Crestek, Inc v. Internal Revenue Service

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
CRESTEK, INC. & SUBSIDIARIES, et al.,
Plaintiffs,
v. Case No. 1:17-cv-00200 (TNM)
INTERNAL REVENUE SERVICE,
Defendant.
MEMORANDUM OPINION
Crestek, Inc. & Subsidiaries and its CEO, J. Michael Goodson (collectively, “Crestek”),
challenge the Internal Revenue Service’s response to their Freedom of Information Act, or
FOIA, requests for 22 categories of documents related to their income tax liabilities from 2006 to
2014. See Compl. Exs. 1, 3. The IRS identified 14,482 pages of responsive records, 12,467 of
which it produced in full. Mot. Summary J. Decl. of William V. Spatz (Spatz Decl.) ¶¶ 6-7. The
IRS invoked several FOIA exemptions to withhold 920 pages in full and to redact portions of the
remaining 1,095 pages. Id. ¶ 7. During this litigation, the IRS resolved some disputes by
disclosing additional materials. Reply ISO Mot. Summary J. Supplemental Decl. of William V.
Spatz (Supp. Spatz Decl. I) ¶ 20; Second Supplemental Decl. of William V. Spatz (Supp. Spatz
Decl. II), ECF No. 41, ¶¶ 8-9. But Crestek still challenges the adequacy of the IRS’s search for
responsive records. It also disputes many withholdings and redactions that the IRS made under
FOIA’s exemptions for documents that would not otherwise be available to private parties in
litigation and for law enforcement information that could reasonably be expected to compromise
a confidential source or to risk circumvention of the law by disclosing investigatory techniques
and procedures. Because the search was adequate and at least one FOIA exemption justifies
each withholding and redaction, the IRS’s Motion for Summary Judgment will be granted.
I. LEGAL STANDARD
To prevail on a motion for summary judgment, a movant must show that “there is no
genuine dispute as to any material fact and the movant is entitled to judgment as a matter of
law.” Fed. R. Civ. P. 56(a); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986);
Celotex Corp v. Catrett, 477 U.S. 317, 322 (1986). FOIA requires federal agencies to “disclose
information to the public upon reasonable request unless the records at issue fall within
specifically delineated exemptions.” Judicial Watch, Inc. v. FBI, 522 F.3d 364, 365-66 (D.C.
Cir. 2008); see also 5 U.S.C. § 552(a)(3)(A) (request must “reasonably describe[]” records
sought). So, a FOIA defendant is entitled to summary judgment if it shows that there is no
genuine dispute about whether “each document that falls within the class requested either has
been produced, is unidentifiable or is wholly exempt from the Act’s inspection requirements.”
See Weisberg v. Dep’t of Justice, 627 F.2d 365, 368 (D.C. Cir. 1980). Courts decide the “vast
majority” of FOIA cases on motions for summary judgment. See Brayton v. Office of United
States Trade Rep., 641 F.3d 521, 527 (D.C. Cir. 2011).
To show that any unproduced documents are exempt from FOIA, an agency may file
“affidavits describing the material withheld and the manner in which it falls within the
exemption claimed.” King v. Dep’t of Justice, 830 F.2d 210, 217 (D.C. Cir. 1987). To show that
any unproduced documents are unidentifiable, a defendant must show “a good faith effort to []
search for the requested records, using methods which can be reasonably expected to produce the
information requested.” Oglesby v. Dep’t of the Army, 920 F.2d 57, 68 (D.C. Cir. 1990). In
other words, the defendant must “demonstrate beyond material doubt that its search was
2
reasonably calculated to uncover all relevant documents.” Nation Magazine v. Customs Serv., 71
F.3d 885, 890 (D.C. Cir. 1995). The touchstone of the analysis is the reasonableness of the
search, not the records produced. See Hodge v. FBI, 703 F.3d 575, 580 (D.C. Cir. 2013) (“[T]he
adequacy of a search is determined not by the fruits of the search, but by the appropriateness of
[its] methods.”); Mobley v. CIA, 806 F.3d 568, 583 (D.C. Cir. 2015) (“[A] search, under FOIA, is
not unreasonable simply because it fails to produce all relevant material.”).
