Opinion
Case No. 1:99-cv-124.
November 16, 1999.
ORDER
In accordance with the opinion filed this date, IT IS ORDERED that the Report and Recommendation of the Magistrate Judge, dated September 24, 1999, is hereby adopted as the opinion of this court and plaintiff's complaint is DISMISSED WITH PREJUDICE.
OPINION ADOPTING REPORT RECOMMENDATION
This is an action filed pursuant to the Freedom of Information Act ("FOIA"), 5 U.S.C. § 552. Plaintiff Nancy L. Folstad seeks to obtain requested documents relating to a June 1994 transfer of mortgage-backed securities between the Harris Trust and Savings Bank, Chicago, Illinois, and the holding company of Bankmont Financial Corporation, Chicago, Illinois, a U.S. subsidiary of the Bank of Montreal. Specifically, plaintiff claims that the Board of Governors of the Federal Reserve (the "Board") is withholding certain portfolio spreadsheets in violation of FOIA.
The matter presently is before the court on plaintiff's objections to the Report and Recommendation ("R R"); filed by the magistrate judge recommending that the court grant defendant's motion for summary judgment and dismiss plaintiff's claim. I am persuaded that plaintiff's objections are without merit. Accordingly, the R R; is adopted as the opinion of this court and the action is dismissed with prejudice.
I. DISCUSSION
This court reviews de novo those portions of an R R; to which objections are made. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P.72(b). The court may accept, reject or modify any or all of the magistrate judge's findings or recommendations. Id.
Plaintiff does not object to the legal standards applied by the magistrate judge in reviewing a FOIA claim. Under FOIA, this court has jurisdiction to enjoin an "agency from withholding agency records and to order the production of any agency records improperly withheld from the complainant." Kissinger v. Reporters Comm. for Freedom of the Press, 445 U.S. 136, 139 (1980) (quoting 5 U.S.C. § 552(a)(4)(B)). Section 552(a)(4)(B) requires the court to exercise its jurisdiction upon a showing that an agency (1) "improperly", (2) "withheld"; (3) "agency records." Id. at 150.
In moving for summary judgment on the basis that it has fully discharged its obligations under FOIA, the agency must demonstrate that it has "thoroughly searched for the requested documents where they might reasonably be found." Klunzinger v. Internal Revenue Serv., 27 F. Supp.2d 1015, 1022 (W.D. Mich. 1998) (citing Miller v. United States Dep't of State, 779 F.2d 1378, 1383 (8th Cir. 1985)). The adequacy of an agency's search is judged by a standard of reasonableness. Id. The agency must demonstrate that it has conducted a search reasonably calculated to uncover all relevant documents. Id. However, the agency need not exhaust every possible location for requested documents. Id.
Further, the agency is not required by FOIA to retain records or to create a document that does not exist in order to satisfy a FOIA request. Id.
In order to meet its burden of proof, the agency may submit affidavits by individuals with personal knowledge of the agency's response to the request. Weisburg v. U.S. Dep't of Justice, 705 F.2d 1344, 1351 (D.C. Cir. 1983). Agency affidavits are entitled to substantial weight. See Goland v. Central Intelligency Agency, 607 F.2d 339, 352 (D.C. Cir. 1978) (citing S.Rep. No. 93-1200, 93rd Cong., 2d Sess. 12 (1974)), cert. denied, 445 U.S. 927 (1980). Once the agency has come forward with affidavits that it has made a good faith search, plaintiff must introduce evidence to rebut those affidavits in order to withstand summary judgment. See Jones v. Federal Bureau of Investigation, 41 F.3d 238, 242 (6th Cir. 1994).
The presumption that the Board made a good faith search may be refuted by evidence that the Board acted in bad faith. Id.
In the instant case, the Board submitted lengthy affidavits regarding the comprehensive search conducted by the agency. The scope of the search is set forth in detail in the R R; and because plaintiff does not dispute the history of the relevant searches, that chronology is accepted here. In addition, plaintiff acknowledges that during the extended search, she was in personal touch with various staff members of defendant and made suggestions regarding the location of the spreadsheets.
