Adamowicz v. I.R.S.

• Decision Date: 31 March 2008
• Docket Number: NO. 06 Civ. 3919(LAP).,06 Civ. 3919(LAP).
• Citation: 552 F.Supp.2d 355
• Parties: Michael ADAMOWICZ & Elizabeth Fraser, as Executors of the Estate of Mary Adamowicz, Plaintiffs, v. INTERNAL REVENUE SERVICE, Defendant.
• Court: U.S. District Court — Southern District of New York

552 F.Supp.2d 355

Michael ADAMOWICZ & Elizabeth Fraser, as Executors of the Estate of Mary Adamowicz, Plaintiffs, v. INTERNAL REVENUE SERVICE, Defendant.

NO. 06 Civ. 3919(LAP).

United States District Court, S.D. New York.

March 31, 2008.

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Frederick M. Sembler, Law Offices of Frederick M. Sembler, PLLC, New York, NY, for plaintiffs.

Lara K. Eshkenazi, U.S. Attorney's Office, SDNY, New York, NY, for defendant.

MEMORANDUM AND ORDER

LORETTA A. PRESKA, District Judge.

Acting as executors of the Estate of their mother Mary Adamowicz, Plaintiffs Michael Adamowicz and Elizabeth Fraser bring this action under the Freedom of Information Act ("FOIA"), 5 U.S.C. § 552, to compel the production of documents withheld by Defendant the Internal Revenue Service ("IRS" or the "Government"). The parties cross-moved for partial summary judgment, and, for the reasons stated below, the Government's motion [dkt. no. 17] is GRANTED in part and DENIED in part, and Plaintiffs' motion [dkt. no. 12] is DENIED.

I. BACKGROUND

On or about May 29, 2003, Plaintiffs filed a United States Estate (and Generation-Skipping Transfer) Tax Return on Form 706 for the Estate of Mary Adamowicz. (Sembler Decl. ¶ 5.) That return was selected for examination by the IRS, and the corresponding audit was assigned to Estate Tax Attorney Susan Leboff. (Leboff Decl. ¶ 2.) During the course of that audit, the IRS denied an Internal Revenue Code ("I.R.C.") § 6166 election on the Estate's Form 706, and Plaintiffs subsequent internal administrative appeal of that decision (" § 6166 appeal") was denied. (Second Sembler Decl. ¶ 4; Glasel Decl. para; 4.)

In January 2005, Plaintiffs initiated a proceeding in the U.S. Tax Court further challenging the denial of the Estate's § 6166 election. (Second Sembler Decl. ¶ 18.) Among other things, Plaintiffs alleged that Leboff had engaged in prohibited ex parte communications with personnel handling the § 6166 appeal in the IRS Appeals Office. (Glasel Decl. ¶ 4.) Before trial of that matter was scheduled to begin, however, the IRS conceded that the Estate's § 6166 election was valid, and the matter was stricken from the Tax Court's calendar in July 2007. (Second Sembler Decl. ¶¶ 19-22.)

During both the audit and the subsequent Tax Court litigation, Donald Glasel, an attorney in the IRS Office of Chief Counsel, advised Leboff and her manager, Patrick Leahy. (See generally Glasel Decl.)

In March 2005, Plaintiffs filed a FOIA request seeking:

All records pertaining to the examination of the Form 706 filed in 2003 for the [Adamowicz] Estate, excluding (i) copies of the Form 706 itself ..., and (ii) copies of correspondence and documents submitted by [Counsel for the Estate] to the Internal Revenue Service....

(Sembler Decl., Ex. A (March 1C, 2005 FOIA Request Letter).) That request was received in the IRS's Manhattan Disclosure Office and assigned to Disclosure Specialist Alan Dichter for processing. (Dichter Decl. ¶ 3.) Dichter met with Leboff, Leahy and Glasel to review records that had been collected as responsive to Plaintiffs' request, (id. ¶¶7, 9), and ultimately produced 1046 pages in their entirety and 87 partially redacted pages, while withholding 1283 pages in their entirety (id., Ex. B (June 10, 2005 Disclosure Letter)). The Disclosure Office cited FOIA Exemptions 3, 5 and 7(A) to justify its non-disclosures. (Id.)

Plaintiffs appealed the FOIA non-disclosures in a July 13, 2005, letter to IRS Appeals Office ("FOIA appeal"), arguing that the Government had failed to demonstrate applicability of the cited exemptions. (Sembler Decl., Ex. C (Plaintiffs' FOIA Appeal Letter).) They also argued that the Government's search was inadequate because it had failed to return any documents related to the § 6166 appeal. (Id.) After reviewing the documents produced and withheld by the Disclosure Office, (Field Decl. ¶¶IN 6-7), the IRS Appeals Office denied Plaintiffs' FOIA appeal by letter dated August 30, 2005 (id. ¶¶ 8-10; see also Sembler Decl., Ex. D (IRS FOIA Appeal Denial Letter)). It concluded that documents related to the § 6166 appeal were not responsive to Plaintiffs' FOIA request and stated that such information would only be considered responsive to a request specifically for documents concerning the appeal. (Field Decl. ¶ 8.) The letter also concluded that the Government's decision to withhold documents was justified because they "contain information concerning other taxpayers and/or, if released, would hinder law enforcement purposes." (Sembler Decl., Ex. D.)

