McKinley v. Federal Deposit Insurance Corporation

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

)
VERN MCKINLEY, )
)
Plaintiff, )
)
v. ) No. 15-cv-1764 (KBJ)
)
FEDERAL DEPOSIT INSURANCE )
CORPORATION, )
)
Defendant. )
)

MEMORANDUM OPINION AND ORDER DENYING
CROSS MOTIONS FOR SUMMARY JUDGMENT WITHOUT PREJUDICE AND
REQUIRING SUPPLEMENTAL SUBMISSIONS

In cases brought under the Freedom of Information Act (“FOIA”), 5 U.S.C.

§ 552, the affidavits or declarations that the government files in support of its motion

for summary judgment must be “non-conclusory[,]” SafeCard Servs., Inc. v. SEC, 926

F.2d 1197, 1200 (D.C. Cir. 1991) (internal quotation marks and citation omitted), and

describe “the documents and the justifications for nondisclosure with reasonably

specific detail, demonstrat[ing] that the information withheld logically falls within the

claimed exemption,” Military Audit Project v. Casey, 656 F.2d 724, 738 (D.C. Cir.

1981). The agency’s duty to provide a detailed, non-conclusory description of its

withholdings arises from the fact that “the agency in a FOIA case has both the burden

of proof and all the evidence,” Elec. Frontier Found. v. Dep’t of Justice, 826 F. Supp.

2d 157, 164 (D.D.C. 2011) (internal quotation marks and citations omitted), and the

agency’s fulfillment of this disclosure duty serves “three interrelated functions . . . : (a)

to force the agency to carefully analyze any information withheld; (b) to enable the
district court to fulfill its duty of evaluating the applicability of claimed exemptions;

and (c) to empower the plaintiff to present his case to the district court[,]” Budik v.

Dep’t of Army, 742 F. Supp. 2d 20, 35 (D.D.C. 2010) (citing Keys v. Dep’t of Justice,

830 F.2d 337, 349 (D.C. Cir. 1987)).

Before this Court at present are cross-motions for summary judgment in the

instant FOIA case, which center on the parties’ disagreement about whether or not

Defendant Federal Deposit Insurance Corporation (“FDIC”) has provided sufficient

support for its invocation of FOIA Exemptions 4, 5, and 8 to withhold information in

response to two document requests that Plaintiff Vern McKinley submitted to the

agency. (See Def.’s Mot. for Summ. J. (“Def.’s Mot.”), ECF No. 10, at 4 (“Because

these records fall squarely within the requirements of FOIA Exemptions 4, 5, and 8, the

FDIC properly withheld these documents.”); Pl.’s Mem. in Opp’n to Def.’s Mot. & in

Supp. of Pl.’s Cross-Mot. for Summ. J. (“Pl.’s Mot.”), ECF No. 12-1, at 6 (“The FDIC

has not come close to satisfying its burden of demonstrating that all responsive records

are properly being withheld.”).) 1 For the reasons explained below, this Court agrees

with Plaintiff that the FDIC’s Vaughn index and supporting declaration manifestly fail

to assert the government’s reasons for withholding the documents at issue with

sufficient detail; therefore, both parties’ cross-motions will be DENIED WITHOUT

PREJUDICE, and the FDIC will be ordered to file a supplemental declaration and/or

an updated Vaughn index that addresses the issues identified in this Opinion. This

1
Page-number citations to documents the parties have filed refer to the page numbers that the Court’s
electronic filing system assigns.

2
Court will also require the government to submit all of the documents that remain at

issue to the Court for in camera review.

I. BACKGROUND

On February 13, 2015, Vern McKinley submitted two FOIA requests to the

FDIC, seeking access to “all records regarding consideration by the FDIC of placing

Citibank into receivership that occurred between October 2008 and April 2009[,]” and

“all records regarding any analysis by the FDIC of Citibank’s solvency between

October 2008 and April 2009.” (Def.’s Statement of Material Facts Not in Dispute

(“Def.’s Material Facts”), ECF No. 10-1, ¶¶ 1−3 (internal quotation marks and citations

omitted).) In response to McKinley’s FOIA requests, FDIC staff conducted searches

for responsive documents in the FDIC’s Division of Resolutions and Receiverships, as

well as the Division of Risk Management Supervision. (See id. ¶ 4.) The FDIC’s

searches yielded 19 responsive records. (See id. ¶ 5.)

