the e-mail chain is the subject of a civil case being handled by the Tax Division. The subsequent seven emails consist of internal discussion among DOJ attorneys regarding the effects of the tip on a still ongoing litigation involving that taxpayer, and about litigation strategy. 18. After this FOIA action commenced, I re-processed the May 2014 e-mails. As I did at the administrative level, I conducted a segregability analysis of the May 2014 e-mails. 19. On January 18, 2017, I provided to one of the DOJ-Tax attorneys representing DOJ-Tax in this suit, are-redacted version of the May 2014 e-mails, and asked that he release it to COA; I understand that he released it on January 18, 2017. This version releases all portions that were disclosed to COA in the DOJ's release of the May 2014 email chain in response to a separate COA FOIA request to DOJ-Tax (see supra), as well as additional portions. 20. I am familiar with the requirements for disclosure in response to a FOIA request and am similarly familiar with the segregation requirement of subsection (b) of the FOIA requiring release of any nonexempt information contained in responsive agency records. 21. I have reviewed all ofthe pages ofthe May 2014 emails; I have determined that the DOJ-Tax has made every reasonably segregable release of non-exempt portions of the May 4 1492.6884, I Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 4 of 11 2014 email chain available to the plaintiff. As a result, I conclude that the DOJ has withheld only those portions of the May 2014 Emails that fall within a FOIA exemption, or those portions of the May 2014 emails that are so inextricably intertwined with exempt material as to be non- segregable. 22. In the following paragraphs, I describe the reasoning for withholding portions of the May 2014 email chain pursuant to FOIA exemptions 5 U.S.C. § 552(b)(3), (b)(5), (b)(6), (b)(7)(A), and (b)(7}(C) (hereinafter referred to as Exemptions 3, 5, 6, 7(A), and 7(C), respectively). FOIA Exemption 7(A) (Interference With Law Enforcement Proceedings) 23. The DOJ is withholding all thee-mails in the May 2014 email chain under FOIA Exemption 7, which exempts from disclosure records "compiled for law enforcement purposes." 1 24. The withheld emails were compiled for a law enforcement purpose, specifically for a civil tax litigation that is currently ongoing. 25. DOJ-Tax handles criminal and civil enforcement matters. The emails discuss a tip from a source regarding the alleged tax non-compliance of a third party taxpayer that is a party to civil case the Tax Division is handling. They were thus compiled for a law enforcement purpose. 26. Exemption 7 A protects information that "could reasonably be expected to interfere with enforcement proceedings." Although the DOJ-Tax could have withheld the e-mails in their entirety based upon Exemption 7(A) and 5 (based upon the attorney work product), it exercised its discretion to d isclose information such as the senders, recipients and those persons copied, in part to show that the communications were amongst DOJ-Tax attorneys. 5 149263~. 1 Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 5 of 11 27. Disclosure of the emails would interfere with enforcement proceedings, specifically the ongoing civil tax case. Disclosing an unsolicited tip, or the DOJ attorneys' discussion of it, or their litigation strategy, would plainly hinder ongoing enforcement proceedings. Disclosing the source and the information provided by the source could allow the taxpayer subject of the underlying civil suit to take actions to circumvent the law. Thus, disclosing the source and the information could hinder the DOJ-Tax attorney in acting or omitting to act upon the information. 28. Disclosing sources and the information they provide could jeopardize the DOJ- Tax's ability to receive information from this same source in any future investigation about the same taxpayer or any taxpayer associated with the same taxpayer. 29. Such disclosure could also hinder future civil court proceedings with other parties by chilling disclosures by sources and discussion by DOJ-Tax attorneys. DOJ-Tax attorneys must be free to receive such tips and discuss their legal ramifications. Similarly, sources and their revelations must be protected. The emails at issue here are particularly noteworthy because they took place in the context ofthen ongoing, and still pending, litigation involving the subject of the source's tip. FOIA Exemption 5 (Attorney Work Product Doctrine Privilege) 30. The Tax Division is withholding the eight emails in question based on 5 U.S.C. § 552(b)(S) ("FOIA Exemption 5"). That section protects from disclosure "inter-agency or intra- agency memorandums or letters which would not be available by law to a party other than an agency in litigation with the agency." The section incorporates privileges which the government enjoys in pretrial discovery, including the attorney work product privilege. 