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Mixed Ruling in Cozen O'Connor's Terrorism FOIA Case
The Legal Intelligencer
August 13, 2008
Cozen O'Connor has won a partial victory in its court battle for access to government documents that the firm says it needs to pursue a massive lawsuit brought by a coalition of insurers against the government of Saudi Arabia and Islamic charities for allegedly helping to finance al-Qaida in the period just prior to the Sept. 11 terrorist attacks.
In his 52-page opinion in Cozen O'Connor v. U.S. Department of Treasury, U.S. District Judge Timothy J. Savage refused to dismiss a suit brought under the Freedom of Information Act, finding that the government has not yet offered a satisfactory explanation of the methods it used to search for documents.
"Summary judgment will be denied, and Treasury will be given an opportunity to explain the parameters of its search to assure that it was adequate to find responsive documents," Savage wrote.
But most of Savage's lengthy opinion was devoted to rejecting Cozen O'Connor's arguments that the government had improperly invoked FOIA exemptions.
For nearly all of the exemptions, Savage concluded that they were properly invoked and that Cozen O'Connor is not entitled to documents covered by them.
The litigation before Savage stems directly from a massive suit pending in the Southern District of New York federal court in which Cozen O'Connor represents three dozen insurers, including Allstate and Chubb, who are seeking to hold Saudi Arabia, a group of Saudi princes and a slew of organizations and individuals responsible for $5 billion in damages from the Sept. 11 attacks.
A New York federal judge has dismissed all claims against the Saudi government and the princes on sovereign immunity grounds -- a decision under review by the 2nd U.S. Circuit Court of Appeals -- and the remaining defendants are lodging motions to dismiss, challenging the court's jurisdiction or in the midst of discovery.
To prove the claims in the New York case, Cozen O'Connor filed a massive FOIA request demanding documents related to the government's terrorism-related designations of 87 individuals, entities and foreign states.
In its FOIA requests, Cozen O'Connor asked for detailed intelligence and investigative information located in the Treasury Department's files relating to: the designations of Iran, Iraq, Sudan and Syria as state sponsors of terrorism; specific groups and organizations engaged in terrorist activity; and individuals and organizations that provided material or financial support to designated terrorists. It also sought the identification of assets belonging to any of those individuals or entities.
When the firm grew dissatisfied with the government's responses, it filed suit in U.S. District Court in Philadelphia.
Justice Department lawyers moved for summary judgment dismissal of the suit, arguing that the Treasury Department's search was adequate and that it properly asserted FOIA exemptions with ample descriptions of the documents it withheld.
The government also defended the Treasury Department's decision to refuse to admit or deny the existence or nonexistence of any responsive records for 16 entities, arguing that the mere fact of whether the agency had opened a file on a given organization could jeopardize an ongoing investigation.
In response, Cozen O'Connor attorneys Elliott R. Feldman and Adam C. Bonin argued that Treasury conducted an inadequate search, improperly invoked exemptions, did not sufficiently describe withheld documents so one could determine if the asserted exemptions applied and improperly refused to acknowledge that it did or did not have documents in certain instances.
They also argued that Treasury acted in bad faith by delaying its responses and inadequately processing the firm's FOIA request.
Savage rejected most of Cozen O'Connor's arguments but found that the case cannot be dismissed because the government's responses were lacking on the issue of the scope of its efforts to search for documents.
The government won a series of rulings in its favor on issues related to whether it had properly invoked FOIA exemptions, such as national security or protecting confidential sources.
"With respect to the asserted exemptions, Treasury's withholding of the documents, with the exception of a few, was proper," Savage wrote.
In a partial victory for Cozen O'Connor, the judge rejected the government's argument that it had fully explained its methods of searching for responsive documents with affidavits from Treasury employees who oversaw the request.
"Lacking the specifics of how the search was conducted, one cannot determine whether it was reasonably calculated to discover responsive documents," Savage wrote.
"It may be that Treasury's ... search was adequate, but there is insufficient information in the record to conclude that it was. Therefore, Treasury will be given the opportunity to specify its search methodology," Savage wrote.
But Savage completely rejected the firm's argument that the government had acted in bad faith by delaying its action on the firm's FOIA requests.
"Here, there is no evidence of bad faith. The length of time in responding to the requests was not inordinate considering the number of agencies involved, the nature of the information sought, the volume of documents to be searched and reviewed, and the sensitivity of many of those documents," Savage wrote.
"Throughout the process, even though they disagreed, the parties communicated regarding progress. Treasury did not intentionally refuse to process the requests. It sought to refine them so it could respond," Savage wrote.
Savage also found that nearly all of the government's claims that documents had been withheld under FOIA exemptions were proper.
Under FOIA, an agency is not required to disclose information or records that have been ordered to be kept secret pursuant to an executive order in the interest of national defense or foreign policy and that are properly classified.
"Having reviewed the unclassified and classified declarations, I conclude that the requirements of the executive order have been satisfied," Savage wrote.