An agency has discretion to craft its search to meet this standard and does not have to
search every system if additional searches are unlikely to produce any marginal return. See
Campbell v. Dep’t of Justice, 164 F.3d 20, 28 (D.C. Cir. 1998). Searching for records requires
“both systemic and case-specific exercises of discretion and administrative judgment and
expertise.” Schrecker v. Dep’t of Justice, 349 F.3d 657, 662 (D.C. Cir. 2003). This is “hardly an
area in which the courts should attempt to micro-manage the executive branch.” Id. To establish
the reasonableness of its search, an agency can submit a “reasonably detailed affidavit, setting
forth the search terms and the type of search performed, and averring that all files likely to
contain responsive materials (if such records exist) were searched.” Oglesby, 920 F.2d at 68.
Agency declarations enjoy “a presumption of good faith, which cannot be rebutted by ‘purely
speculative claims about the existence and discoverability of other documents.’” SafeCard
Servs. Inc. v. SEC, 926 F.2d 1197, 1201 (D.C. Cir. 1991).
II. ANALYSIS
A. The IRS Conducted an Adequate Search
The IRS has provided affidavits describing its search for responsive documents. Mot.
Summary J. Declaration of Charlene Inman (Inman Decl.) ¶¶ 4-11; Spatz Decl. ¶¶ 4-5. It has
also provided an affidavit stating that, “[t]o the best of my knowledge, there are no other files
3
responsive to [Crestek’s] FOIA requests that would be located in any other office or location.”
Supp. Spatz Decl. I ¶ 13. Crestek challenges both the sufficiency of these declarations and their
credibility. See Opp. to Mot. Summary J. 5-6; Sur-Reply to Mot. Summary J. 1-2.
Crestek raises two challenges to the sufficiency of the IRS declarations. First, Crestek
complains that the declarations do not say the IRS located “all responsive documents.” Opp. to
Mot. Summary J. 6. But the law does not require such a representation. See Mobley, 806 F.3d at
583 (noting that a search may be adequate even if it does not identify all relevant material). If
Crestek intended to point out that the original declarations did not state that the IRS searched all
files likely to contain responsive materials, see Oglesby, 920 F.2d at 68, the Supplemental Spatz
Declaration remedies this deficiency. See Supp. Spatz Decl. I ¶ 13.
Second, Crestek complains that Lisa Rodriguez and Carmen Presinal-Roberts, “who
actually originally gathered and identified the documents,” did not author the declarations. Opp.
to Mot. Summary J. 6. But Crestek cites no legal authority stating that the person who conducted
a search must author the agency’s declaration to prove the search’s adequacy. See id. Nor does
it cite anything in the record to suggest that the declarants did not conduct the search as they
claim. See id.; see also Inman Decl. ¶¶ 4-11 (describing steps Ms. Inman took to identify
responsive records); Spatz Decl. ¶¶ 4-5 (describing steps Mr. Inman took to identify additional
responsive records); Supp. Spatz Decl. I ¶¶ 9, 11-13 (same). 1 I conclude the IRS declarations are
sufficient. See Assassination Archives & Research Center, Inc. v. CIA, __ F. Supp. 3d __, 2018
WL 3448229 at *3 (D.D.C. July 17, 2018) (“No statutory provision or court precedent requires
1
Ms. Inman states that she asked Ms. Rodriguez for files in her possession and that they worked
together to determine which records were responsive. Inman Decl. ¶¶ 5-6, 9. Ms. Inman also
states that Ms. Presinal-Roberts told her Crestek had obtained discovery of the non-privileged
portions of its file for the tax years ending in June 2008 and June 2009. Id. ¶ 8. But this does
not show a need for declarations by Ms. Rodriguez and Ms. Presinal-Roberts.
4
affidavits from all government employees involved in the search or dictates who among them
should be the affiant.”).