6 14926884.1 Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 6 of 11 7 14931129.1 31. The May 2014 emails were prepared by DOJ attorneys involved in active litigation with the subject of the confidential tip. The emails discuss the actual and possible ramifications as to the then and still ongoing litigation of the tip. 32. Thus, the May 2014 emails are exempt under § 552(b)(5) and the work product privilege. FOIA Exemption 5 (Deliberative Process Privilege): 33. The DOJ is also withholding portions of some of the e-mail strings in the May 2014 emails under FOIA Exemption 5 in conjunction with the deliberative process privilege. The deliberative process privilege protects records reflecting advisory opinions, recommendations and deliberations comprising part of a process by which governmental decisions and policies are formulated. The pages bearing the deliberative process privilege redactions are located on pages bearing control numbers TAX 001 - 003. 34. The relevant decision here is whether DOJ-Tax would decide to use some, all, or none of the unsolicited information provided by the source. Portions of some of the e-mail strings are pre-decisional because they were created prior to the DOJ deciding how to proceed with its then-ongoing civil litigation involving the subject of the unsolicited tip. The portions of the e-mail strings withheld pursuant to the deliberative process privilege are deliberative because they contain a DOJ attorney’s thoughts as to whether the unsolicited information would be used in the underling ongoing tax litigation. 35. I have conducted a segregability analyses as to the deliberative process privilege even though the DOJ-Tax is withholding all the substantive underlying content under the attorney work product privilege. The Tax Division is asserting the deliberative process privilege Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 7 of 11 only as to some e-mail strings or portions of e-mail strings.2 The withheld emails are therefore properly withheld under FOIA Exemption 5. FOIA Exemption 3 with 26 USC § 6103 (identity of a taxpayer). 36. The Tax Division is withholding the first seven of the eight emails in question, and portions ofth eight email, based on 5 U.S.C. § 552(b}(3} ("FOIA Exemption 3"}, specifically with section 6103 ofthe Internal Revenue Code. Exemption 3 exempts from disclosure information prohibited from disclosure by another non-FOIA statute. Section 6103, which prohibits disclosing tax "return information," has been held to be an Exemption 3 statute. 37. The May 2014 emails commence with the e-mail earliest in time from a source to a Tax Division attorney, and the subsequent seven emails consist of an internal discussion among two DOJ-Tax attorneys regarding the possible effects of the tip on the then pending litigation, which is still ongoing, involving the subject ofthe tip. 38. The information contained in the withheld emails would identify the taxpayer who is the subject of an enforcement case being handled by DOJ-Tax. Specifically, the subject line of all e-m ails reveals the name of the taxpayer. The content of the e-mails by themselves or in the aggregate would expressly or implicitly identify the taxpayer. The May 2014 e-mails discuss the nature and source of the taxpayer's tax liability, and contain information that would reveal that the taxpayer is subject of a case involving its actual federal tax liability. 39. The information reveals the identity of another taxpayer that is associated with the subject taxpayer, thus indirectly revealing the subject taxpayer. The content of the information 2 As required by statute, the exemptions from disclosure asserted are indicated within the redactions. 8 14~26SU I Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 8 of 11 in the earliest e-mail and the subsequent e-mails reveals the identity of a third party taxpayer; thus, disclosing this information would violate section 61 03(a). 40. The first seven e-mails are fully exempt from disclosure pursuant to FOIA Exemption 3. 41. The eighth and most recent e-mail string is partially withheld under Exemption 3 with section 61 03(a) because disclosing the text of the subject of the e-mail would identify the taxpayer; and therefore, it is exempt under Exemption 3. The eighth e-mail identifies the party in a tax case in litigation; therefore, it is partially withheld under Exemption 3 with 6103. Moreover, as discussed above; this e-mail string is fully withheld under Exemption 5 and the attorney work product doctrine/privilege. FOIA Exemptions 6 and 7(C) 42. The entirety of the earliest initial e-mail, which is the e-mail from the source, and portions of thee-mails following the earliest (except for the most recent e-mail) are exempt under Exemption 6. First, the e-mail identifies the individual source providing the unsolicited information to the DOJ-Tax. Second, these same e-mails name several other individuals, and reveal their personal information. Disclosing the personal private information would be an unwarranted invasion of the personal privacy of all individuals identified; none of the personal private information serves a public interest purpose. 