Court Opinion

ID: 4160191
Source: CourtListenerOpinion
Date Created: 2017-04-13 18:01:04.912637+00
Date Added: 2024-06-11T07:46:46.377479
License: Public Domain

UNITED STATES DISTRICT COURT
                   FOR THE DISTRICT OF COLUMBIA
______________________________
                               )
U.S. DEPARTMENT OF THE         )
TREASURY,                      )
                               )
           Petitioner,         )
                               )
     v.                        )   Case No. 12-mc-100 (EGS)
                               )
PENSION BENEFIT GUARANTY       )
CORPORATION,                   )
                               )
           Interested Party, )
                               )
     v.                        )
                               )
DENNIS BLACK, et al.,          )
                               )
          Respondents.         )
______________________________)

                       MEMORANDUM OPINION

     Pending before the Court are the U.S. Department of

Treasury’s contested privilege assertions that were not resolved

by the Court’s December 20, 2016 Opinion ordering Treasury to:

(1) produce all documents over which it asserted the

deliberative process privilege in isolation; and (2) submit a

revised privilege log and in camera production. Upon

consideration of Respondents’ motion to compel, response and

reply thereto, the relevant caselaw, the in camera production

and the entire record, and for the reasons set forth below, the

                                1
unresolved portion of the motion is GRANTED in part and DENIED

in part.

     I.    BACKGROUND

     Respondents in this miscellaneous action are plaintiffs in

Black v. PBGC, Case No. 09-13616, a civil action pending in the

United States District Court for the Eastern District of

Michigan. Respondents are current and former salaried workers at

Delphi Corporation (“Delphi”), an automotive supply company. In

the civil action, Respondents allege that in July 2009, the

Pension Benefit Guaranty Corporation (“PBGC”) improperly

terminated Delphi’s pension plan for its salaried workers

(“Plan”) via an agreement with Delphi and General Motors.

Treasury is not a party to the civil action.

     On July 9, 2015, Respondents filed a motion to compel the

production, or alternatively in camera review, of the documents

Treasury withheld or redacted under four separate claims of

privilege: (1) the deliberative process privilege; (2) the

presidential communications privilege; (3) the attorney-client

privilege; and (4) the work product doctrine. See generally Mot.

Compel, ECF No. 30. After reviewing the withheld documents in

camera, the Court concluded that Treasury failed to provide a

specific articulation of the rationale supporting the

deliberative process privilege and ordered Treasury to produce

to Respondents all of the documents over which it asserted the

                                2
deliberative process in isolation. See Op., ECF No. 42. Noting

that Treasury had withdrawn nearly 75% of its privilege

assertions when first ordered to make an in camera submission,

the Court ordered Treasury to revise its privilege log and

submit an updated in camera production containing only the

documents withheld under the presidential communications

privilege, the attorney-client privilege, or the work product

doctrine. The 85 documents over which Treasury asserts one of

these privileges are now at issue before the Court.

     II.   THE PRESIDENTIAL COMMUNICATIONS PRIVILEGE

     The purpose of the presidential communications privilege is

to “guarantee the candor of presidential advisers and to provide

‘[a] President and those who assist him ... [with] freedom to

explore alternatives in the process of shaping policies and

making decisions and to do so in a way many would be unwilling

to express except privately.’” In re Sealed Case, 121 F.3d 729,

743 (D.C. Cir. 1997) (quoting U.S. v. Nixon, 418 U.S. 683, 708

(1974)). This privilege extends not only to communications

directly involving the President, but also “to communications

authored or received in response to a solicitation by members of

a presidential adviser's staff, since in many instances advisers

must rely on their staff to investigate and issue and formulate

the advice to be given to the President.” ACLU v. Dep’t of

Justice, Case No. 10–123, 2011 U.S. Dist. LEXIS 156267, *30

                                 3
(D.D.C. Feb. 14, 2011) (citing In re Sealed Case, 121 F.3d at

752). “Unlike the deliberative process privilege, the

presidential communications privilege covers documents in their

entirety.” Loving v. Dep't of Def., 496 F. Supp. 2d 101, 107

(D.D.C. 2007), aff'd sub nom. Loving v. Dep't of Def., 550 F.3d
32 (D.C. Cir. 2008).