In a letter dated May 5, 2015, the FDIC informed McKinley that the agency had

identified 19 records responsive to McKinley’s requests, but that the agency had

determined that all of the records were exempt from disclosure pursuant to FOIA

Exemptions 4, 5, and 8, and that none of the documents contained any reasonably

segregable, non-exempt information. (See id. ¶¶ 5, 8.) 2 Approximately one month

later, McKinley submitted an administrative appeal of the agency’s decision, in which

2
These three exemptions permit the withholding of information ranging from “trade secrets and
commercial or financial information obtained from a person and privileged or confidential[,]” 5 U.S.C.
§ 552(b)(4), to “inter-agency or intra-agency memorandums or letters that would not be available by
law to a party other than an agency in litigation with the agency[,]” id. § 552(b)(5), to records
“contained in or related to examination, operating, or condition reports prepared by, on behalf of, or for
the use of an agency responsible for the regulation or supervision of financial institutions[,]” id. §
552(b)(8).

3
he objected to the lack of information that was “cited to justify the claims of these

exemptions[,]” and he further argued that the agency had failed to meet its burden of

demonstrating that no reasonably segregable information existed within the documents

that had been withheld. (Pl.’s Admin. Appeal Letters (“Pl.’s Appeal”), Ex. 3 to Def.’s

Mot., ECF No. 10-3, at 11.) McKinley also maintained that the FDIC had waived the

stated exemptions “through prior disclosure of the substance of the requested records.”

(Id. at 12.) The FDIC denied McKinley’s appeals in their entirety on July 9, 2015 (see

Def.’s Material Facts ¶ 12), and approximately three months later, McKinley initiated

the instant lawsuit in order “to compel compliance with” the FOIA (Compl., ECF No. 1,

at 1).

Shortly after McKinley filed the instant action, and in an effort to narrow the

issues before the Court, the FDIC agreed to provide a Vaughn index to McKinley. (See

Def.’s Material Facts ¶ 13.) McKinley reviewed this listing, and notified the Court that

he now challenges only twelve out of the agency’s nineteen original record

withholdings. (See Joint Status Report, ECF No. 9, ¶ 5.) In addition, McKinley has

further clarified that he is not mounting any challenge to the adequacy of the agency’s

search. (See Def.’s Material Facts ¶ 15.)

On March 16, 2016, the FDIC filed a motion for summary judgment, to which it

attached both a statement of material facts as to which there is no genuine dispute and a

supporting declaration from the supervisor of the FDIC’s FOIA group. (See Def.’s

Mot.; Def.’s Material Facts; Decl. of Hugo A. Zia (“Zia Decl.”), Ex. to Def.’s Mot.,

ECF No. 10-2, at 1.) Also attached to the FDIC’s motion is a Vaughn index that is

formatted as a table with 19 entries that correspond to the 19 withheld documents—

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seven rows of which are shaded in gray to indicate the withholdings that McKinley is

no longer challenging. (See Vaughn Index, Ex. 5 to Def.’s Mot., ECF No. 10-3, at

22−31.) In its summary judgment motion, the FDIC first argues that McKinley failed to

exhaust the applicable administrative appeal process. (See Def.’s Mot. at 8 (“[Plaintiff]

challenged the FDIC’s failure to provide detailed explanations of the reasons for

withholding records from disclosure[,]” but “did not raise a [substantive] challenge to

any of the three specific exemptions claimed by the FDIC in denying his FOIA

requests”).) The agency further contends that it appropriately withheld the twelve

responsive records at issue pursuant to Exemptions 4, 5, and 8, and also that the

responsive records contain no non-exempt, segregable information. (See id. at 9−15.)

McKinley filed a combined brief in opposition and cross-motion for summary

judgment on April 14, 2016. (See generally Pl.’s Mot.) In that filing, McKinley insists

that he properly exhausted all administrative remedies (see id. at 9−10), and he also

maintains that the FDIC has not provided sufficient support for its invocation of

Exemptions 4, 5, and 8 (see id. at 10−14). (See also Pl.’s Reply in Supp. of Pl.’s Cross-

Mot. for Summ. J. (“Pl.’s Reply”), ECF No. 15, at 5 (“[T]he FDIC failed to provide the

Court with the information necessary for it to determine whether the records responsive

to McKinley’s FOIA requests are being properly withheld.”).) In addition, McKinley

argues that the agency has officially acknowledged the information that it has withheld,

and therefore, disclosure is required notwithstanding any otherwise applicable

exemptions. (See Pl.’s Mot. at 15−17.)

On May 23, 2016, the parties’ cross-motions became ripe for this Court’s review.