43. The entirety of the earliest initial e-mail, which is the e-mail from the source, and portions of thee-mails following the earliest (except for the most recent e-mail) are exempt from disclosure under Exemption 7(C) to withhold the same information as above because disclosing 9 14926884.1 Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 9 of 11 such information could reasonably be expected to invade the privacy of the individuals identified; none of the personal private information serves a public interest purpose. 44. I made every effort to segregate non-exempt information, and I have determined that releasing the private information would violate the FOIA because there is no actual public interest in releasing any of the withheld information. I declare under penalty of perjury that the foregoing is true and correct. Executed January 18, 2017 in Washington, DC ~~ CARMEN MBANERE lO 1492688-1. 1 Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 10 of 11 EX. A Case 1:16-cv-02226-RBW Document 12-1 Filed 01/18/17 Page 11 of 11 14931402.1 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA CAUSE OF ACTION INSTITUTE, ) ) Plaintiff, ) ) v. ) Civil No. 1:16-cv-2226-RBW ) UNITED STATES DEPARTMENT ) OF JUSTICE, ) ) Defendant. ) STATEMENT OF UNDISPUTED MATERIAL FACTS The United States submits the following Statement of Material Facts pursuant to Local Rule 7(h). 1. On July 15, 2016, the Tax Division received a FOIA request submitted by James Valvo on behalf of Cause of Action Institute (“COA”) dated the same day. Compl. ¶ 6; Banerjee Decl. ¶ 10. 2. On August 9, 2016, Carmen Banerjee of the Department of Justice Tax Division (“DOJ-Tax”) requested to Mr. Valvo of COA that he and Ms. Banerjee have a conference call because the Tax Division needed clarification of COA’s request. Compl. ¶11; Id. ¶ at 10. She asked that Mr. Valvo memorialize the call after it occurred. Id. Mr. Valvo and Ms. Banerjee had a phone conference on August 15, 2016 to clarify the scope of COA’s request dated July 15, 2016. Id. 3. Moments before the call on August 15, 2016, Mr. Valvo emailed Ms. Banerjee copies of what he described as: (1) “an email chain on or about May 22, 2014 between, among others, Norah Bringer and Gretchen Wolfinger” (the “May 2014 Emails”) and (2) “a November Case 1:16-cv-02226-RBW Document 12-2 Filed 01/18/17 Page 1 of 8 2 14931402.1 2011 report entitled Current Practices for Attorney Assignments, Transfers, and Details” (“November 2011 Report”), which the Tax Division had released to COA in response to a FOIA request that is subject of Cause of Action Institute v. Dep’t of Justice and Internal Revenue Service, No. 1:15-0770 (D.D.C), another FOIA suit against DOJ-Tax. Banerjee Decl. ¶ 12. 4. During the call, and in Mr. Valvo’s email of August 15, 2016 soon after the call memorializing it, COA clarified and agreed that its July 15, 2016 FOIA request sought only the May 2014 Emails and the November 2011 report. Id. ¶ 13. 5. COA also agreed in its August 15, 2016 email that DOJ-Tax need not conduct any search to locate the May 2014 Emails and the November 2011 report. Id. ¶ 14 6. As clarified on August 15, 2016, COA’s FOIA request sought two documents that DOJ-Tax had released in part in response to a different prior FOIA request that COA had submitted. Id. ¶ 15. The DOJ-Tax released the records in part during the pendency of Cause of Action Institute v. Dep’t of Justice and Internal Revenue Service, No. 1:15-0770 (D.D.C). Id. 7. On September 20, 2016, Ms. Banerjee issued DOJ-Tax’s final determination to COA in response to COA’s July 15, 2016 FOIA request as clarified. Id. ¶ 16. As part of its response, the Tax Division released in full (i.e., without any redactions) the November 2011 report and a heavily redacted version of the May 2014 Emails. Id. 8. The May 2014 Emails, which COA also asked for in its clarified request of July 15, 2016, consists of eight emails totaling six pages. Id. ¶ 17. The earliest email in the chain consists of a tip about a taxpayer previously investigated by the IRS and then referred to DOJ- Tax for a civil suit; the tip’s source provided unsolicited information to a DOJ-Tax attorney. Id. At the time of the email, and currently, the taxpayer subject of the email chain is the subject of a Case 1:16-cv-02226-RBW Document 12-2 Filed 01/18/17 Page 2 of 8 3 14931402.1 civil case being handled by the Tax Division. Id. The subsequent seven emails consist of internal discussions among DOJ attorneys regarding the effects of the tip on a still ongoing litigation involving that taxpayer, and about possible litigation strategy. Id. 9. After this FOIA action commenced, Ms. Banerjee re-processed the May 2014 Emails. As she did at the administrative level, she conducted a segregability analysis of the May 2014 Emails. Id. ¶¶ 