     Treasury has raised the presidential communications

privilege as the basis for withholding 63 documents from

production. The documents can be grouped into four categories:

(1) drafts of presidential speeches; 1 (2) personal requests for

information by President Obama; 2 (3) draft memoranda from

staffers to Dr. Lawrence Summers, the Director of the National

Economic Council, Assistant to the President for Economic

Policy, and co-chair of the Presidential Task Force on the Auto

Industry (“Auto Task Force”); 3 and (4) electronic mail

conversations among Auto Team members concerning advice to be

provided to the President. 4 O’Connor Decl., ECF No. 35-3 ¶ 7. For

the following reasons, the Court concludes that while these

documents are covered by the presidential communications

1
  See Document Nos. 612 and 778.
2
  See Document No. 764.
3 See Document Nos. 67, 72, 84, 94, 275, 560, 593, 596, 599, 601, 603,

605, 611, 623, 627, 629, 631, 633, 638, 668, 670, 672, 674, 676, 692,
758, 759, 760, 761, 762, 766, 770, 777, 849, 856, 859, 860, 863, 944,
948, 950, 956, 1006, 1089, 1091, 1094, 1152, 1166, 1168, 1217, 1219,
1221, and 1223.
4 See Document Nos. 358, 610, 621, 763, 765, 767, and 776.

                                   4
privilege, Respondents have demonstrated a need sufficient to

overcome the privilege.

       The Court can swiftly resolve the first two categories of

documents. With regard to the draft presidential speeches,

Respondents, in their reply brief, “concede that these two

documents are covered by the privilege” because they “would have

been seen by the President[.]” Reply, ECF No. 36 at 18. By the

same token, the draft letter containing a handwritten request

from President Obama to consult Dr. Summers regarding the Delphi

salaried pension plan is also covered by the presidential

communications privilege. 5 See Judicial Watch, Inc. v. Dep't of

Justice, 365 F.3d 1108, 1114 (D.C. Cir. 2004) (recognizing that

“communications directly involving and documents actually viewed

by the President” are privileged).

       The vast bulk of the documents withheld from production

under the presidential communications privilege — i.e., 53 of

the remaining 60 documents — fall into the third category. To

justify withholding these draft memoranda from production,

Treasury submitted a declaration from Jennifer M. O’Connor, the

Deputy Counsel to the President. See O’Connor Decl., ECF No. 35-

3. Ms. O’Connor’s responsibilities in the White House Counsel’s

Office include providing legal advice to White House staff,

5
    See Document No. 764.
                                  5
including on matters involving the invocation of the

presidential communications privilege. Id. ¶ 1. Ms. O’Connor

represents that all of the withheld documents “relate to the

President’s decisions as to how the United States should address

the financial distress of several of its large automobile

corporations and protect the country from the potential

consequences of their bankruptcy.” Id. ¶ 7. Ms. O’Connor also

sheds light on the relationship between the Auto Task Force, Dr.

Lawrence Summers, and the President. During the time of the

challenged communications, Dr. Summers served as co-chair of the

Auto Task Force, the Director of the National Economic Council,

and Assistant to the President for Economic Policy. Id. ¶ 8. In

this role, Dr. Summers led the President’s daily economic

briefing and advised the President on decisions relating to the

United States’ actions in response to the bankruptcy and

restructuring of major automotive companies, including General

Motors. Id. ¶ 9. A team of federal employees (the “Auto Team”)

supported Dr. Summers and the Auto Task Force. Id. ¶ 8.

     In In re Sealed Case, the Court of Appeals, determined that

“communications made by presidential advisers in the course of

preparing advice for the President come under the presidential

communications privilege, even when these communications are not

made directly to the President.” In re Sealed Case, 121 F.3d at

752. In defining the scope of the privilege, the Court reasoned

                                6
that “[g]iven the need to provide sufficient elbow room for

advisers to obtain information from all knowledgeable sources,

the privilege must apply both to communications which these

advisers solicited and received from others as well as those

they authored themselves.” Id.

     Here, the draft memoranda from Auto Team members to Dr.

Summers concerning the Auto Task Force’s duties are clearly

protected by the presidential communications privilege.

