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Nature of Suit Code: 895
Nature of Suit: Freedom of Information Act of 1974
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued March 17, 2003 Decided May 2, 2003

No. 02-5154

JUDICIAL WATCH, INC.,

APPELLANT

v.

CHARLES O. ROSSOTTI,

COMMISSIONER, INTERNAL REVENUE SERVICE AND

DEPARTMENT OF TREASURY,

APPELLEES

Appeal from the United States District Court

for the District of Columbia

(No. 01cv01612)

–————

Larry E. Klayman argued the cause and filed the briefs

for appellant.

Gretchen M. Wolfinger, Attorney, U.S. Department of Justice, argued the cause for appellee. With her on the brief

 Bills of costs must be filed within 14 days after entry of judgment.

The court looks with disfavor upon motions to file bills of costs out

of time.

USCA Case #02-5154 Document #747209 Filed: 05/02/2003 Page 1 of 11
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were Roscoe C. Howard, Jr., U.S. Attorney, and Jonathan S.

Cohen, Attorney, U.S. Department of Justice.

Before: SENTELLE, HENDERSON and TATEL, Circuit Judges.

Opinion for the Court filed by Circuit Judge TATEL.

TATEL, Circuit Judge: Appellant, a non-profit organization,

argues that it qualifies for a fee waiver under the Freedom of

Information Act because disclosure of the requested documents regarding a conflict-of-interest waiver received by the

Commissioner of the Internal Revenue Service would serve

the ‘‘public interest.’’ The district court thought appellant’s

request too ‘‘general and formulaic’’ to satisfy FOIA. We

disagree. Following Congress’s directive that FOIA’s fee

waiver requirement be liberally construed, and finding appellant’s request both reasonably specific and non-conclusory—

all that our case law requires—we reverse.

I.

Intended to ‘‘ensure an informed citizenry, vital to the

functioning of a democratic society, needed to check against

corruption and to hold the governors accountable to the

governed,’’ NLRB v. Robbins Tire & Rubber Co., 437 U.S.

214, 242 (1978), the Freedom of Information Act requires

federal agencies to disclose information upon request unless

the statute expressly exempts the information from disclosure. 5 U.S.C. § 552 et seq. Although requesters must pay

reasonable charges associated with processing their requests,

5 U.S.C. § 552(a), FOIA section 552(a)(4)(A)(iii) requires

agencies to waive fees for requesters able to demonstrate that

‘‘disclosure of the information is in the public interest.’’ Requesters may seek judicial review of denials of fee waivers

only after exhausting specified administrative remedies. 5

U.S.C. § 552(a)(6)(A)(i), (ii); Oglesby v. U.S. Dep’t of the

Army, 920 F.2d 57, 61–62 (D.C. Cir. 1990) (holding that FOIA

administrative exhaustion requirement is jurisdictional). A

requester is considered to have constructively exhausted administrative remedies and may seek judicial review immediately if (with one exception not relevant here) the agency fails

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to answer the request within twenty days. 5 U.S.C.

§ 552(a)(6)(c). If the agency responds to the request after

the twenty-day statutory window, but before the requester

files suit, the administrative exhaustion requirement still applies. Oglesby, 920 F.2d at 64–65.

On June 6, 2001, appellant, Judicial Watch, Inc., ‘‘a nonprofit, non-partisan, public interest organization committed to

fighting corruption by government officials,’’ Appellant’s Br.

at 2, sent virtually identical FOIA requests to the Internal

Revenue Service and the Department of the Treasury. The

two requests sought information about former Internal Revenue Service Commissioner Charles Rossotti’s relationship

with American Management Systems, Inc., a company he cofounded and in which he retained stock; the company’s

contract with the IRS; and Rossotti’s receipt of a conflict-ofinterest waiver from Treasury. Specifically, the letters requested information concerning:

1. IRS Commissioner Charles O. Rossotti’s December 11, 2000 waiver, executed by former Deputy

Treasury Secretary Stuart Eizenstadt, concerning

the ‘‘Custodial Accounting Project’’ (hereinafter

‘‘CAP’’).

2. IRS Commissioner Charles O. Rossotti and

American Management Systems, Inc. (hereinafter

‘‘AMS’’).

3. Decision(s) concerning CAP that have or would

have a direct and predictable effect on IRS Commissioner Charles O. Rossotti’s financial interest in

AMS.

4. The decision to grant IRS Commissioner

Charles O. Rossotti a conflict-of-interest waiver on

December 11, 2000.

5. Communications between IRS Commissioner

Charles O. Rossotti, former Deputy Treasury Secretary Stuart Eizenstadt, and/or former Treasury Department Assistant General Counsel Kenneth

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Schmalzbach concerning the December 11, 2000 conflict-of-interest waiver and/or CAP, and/or AMS.

