Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_05-cv-04760/USCOURTS-cand-4_05-cv-04760-0/pdf.json

Parties Involved:
Gregory J. Laroche
Plaintiff
United States Securities and Exchange Commission
Defendant

Document Text:

United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

GREGORY J. LAROCHE,

Plaintiff,

v.

U.S. SECURITIES AND EXCHANGE

COMMISSION,

Defendant.

 /

No. C 05-4760 CW

ORDER GRANTING

PLAINTIFF'S

MOTION TO

CONTINUE SUMMARY

JUDGMENT

PROCEEDINGS

Plaintiff Gregory LaRoche moves pursuant to Federal Rule of

Civil Procedure 56(f) for a continuance of summary judgment

proceedings. Defendant United States Securities and Exchange

Commission opposes the motion. The matter was taken under

submission on the papers. Having considered all of the papers

filed by the parties, the Court grants Plaintiff's motion.

BACKGROUND

In this lawsuit, Plaintiff seeks to obtain certain agency

records which he has requested under the Freedom of Information Act

(FOIA). Specifically, Plaintiff seeks an electronic version of

data fields from records of Uniform Broker-Dealer Applications

("Forms BD"), which are submitted electronically by Broker-Dealers

to Defendant. Form BD information is collected in the Central

Case 4:05-cv-04760-CW Document 36 Filed 06/29/06 Page 1 of 6
United States District Court

For the Northern District of California

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Registration Depository (WebCRD), a proprietary system of the

National Association of Securities Dealers, Inc. (NASD). Plaintiff

also challenges the adequacy of Defendant's search in response to a

subsequent FOIA request for documents pertaining to any arrangement

between Defendant and NASD. 

Prior to their summary judgment briefing, the parties agreed

that "no discovery is necessary at this time to fully resolve the

issues in this case, while fully reserving the right to request

limited discovery in the event that any unanticipated significant

new information is presented in the parties' respective Cross

Motions for Summary Judgment in this action." March 17, 2006 Joint

Case Management Statement at 3. Plaintiff filed a motion for

summary judgment on March 24, 2006, and Defendant filed an

opposition and cross-motion on April 14, 2006. 

In its cross-motion for summary judgment, Defendant stated

that it could not provide Plaintiff with the electronic records he

seeks because SEC staff does not "have the capability to

manipulate, download or electronically save information from

WebCRD" and can "only print the entire Form BD from WebCRD in hard

copy." Pearsall Decl. ¶¶ 6-7. A NASD representative declares,

"NASD permits free use of Web CRD® by regulators only for

regulatory purposes." Cummings Decl. ¶ 6. Daniel J. Stotter,

counsel for Plaintiff, declares that these statements do not

adequately describe "the specific factual nature of the SEC's

impediments or limitations to providing these agency records in

electronic format." Stotter Decl. ¶ 3. 

With respect to Plaintiff's second FOIA claim, Defendant

Case 4:05-cv-04760-CW Document 36 Filed 06/29/06 Page 2 of 6
United States District Court

For the Northern District of California

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maintains that it conducted an adequate search and produced all

responsive documents. In support of this assertion, Celia Winter,

SEC FOIA Officer, explained the various offices and divisions that

were queried. Winter Decl. ¶ 8. She also declares that SEC staff

"followed the standard protocol employed by the FOIA Office in

search for records at the Commission," including providing a

referral memorandum and a copy of Plaintiff's request to each

office queried. Id. ¶ 9. Mr. Stotter declares that Plaintiff

requires "additional factual information in order to evaluate the

generalized assertions by Defendant SEC as to the 'adequacy' of its

search," including the "nature of the search that was undertaken"

or the "search terms used by said offices to look for all records

responsive to plaintiff's FOIA request." Stotter Decl. ¶ 5. 

In order to address these issues, Plaintiff seeks a sixty-day

stay of summary judgment proceedings to allow the following

additional fact discovery: 

limited requests for admissions, requests for production, and

limited telephonic depositions of Defendant's Declarants,

James J. Cummings, Seretha Pearsall, and Celia Winter, solely

as to the issues of: (1) the nature of any fact based

impediments to providing Plaintiff with the electronic data

format he has requested for the SEC Form BD fields sought by

Plaintiff's April 6, 2005 FOIA request, and (2) the nature of

the SEC's search methods and search terms utilized in

responding to Plaintiff's September 29, 2005 FOIA request.

Pl.'s R. 56(f) Mot. at 2. 

LEGAL STANDARD

Rule 56(f) provides that:

Should it appear from the affidavits of a party opposing the

motion that the party cannot for reasons stated present by

affidavit facts essential to justify the party's opposition,

the court may refuse the application for [summary] judgment or

may order a continuance to permit affidavits to be obtained or

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United States District Court

For the Northern District of California

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depositions to be taken or discovery to be had or may make

such other order as is just.

This rule should be applied with a spirit of liberality to prevent

injustice to the party facing summary judgment. See 10B Wright &

Miller, Fed. Practice & Proc., § 2740, p. 402 (West 1998); First

Chicago Int'l v. United Exchange Co., 836 F.2d 1375, 1380 (D.C.

Cir. 1988). Parties seeking a continuance must show "(1) that they

have set forth in affidavit form the specific facts that they hope

to elicit from further discovery, (2) that the facts sought exist,

and (3) that these sought-after facts are 'essential' to resist the

summary judgment motion." State of Cal. v. Campbell, 138 F.3d 772,

779 (9th Cir. 1998); see also Continental Maritime of San Francisco

v. Pacific Coast Metal Trades Dist. Council, Metal Trades Dep’t,

AFL-CIO, 817 F.2d 1391, 1395 (9th Cir. 1987) (noting that party

seeking a continuance bears the burden to show specific facts it

hopes to discover; "mere hope that further evidence may develop" is

insufficient). Denial of a Rule 56(f) application is proper "where

it is clear that the evidence sought is almost certainly

nonexistent or is the object of pure speculation." Terrell v.

Brewer, 935 F.2d 1015, 1018 (9th Cir. 1991). 

DISCUSSION

The Court finds that Mr. Stotter's declaration is sufficient

to support Plaintiff's request for a continuance under Rule 56(f). 

With respect to Plaintiff's first FOIA claim, relating to his

request for electronic Form BD data, the Pearsall and Cummings

Declarations demonstrate ambiguity regarding the reasons

(technological or contractual) why Defendant cannot provide

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United States District Court

For the Northern District of California

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Plaintiff with electronic information as requested. A clearer

answer to that question may enable Plaintiff to refute Defendant's

assertion in its brief that it does not have access to responsive

electronic information. 

 With respect to the second FOIA claim, relating to information

about an arrangement between the SEC and NASD, Plaintiff's desire

to discover the nature of the search conducted and the terms used

is a sufficiently specific request under Rule 56(f). Defendant's

assertion that the Winter Declaration provides "both the nature of

the search and the search terms" mischaracterizes that declaration,

which did not state which terms were used to search for information

responsive to Plaintiff's request. Information about the search is

essential to opposing Defendant's motion for summary judgment. 

The fact that Plaintiff previously believed that he had all

the necessary information to proceed to summary judgment does not

preclude his current position, having received Defendant's crossmotion, that discovery is needed. 

CONCLUSION

For the foregoing reasons, Plaintiff's motion for a sixty-day

continuance is GRANTED (Docket No. 27). Plaintiff's opposition to

Defendant's motion for summary judgment shall be due on September

1, 2006, and Defendant may file any reply one week later. The

Court will take the matters under submission on the papers. 

IT IS SO ORDERED.

Dated: 6/29/06 

CLAUDIA WILKEN

United States District Judge

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