Respondents do not seem to dispute that Dr. Summers, the co-

Chair of the Auto Task Force and Assistant to the President for

Economic Policy, qualifies as a presidential adviser for

purposes of the privilege. See Reply, ECF No. 36 at 18-19. Not

only did President Obama select Dr. Summers to helm the Auto

Task Force, a group formed to review viability plans submitted

by major automotive manufacturers, but Dr. Summers also advised

the President on economic issues on a daily basis. 6 O’Connor

Decl., ECF No. 35-3 ¶ 9. The privilege that would attach to

communications between Dr. Summers and the President also

extends to communications between Dr. Summers and his staff

members who have responsibility for formulating the advice to be

given the President concerning the government’s bankruptcy and

6
  To the extent that Dr. Summers’ title leaves any room for doubt as to
his position as a presidential advisor, President Obama, in a
handwritten note on a letter regarding the Delphi pension plan,
specifically requested that Dr. Summers be consulted on the matter at
issue. See Document No. 764.
                                   7
restructuring efforts. See In re Sealed Case, 121 F.3d at 752.

Each draft memoranda that Treasury has withheld from production

is authored by the Auto Team, addressed specifically to Dr.

Summers, and concerns the Auto Team’s efforts to provide the

Auto Task Force and the President with sufficient information to

achieve the government’s automotive restructuring objectives.

     Respondents contend that the presidential communications

privilege should not apply because Treasury has not shown that

the challenged documents were solicited by Dr. Summers, rather

than merely received by him. See Reply, ECF No. 36 at 19.

According to Respondents, “if everything a presidential advisor

or his staff received was automatically covered by the

privilege, vast swaths of government communications could be

hidden from public view merely by regularly copying such people

on emails.” Id. While Respondents are correct that the

presidential communications privilege applies only to documents

that are “solicited and received by those members of an

immediate White House adviser's staff who have broad and

significant responsibility for investigating and formulating the

advice to be given the President[,]” In re Sealed Case, 121 F.3d

at 752, Respondents’ argument is unpersuasive for two reasons.

First, the White House Counsel’s Office expressly represented

that the disputed materials “were authored by or solicited and

received by the President or senior presidential advisors and

                                8
staff, including Lawrence H. Summers.” O’Connor Decl., ECF No.

35-3 ¶ 8. Second, upon examination of the challenged documents

in camera, it is apparent from the faces of the memoranda that

they were in fact solicited by Dr. Summers. For instance, the

Auto Team prefaced many draft memoranda with a note that the

included information was being provided “as requested” or “as

discussed” in a recent meeting with Dr. Summers. The content of

the withheld material also suggests that the drafters of the

memoranda met frequently with Dr. Summers to inform him of

research results, discuss strategy, and formulate advice to the

President. As a result, the Court is satisfied that the draft

memoranda were solicited rather than merely received by Dr.

Summers. See also In re Sealed Case, 121 F.3d at 758 (remarking

that a “review of the [challenged] documents themselves

demonstrates that from the nature of their contents and the

persons to whom they were directed there can be little question

that they had been solicited”).

     For the same reasons, the seven documents in the fourth

category — i.e., emails among Auto Team members regarding the

formulation of advice to the President — are covered by the

presidential communications privilege. Although, Dr. Summers may

not be present on some of these communications, it is apparent

from the documents’ content that the Auto Team members were

responding to requests for information by Dr. Summers or the

                                  9
President. In these communications, Auto Team members discussed

the preparation of memoranda to the President and harmonized

edits to be presented to Dr. Summers. Because the presidential

communications privilege extends “to communications authored or

solicited and received by those members of an immediate White

House adviser's staff who have broad and significant

responsibility for investigating and formulating the advice to

be given the President on the particular matter to which the

communications relate[,]” these documents are privileged. Id. at

752.

       Although the Court has established that the documents in

all four categories are covered by the presidential

communications privilege, the Court’s inquiry is not complete.

The presidential communications privilege “is qualified, not

absolute, and can be overcome by an adequate showing of need.”