Crestek has also failed to overcome the presumption of good faith accorded to the IRS
declarations. See SafeCard, 926 F.2d at 1201. Crestek challenges the Inman Declaration’s
credibility on two grounds. First, Crestek challenges its credibility because the record does not
contain independent validation of its statement that Ms. Inman left a voicemail for Crestek’s
attorney asking if some of Crestek’s FOIA requests were satisfied by discovery that Crestek had
obtained in other litigation. Opp. to Mot. Summary J. 5. 2 But Crestek offers no basis for
demanding corroborating evidence. See Oglesby, 920 F.2d at 68 (holding that a court may rely
on an affidavit to determine the adequacy of a FOIA search). Second, Crestek challenges the
Inman Declaration’s credibility because the IRS did not produce responsive documents until
April 2017 even though the declaration says that the IRS gathered 2,580 pages of records by
March 2016 and another 445 pages of records by October 2016. Id. 5-6. But it offers only
speculation to suggest that these facts are inconsistent. See SafeCard, 926 F.2d at 1201 (holding
that speculation cannot overcome the presumption of good faith). Neither of these challenges to
the Inman Declaration’s credibility has merit.
Crestek also challenges the Spatz Declaration’s credibility for two reasons. First, it
complains that Spatz relied on others to identify responsive records and that this was
unreasonable since he identified responsive records that others did not find. Id. at 6. But the
2
Crestek seems to infer that if Ms. Inman had left this voicemail the IRS would have repeated
her question or referenced her voicemail in letters to Crestek sent between January and October
2016 stating that the IRS needed additional time to collect responsive documents. Sur-Reply to
Mot. Summary J. 2. But there is no contradiction between Ms. Inman’s question whether part of
Crestek’s FOIA requests had been satisfied and the letters’ position that additional records were
necessary to satisfy Crestek’s FOIA requests in their entirety.
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Spatz Declaration—and Crestek’s observation that Mr. Spatz identified responsive records that
others overlooked—shows that he did not simply rely on others. Spatz Decl. ¶¶ 4-5. Second,
Crestek challenges the Supplemental Spatz Declaration’s credibility because it references
Ms. Inman’s voicemail without explaining how he would have personal knowledge of it. Sur-
Reply to Mot. Summary J. 1-2. But the Supplemental Spatz Declaration explains that Mr.
Spatz’s information about Ms. Inman’s voicemail was based on her representations. Supp. Spatz
Decl. I ¶ 8. And none of the statements that Crestek challenges are material to the adequacy of
the IRS’s search for responsive records. So, I conclude that the declarations provide sufficient
and credible evidence that the IRS conducted an adequate search.
B. The IRS Has Justified All Disputed Exemption 5 Redactions and Withholdings
Exemption 5 applies 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.” 5 U.S.C.
§ 552(b)(5). FOIA qualifies Exemption 5 by saying that “the deliberative process privilege shall
not apply to records created 25 years or more before the date on which the records were
requested.” Id. In addition to protecting documents that enjoy the deliberative process privilege,
Exemption 5 protects documents subject to the attorney work-product privilege and the attorney-
client privilege. Coastal States Gas Corp. v. Dep’t of Energy, 617 F.2d 854, 862 (D.C. Cir.
1980). The IRS invokes all three privileges for overlapping sets of documents.
1. The IRS Has Justified All Disputed Deliberative Process Redactions and
Withholdings
The deliberative process privilege protects the confidentiality of “documents reflecting
advisory opinions, recommendations and deliberations comprising part of a process by which
governmental decisions and policies are formulated.” NLRB v. Sears, Roebuck & Co., 421 U.S.
6
132, 150 (1975). A document must be predecisional and deliberative to enjoy this privilege.
Mapother v. Dep’t of Justice, 3 F.3d 1533, 1537 (D.C. Cir. 1993).
An agency invoking the deliberative process privilege “has the burden of establishing
what deliberative process is involved, and the role played by the documents in issue in the course
of that process.” Coastal States Gas Corp., 617 F.2d at 868. In making this showing, “[t]he
identity of the parties to the memorandum is important; 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.” Id. The content of the document is also important because “factual material
must be disclosed but advice and recommendations may be withheld.” Mapother, 3 F.3d 1537.
An agency’s description of each document redacted or withheld plays a particularly important
role in the context of the deliberative process privilege because this “privilege is so dependent
upon the individual document and the role it plays in the administrative process.” Animal Legal
Def. Fund v. Dep’t of Air Force, 44 F. Supp. 2d 295, 299 (D.C. Cir. 1999).
