A federal judge yesterday largely upheld a decision by the Federal Reserve System to deny a request from Fox News Network for information about loans the Federal Reserve made in 2007 and 2008 to stem the credit crisis. Fox News argued that since the money came from taxpayers, it was entitled to disclosure of the borrowers’ names, loan amounts and pledged collateral. But Southern District Judge Alvin K. Hellerstein ruled that 6,186 pages of records could be withheld under an exemption to the federal Freedom of Information Law that applies to an agency’s commercial, financial or trade secret information obtained from a person and is privileged or confidential.
Judge Hellerstein said that to accede to the network’s request “would compromise the [Federal Reserve] Board’s effective execution of its statutory responsibilities.” He observed that “borrowers would view taking such last-resort publicly disclosed loans as unwise because it would stigmatize the company and lead to a, perhaps false, belief that the company is in financial trouble. This would undermine the Board’s mandate to provide stability to markets, especially during a financial crisis.”
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