(See Def.’s Mot.; Pl.’s Mot.; Def.’s Consolidated Reply in Supp. of its Mot. & Opp’n to

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Pl.’s Cross-Mot. for Summ. J. (“Def.’s Reply”), ECF No. 13; Pl.’s Reply.)

II. LEGAL STANDARD

The “FOIA generally requires the disclosure, upon request, of records held by a

federal government agency[.]” Gov’t Accountability Project v. FDA, 206 F. Supp. 3d

420, 428 (D.D.C. 2016) (alteration in original) (internal quotation marks and citation

omitted). However, the FOIA also includes nine exemptions that permit agencies to

withhold certain information from disclosure. See Judicial Watch, Inc. v. Dep’t of the

Treasury, 796 F. Supp. 2d 13, 23 (D.D.C. 2011). These exemptions are to be construed

narrowly, see Dep’t of the Air Force v. Rose, 425 U.S. 352, 361 (1976), and the

government bears the burden of demonstrating that any withheld information falls

within the claimed exemptions, see Maydak v. Dep’t of Justice, 218 F.3d 760, 764 (D.C.

Cir. 2000).

Significantly for present purposes, to prevail on a motion for summary judgment

that claims that an agency has satisfied its duties under the FOIA, “the defending

agency must prove that each document that falls within the class requested either has

been produced, is unidentifiable or is wholly exempt from the Act’s inspection

requirements.” Weisberg v. Dep’t of Justice, 627 F.2d 365, 368 (D.C. Cir. 1980)

(internal quotation marks and citation omitted); see also McKinley v. FDIC, 756 F.

Supp. 2d 105, 111 (D.D.C. 2010) (“[T]he burden of proof is always on the agency to

demonstrate that it has fully discharged its obligations under the FOIA.”). To satisfy its

burden of establishing the applicability of an exemption, a defendant may rely on

declarations that are reasonably detailed and non-conclusory, and this showing may be

made in the form of a Vaughn index that describes each document that is being withheld

6
and includes other identifying information, and that also provides both the particular

FOIA exemption that the government is asserting with respect to that document and the

reasons that the government believes that exemption is applicable. See Pub. Emps. For

Envtl. Responsibility v. EPA, 213 F. Supp. 3d 1, 9 (D.D.C. 2016). Because the purpose

of an agency’s declaration or Vaughn index is “to permit adequate adversary testing of

the agency’s claimed right to an exemption[,]” the proffered justification must contain

“an adequate description of the records” and “a plain statement of the exemptions relied

upon to withhold each record[.]” Nat’l Treasury Emps. Union v. U.S. Customs Serv.,

802 F.2d 525, 527, 527 n.9 (D.C. Cir. 1986) (citation omitted); see also Morley v. CIA,

508 F.3d 1108, 1115 (D.C. Cir. 2007) (“[C]onclusory and generalized allegations of

exemptions are unacceptable[.]” (internal quotation marks and citations omitted)).

III. DISCUSSION

Plaintiff argues here, as he did on administrative appeal, that the FDIC “has

completely failed to demonstrate, either by Vaughn indexes, affidavits, or declarations,

that its withholdings are proper or that it can overcome the ‘strong presumption’ in

favor of disclosure.” (Pl.’s Mot. at 11.) Thus, the issue before this Court at present is

whether the FDIC has adequately supported its invocation of Exemptions 4, 5, and 8

with respect to the twelve disputed documents that the agency has withheld. 3 For the

3
With its odd contention that McKinley raised no substantive challenge to the agency’s invocation of
these exemptions during the administrative appeal process (see Def.’s Mot. at 8−9), the FDIC has
clouded what is otherwise crystal clear: McKinley has consistently insisted that the agency has not
provided sufficiently detailed reasons for invoking Exemptions 4, 5, and 8, and as a result, says
McKinley, no substantive challenge can be made (see Pl.’s Appeal at 11 (“[M]ore detail on the precise
type of information and underlying reasons for the withholdings is necessary to allow me to assess the
propriety of the claimed exemptions.”)). Consequently, while the agency is correct that McKinley did
not raise any substantive concerns about the exemptions during the administrative appeal, it is wrong to
suggest that McKinley is saying something different now, or that he is foreclosed from ever making any
such substantive arguments regarding the exemptions in the context of the instant case.