The IRS originally invoked the deliberative process privilege to redact or withhold 168
groups of responsive records. Spatz Decl. ¶ 22. Crestek argued that the IRS had not shown all
the documents to be predecisional since the IRS did not state when each document was written or
when the relevant decisions took place. Opp. to Mot. Summary J. 8-9. Crestek also argued that
the IRS had not shown all the documents to be deliberative since the IRS had not identified the
author and recipient. Id. at 9. Crestek did not specify which of its arguments applied to which of
the IRS’s withholdings and redactions under the deliberative process privilege.
The IRS responded to Crestek’s challenge with a supplemental declaration that
established the applicability of the deliberative process privilege to 15 of the 168 groups of
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records at issue. See Supp. Spatz Decl. I. The supplemental declaration clarified why 46 groups
of records were predecisional. Id. ¶ 19. But the IRS identified the author and recipient of only
15 of the records that it showed to be predecisional. See Spatz Decl. 19 (Items 1-3), 20 (Items 3-
4), 27 (Item 3), 28 (Items 6-7), 36 (Items 3-4), 38 (Item 3), 39 (Items 2-3 and 5), 41 (Item 1).
Because the IRS did not show that the remaining 153 groups of records were both predecisional
and deliberative, I ordered the IRS to produce these records or submit another supplemental
declaration explaining the basis for its withholdings. ECF #38 (May 14, 2018 Order).
The IRS responded to my order by producing 1,247 pages of responsive records without
deliberative process redactions and submitting a supplemental declaration to justify its
withholding of the 186 pages that remained at issue. Supp. Spatz Decl. II ¶¶ 8-10. Crestek’s
response to the supplemental declaration raises three final concerns.
First, Crestek expresses concern about the declaration’s statement that “the IRS Appeals
Office uses alternative dispute resolution techniques to promote agreement, and the ordinary
prohibitions against ex parte communications between IRS Appeals Officers and other IRS
employees do not apply to Fast Track.” Pls.’ Opp. to Supp. Spatz Decl. II 1 (quoting Supp.
Spatz Decl. II ¶ 12). Crestek speculates that any ex parte communications that took place
“would not properly be a part of the IRS deliberative process.” Id. at 1-2. 3 The IRS has clarified
that it redacted six emails reflecting the content of ex parte communications under the
deliberative process privilege. Supp. Spatz Decl. III ¶ 9. These communications were about
whether the issues in Crestek’s case were suitable for Fast Track settlement and about how the
3
Crestek does not directly challenge the propriety of ex parte communications themselves. The
IRS has explained their propriety under the applicable statute and Revenue Procedure and under
Crestek’s Application for Fast Track Settlement, which contains a voluntary waiver of
restrictions on ex parte communications. Third Supplemental Declaration of William V. Spatz
(Supp. Spatz Decl. III) ¶¶ 3-5.
8
IRS might withdraw the Fast Track application if it wished. See id. ¶¶ 8-9. They were
predecisional and deliberative because they helped the IRS decide whether to pursue a Fast
Track settlement or withdraw the Fast Track application. Crestek did not renew its opposition to
the withholding of these communications after the IRS described their contents, and in any event
I find that the IRS has adequately proven their privileged status. See Mapother, 3 F.3d at 1537
(holding that Exemption 5 applies to documents that are both predecisional and deliberative).
Second, Crestek challenges the IRS’s redactions to six pages of emails. It notes that the
redactions protect discussions about the effect of a request for assistance that Crestek made to the
Taxpayer Advocate Office, and it asserts that these discussions have no connection to the IRS’s
deliberations about Crestek’s tax liability. Pls.’ Opp. to Supp. Spatz Decl. II 2. But the IRS
explains that the discussions do have a connection to the IRS’s deliberative process. Because the
Taxpayer Advocate Office has significant power over IRS employees and can require them to
take an action permitted by law, to refrain from taking any action, or to stop any action under
way, Crestek’s request for assistance caused “serious uncertainty” about the next steps for
Crestek’s case. Supp. Spatz Decl. III ¶ 10. So the IRS exam team discussed “what the IRS
could do in the Crestek audit while it was uncertain whether the Taxpayer Advocate Office
would intervene” in the team’s denial of Crestek’s Application for Fast Track Settlement. Id.
¶ 12. These are deliberations that preceded a decision about what next steps the team should
take, and they enjoy the protection of the deliberative process privilege.