6. The decision to grant AMS the contract for an

automated financial management system and software supporting CAP.

Claiming that disclosing such information would serve the

‘‘public interest,’’ 5 U.S.C. § 552(a)(4)(A)(iii), Judicial Watch

sought a fee waiver in connection with each request. The

IRS replied by letter dated July 5. Without addressing the

fee waiver request, the July 5 letter asked Judicial Watch for

additional time to respond. The letter explained that if

Judicial Watch did not agree to the extension, the organization could seek judicial review. Judicial Watch never answered.

Treasury responded to Judicial Watch’s fee waiver request

with multiple letters, only two of which are relevant here. By

letter dated July 10, Treasury asked for additional information from Judicial Watch regarding its waiver request. Judicial Watch never replied, so on August 10, Treasury informed

Judicial Watch that its request would be deemed withdrawn

within thirty days unless it complied with Treasury’s advance

fee payment requirement. Again, Judicial Watch did not

respond, and Treasury administratively closed the matter.

On July 25, Judicial Watch filed suit in the U.S. District

Court for the District of Columbia seeking to compel the two

agencies to grant fee waivers. In an opinion addressing both

fee waiver requests, the district court granted summary

judgment for the IRS and dismissed the complaint against

Treasury. Judicial Watch v. Rossotti, No. 01–1612 (D.D.C.

Mar. 18, 2002). With respect to Treasury, the court found

that Judicial Watch failed to exhaust its administrative remedies because the Department’s July 10 letter, sent before

Judicial Watch filed suit, constituted a substantive response.

Addressing the merits of the IRS request, the district court

characterized Judicial Watch’s June 6 letter as ‘‘general and

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formulaic,’’ finding that it fell ‘‘far short’’ of demonstrating

that release of the information would be in the public interest.

Id., mem. op. at 8.

Judicial Watch appeals. We review the district court’s

decision to grant summary judgment and to dismiss the

complaint de novo. Trifax Corp. v. Dist. of Columbia, 314

F.3d 641, 643 (D.C. Cir. 2003). We also review de novo an

agency’s denial of a fee waiver request, but our review is

‘‘limited to the record before the agency.’’ 5 U.S.C.

§ 552(a)(4)(A)(vii).

II.

Judicial Watch challenges the district court’s grant of summary judgment to the IRS and dismissal of its complaint

against Treasury. The government defends the district

court’s reason for granting summary judgment to the IRS,

but offers a new justification for dismissing the complaint

against Treasury. See Dimond v. Dist. of Columbia, 792

F.2d 179, 187 (D.C. Cir. 1986) (noting that appellate court can

consider any argument on appeal that supports the district

court’s judgment). Citing Treasury regulations providing

that FOIA’s twenty-day time limit does not apply to requests

that fail to ‘‘conform in every respect’’ to the department’s

regulations, 31 C.F.R. § 1.5(a)(1), and that requests are only

‘‘considered to have been received on the date on which a

complete request TTT has been received,’’ id. at § 1.5(f), the

government argues that Judicial Watch failed to constructively exhaust its administrative remedies both because FOIA’s

twenty-day statutory window did not apply to its nonconforming request and because Judicial Watch’s incomplete request

was never considered to be ‘‘received.’’ According to the

government, our disposition of Judicial Watch’s case against

Treasury therefore turns on the adequacy of its June 6 letter:

If the letter did not demonstrate Judicial Watch’s eligibility

for a fee waiver, then Treasury had no obligation to respond

and Judicial Watch failed to exhaust its administrative remedies; but if Judicial Watch qualified for a fee waiver, then it

constructively exhausted its administrative remedies because

Treasury did not respond substantively within twenty days.

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Given the district court’s reason for granting summary judgment to the IRS—that Judicial Watch failed to qualify for a

fee waiver—both cases now turn on whether the June 6

letters demonstrate that disclosure of the information would

serve the ‘‘public interest.’’ 5 U.S.C. § 552(a)(4)(A)(iii).

In order to demonstrate that a FOIA request is in the

public interest, and therefore eligible for a fee waiver, the

requester must show that disclosure of the information ‘‘is

likely to contribute significantly to public understanding of

the operations or activities of the government and is not

primarily in the commercial interest of the requester.’’ 5

U.S.C. § 552(a)(4)(A)(iii). Because the government does not

argue that the requests serve Judicial Watch’s ‘‘commercial

interests,’’ this case turns on whether disclosure of the information is ‘‘likely to contribute significantly to public understanding of the [government’s] operations or activities.’’ On

this issue, the IRS’s implementing regulation essentially repeats the statute’s language and includes the following nonexclusive list of factors the agency ‘‘shall consider’’:

(A) Whether the subject of the releasable records

concerns the agency’s operations or activities;

(B) Whether the releasable records are likely to

contribute to an understanding of the agency’s operations or activities;

(C) Whether the releasable records are likely to

contribute to the general public’s understanding of

the agency’s operations or activities (e.g., how will

the requester convey the information to the general

public);

(D) The significance of the contribution to the general public’s understanding of the agency’s operations or activities (e.g., is the information contained

in the releasable records already available to the

general public).

