## Facts

- Fox News Network, LLC submitted a FOIA request to the Department of the Treasury seeking agency records concerning the federal bailout of AIG and Citigroup under TARP.
- Treasury produced more than 10,000 pages but withheld all or portions of roughly 7,000 pages, asserting FOIA Exemption 5 (deliberative process and attorney-client privilege) and Exemption 4 (confidential commercial or financial information).
- The court required Treasury to provide a Vaughn index identifying withheld documents and explaining the claimed exemptions.
- After negotiations, the dispute narrowed to approximately 300 documents, including internal emails, memoranda, drafts, analyses, and communications involving AIG, Citigroup, and other participants in bailout-related negotiations.
- The parties filed cross-motions for summary judgment over whether Treasury adequately justified withholding and whether non-exempt material was reasonably segregable and should be released.

## Issues

1. Whether Treasury properly withheld records under FOIA Exemption 5’s deliberative process privilege by showing the materials were both predecisional and deliberative.
2. Whether Treasury properly withheld records under FOIA Exemption 5’s attorney-client privilege by showing communications were confidential and primarily for legal advice rather than policy or business advice.
3. Whether Treasury properly withheld records under FOIA Exemption 4 by showing the information was confidential commercial or financial information and that disclosure would likely cause substantial competitive harm.
4. Whether Treasury’s Vaughn index and declarations were sufficiently specific and whether Treasury released all reasonably segregable non-exempt portions.

## Decision

- The court granted in part and denied in part both parties’ motions for summary judgment.
- Treasury was permitted to withhold some materials under Exemption 5 where the records reflected internal give-and-take on bailout decisions or contained qualifying attorney-client legal advice.
- Treasury was permitted to withhold some materials under Exemption 4 where the information was non-public, commercially sensitive, and supported by a concrete showing of likely competitive harm.
- The court ordered disclosure (often with redactions) for certain materials where Treasury did not sufficiently show they were predecisional and deliberative, relied too heavily on draft status alone, failed to substantiate competitive harm, or did not justify withholding non-exempt segregable portions.

## Legal Principles

- Exemption 5 (deliberative process) applies only to materials that are both predecisional (prepared to assist a decisionmaker before a final decision) and deliberative (reflecting opinions, recommendations, or consultative exchanges rather than purely factual material).
- Draft status does not automatically establish deliberative process protection; the agency must show how disclosure would reveal internal deliberations, and similarity to a final, public version may weaken the claim.
- Exemption 5 (attorney-client privilege) protects confidential communications whose primary purpose is obtaining or providing legal advice; it does not protect communications that are primarily business, political, or policy guidance labeled as legal advice.
- Exemption 4 protects qualifying commercial or financial information obtained from a non-governmental person when the agency shows, with specific support, that disclosure would likely cause substantial competitive harm; conclusory “confidential” labels are insufficient, and public availability can defeat the claim.
- Agencies must provide a Vaughn index and supporting declarations detailed enough to permit adversarial testing of exemption claims, and must release all reasonably segregable non-exempt material within responsive records.

## Conclusion

The court partially sustained Treasury’s FOIA withholdings regarding TARP bailout records but required further disclosure where the agency’s Exemption 4 and Exemption 5 justifications were overbroad, inadequately supported, or failed to account for segregable, non-exempt information.


Fox News Network, LLC v. Dep’t of the Treasury, 739 F. Supp. 2d 515 (S.D.N.Y. 2010)