Third, Crestek challenges the adequacy of Paragraph 27 of the IRS’s second
supplemental declaration because the IRS “does not provide the identifying names of the
individuals claimed to be the IRS Counsel who engaged in communications.” Pls.’ Opp. to
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Supp. Spatz Decl. II 2. 4 But the IRS has not claimed that any of the redactions and withholdings
in question protect communications in which an IRS counsel participated. Spatz Decl. II ¶ 27.
The IRS describes the records as entries in Appeals Officer Koprowski’s Case Activity Record
that reflect her conversations with Tax Computation Specialist Jen Xenakis and two drafts of a
statutory notice of deficiency with handwritten annotations believed to have been made by
Ms. Koprowski. Id. Crestek is right that the IRS has not provided the names of any IRS counsel
related to these records. But that does not undermine the IRS’s claim of privilege.
After several rounds of briefing, four declarations, and extensive production, the parties
have narrowed their disputes about the deliberative process privilege down to three issues. None
of the Crestek’s arguments about these issues has merit. So I will grant the IRS’s motion for
summary judgment on its redactions and withholdings under the deliberative process privilege.
2. The IRS Has Justified All Disputed Attorney Work-Product Privilege
Redactions and Withholdings
The attorney work-product privilege protects the confidentiality of materials prepared in
anticipation of litigation by or for a party or by or for a party’s representative, including a party’s
attorney or agent. Tax Analysts v. IRS, 117 F.3d 607, 620 (D.C. Cir. 1997) (citing Fed. R. Civ. P.
26(b)(3)). The IRS invokes the attorney work-product privilege to redact or withhold 22 groups
of responsive records. Spatz Decl. ¶ 14. Crestek concedes that the IRS may have rightfully
redacted or withheld some of these documents. Opp. to Mot. Summary J. 8. But it argues that
4
Similarly, Crestek objects to the fact that Paragraph 25 of the IRS’s second supplemental
declaration references protected communications with IRS counsel without providing their
names. Pls.’ Opp. to Supp. Spatz Decl. II 2 (citing Supp. Spatz Decl. II ¶ 25). But the second
supplemental declaration mentions these documents only in passing to note that my order
required no supplemental explanation of why these documents are privileged. See Supp. Spatz
Decl. II ¶ 25. The names of the IRS counsel appear in the IRS’s first declaration. Spatz Decl. 19
(Items 1-3), 27 (Item 3), and 36 (Item 3). As my order suggested, there was no need for the IRS
to repeat this information in its second supplemental declaration.
10
the Court cannot evaluate the applicability of the privilege to any of the documents in question
because the IRS has not stated when it first anticipated litigation, making it impossible to tell
whether the documents were prepared in anticipation of litigation. Id. Crestek also argues that
the Court cannot adequately evaluate the applicability of the privilege to documents for which
the IRS has not specified the name of the author, sender, or recipient. Id.
The IRS has resolved Crestek’s first concern by submitting a supplemental declaration
stating what litigation the IRS anticipated in preparing each document for which it has invoked
the attorney work-product privilege and stating the date on which the IRS first anticipated that
litigation. See Supp. Spatz Decl. I ¶¶ 14-17. 5 Crestek’s second concern apparently applies to
five documents withheld in full: Although Crestek again has not specified which withholdings it
wishes to dispute, the IRS failed to specify the name of the author, sender, or recipient for four
draft annotated timelines and one request for a tax computation specialist. See Spatz Decl.
¶ 14(a). But the IRS has stated that the timelines were prepared at the direction of IRS counsel to
help respond to allegations of misconduct. Id. This shows that the timelines were prepared by or
for a party—the IRS—and by or for a party’s representative—IRS counsel. See Tax Analysts,
117 F.3d at 620. And it has stated that the request for a tax computation specialist was based on
legal advice given to Ms. Koprowski, an IRS employee, supporting an inference that an IRS
representative made the request. See Spatz Decl. ¶ 14(a). So, Crestek has failed to raise any
viable challenge to the IRS’s invocation of the attorney work-product privilege.
5
Even without this supplemental declaration and without specific dates on which the IRS
anticipated litigation, the IRS provided sufficient information to determine that several
documents constituted attorney work product. See, e.g., Spatz Decl. ¶ 14 (explaining that the
IRS reasonably anticipates litigation whenever it prepares a statutory notice of deficiency and
listing withholdings related to the preparation of a statutory notice of deficiency).