7
reasons explained below, this Court agrees with Plaintiff that the FDIC has failed to

provide sufficient information to enable the Court “to make a rational decision

[regarding] whether the withheld material must be produced[.]” King v. Dep’t of

Justice, 830 F.2d 210, 219 (D.C. Cir. 1987) (internal quotation marks and citation

omitted). Accordingly, summary judgment will not be granted in favor of either party

at this juncture, and the Court will order the FDIC to submit supplemental filings.

A. Exemption 4 Requires An Assessment Of Whether The Information
Was Disclosed To The Agency Voluntarily Or Upon Compulsion

The FDIC maintains that FOIA Exemption 4 protects eleven of the twelve

documents at issue. (See Zia Decl. at 5.) Exemption 4 protects from disclosure “trade

secrets and commercial or financial information obtained from a person and privileged

or confidential[.]” 5 U.S.C. § 552(b)(4). “Unlike many other types of information

subject to an agency’s control, materials implicating Exemption 4 are generally not

developed within the agency. Instead, [the agency] must procure commercial [or

financial] information from third parties, either by requirement or by request.” Judicial

Watch, Inc. v. FDA, 449 F.3d 141, 148 (D.C. Cir. 2006).

Notably, “[c]ourts employ different tests to determine whether information” is

privileged and confidential within the meaning of Exemption 4, “depending in part on

whether the initial disclosure of the information was voluntary or compulsory.” Gov’t

Accountability, 206 F. Supp. 3d at 429. As a result, “the court must first determine

whether the information was provided to the government voluntarily or if it was

required to be provided[,]” and “[d]epending on the answer to this question, the Court

must then apply the appropriate test for privilege/confidentiality.” McKinley, 756 F.

Supp. 2d at 114 (internal quotation marks and citations omitted); see also Gov’t

8
Accountability, 206 F. Supp. 3d at 429 (outlining applicable test where a party is

required to submit the information to the government); Defs. of Wildlife v. Dep’t of the

Interior, 314 F. Supp. 2d 1, 16 (D.D.C. 2004) (describing applicable test when a party

voluntarily provides the information).

In the instant case, the FDIC has made no effort to explain whether Citibank

voluntarily or involuntarily provided the information that the agency is withholding

pursuant to Exemption 4. (See, e.g., Vaughn Index at 31 (Document 18) (characterizing

a “[t]able setting out categories of assets in ring-fenced portfolio, valuations, credit

losses, and examiner judgments” as exempt under Exemption 4 simply and solely

because it “contains commercial or financial information obtained from Citibank and

privileged or confidential”); see also id. (Document 19); id. at 30 (Document 15).) The

agency’s declaration likewise merely maintains that “[t]he information contained within

those eleven documents consists of confidential financial information obtained from

Citibank,” but does not specify the manner in which the FDIC obtained this

information. (Zia Decl. at 5.) In the absence of details from the FDIC regarding its

acquisition of the allegedly exempt information from Citibank, this Court cannot

identify and apply the appropriate test for privilege or confidentiality. See McKinley,

756 F. Supp. 2d at 114.

B. Exemption 5 Protects Only Records That Are Predecisional And
Deliberative

The FDIC also contends that it has properly withheld eight documents pursuant

to FOIA Exemption 5. (See Zia Decl. at 5.) Exemption 5 permits the withholding of

“inter-agency or intra-agency memorandums or letters that would not be available by

law to a party other than an agency in litigation with the agency[.]” 5 U.S.C.

9
§ 552(b)(5). “This exemption protects documents normally privileged in the civil

discovery context, such as materials shielded by . . . the deliberative process privilege.”

Pub. Emps., 213 F. Supp. 3d at 10 (internal quotation marks and citations omitted). The

deliberative process privilege protects “documents reflecting advisory opinions,

recommendations and deliberations comprising part of a process by which governmental

decisions and policies are formulated[.]” Dep’t of the Interior v. Klamath Water Users

Protective Ass’n, 532 U.S. 1, 8 (2001) (internal quotation marks and citation omitted).

However, this exemption cannot be indiscriminately invoked, because to qualify for

protection under the privilege, materials must “be both predecisional and deliberative.”

Pub. Citizen, Inc. v. Office of Mgmt. and Budget, 598 F.3d 865, 874 (D.C. Cir. 2010)

(internal quotation marks and citation omitted). A document is “predecisional if it was

generated before the adoption of an agency policy and deliberative if it reflects the

give-and-take of the consultative process.” Judicial Watch, 449 F.3d at 151 (internal

quotation marks and citations omitted).

