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ALBANY – A government entity’s internal communications on press strategy are not subject to the Freedom of Information Law, an appellate panel in Albany has held in a case lodged against the New York Attorney General’s office.

Smith v. Attorney General, 517176, is one of several offshoots of a lengthy and continuing civil fraud prosecution against two former executives of American International Group (AIG).

In this FOIL case, the company’s former chief financial officer, Howard Smith, sought internal correspondence related to the attorney general’s media strategy for publicizing the civil fraud matter against him and former AIG chief executive officer Maurice “Hank” Greenberg. Smith and Greenberg are awaiting trial in a nine-year-old action initiated by then Attorney General Eliot Spitzer regarding allegedly fraudulent reinsurance transactions.

Smith sought emails in which officials in the attorney general’s office shared draft press releases and discussed strategy for publicizing the civil fraud case through press conferences, television appearances and other means. Supreme Court Justice Christopher Cahill (See Profile) denied the FOIL in an opinion unanimously affirmed Thursday by the Appellate Division, Third Department.

Writing for the court, Presiding Justice Karen Peters (See Profile) said the items at issue here are exactly the sort of deliberative and pre-decisional materials that the Legislature exempted from FOIL disclosure.

“[P]ublic disclosure of materials reflecting the process by which respondent formulates its policy concerning statements to and interactions with the press regarding ongoing litigation would, in our view, have the precise effect of stifling open, honest and frank communication that the inter-agency exemption was designed to protect against,” Peters wrote in an opinion joined by justices Leslie Stein (See Profile), William McCarthy (See Profile) and John Egan Jr. (See Profile).

The ruling relied on the Court of Appeals’ 2005 opinion in Matter of New York Times v. City of New York Fire Department, 4 NY3d 477.

Matter of New York Times centered on an attempt to obtain through FOIL transcripts of dispatch calls in the wake of the terrorist attacks of Sept. 11, 2001.

The high court, in an opinion by Judge Robert Smith, said the calls constituted “inter-agency materials” included in a FOIL exception designed to “permit people within an agency to exchange opinions, advice and criticism freely and frankly.” He said the exemption “applies not only to comments made in the official policy meetings and well-considered memorandums, but also to suggestions and criticisms offered with little chance of reflection in moments of crisis.”

The Third Department agreed with Smith that the exemption for intra-agency material does not cover materials related to decisions that have already been made.

“Here, however, the documents in question—although relating to respondent’s decision to commence the AIG litigation—consist of internal discussions on the entirely separate decision regarding what information to disclose to the public about the pending AIG litigation and how best to do so,” Peters wrote.

Robert Freeman, executive director of the state Committee on Open Government, said the ruling does not break new ground.

“From my perspective, the rationale expressed in this decision was very well stated,” Freeman. “I think it describes the exception regarding deliberative materials unusually well.”

Smith was represented on the appeal argued Feb. 13 by Daphne Morduchowitz of Kaye Scholer. Jeffrey Lang appeared for the attorney general.

In a separate FOIL, Smith is seeking Spitzer’s private emails, alleging that the former attorney general sometimes used a personal account while in office to discuss public business. That motion, which seeks to compel incumbent Attorney General Eric Schneiderman to obtain records from Spitzer and then make them available via FOIL, is pending before Cahill. A hearing is slated for May 2 (NYLJ, April 9).