Id. at 745. To overcome the privilege, Respondents must

demonstrate two elements: (1) that the subpoenaed material

likely contains evidence “directly relevant to issues that are

expected to be central to the trial[;]” and (2) that the

evidence “is not available with due diligence elsewhere.” Id. at

754. Here, Respondents have satisfied both prongs. First,

Respondents assert that they need the withheld material because

it may show pressure exerted by Treasury or the White House to

terminate the Delphi Plan for impermissible or political

                                 10
reasons, an issue at the core of the parties’ dispute in the

Michigan case. Mot. Compel, ECF No. 30 at 32. In that case,

Respondents allege that the PBGC’s termination of the Delphi

Plan was not justified by the applicable statute but instead the

result of undue pressure imposed by Treasury and the Auto Task

Force. Id. at 4. Rather than substantively engage in the needs

analysis or attempt to distinguish the cases upon which

Respondents rely, Treasury argues unconvincingly that

Respondents’ rationale for the material is “nothing but rank

speculation.” Opp’n, ECF No. 35 at 24. Nonetheless, for

substantially the same reasons advanced by Respondents, the

Court is persuaded that Respondents have made “at least a

preliminary showing of necessity for information that is not

merely demonstrably relevant but indeed substantially material

to their case.” Dellums v. Powell, 561 F.2d 242, 249 (D.C. Cir.

1977). Second, Respondents represent that the materials are

unavailable through any other means, see Mot. Compel, ECF No. 30

at 32, and Treasury does not challenge this assertion in its

opposition motion. See Opp’n, ECF No. 35 at 24. Accordingly, the

Court finds that Respondents have demonstrated a need sufficient

to overcome the presidential communications privilege.

                               11
     III. THE ATTORNEY-CLIENT PRIVILEGE

     Treasury has withheld or redacted 15 documents under the

attorney-client privilege. 7 “The attorney-client privilege

protects confidential communications made between clients and

their attorneys when the communications are for the purpose of

securing legal advice or services.” In re Lindsey, 158 F.3d
1263, 1267 (D.C. Cir. 1998). The purpose of the privilege is to

protect a client’s confidences to his or her attorney, thereby

encouraging an open and honest relationship between the client

and the attorney. Coastal States Gas Corp. v. Dep't of Energy,

617 F.2d 854, 862 (D.C. Cir. 1980). The privilege is “narrowly

construed and is limited to those situations in which its

purposes will be served.” Id. Hence, the privilege “protects

only those disclosures necessary to obtain informed legal advice

which may not have been made absent the privilege.” Id. (quoting

Fisher v. United States, 425 U.S. 391, 403 (1976)). The

privilege protects communications between the attorney and the

client, but does not shield the underlying facts contained in

those conversations from disclosure. Upjohn Co. v. United

States, 449 U.S. 383, 395 (1981).

     As a threshold matter, six of the challenged documents

concern communications between Auto Team members and attorneys

7
  See Document Nos. 30, 207, 210, 446, 499, 558, 570, 679, 685, 720,
789, 792, 1071, 1113, and 1204.
                                  12
at Cadwalader, Wickersham, and Taft LLP (“Cadwalader”), one of

the law firms that served as outside counsel to the Auto Team. 8

Because Respondents have indicated that they “do not dispute the

Treasury’s invocation of attorney-client privilege for those

communications [with Cadwalader attorneys],” Mot. Compel, ECF

No. 30 at 33, the Court will not order the production of these

documents.

       With regard to the remaining nine documents, each one

concerns a communication between Auto Team members and Matthew

Feldman, an Auto Team member who is also an attorney. 9

Respondents argue that these communications are not privileged

because Mr. Feldman, while an attorney, provided both legal and

non-legal advice to the Auto Team. Id. at 35. Respondents admit,

however, that “Treasury can invoke the attorney-client privilege

only for those communications of Mr. Feldman which were

primarily legal in nature[.]” Id. at 35-36. After reviewing

these documents in camera, the Court is satisfied that Mr.

Feldman acted in his legal capacity in each communication. In

some cases, Auto Team members asked Mr. Feldman a legal question

– e.g., the potential liability surrounding specific Auto Team

proposals – and Mr. Feldman provided his legal opinion. In other

instances, Mr. Feldman requested information from Treasury

8
    See Document Nos. 685, 720, 792, 1071, 1113, and 1204.
9
    See Document Nos. 30, 207, 210, 446, 499, 558, 570, 679, and 789.
                                    13
employees to aid the preparation of Treasury’s response to

congressional inquiries. Nothing in these communications

suggests that their confidential nature was compromised or that

the privilege was waived. As a result, the Court concludes that

Treasury correctly withheld these 15 documents from production

under the attorney-client privilege.