Importantly, in order to demonstrate that Exemption 5 applies, the agency must

establish “what deliberative process is involved, and the role played by the documents

in issue in the course of that process.” Coastal States Gas v. Dep’t of Energy, 617 F.2d

854, 868 (D.C. Cir. 1980) (emphasis added). The agency need not “identify a specific

decision in connection with which a memorandum is prepared[,]” NLRB v. Sears,

Roebuck & Co., 421 U.S. 132, 151 n.18 (1975); however, it must still show that “the

document was generated as part of a definable decision-making process.” Gold Anti–

Trust Action Comm., Inc. v. Bd. of Governors of the Fed. Reserve Sys., 762 F. Supp. 2d

123, 135–36 (D.D.C. 2011); see also Pub. Emps., 213 F. Supp. 3d at 14 (“Although [the

10
agency] is not required to link each document to a specific action, it must do more to tie

the materials to some definable process.”). Moreover, “[i]n addition to explaining the

‘function and significance of the document(s) in the agency’s decisionmaking process,’

the agency must describe ‘the nature of the decisionmaking authority vested in the

office or person issuing the disputed document(s), and the positions in the chain of

command of the parties to the documents.’” Elec. Frontier Found., 826 F. Supp. 2d at

168 (quoting Arthur Andersen & Co. v. IRS, 679 F.2d 254, 258 (D.C. Cir. 1982)). “The

need to describe each withheld document when Exemption 5 is at issue is particularly

acute because the deliberative process privilege is so dependent upon the individual

document and the role it plays in the administrative process.” Pub. Emps., 213 F. Supp.

3d at 11 (internal quotation marks and citation omitted); see also Judicial Watch v. U.S.

Postal Serv., 297 F. Supp. 2d 252, 260 (D.D.C. 2004) (“Without a sufficiently specific

affidavit or Vaughn index, a court cannot decide, one way or the other, a deliberative

process privilege claim.”).

In the instant case, the FDIC’s submissions manifestly fail to provide necessary

contextual information about the decision making processes to which the withheld

documents contributed, and the role the withheld documents played in those processes.

For example, the FDIC describes Document 17 as a “[m]emorandum analyzing various

financial aspects of Citigroup[,]” including “the assets held by the holding company,

lead bank, and other entities; the capital structure of the holding company, lead bank,

and other entities; the valuation of the ‘ring-fenced’ portfolio, and terms on outstanding

preferred stock.” (Vaughn Index at 30−31.) But the agency’s bald statement that this

document “includes pre-decisional deliberations of government officials contemplating

11
actions relating to Citibank” (id. at 31), does not explain how records regarding

“various financial aspects of Citigroup” (id. at 30) relate to any definable decision the

agency has made. (Compare Zia Decl. at 6 (describing all eight documents withheld

pursuant to Exemption 5 as “concern[ing] opinions and recommendations about

potential future decisions and actions to be taken by the FDIC with respect to

Citibank”), with Judicial Watch, Inc. v. Dep’t of Homeland Sec., 926 F. Supp. 2d 121,

135−36 (D.D.C. 2013) (endorsing as sufficient a Vaughn index that described the

withheld information as “a discussion about the procedures for filing motions to dismiss

proceedings in several Chief Counsel offices, including one employee’s personal

opinions as to whether or not the implementation of a certain procedure was

appropriate”). Indeed, McKinley submitted two separate FOIA requests—one for

documents regarding the FDIC’s consideration of a Citibank receivership, and one for

documents regarding the agency’s analysis of Citibank’s solvency (see Def.’s Material

Facts ¶¶ 2−3)—yet neither the agency’s Vaughn index nor the accompanying

declaration identifies which of the FOIA requests each withheld document responds to,

much less the particular decision making process to which each document relates.

Also missing from the FDIC’s Vaughn index is a description of what role the

withheld documents played in the agency’s deliberative processes, as well as a clear

indication of the relevant “chronology” necessary to demonstrate that documents were

predecisional. McKinley, 756 F. Supp. 2d at 114 (internal quotation marks and citation

omitted); see also Petroleum Info. Corp. v. Dep’t of the Interior, 976 F.2d 1429, 1434

(D.C. Cir. 1992) (“A document is predecisional if it was prepared in order to assist an

agency decisionmaker in arriving at his decision, rather than to support a decision

12
already made.” (internal quotation marks and citation omitted)). The memorandum

labeled Document 13 is a good example: according to the FDIC’s Vaughn index,

Document 13 addresses the “supervisory actions taken” and the “agreements reached”

that “provid[ed] the basis for a change in CAMELS rating.” (Vaughn Index at 29

(emphasis added).) Because the agency has not sufficiently articulated the timeline

surrounding the referenced change in CAMELS rating, however, this Court cannot

determine whether the document at issue—which appears to summarize actions already

taken and decisions already made—was in fact generated before the adoption of the

agency’s policy. What is more, the FDIC has entirely omitted any explanation

regarding what role the memorandum played in the agency’s CAMELS rating decision.