Plaintiffs then instituted this action by filing a complaint seeking release of the withheld responsive documents and reasonable attorneys' fees and expenses. Defendants filed an answer and agreed, in an August 21, 2006 letter, to provide a Vaughn Index detailing the withheld documents and the FOIA exemptions claimed therefor. See Vaughn v. Rosen, 484 F.2d 820 (D.C.Cir.1973); see also Sembler Deck, Ex. H (Government's August 21, 2006 Letter). Counsel produced an Index on November 14, 2006, (Eshkanazi Decl, Ex. A (First Vaughn Index Letter)), and, after further negotiations, provided a second, revised Index and documents with fewer redactions (id., Ex. B (Second Vaughn Index Letter)).

Having exhausted their efforts to resolve this dispute amicably, the parties indicated their intent to proceed with summary judgment motions and, after a premotion conference, I approved a briefing schedule on the cross motions currently before the Court. (Sembler Deck, Ex. P (Briefing Schedule Order).) Of course, the parties have fully briefed the matter and have provided their supporting declarations and exhibits. In addition, the Government has submitted a third Vaughn Index prepared by Mary Ellen Keys, an attorney in the IRS Office of the Associate Chief Counsel, and a corresponding Keys Declaration further explaining the Final Revised Vaughn Index. (Keys Decl.; id., Ex. A; Third Vaughn Index).¹

II. DISCUSSION

A. FOIA Summary Judgment Standards

Congress enacted FOIA "to promote honest and open government and to assure the existence of an informed citizenry to hold the governors accountable to the governed." Grand Cent. P'ship, Inc. v. Cuomo, 166 F.3d 473, 478 (2d Cir.1999) (quotation omitted). FOIA's broad disclosure mandate consequently requires disclosure of documents unless they fall within one of the enumerated exemptions. See, e.g., Dep't of the Interior v. Klamath Water Users Protective Ass'n, .532 U.S. 1, 7, 121 S.Ct. 1060, 149 L.Ed.2d 87 (2001). These exemptions embody Congress's recognition that not all information should be released to the public, see Ctr. for Nat'l Sec. Studies v. Dep't of Justice, 331 F.3d 918, 925 (D.C.Cir.2003), but "do not obscure the basic policy that disclosure, not secrecy, is the dominant objective of the Act," Klamath, 532 U.S. at 7-8, 121 S.Ct. 1060. Thus, while courts are reminded to give the exemptions "meaningful reach and application," John Doe Agency v. John Doe Corp., 493 U.S. 146, 152, 110 S.Ct. 471, 107 L.Ed.2d 462 (1989), the fundamental directive remains that they should be given "a narrow compass," Klamath, 532 U.S. at 8, 121 S.Ct. 1060; see also Local 3, Int'l Bhd. of Elec. Workers v. NLRB, 845 F.2d 1177, 1180 (2d Cir.1988) (exemptions are to be "narrowly construed with all doubts resolved in favor of disclosure").

Summary judgment is the preferred procedural vehicle for resolving FOIA disputes, and the attendant standards are well-defined in this Circuit:

In order to prevail on a motion for summary judgment in a FOIA case, the defending agency has the burden of showing that its search was adequate and that any withheld documents fall within an exemption to the FOIA. Affidavits or declarations supplying facts indicating that the agency has conducted a thorough search and giving reasonably detailed explanations why any withheld documents fall within an exemption are sufficient to sustain the agency's burden. Affidavits submitted by an agency are "accorded a presumption of good faith," [and,] accordingly, discovery relating to the agency's search and the exemptions it claims for withholding records generally is unnecessary if the agency's submissions are adequate on their face. When this is the case, the district court may forgo discovery and award summary judgment on the basis of affidavits.

In order to justify discovery once the agency has satisfied its burden, the plaintiff must make a showing of bad faith on the part of the agency sufficient to impugn the agency's affidavits or declarations, or provide some tangible evidence that an exemption claimed by the agency should not apply or summary judgment is otherwise inappropriate.

Carney v. Dep't of Justice, 19 F.3d 807, 812 (2d Cir.1994) (citations and quotations omitted); see also Jones-Edwards v. Appeal Bd. of Nat'l Sec. Agency, 196 Fed. Appx. 36, 37 (2d Cir.2006).

On these cross summary judgment motions, the Government argues that its search was adequate and that the non disclosures are justified under the following FOIA exemptions: Exemption 3, 5 U.S.C. § 552(b)(3), exempting documents "specifically exempted from disclosure by statute;" Exemption 5, 5 U.S.C. § 552(b)(5), exempting documents that would be subject to privilege in civil litigation;² and Exemption 7, 5 U.S.C. § 552(b)(7), exempting documents collected for law enforcement purposes that, inter alia, "could reasonably be expected to constitute an unwarranted invasion of personal privacy, [or] could reasonably be expected to disclose the identity of a confidential source." Plaintiffs contest each point.

I turn first to the adequacy of the Government's search.

B. Adequacy of the Search

The Government must establish the adequacy of its search by showing "that the agency made a good faith effort to search for the requested documents, using methods `reasonably calculated' to produce documents responsive to the FOIA request." Garcia v. U.S....