        IV.   ATTORNEY WORK PRODUCT DOCTRINE

        Treasury has raised the attorney work product doctrine over

seven documents. 10 The work product doctrine “protects written

materials lawyers prepare ‘in anticipation of litigation.’” In

re Sealed Case, 146 F.3d 881, 884 (D.C. Cir. 1998) (quoting Fed.

R. Civ. P. 26(b)(3)). In assessing whether the proponent has

carried its burden to show a document is protected as work

product, the relevant inquiry is “whether, in light of the

nature of the document and the factual situation in the

particular case, the document can fairly be said to have been

prepared ... because of the prospect of litigation.” EEOC v.

Lutheran Soc. Servs., 186 F.3d 959, 968 (D.C. Cir. 1999).

Although an agency need not have a specific claim in mind when

preparing the documents, there must exist some articulable claim

that is likely to lead to litigation in order to qualify the

documents as attorney work product. Coastal States Gas Corp.,

10
     See Document Nos. 203, 792, 983, 985, 987, 989, and 1259.
                                     14
617 F.2d at 865; Am. Immigration Council v. Dep't of Homeland

Security, 905 F. Supp. 2d 206, 221 (D.D.C. 2012) (work product

encompasses documents prepared for litigation that is

“foreseeable,” if not necessarily imminent; “documents that ...

advise the agency of the types of legal challenges likely to be

mounted to a proposed program, potential defenses available to

the agency, and the likely outcome,” are covered).

        Here, there can be little doubt that the material Treasury

has withheld under the work product doctrine is protected from

disclosure. Four of the seven documents at issue are draft

memoranda authored by Cadwalader attorneys. 11 The remaining three

documents are draft letters prepared by Department of Justice

attorneys. 12 It is apparent from the face of each of the

challenged documents that they were prepared by counsel in

anticipation of the Chrysler and General Motors bankruptcy

proceedings – i.e., in anticipation of litigation. Among other

things, the documents outline potential legal approaches to

disposing of corporate assets, discuss proposed amendments to

loan agreements, and detail objectives for pending mediation

proceedings. Further, these materials constitute opinion work

product, rather than fact work product, because they reveal “the

mental impressions, conclusions, opinions, or legal theories of

11
     See Document Nos. 203, 792, 983, and 1259.
12
     See Document Nos. 985, 987, and 989.
                                     15
a party's attorney” concerning potential litigation. F.T.C. v.

Boehringer Ingelheim Pharm., Inc., 778 F.3d 142, 151 (D.C. Cir.

2015).

     Nonetheless, as with the presidential communications

privilege, the work product doctrine is not an absolute

privilege. Disclosure may be warranted if the party seeking the

privileged material can make a showing of substantial need and

an inability to obtain the equivalent without undue hardship.

See Upjohn, 449 U.S. at 400. Respondents, however, have not

articulated a specific need for these documents. Whereas

Respondents claim that they need the materials protected under

the presidential communications privilege because those

documents may reveal undue pressure exerted by the White House

or Treasury over the decision to cancel the Delphi Plan,

Respondents make no similar claim as to these seven documents.

Respondents simply have not made “the extraordinary showing of

necessity” required to obtain access to opinion work product. In

re Sealed Case, 676 F.2d 793, 811 (D.C. Cir. 1982). Accordingly,

the Court will not order the production of the documents

withheld under the work product doctrine.

                               16
        V.    RELEVANCE

        Treasury has withheld one document from production on

grounds of relevance. 13 The document consists of a weekly report

from Treasury to the White House and an email circulating the

report among Treasury personnel. Because Respondents have not

challenged Treasury’s relevance assertion, the Court will not

order the production of this document.

        VI.   CONCLUSION

        For the foregoing reasons, the unresolved portion of

Respondents’ motion to compel the production, or alternatively

in camera review, of the documents withheld and redacted by

Treasury is GRANTED in part and DENIED in part. The 63 documents

over which Treasury has asserted the presidential communications

privilege shall be FORTHWITH PRODUCED to Respondents. The

documents over which Treasury has asserted a claim of relevance,

attorney-client privilege or work product are protected from

production. An appropriate Order accompanies this Memorandum

Opinion, filed this same day.

        SO ORDERED.

Signed:       Emmet G. Sullivan
              United States District Judge
              April 13, 2017

13
     See Document No. 619.
                                   17