See, e.g., Pub. Emps, 213 F. Supp. 3d at 15 (noting that “[t]he closest the entry comes

to explaining the function and significance of the document is to state that the ‘record

reflects analysis, recommendations, and opinions that were considered as part of the

Agency’s decision making process[,]’” and concluding that “[a] general statement of

this sort is not sufficient to carry the agency’s burden to explain the function and

significance of a document in the agency’s decisionmaking process” (citation omitted)).

Finally, the FDIC’s Vaughn index and supporting declaration also fail to describe

adequately the “nature of the decisionmaking authority vested in the office or person

issuing the disputed document(s), and the positions in the chain of command of the

parties to the documents.” Arthur Andersen, 679 F.2d at 258 (internal quotation marks

and citation omitted). The D.C. Circuit has instructed that, with respect to evaluating

the withholding of material pursuant to the deliberative process privilege, the “identity

of the parties to the memorandum is important[,]” because the relative position of the

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author and recipient aids the court in determining whether a document is predecisional.

Coastal States, 617 F.2d at 868. Here, the FDIC does at times reveal the author and

recipient of a withheld document, but at no time does it describe the “relative positions

in the agency’s ‘chain of command’ occupied by the document’s author and recipient.”

Senate of the Commonwealth of P.R. on Behalf of Judiciary Comm. v. Dep’t of Justice,

823 F.2d 574, 586 (D.C. Cir. 1987) (quoting Arthur Andersen, 679 F.2d at 258). (See,

e.g., Vaughn Index at 29 (Document 13) (noting that the Associate Director of Complex

Financial Institutions sent the memorandum to the Director of the Division of

Supervision and Consumer Protection, without explaining the relative positions of the

author and recipient within the agency’s chain of command).) Thus, it is difficult to

discern the approximate hierarchy of the author and recipients, which is an important

marker when determining whether a document has been properly withheld under

Exemption 5. See Coastal States, 617 F.2d at 868 (explaining that “a document from a

subordinate to a superior official is more likely to be predecisional, while a document

moving in the opposite direction is more likely to contain instructions to staff

explaining the reasons for a decision already made”).

Ultimately, while the eight documents that the FDIC has withheld pursuant to

Exemption 5 in the context of the instant case certainly might contain information that

the deliberative process privilege protects, this Court cannot conclude that they do on

the record before it. Accordingly, the FDIC is required to provide the Court with the

following information for each document withheld pursuant to Exemption 5: “(1) the

nature of the specific deliberative process involved, (2) the function and significance of

the document in that process, and (3) the nature of the decisionmaking authority vested

14
in the document’s author and recipient.” Pub. Emps., 213 F. Supp. 3d at 13 (internal

quotation marks and citations omitted).

C. Exemption 8 Protects Certain Agency Reports And Documents
Related Thereto

The FDIC also contends that each of the twelve disputed documents may be

properly withheld pursuant to Exemption 8. (See Zia Decl. at 6.) Exemption 8 of the

FOIA protects from disclosure records “contained in or related to examination,

operating, or condition reports prepared by, on behalf of, or for the use of an agency

responsible for the regulation or supervision of financial institutions[.]” 5 U.S.C. §

552(b)(8). “Although the exemption is a mouthful,” Pub. Inv’rs Arbitration Bar Ass’n

v. SEC (“Pub. Inv’rs II”), 771 F.3d 1, 4 (D.C. Cir. 2014), it broadly protects certain

reports—i.e., “examination, operating, or condition reports”—when such reports are

prepared by or for an agency that meets the statutory definition, and it further protects

all materials that are logically “related to” these three types of reports. 5 U.S.C. §

552(b)(8). “[T]he D.C. Circuit has distilled two legislative purposes behind Exemption

8”: (1) “to ensure the security of financial institutions[,]” and (2) “to safeguard the

relationship between the banks and their supervising agencies.” Pub. Inv’rs Arbitration

Bar Ass’n v. SEC (“Pub. Inv’rs I”), 930 F. Supp. 2d 55, 64 (D.D.C. 2013) (internal

quotation marks and citations omitted), aff’d 771 F.3d 1 (D.C. Cir. 2014).