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3. The IRS Has Justified All Disputed Attorney-Client Privilege Redactions and
Withholdings Except Five Withholdings for Documents That Enjoy the Attorney
Work-Product Privilege
Exemption 5 and the attorney-client privilege extend to “confidential communications
from clients to their attorneys made for the purpose of securing legal advice or services” and to
“communications from attorneys to their clients if the communications rest on confidential
information obtained from the client.” Tax Analysts, 117 F.3d at 618. “In the governmental
context, the client may be the agency and the attorney may be an agency lawyer.” Id. The IRS
invokes the attorney-client privilege to redact or withhold 30 groups of responsive records.
Spatz Decl. ¶ 13. As with the attorney work-product privilege, Crestek concedes that the IRS
may have rightfully redacted or withheld these documents. Opp. to Mot. Summary J. 7-8. But
Crestek argues that the IRS has not adequately established the applicability of the privilege to
documents for which it has not expressly identified who provided advice or information to
whom. Id.
Once again, Crestek has not troubled to specify which documents it believe the IRS
improperly redacted or withheld. See id. But I have identified only six records that the IRS
withheld in full without expressly stating who provided advice or information to whom. One of
these is a markup by IRS Counsel Rodriguez of a draft letter by IRS Manager Sally Warner to
Crestek’s counsel. Spatz Decl. ¶ 13(a). Although the IRS does not expressly state who Ms.
Rodriguez provided the markup to, the IRS’s description of the document makes it clear that Ms.
Rodriguez offered her advice to Ms. Warner. See id. This puts it within the scope of the
attorney-client privilege. The IRS has not described the other five records with enough detail to
allow me to determine that the attorney-client privilege applies. These records are a request for a
Tax Computation Specialist and four draft annotated timelines prepared at counsel’s direction to
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help respond to allegations of misconduct. See id. But they still enjoy the attorney work-product
privilege, as discussed above, so no disclosure is necessary. See supra, Part II.B.2.
C. The IRS Has Justified All the Exemption 7(D) Redactions and Withholdings
Exemption 7(D) shields from disclosure “records or information compiled for law
enforcement purposes” that “could reasonably be expected to disclose the identity of a
confidential source.” 5 U.S.C. § 552(b)(7). The IRS had a confidential source in proceedings
against Crestek, it has not disclosed this source, and it has withheld or redacted 17 groups of
responsive records that could reasonably be expected to identify the source. Mot. Summary J.
12; Spatz Decl. ¶ 29. Crestek argues that it already knows the identities of two whistleblowers,
that one of them has waived her rights to confidentiality, and that the other has no right to
confidentiality because he did not provide information directly to the IRS on a Form 211. Opp.
to Mot. Summary J. 10. My review of the record, the briefing, and the IRS’s in camera
submission persuade me to reject Crestek’s argument. Further explanation on the public record
would thwart the purposes of the exemption, but I am satisfied that the IRS’s withholdings and
redactions are necessary to avoid disclosing the identity of a confidential source. See 5 U.S.C.
§ 552(b)(7).
D. The IRS Has Justified All the Exemption 7(E) Withholdings
Exemption 7(E) protects from disclosure “records or information compiled for law
enforcement purposes” that “would disclose techniques and procedures for law enforcement
investigations or prosecutions, or would disclose guidelines for law enforcement investigations
or prosecutions if such disclosure could reasonably be expected to risk circumvention of the
law.” 5 U.S.C. § 552(b)(7). The IRS has withheld or redacted 15 groups of responsive records
under Exemption 7(E). Spatz Decl. ¶ 24. Crestek challenges the withholding of six partially-
13
completed copies of IRS Internal Form 11369. Opp. to Mot. Summary J. 9-10. 6 The IRS uses
Internal Form 11369 to evaluate information provided by whistleblowers. Spatz Decl. ¶ 24(a).
Release of this information would disclose the process by which the IRS evaluates whistleblower
information and risk circumvention of the law. Spatz Decl. ¶ 24. Thus, Exemption 7(E)
applies. 7
E. Crestek Has No Right to Discovery
Crestek’s Sur-Reply requests that I postpone a decision on the IRS’s Motion for
Summary Judgment until Crestek conducts discovery. Sur-Reply to Mot. Summary J. 2, 4, 6. 8
A party opposing a motion for summary judgment may seek discovery based on an affidavit or
declaration specifying the reasons that it cannot yet present the facts necessary to justify the
opposition. Fed. R. Civ. P. 56(d). To specify adequately the reasons for further discovery, a
party opposing summary judgment must “indicate what facts [it] intend[s] to discover that would
create a triable issue and why [it] could not produce them in opposition to the motion.”
