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Stein v. SEC, No. 15-1560, 2017 WL 3141903 (D.D.C. July 24, 2017) (Bates, J.)


Stein v. SEC, No. 15-1560, 2017 WL 3141903 (D.D.C. July 24, 2017) (Bates, J.)

Re:  Request for records developed in civil enforcement action brought against plaintiff

Disposition:  Granting in part and denying in part defendant's motion for summary judgment; denying plaintiff's motion for summary judgment

  • Litigation Considerations, Exhaustion of Administrative Remedies:  The court relates that "SEC . . . argues that [plaintiff] has failed to exhaust his FOIA claim with respect to the second category of requested documents[.]"  The court finds that "[i]t is true that [plaintiff] did not specifically contest this point in his appeal letter."  "But his appeal letter also specifically demanded – twice – 'all of the requested documents,' not just documents related to the first category."  "The government is obligated to construe FOIA requests – and appeals – liberally[.]"  "While [plaintiff's] appeal letter could have been more specific, it is reasonably apparent based on his references to all of the documents he requested that he intended to appeal the SEC's decision with respect to his entire request, not merely some portion of it."
  • Litigation Considerations, Adequacy of Search:  "The Court is . . . satisfied that the agency has fulfilled its search obligations with respect to the first category of requested documents."  The court finds that "[t]he SEC's search terms with respect to the privileged emails were reasonably calculated to identify privileged emails . . . by identifying relevant dates . . ., custodians . . ., and subjects of or persons of interest in the investigation[.]"  "There is no evidence of bad faith."
  • Procedural Requirements, Searching for Responsive Records:  The court finds that "the SEC has not conducted a search for [plaintiff's] second category of requests at all, relying on its productions in the [prior civil enforcement] case."  The court finds that "[t]he SEC seems to think that its open file discovery policy during the [civil enforcement] litigation has satisfied its FOIA obligations and that it need not search for documents responsive to [plaintiff's] second category of requests, because there is nothing it could search for or produce that [plaintiff] has not already seen, excepting the documents on the privilege log."  "Were the Court certain that [plaintiff] already received all documents responsive to his FOIA request in the prior litigation, the Court might agree."  "If an agency can demonstrate that it has already searched for and actually produced all documents responsive to a plaintiff's FOIA request, FOIA surely does not require it to duplicate those efforts."  "But it is not clear here that this situation is so neat[.]"  However, the court does find that, with respect to some of the documents in this category, "[m]ere speculation about the existence of other documents is not sufficient to overcome the presumption of good faith accorded the agency's affidavits."
  • Exemption 7(A):  "The Court is . . . satisfied that release of both groups of documents is 'reasonably likely' to interfere with the ongoing [civil enforcement] litigation."  "Because the work product, internal communications, and deliberative documents that [plaintiff] seeks essentially provide a road map for the SEC's case in the [civil enforcement] litigation, they are likely to give [plaintiff] insight into the way the investigation and the SEC's legal strategies developed that he . . . would not otherwise have, which could make re-litigating [his] case[] – or possibly even pursuing [it] on appeal – difficult."
  • Exemption 5, Attorney Work-Product:  The court holds that, "[w]ith respect to all of the documents for which the SEC claims this exemption, it is clear that the documents were created for purposes of the [civil enforcement] investigation and litigation, or in the case of a few documents listed on the Vaughn index, were memos created for other cases but used for research in the [civil enforcement] case."  "The SEC has thus satisfied the requirement that the documents for which the work-product privilege is sought were 'prepared or obtained because of the prospect of litigation.'"  "For a handful of documents described on the Vaughn index, however, the SEC has not provided sufficient information for the Court to determine that the documents are indeed work product."  The court explains that "[n]ot everything created or requested by an attorney constitutes work product[.]"
  • Exemption 3:  The court holds that "[t]he SEC's withholding of the [Suspicious Activity Reports ("SARs")] here under Exemption 3 was appropriate."  The court agrees with defendants "that the SARs are protected from disclosure under 31 U.S.C. § 5319, a provision of the Bank Secrecy Act which exempts from FOIA disclosure records and reports on monetary instruments transactions, including SARs."
  • Exemption 7(C):  The court holds that "[plaintiff] has failed to explain what public interest exists in the names, addresses, social security numbers, and other personal information of the informants and investigators whose information the government withheld under Exemption 7(C)."  "The private interests in this information, on the other hand, are obvious."  "The government's withholding and partial withholding of documents under Exemption 7(C) is appropriate."
  • Litigation Considerations, "Reasonably Segregable" Requirements:  First, the court finds that "the SEC has sufficiently described two categories of documents that it has withheld under Exemption 7(A) in their entirety, and explained that it is not possible to segregate non-exempt information from these documents[.]"  Second, the court finds that "the SEC need not demonstrate segregability with respect to those documents that were also withheld as attorney work product under Exemption 5, because where 'a document is fully protected as work product, then segregability is not required.'"  Third, "[r]egarding the documents withheld under Exemption 7(C) to protect personal privacy, the SEC has explained why certain documents must be withheld in their entirety."  However, the court also finds that defendant "has not satisfied its obligations with respect to the partially redacted documents withheld under Exemption 7(C), until it confirms that it has provided the unredacted portions of these documents to [plaintiff]."
Court Decision Topic(s)
District Court opinions
Exemption 3
Exemption 5
Exemption 5, Attorney Work-Product Privilege
Exemption 7(A)
Exemption 7(C)
Litigation Considerations, Adequacy of Search
Litigation Considerations, Exhaustion of Administrative Remedies
Litigation Considerations, “Reasonably Segregable” Requirements
Procedural Requirements, Searching for Responsive Records
Updated December 14, 2021