Plaintiff contends, however, that the magistrate judge erred in concluding that she had failed to meet her burden of rebutting the agency's affidavits. Specifically, plaintiff asserts that because the documents in question were relevant to a "material event" under federal securities law, i.e., an event that could affect a company's earnings by at least three percent, under the federal retention schedule, the documentation at issue had a "permanent" retention designation. As a result, plaintiff contends that the records must exist because they should have been retained under the retention schedule.
Assuming that plaintiff is correct regarding the retention requirements for the documents at issue in this case, FOIA is not the source of those requirements and does not independently impose a retention obligation on the agency.
Even if the agency failed to keep documents that it should have kept, that failure would create neither responsibility under FOIA to reconstruct those documents nor liability for the lapse. Klunzinger, 27 F. Supp.2d at 1022; Yeager v. Drug Enforcement Admin., 678 F.2d 315, 321 (D.C. Cir. 1982).
Plaintiff has shown no bad faith on the part of the agency. See Miller 779 F.2d at 1384 (to disprove agency affidavits, plaintiff must contradict defendant's account of the search procedure or raise evidence of bad faith). Indeed, her own affidavits demonstrate extensive contacts with agency employees suggesting alternative places to search for the requested information, which apparently were pursued by the agency.
Plaintiff has not suggested any search of agency records that has not been conducted.
Plaintiff next suggests that the Harris Bank presumably retains copies of the portfolio spreadsheets and that, because the Board "improperly" failed to keep their own copies, the Board should be required to obtain a new copy from the Harris Bank. As plaintiff acknowledges, however, in order to trigger the agency obligation to produce under FOIA, the requested documents must be in the agency's control at the time the FOIA request is made. See United States Department of Justice v. Tax Analysts, 492 U.S. 136, 145 (1989). Plaintiff claims, however, that records are within the "control" of the agency when they have been created or obtained by the agency in its official capacity. Id. (reiterating that not all documents possessed by agency employees are documents within the "control" of the agency; documents in the possession of agency employees are only within the control of the agency when they are created or obtained by the agency in the conduct of its official duties). As a result, plaintiff reasons, once the agency has at some time come into FOIA "control" of the document and later misplaced or destroyed that document, the agency has an obligation to replace the document to meet a FOIA request.
Plaintiff's construction is at odds with the requirement that "the agency must be in control of the requested materials at the time the FOIA request is made." Id. (emphasis added). The Supreme Court has recognized that "Congress did not believe that an agency `withholds a document which has been removed from the possession of the agency prior to the filing of the FOIA request.'" Id. at 148 (quoting Kissinger, 445 U.S. at 150-51). "The Act does not obligate agencies to . . . retain documents; it only obligates them to provide access to those which it in fact has . . . retained." Kissinger, 445 U.S. at 152. If the Board is no longer in possession of the documents, nothing in FOIA requires the agency to obtain those documents from the private institution, regardless of plaintiff's desire for — or even need of — the documents. The Board's refusal to obtain the requested documents does not amount to "withholding agency records" within the meaning of FOIA. 5 U.S.C. § 552(a)(4)(B).
Plaintiff next objects that the magistrate judge erred in refusing to disclose four memorandums submitted to the court for in camera review. Plaintiff contends that based on telephone conversations with Board staff members Barbara Baldwin and Robert Friedman, the four memorandums at issue specifically referred to the portfolio spreadsheets and therefore should have been released as responsive to the FOIA request. She therefore contends that the magistrate judge erroneously concluded that the portfolio spreadsheets were not referenced in the memorandums.
This court has conducted an independent review of the in camera documents and finds no error in the magistrate judge's conclusions. The memorandums do not mention the portfolio spreadsheets or in any way attest to the existence of those spreadsheets.
II. CONCLUSION
Having reviewed each of plaintiff's objections to the R R; and finding them to be without merit, the R R; is ADOPTED as the opinion of this court and plaintiff's complaint is DISMISSED WITH PREJUDICE.