6
Crestek states that the Spatz Declaration lists four documents under the description “Partially-
Completed IRS Internal Forms 11369.” Id. But the Spatz Declaration lists pages 12791-12796,
12944-12946, 12957-12959, and 13027-13032 under this description. Spatz Decl. ¶ 24(a).
These pages contain six partially completed copies of Internal Form 11369. Spatz Decl. ¶ 29(a)
(invoking Exemption 7(D), which also applies as stated above).
7
Crestek does not dispute that Exemption 7(E) applies to a blank copy of Internal Form 11369.
See Opp. to Mot. Summary J. 9-10 (disputing only the withholding of partially completed
forms); see also Spatz Decl. ¶ 24(a) (listing a blank Internal Form 11369 among the documents
withheld). Although it might be possible to produce the entries made on a form while redacting
the form itself, such a production would necessarily reveal information about the structure of the
form and the types of information that the form treats as relevant to a law enforcement decision.
8
Crestek’s Sur-Reply also argues, without citation to authority, that the public interest in its
FOIA request “outweighs the deliberative process privilege and enforcement privileges” asserted
by the IRS. Id. at 4-6. This appears to be an invitation to set FOIA’s exemptions aside in
evaluating Crestek’s FOIA claims. If Crestek intends to argue that the public interest is a factor
under FOIA Exemptions 5, 7(D), and 7(E), it has forfeited this argument by failing to brief it
adequately. See Schneider v. Kissinger, 412 F.3d 190, 200 n.1 (D.C. Cir. 2005) (requiring
litigants to spell out their arguments rather than “leaving the court to do counsel’s work”).
14
Carpenter v. Fed. Nat’l Mortg. Ass’n, 174 F.3d 231, 237 (D.C. Cir. 1999). An affidavit or
declaration in support of further discovery must be factually supported and may not rely on
conclusory assertions. Messina v. Krakower, 439 F.3d 755, 762 (D.C. Cir. 2006). “Discovery in
FOIA is rare” because courts have a right to rely on agency declarations submitted in good faith.
Schrecker v. Dep’t of Justice, 217 F. Supp. 2d 29, 35 (D.D.C. 2002). Instead of ordering
discovery, courts generally request supplemental declarations when the initial declarations fail to
provide all necessary information. “When an agency’s affidavits or declarations are deficient,”
as at first they were here, “the courts generally will request that the agency supplement its
supporting declarations.” Judicial Watch, Inc. v. Dep’t of Justice, 185 F. Supp. 2d 54, 65
(D.D.C. 2002). This I have already done.
Crestek is not entitled to discovery for at least additional three reasons. First, Crestek has
not supported its request for discovery with an affidavit or declaration. See Hicks v. Gotbaum,
828 F. Supp. 2d 152, 159 (D.D.C. 2011) (denying discovery when party opposing summary
judgment filed no affidavit or declaration). Second, Crestek has not specified what facts they
intend to discover. See Carpenter, 174 F.3d at 237. Instead, it has merely pointed to the topics it
wishes to investigate—why the IRS withheld whistleblower-related documents and why the IRS
declarations reference a voicemail not mentioned elsewhere in the record. Sur-Reply to Mot.
Summary J. 2, 4. Third, Crestek has not shown how discovery would create an issue of material
fact. See Carpenter, 174 F.3d at 237. I have already determined that the IRS properly withheld
whistleblower-related documents and that it has explained this withholding as fully as possible
on the public record. And I have explained that there is no reason other parts of the record must
reference the voicemail, which, in any event, is not material to my evaluation of the search or of
the redactions and withholdings. For all these reasons, Crestek is not entitled to discovery.
15
III. CONCLUSION
For the reasons explained above, the IRS is entitled to summary judgment. A separate
order will issue.
2018.08.27
15:27:25 -04'00'
Dated: August 27, 2018 TREVOR N. MCFADDEN
United States District Judge
16