UNITED STATES DISTRICT COURT FORTHE DISTRICT OF COLUMBIA SECURITIES & EXCHANGE COMMISSION, Plaintiff,


### v. AMERICAN INTERNATIONAL GROUP, INC., Defendant. CivilAction No. 04-2070 (GK)

MEMORANDUM ORDER This civil action brought by the Securities and Exchange Commission ('•SEC") against the American International Group ("AIG") under the Securities Act of 1933, 15 U.S.C. § 77a et seq., the Securities Exchange Act of 1934, 15 U.S.C. § 78a et seq., and Rules promulgated pursuant to the Securities Exchange Act, is now before the Court on Sue Reisinger•s Second Motion Seeking Release ofReports and Notifications ofthe Independent Consultant [Dkt. No. 33]. Upon consideration ofthe Motion, the Opposition, and the Reply, the Court concludes that Ms. Reisinger•s Motionmustbe denied. I. BACKGROUND On November 30, 2004, the SEC filed a Complaint against AIG, alleging violations of federal securities laws [Dkt. No. 1]. On the same date, the SEC submitted to the Court the Consent ofDefendant American International Group, Inc. ("Consent Order" [Dkt. No. 1-1]. In this document, AIG consented to entry of Final Judgment without admitting or denying the allegations of the Complaint. The Court entered Final Judgment, incorporating the Consent Order, onDecember7, 2004 [Dkt. No.2].Under the terms ofthe Consent Order, AIG agreed to take on two main responsibilities. First, AIG consented to establish a Transaction Review Committee to reviewtransactions taking place afterthe entry ofFinal Judgment. The Committee was charged with setting up procedures to identify transactions that would involve heightened legal, reputational, or regulatory risk. Under the Consent Order, these transactions require review and approval by the Committee before theycanbe completed. Second, AIG agreed to retain an independent consultant, selectedbythe Fraud Section of the Department of Justice and acceptable to the SEC, to review the Transaction Review Committee's policies and procedures as well as all transactions that AIG entered into between January 1, 2000, and the date ofthe Final Judgment and that had "aprimary purpose ofenabling
a Reporting Company to obtain an accounting or financial reporting result." Consent Order**~** 3a.l. The purpose ofthe review ofpast transactions was for the Independent Consultant to determine whether they were used or designed to permit counter-parties to violate generally accepted accounting principles ("GAAP") or rules promulgated bythe SEC. These transactions formed thebasis ofthe SEC's Complaint. At the conclusion ofhis or her review, the consultant was required to provide copies of reports ofhis or her findings ("IC Reports") to the SEC, the DOJ, and AIG's Audit Committee. AIG was thenrequiredto implement all reasonable recommendations made by the consultant. If AIG violated certain designated provisions ofthe Consent Order, the SEC was permitted to petitionthe Courtto vacate the Final Judgment and restore the actionto its active docket, i.e., to proceed with litigating the Complaint. Further, the Court retainedjurisdiction over the case in orderto enforce all terms ofthe FinalJudgment, includingprovisions relatedto the IC Reports.

2More than a year and a half later, on June 14, 2006, the SEC and AIG filed a Joint Motion for Clarification of Consent of American International Group, Inc. ("Joint Mot. for Clarification") [Dkt. No. 3]. According to this JointMotion, "[i]t was notthe parties' intent that [the informationprovidedby AIG to the independent consultant] be disseminated or available to anyone outside of the entities identified in the Consent." Joint Mot. for Clarification 3. Accordingly, the SEC and AIG requested thatthe Court "clarify" the Consent Orderby adding a provisionprohibitingpublic dissemination ofthe IC Reports. The Court granted the Joint Motion for Clarification on June 14, 2006 [Dkt. No. 4]. Since thattime, the Courthas twice granted requests to release IC Reports: once on October 23, 2007, to the Office ofThrift Supervision at the request ofthe SEC and AIG [Dkt. No. 8], and
once onMay 4, 2009, to the House ofRepresentatives Committee on Oversight and Government Reform atthe request ofthe SEC [see Dkt. No. 11]. II. ANALYSIS AIG argues that resjudicata precludes Reisinger from relitigating her claims for release oftheIC's Reports. 1 In Sheptock v. Fenty, 707 F.3d 326, 330, the Court ofAppeals noted that "'The federal courts have traditionally adhered to the doctrine[]
... ofresjudicata' Allen v. McCurry, 449 U.S. 90, 94 (1980)." "Under the doctrine of claim preclusion, a final judgment forecloses 'successive litigation ofthe very same claim, whether or not relitigation ofthe claim raises the
same issues as the earlier suit."' Taylor v. Sturgell, 553 U.S. 880, 892 (2008) (quoting New Hampshire v. Maine, 532 U.S. 742, 748 (2001)). As recently as 2011, the Supreme Court ruled that "the now-acceptedtestinpreclusion-lawfor determining whethertwo suits involvethe same