18, 21 10. On January 18, 2017, Ms. Banerjee provided to one of the DOJ-Tax attorneys representing DOJ-Tax in this suit, a re-redacted version of the May 2014 Emails, and asked that he release it to COA; he released it to COA on January 18, 2017. Id. ¶ 19. This version releases all portions that were disclosed to COA in the DOJ’s release of the May 2014 Emails in response to a separate COA FOIA request to DOJ-Tax (see supra), and additional portions. Id. 11. Ms. Banerjee reviewed all of the pages of the May 2014 Emails and determined that DOJ-Tax has made every reasonably-segregable release of non-exempt portions of the May 2014 Emails available to the plaintiff. Id. ¶ 21. As a result, Ms. Banerjee concluded that the DOJ has withheld only those portions of the May 2014 Emails that fall within a FOIA exemption, or those portions of the May 2014 Emails that are so inextricably intertwined with exempt material as to be non-segregable. Id. FOIA Exemption 7(A) (Possible Interference With Law Enforcement Proceedings) 12. The DOJ is withholding all the emails in the May 2014 Emails under FOIA Exemption 7, which exempts from disclosure records “compiled for law enforcement purposes.” Id. ¶ 23. Case 1:16-cv-02226-RBW Document 12-2 Filed 01/18/17 Page 3 of 8 4 14931402.1 13. The withheld emails were compiled for a law enforcement purpose, specifically for a civil tax litigation that is currently ongoing. Id. ¶ 24. 14. DOJ-Tax handles criminal and civil enforcement matters. Id. ¶ 25. The emails discuss a tip from a source regarding the alleged tax non-compliance of a third party taxpayer that is a party to civil case the Tax Division is handling. Id. They were thus compiled for a law enforcement purpose. Id. 15. Disclosure of the emails would interfere with enforcement proceedings, specifically the ongoing civil tax case. Id. ¶ 27. Disclosing an unsolicited tip, or the DOJ attorneys’ discussion of it, or their litigation strategy, would hinder ongoing enforcement proceedings. Id. Disclosing the source and the information provided by the source could allow the taxpayer subject of the underlying civil suit to take actions to circumvent the law. Id. Thus, disclosing the source and the information could hinder the current DOJ-Tax attorneys handling the civil tax case in acting or omitting to act upon the information. Id. 16. Disclosing sources and the information they provide could jeopardize the DOJ- Tax’s ability to receive information from this same source in any future investigation about the same taxpayer or any taxpayer associated with the same taxpayer. Id. ¶ 28. 17. Such disclosure could also hinder future civil court proceedings with other parties by chilling disclosures by sources and discussion by DOJ-Tax attorneys. Id. ¶ 29. Similarly, sources and their revelations must be protected. Id. The emails at issue here are particularly noteworthy because they took place in the context of then ongoing, and still pending, litigation involving the subject of the source’s tip. Id. Case 1:16-cv-02226-RBW Document 12-2 Filed 01/18/17 Page 4 of 8 5 14931402.1 FOIA Exemption 5 (Attorney Work Product Doctrine Privilege) 18. The Tax Division is withholding the eight emails in question based on 5 U.S.C. § 552(b)(5) (“FOIA Exemption 5”). Id. ¶ 30. Exemption 5 incorporates privileges which the government enjoys in pretrial discovery, including the attorney work product privilege. Id. 19. The May 2014 Emails were prepared by DOJ attorneys involved in active litigation with the subject of the confidential tip. Id. ¶ 31. The emails discuss the actual and possible ramifications of the tip and other strategy discussion as to the then and still ongoing litigation. Id. 20. Thus, the May 2014 Emails are exempt under § 552(b)(5) and the work product privilege. Id. FOIA Exemption 5 (Deliberative Process Privilege): 21. The DOJ is also withholding portions of some of the email strings in the May 2014 Emails under FOIA Exemption 5 in conjunction with the deliberative process privilege. Id. ¶ 33. 22. Portions of some of the email strings are pre-decisional because they were created prior to the DOJ deciding how to proceed with its then-ongoing civil litigation involving the subject of the unsolicited tip. Id. ¶ 34. The portions of the email strings withheld pursuant to the deliberative process privilege are deliberative because they contain a DOJ attorney’s thoughts as to whether the unsolicited information would be used in the underlying ongoing tax litigation. Id. Case 1:16-cv-02226-RBW Document 12-2 Filed 01/18/17 Page 5 of 8 6 14931402.1 23. DOJ-Tax is withholding all the substantive underlying content under the attorney work product privilege. Id. ¶ 35. 24. DOJ-Tax is asserting the deliberative process privilege only as to some email strings or portions of email strings. Id. Ms. Banerjee made every effort to segregate non-exempt information (Id. at ¶¶ 18, 21, 35), and released unharmful material.. 