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A prosecutor’s memorandum on reforming the way the Internal Revenue Service conducts criminal investigations cannot be obtained by a New York defense lawyer, the 2nd U.S. Circuit Court of Appeals has ruled. The 2nd Circuit found that lawyer John J. Tigue Jr. has no right under the Freedom of Information Act to obtain a copy of the so-called Neiman Memorandum, which was drafted by Southern District of New York prosecutor Shirah Neiman at the request of a blue-ribbon commission on IRS reform. The court, in Tigue v. United States Department of Justice, 01-6243, upheld a decision by Southern District Judge Alvin K. Hellerstein and ruled that the document fell under the deliberative process privilege, an exemption from the Freedom of Information Act’s presumption that government documents are available to the public. The controversy first arose in 1998, when Judge William Webster agreed to head a task force to conduct an independent review of the IRS’s Criminal Investigations Department (CID). Because of the large volume of tax investigations in the Southern District, the Webster Commission requested the U.S. Attorney’s Office’s opinion on possible changes to the handling of criminal investigations. Neiman, at the time a deputy U.S. Attorney under Mary Jo White and now chief counsel to James B. Comey, wrote a 16-page document on the assumption it would remain confidential. But a small portion of the document became public with the release of the Webster Commission Report in 1999. First, the report noted that contrary to the prevailing view of senior Justice Department officials and most U.S. Attorneys, the Southern District believed the CID should not investigate money laundering and narcotics cases. Second, the report noted the memorandum’s criticism of administrative investigations and IRS summonses as too slow and ineffective. The report quotes the memorandum as saying that “service of an administrative summons simply does not convey the urgency of a grand jury subpoena, and is not as readily enforceable as a subpoena, and represented subjects of administrative investigations often succeed in dragging out these investigations for unimaginably long periods.” Tigue, of New York’s Morvillo, Abramowitz, Grand, Iason & Silberberg, sought to obtain the entire memorandum to learn more about Southern District strategy on criminal tax prosecutions. But Tigue’s application under the Freedom of Information Act (FOIA) was denied by the Justice Department, which claimed the memorandum was protected by the deliberative process privilege as outlined in 5 U.S.C. � 552(b). After Tigue filed suit in the Southern District, Judge Hellerstein reviewed the memo in camera and then granted summary judgment for the Justice Department and the IRS. Judge Hellerstein found the memo was “predominantly evaluative, evaluating both policies and procedures of the United States Attorney for the Southern District of New York in criminal investigations involving tax matters and those of the Internal Revenue Services, and recommending procedures for the Internal Revenue Service.” SECOND CIRCUIT APPEAL On the appeal to the 2nd Circuit, Judge Sonia Sotomayor said the issue was Exemption 5 in FOIA, “which protects from disclosure ‘inter-agency or intra-agency memorandums which would not be available by law to a party other than an agency in litigation with the agency.’” To invoke the deliberative process privilege, she said, the government has to show that the document did not constitute a final result, but instead was “predecisional.” And while Tigue conceded that the Neiman Memorandum was “at least in part deliberative,” the judge said, he challenged the government’s claim that it was an inter-agency or intra-agency document, as well as whether it was “predecisional.” But Judge Sotomayor said the Neiman Memorandum qualifies as an “inter-agency document, in that it was prepared by one governmental agency for use by another agency,” even though the Webster Commission was acting, in effect, as a consultant for the IRS. The memorandum was also predecisional, she said, because it was “specifically prepared for use by the Webster Commission in advising the IRS on its future policy with respect to the CID.” Finally, the 2nd Circuit said the two references to the Neiman Memorandum in the Webster Commission report did not amount to a waiver of the deliberative process privilege. Judge Jose A. Cabranes and Eastern District Judge John Gleeson, sitting by designation, joined in the opinion. Assistant U.S. Attorneys Daniel S. Alter and Gideon A. Schor represented the government. Tigue was joined by Daniel B. Kosove on the plaintiff’s brief.

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