26 C.F.R. § 601.702(f)(2)(ii). Though phrased somewhat differently, Treasury’s fee waiver regulation, 28 C.F.R.

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§ 16.11(k)(2)(i)-(iv), is substantively identical, and the parties

agree that our resolution of the IRS fee waiver request will

therefore dispose of the Treasury request as well.

Under well-established case law, fee waiver requests must

be made with ‘‘reasonable specificity,’’ Larson v. C.I.A., 843

F.2d 1481, 1483 (D.C. Cir. 1988) (per curiam) (internal quotation marks and citation omitted), and based on more than

‘‘conclusory allegations,’’ Nat’l Treasury Employees Union v.

Griffin, 811 F.2d 644, 647 (D.C. Cir. 1987). We are also

mindful that Congress amended FOIA to ensure that it is

‘‘ ‘liberally construed in favor of waivers for noncommercial

requesters.’ ’’ McClellan Ecological Seepage Situation v.

Carlucci, 835 F.2d 1282, 1284 (9th Cir. 1987) (quoting 132

CONG. REC. 27,190 (1986) (Sen. Leahy)).

In support of its fee waiver request to the IRS, Judicial

Watch stated in its June 6 letter:

Judicial Watch is a 501(c)(3) not-for-profit public

interest organization. One of its purposes is to

provide the public with information which exposes

government activities that are contrary to law. Judicial Watch is, in effect, an educational foundation,

as well as a law firm, which uses several mechanisms

for the dissemination of the information it acquires,

and operates to ensure that this information will be

made available to the public on a daily basis.

After listing the multiple mechanisms Judicial Watch employs

to disseminate information it obtains under FOIA, the letter

explains that ‘‘there is an unequivocal public interest served

by revealing the aforementioned documents’’; ‘‘[t]he American people should be made aware of, among other things,

reports, investigations, decisions, waivers and findings of fact

concerning conflicts-of-interest by high government officials

and heads of various agencies and departments, in this case,

IRS Commissioner Charles O. Rossotti’’; and ‘‘[r]elease of

the information will promote confidence in our Constitutional

Republic, and contribute to furthering the integrity of the

American national government by deterring and/or sanctioning corrupt activities.’’

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The government argues that Judicial Watch’s ‘‘justification

for a fee waiver consisted primarily of vague, conclusory

statements that were not sufficiently specific for the IRS to

determine whether a fee waiver was warranted.’’ Appellees’

Br. at 11. In particular, the government argues that Judicial

Watch’s request fails each of the four factors the agency uses

to assess fee waiver requests. Because the government has

organized its brief around these factors, we will organize our

analysis around them as well. In doing so, however, we

emphasize that we owe no particular deference to the IRS’s

interpretation of FOIA. Tax Analysts v. Commissioner, 117

F.3d 607, 613 (D.C. Cir. 1997) (noting that court ‘‘will not

defer to an agency’s view of FOIA’s meaning’’).

Beginning with the first factor—that the request ‘‘concerns

the Agency’s operations or activities’’—we disagree with the

government’s contention that Judicial Watch failed to ‘‘specifically identify the operations or activities of the IRS to which

its FOIA request pertained.’’ Appellees’ Br. at 22. With

‘‘reasonable specificity’’—all that FOIA requires, Larson, 843

F.2d at 1483—Judicial Watch sought documents regarding

specified ‘‘operations and activities’’ of the IRS, i.e., a conflictof-interest waiver executed by the Deputy Treasury Secretary for the Commissioner of the IRS, the Commissioner’s

relationship with a private company doing business with the

IRS, and decisions by the IRS involving the private company.

See supra p. 4. We cannot imagine what else Judicial Watch

could have said to satisfy the government’s appetite for

specificity.