1 The SEC has notfiled any Oppositionto thependingMotion. 3claim or cause of action depends on factual overlap, barring 'claims arising from the same transaction."' United States v. Tohono O'OdhamNation, 131 S.Ct. 1723, 1730 (2011). Claimpreclusion applies "'ifthere has beenprior litigation (1) involving the same claims
or cause ofaction, (2) between the same parties or their privies, and (3) there has been a final, valid judgment on the merits, (4) by a court of competent jurisdiction."' Natural Res. Def. Council v. E.P.A., 513 F.3d257, 260 (D.C. Cir. 2008) (quoting Smalls v. United States, 471 F.3d 186, 192 (D.C. Cir. 2006)). Reisinger's Motion fits squarely within the requirements for application of the claim preclusion doctrine. First, her Motion involves the same claims or cause ofaction as did her priormotion, namely, herrightto access to the IC Reports. Second, herMotion is being litigated by the same parties who litigated her first motion: namely, Defendant AIG and Reisinger? Third and fourth, there has been a final, validjudgment on the merits by a court ofcompetent jurisdiction since, in SEC v. American Int'l Group, 712 F.3d 1, 3 (nC. Cir. 2013), our Court of Appeals ruled that the documents Reisinger sought in her first motion were "notjudicial records subject to the [common law] right ofaccess". The decision ofour Court ofAppeals was a final
one and obviouslythe CourtofAppeals is "a court ofcompetentjurisdiction." Reisinger argues that "[t]he parties are not identical, no courthas yet consideredthe issue at bar

-- thus, no judgment has been made on the merits and the pending motion presents no
cause ofaction, much less one previously litigated by these parties." Mot. at 2. It is hard to understand what this sentence means. Reisinger's cause ofaction is for access to the Reports of AIG's IC. That was the issue litigated in her first motion

-- and she lost. She presents no

2 The only difference between the two Motions as to the identity ofparties is that the SEC has chosen not to join AIG's Opposition. The SEC made a different choice regarding the first motion, whenit filed ajointoppositionwithAIG. The absence ofthe SEC onthis Motionmakes no substantive difference inthe applicability ofresjudicata
. . 4additional facts or case lawthat in any way differentiates her cause ofaction inthis Motion from her cause of action in her first motion. "[A] 'cause of action' is determined by the factual nucleus, notthe theory on which aplaintiffrelies
. . . Ifthere is a commonnucleus offacts, then the actions arise out ofthe same cause of action
..." Sheptock, 703 F.3d at 330 (quoting Faulkner v. GEICO, 618 A.2d 181, 183 (D.C. 1992). There is a common, indeed, an identical, nucleus offacts inReisinger'stwo Motions and, therefore, the same cause ofaction exists inboth Motions. The only difference between the two Motions is that Reisinger is presenting a legal theory in the second Motion that she could have, but failed, to raise in her first motion. "'There is an identity ofthe causes of action when the cases are based on the 'same nucleus offacts' because 'it is the facts surrounding the action or occurrence which operate to constitute the cause of action, not the legal theory on which a litigant relies."' Capitol Hill Group v. Pillsbury, Winthrop, Shaw, Pittman, LLC, 569 F.3d 485, 490 (D.C. Cir. 2009) (quoting Page v. United States, 729 F.2d 818, 820 (D.C. Cir. 1984)). In Natural Res. Def. Council v. E.P.A., 513 F.3d at 261, the Court of Appeals emphasized that "claim preclusion is also intended 'to prevent litigation ofmatters that should have been raised in an earlier suit"' (citation omitted) (emphasis in original). In short, Reisinger had the option to raise her "good cause" argument in her first motion for access to the IC documents and failed to do so. That failure to raise an argument which could have been litigated in an earlier proceeding is covered by the claim preclusion doctrine. "[R]esjudicata
... bars relitigation not only ofmatters determined in a previous litigation but also ones that a party could have raised[.]" Natural Res. Def. Council v. Thomas, 838 F.2d 1224, 1252 (D.C. Cir. 1988). As the Court said inNatural Res. Def. Council v. E.P.A.,

5513 F.3d at 261, "[t]he two [motions] simply offer different legal theories to support the same claim[.]" For all thesereasons, the CourtconcludesthatMs. Reisinger's Motionis denied.

Mayi£, 2013

# GladysKes~ United States 1stnctJudge CopiesviaECFto all counsel ofrecord

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