Although the FDIC maintains that Exemption 8 justifies its withholding of all

twelve documents at issue in the instant case (see Zia Decl. at 6), this Court cannot

conclude on the record before it that the FDIC has properly withheld the records

pursuant to Exemption 8. As an initial matter, the FDIC’s submissions fail to furnish

the most basic threshold information, which is whether each of the twelve documents

15
consists of information that is directly contained in one of the three enumerated reports,

or whether they include information that is simply related to any such report. Compare

Williams & Connolly LLP v. Office of the Comptroller of the Currency, 39 F. Supp. 3d

82, 89 (D.D.C. 2014) (noting that the parties dispute “whether the requested documents

are ‘related to’ a bank examination for purposes of Exemption 8” (emphasis added)),

with Vaughn Index at 27 (Document 9) (stating broadly that “[t]he document consists of

information ‘contained in or related to examination, operating, or condition reports

prepared by, on behalf of, or for the use of an agency responsible for the regulation or

supervision of financial institutions.’” (emphasis added) (quoting 5 U.S.C. §

552(b)(8))).

Moreover, even assuming, arguendo, that the FDIC need not identify whether the

withheld record is a report or merely a document that relates to some report, this Court

has no doubt that the agency must, at the very least, specify whether it characterizes the

relevant report as an examination report, an operating report, or a condition report. See,

e.g., Pub. Inv’rs II, 771 F.3d at 4. The FDIC’s Vaughn index does not do so; instead, it

reveals that the document at issue is a ‘table’ or a ‘memorandum,’ and then merely

parrots the statute in regard to the document’s contents. For example, with respect to

Document 15, the index says only that the document is a “[t]able listing various

categories of assets, actual valuations, credit losses, and assumptions[,]” and then

describes it as consisting “of information ‘contained in or related to examination,

operating, or condition reports prepared by, on behalf of, or for the use of an agency

responsible for the regulation or supervision of financial institutions.’” (Vaughn Index

at 30 (quoting 5 U.S.C. § 552(b)(8)).) Absent from this description is any sense of the

16
agency’s position regarding how or why—precisely—these tables fall within the

specific contours of Exemption 8. That is, are these asset tables that are directly

included in an operating report? Alternatively, they might be tables that relate to a

condition report. Or perhaps the agency has invoked this exemption for another reason

entirely. As a result of this uncertainty, which arises based on what the Vaughn index

currently reveals, this Court simply cannot discern the FDIC’s particular justification

for seeking to withhold each document. And this lack of specificity is significant,

because the agency’s description of the underlying report may well impact the Court’s

analysis of the propriety of the exemption. See Pub Inv’rs II, 771 F.3d at 8 (defining an

examination report as “any report arising out of a ‘close inspection’ or ‘careful

inquiry’” (citation omitted)).

The agency’s declarant—Hugo Zia—does little to further elucidate the agency’s

position. In his discussion of Exemption 8, Zia, too, adopts the general and inclusive

language of the statute, stating that each of the twelve withheld documents pertains to

disparate categories of information, such as information “contained in” or “related to

examination and other condition reports concerning Citibank[,]” “financial information

obtained from Citibank for the purpose of preparing such examination reports or other

condition reports[,]” and “opinions and recommendations of examiners and other

officials responsible for the examination and supervisory oversight of Citibank.” (Zia

Decl. at 6.) While this description accurately reflects the broad scope of information

that potentially falls within the ambit of Exemption 8, it does nothing to link any of the

categories of information that exemption covers to each of the twelve specific records

that the agency has withheld. And therein lies the problem. Although “Congress has

17
intentionally and unambiguously crafted a particularly broad, all-inclusive definition”

for Exemption 8, Consumers Union of U.S., Inc. v. Heimann, 589 F.2d 531, 533 (D.C.

Cir. 1978), this expansive definition does not excuse the FDIC from its general

obligation to provide “a relatively detailed justification [for its withholdings],

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[.]” Morley, 508 F.3d at 1122 (internal quotation marks and citations omitted).

Put another way, however broad Exemption 8’s disjunctive list might sweep, it is

not so broad as to permit the agency to refuse to identify which of the many grounds

within Exemption 8 purportedly applies to each document that the agency seeks to

withhold. Cf. id. at 1115 (“[C]onclusory and generalized allegations of exemptions are

unacceptable[.]” (internal quotation marks and citation omitted)); McKinley, 756 F.