Nor do we see how Judicial Watch’s request fails to ‘‘contribute to the public’s understanding of the agencies’ operations,’’ the regulation’s second factor. What could be more

important to the public’s understanding of IRS operations

than knowing whether its commissioner awarded a government contract to a company he co-founded and in which he

held stock? The government argues that ‘‘Judicial Watch

stated nothing about the informative value of the information

it requested,’’ Appellees’ Br. at 23, but the June 6 letter

specifically explains that ‘‘the public is always well served

when it knows how government activities, particularly matUSCA Case #02-5154 Document #747209 Filed: 05/02/2003 Page 8 of 11
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ters touching on legal and ethical questions, have been conducted,’’ and that ‘‘the information requested will be meaningfully informative in increasing public understanding of the

IRS commissioner’s involvement and interest in lucrative

government contracts.’’ At oral argument, government counsel complained that Judicial Watch provided no evidence that

Rossotti actually had a conflict of interest. That may be true,

but the question here is not whether Rossotti had such a

conflict, but whether disclosure of the requested documents is

likely to contribute to public understanding of IRS operations—a goal that disclosure will promote regardless of what

the documents reveal. Contrary to the implications of the

government’s argument, the American people have as much

interest in knowing that key IRS decisions are free from the

taint of conflict of interest as they have in discovering that

they are not.

Claiming that Judicial Watch failed to satisfy the third

factor, the government argues that the organization never

‘‘state[d] that it intends to disseminate the information it has

requested, and more importantly, how it intends to do so.’’

Appellees’ Br. at 23–24 (citing 26 C.F.R. § 601.702(f)(2)(ii)(C)

(requesters must demonstrate how they will ‘‘convey the

information to the general public’’)). In fact, however, the

June 6 letter not only explains that Judicial Watch’s mission

is obtaining information under FOIA, but also lists nine ways

in which it communicates collected information to the public:

press releases; a newsletter with a monthly circulation of

‘‘over 300,000 copies nationwide’’; a website on which people

can view copies of documents and that has ‘‘logged up to

1,000,000 visitors in a single day’’; an ‘‘Infonet’’ listserve with

‘‘over 60,000 subscribe[rs]’’ who receive daily updates on

Judicial Watch lawsuits, FOIA requests, and investigations;

congressional testimony; a nationally syndicated news and

information television show Judicial Watch helps to produce;

a Judicial Watch-produced weekly radio program which ‘‘airs

nationwide on thirty-six radio stations and the Internet’’;

appearances by Judicial Watch employees on television and

radio programs; and conferences organized by Judicial

Watch. Judicial Watch might have added that it will use

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these methods to publicize any information it obtains from

this request, but the government points to nothing in FOIA,

the IRS regulation, or our case law requiring such pointless

specificity.

Judicial Watch’s request contains considerably more detail

regarding its ability to publicize disclosed information than

did the defective request at issue in Larson v. C.I.A. In that

case, we upheld a CIA fee waiver denial where, although the

requester stated that he intended to distribute collected

information to a newspaper, he ‘‘failed to identify the newspaper company to which he intended to release the requested

information, his purpose for seeking the requested material,

or his professional or personal contacts with any major newspaper companies.’’ Larson, 843 F.2d at 1483. By contrast,

Judicial Watch has explained, in detailed and non-conclusory

terms—again, all that FOIA requires—exactly how and to

whom it will disseminate the information it receives.

Finally, addressing the fourth factor, the government argues that Judicial Watch failed to show whether ‘‘the information contained in the releasable records [is] already available

to the general public.’’ 26 C.F.R. § 601.702(f)(2)(ii). According to the government, ‘‘[i]t is clear TTT that at least some of

the information is public[ ] because Judicial Watch states that

its request is based on news articles concerning the conflict of

interest waiver.’’ Appellees’ Br. at 24 n.13. Although the

June 6 letter does say that ‘‘this request is based, in part, on

news articles by Mr. John Berlau that were reported in

Insight Magazine,’’ and although that article reports that

‘‘Insight has obtained a copy of that waiver,’’ nothing in the

record before us suggests that the waiver has been disclosed

to anyone other than Insight. Moreover, Judicial Watch

seeks considerably more than the waiver itself. Its June 6

letter requests ‘‘correspondence, memoranda, documents, reports, records, statements, audits, lists of names, applications,

diskettes, letters, expense logs and receipts, and calendar or

diary logs’’ relating to Rossotti’s alleged conflict of interest

and Treasury’s decision to grant him a conflict-of-interest

waiver.

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At oral argument, counsel for Judicial Watch asserted that

the government’s response to its waiver request amounted to

just the sort of ‘‘roadblock[ ] and technicalit[y]’’ that led

Congress to liberalize the fee waiver provision. 132 CONG.

REC. 31,415 (1986) (Sen. Leahy). We cannot disagree. Because Judicial Watch’s June 6 request demonstrates with

reasonable specificity that disclosure of the information

sought will serve the public interest, we reverse the district

court’s grant of summary judgment to the IRS and, for the

same reason, its dismissal of the complaint against Treasury.

So ordered.

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