25. The withheld emails are properly withheld under FOIA Exemption 5. Id. FOIA Exemption 3 with 26 USC § 6103 (identity of a taxpayer). 26. The Tax Division is withholding the first seven of the eight emails in question, and portions of the eighth email, based on 5 U.S.C. § 552(b)(3) (“FOIA Exemption 3”), specifically with section 6103 of the Internal Revenue Code. Id. ¶ 36. Exemption 3 exempts from disclosure information prohibited from disclosure by another non-FOIA statute. Id. 27. The May 2014 Emails commence with the email earliest in time from a source to a Tax Division attorney, and the subsequent seven emails consist of an internal discussion among two DOJ-Tax attorneys regarding the possible effects of the tip on the then pending litigation, which is still ongoing, involving the subject of the tip. Id. ¶ 37. 28. The information contained in the withheld emails would identify the taxpayer who is the subject of an enforcement case being handled by DOJ-Tax. Id. ¶ 38. Specifically, the subject line of all emails reveals the name of the taxpayer. Id. The content of the emails by themselves or in the aggregate would expressly or implicitly identify the taxpayer. Id. The May 2014 Emails discuss the nature and source of the taxpayer’s tax liability, and contain information that would reveal that the taxpayer is subject of a case involving its actual federal tax liability. Id. Case 1:16-cv-02226-RBW Document 12-2 Filed 01/18/17 Page 6 of 8 7 14931402.1 29. The information reveals the identity of another taxpayer that is associated with the subject taxpayer, thus indirectly revealing the subject taxpayer. Id. ¶ 39. The content of the information in the earliest email and the subsequent emails reveals the identity of a third party taxpayer; thus, disclosing this information would violate section 6103(a). Id. 30. The first seven emails are fully exempt from disclosure pursuant to FOIA Exemption 3. Id. ¶ 40. 31. The eighth and most recent email string is partially withheld under Exemption 3 with section 6103(a) because disclosing the text of the subject of the email would identify the taxpayer; and therefore, it is exempt under Exemption 3. Id. ¶ 41. The eighth email identifies the party in a tax case in litigation; therefore, it is partially withheld under Exemption 3 with 6103. Id. Moreover, as discussed above; this eighth email is fully withheld under Exemption 5 and the attorney work product doctrine/privilege. Id. FOIA Exemptions 6 and 7(C) 32. The entirety of the earliest initial email, which is the email from the source, and portions of the emails following the earliest (except for the most recent email) are exempt under Exemption 6. Id. ¶ 42. First, the withheld portions identify the individual source providing the unsolicited information to the DOJ-Tax. Id. Second, these same emails name several other individuals, and reveal their personal information. Id. Disclosing the personal private information would be an unwarranted invasion of the personal privacy of all individuals identified; none of the personal private information serves a public interest purpose. Id. 33. The entirety of the earliest initial email, which is the email from the source, and portions of the emails following the earliest (except for the most recent email) are exempt from Case 1:16-cv-02226-RBW Document 12-2 Filed 01/18/17 Page 7 of 8 8 14931402.1 disclosure under Exemption 7(C) to withhold the same information as above because disclosing such information could reasonably be expected to invade the privacy of all the individuals identified; none of the personal private information serves a public interest purpose. Id. at ¶ 43. 34. Ms. Banerjee determined that releasing the private information could and would invade the privacy of individuals and that there is no actual public interest in releasing any of the information withheld under exemptions 6 and 7(C). Id. at ¶ 44. Dated: January 18, 2017 Respectfully Submitted, CAROLINE D. CIRAOLO Principal Deputy Assistant Attorney General /s/ Nelson Wagner NELSON WAGNER Trial Attorney, Tax Division U.S. Department of Justice P.O. Box 227, Ben Franklin Station Washington, DC 20044 Tel: (202) 616-3369 Fax: (202) 514-6866 Email: Nelson.Wagner@usdoj.gov Attorney for Plaintiff the United States of America Case 1:16-cv-02226-RBW Document 12-2 Filed 01/18/17 Page 8 of 8 14929744.1 IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA CAUSE OF ACTION INSTITUTE, ) ) Plaintiff, ) ) v. ) Civil No. 1:16-cv-2226-RBW ) UNITED STATES DEPARTMENT ) OF JUSTICE, ) ) Defendant. ) ORDER ON DEPARTMENT OF JUSTICE’S MOTION FOR SUMMARY JUDGMENT Upon consideration of the defendant’s Motion for Summary Judgment (the “Motion”), and all parts of the record related thereto, the Motion is hereby GRANTED. This action is hereby dismissed with prejudice. IT IS SO ORDERED. This _____________ day of ________________________, 2017. _____________________________________ UNITED STATES DISTRICT JUDGE Case 1:16-cv-02226-RBW Document 12-3 Filed 01/18/17 Page 1 of 1