Supp. 2d at 115 (finding that “[b]ased on the extremely limited information provided by

the FDIC, the Court cannot determine whether the material withheld contains or is

derived from any part of an examination, operating report or condition report”).

Accordingly, with respect to records withheld pursuant to Exemption 8, the FDIC must

(1) explain whether the document at issue consists of information contained within a

report, or related to a report, and (2) specify whether the relevant corresponding report

is an examination report, operating report, or condition report.

D. A Court May Order Supplemental Filings As Needed In The Context
Of A FOIA Case

When a court finds that an agency has failed “to provide a sufficiently detailed

explanation to enable the district court to make a de novo determination of the agency’s

claims of exemption, the district court . . . has several options, including inspecting the

18
documents in camera, requesting further affidavits, or allowing the plaintiff discovery.”

Pub. Emps., 213 F. Supp. 3d at 16 (internal quotation marks omitted) (quoting Spirko v.

U.S. Postal Serv., 147 F.3d 992, 997 (D.C. Cir. 1998)). Given the deficiencies

described above, this Court will direct the FDIC to revise its submissions so as to

address the specific shortcomings the Court has identified, and will also require the

submission of copies of the twelve documents at issue, which, when reviewed in

camera in combination with the supplemental filings, will assist the Court in

determining both the propriety of the claimed exemptions and also whether there is any

reasonably segregable information that the FDIC must still produce. See McKinley v.

FDIC, 744 F. Supp. 2d 128, 145 (D.D.C. 2010) (“[T]he Court has an affirmative

obligation to address the issue of segregability sua sponte.” (citation omitted)); see also

Mead Data Ctr., Inc. v. Dep’t of Air Force, 566 F.2d 242, 260 (D.C. Cir. 1977)

(“[N]on-exempt portions of a document must be disclosed unless they are inextricably

intertwined with exempt portions.”). 4

IV. ORDER

For the reasons stated above, this Court concludes that the FDIC “has failed to

supply [the Court] with even the minimal information necessary to make a

4
While the FDIC argues that there is no “non-exempt information that must be segregated and
disclosed” in this matter because “all of the records relate to the financial condition of Citibank” and
are thus “exempt in their entirety from disclosure under FOIA Exemption 8” (FDIC’s Denial of Pl.’s
Administrative FOIA Appeals (“Final Denial Letter”), Ex. 4 to Def.’s Mot., ECF No. 10-3 at 18, 19),
the Court cannot determine whether any portions of the withheld records can be reasonably segregated
without first addressing whether the document is subject to exemption. Reviewing the documents in
camera will assist the Court in making both the exemption and the segregability determination. See
Spirko, 147 F.3d at 996 (“A judge has discretion to order in camera inspection” and “[t]he ultimate
criterion is simply this: Whether the district judge believes that in camera inspection is needed in
order to make a responsible de novo determination on the claims of exemption” (internal quotation
marks and citation omitted)).

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determination” regarding whether or not the documents at issue are exempt as a matter

of law. Coastal States, 617 F.2d at 861. Therefore, it is hereby

ORDERED that the FDIC’s [10] Motion for Summary Judgment and McKinley’s

[12] Cross-Motion for Summary Judgment are DENIED WITHOUT PREJUDICE, and

the FDIC has until September 5, 2017, to submit either a revised Vaughn index and/or

one or more supplemental declarations that explain with specificity the grounds for each

withholding in the manner described above. In addition, on or before September 5,

2017, the FDIC shall lodge with the Court for in camera, ex parte review copies of the

twelve documents that remain at issue in this case. It is

FURTHER ORDERED that Defendant shall file a renewed motion for summary

judgment regarding the challenged withholdings on or before October 3, 2017;

Plaintiff’s consolidated opposition to Defendant’s motion for summary judgment and

cross-motion for summary judgment shall be filed on or before October 31, 2017;

Defendant’s consolidated reply in support of its motion for summary judgment and in

opposition to Plaintiff’s cross-motion for summary judgment shall be filed on or before

November 14, 2017; and Plaintiff’s reply in support for its cross-motion for summary

judgment shall be filed on or before November 28, 2017. 5

DATE: August 7, 2017 Ketanji Brown Jackson
KETANJI BROWN JACKSON
United States District Judge

5
The instant Opinion and Order takes no position on McKinley’s contention that the information he
requested via FOIA has already been made public through an official and documented disclosure. (See
Pl.’s Mot. at 15−17.) That assertion can be raised again in the context of Plaintiff’s consolidated brief
in opposition and renewed motion for summary judgment.

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