CHURCH OF SCIENTOLOGY OF CALIFORNIA, Plaintiff,
v.
INTERNAL REVENUE SERVICE, Defendant.
Civ. A. No. 80-3239.
United States District Court,
District of Columbia.
June 24, 1983.
Taxpayer brought action under the Freedom of Information Act to compel
Internal Revenue Service to release certain documents claimed by agency to be
exempt from disclosure. On Internal Revenue Service's motion for summary
judgment, the District Court, Norma Holloway Johnson, J., held that: (1)
taxpayer was estopped from relitigating its claim to access to documents at
issue in prior proceeding; (2) Internal Revenue Service demonstrated that its
withholding of certain documents was rational and not beyond bounds of its
discretionary authority under provision of Internal Revenue Code governing
disclosure of return information to persons having material interests therein;
and (3) Internal Revenue Service's efforts to locate materials responsive to
taxpayer's request were reasonable and adequate as a matter of law.
Ordered accordingly.
[1] JUDGMENT
Taxpayer was estopped under doctrine of res judicata from relitigating its
claim to access to documents sought in prior Freedom of Information Act action,
in view of fact that defendant Internal Revenue Service had no duty to justify
new bases for nondisclosure of documents at issue in prior action. 5
U.S.C.A. s 552 et seq.
[2] INTERNAL REVENUE
Documents relating to ongoing litigation in United States Tax Court but
generated or received by defendant Internal Revenue Service subsequent to its
preparation of index in Tax Court case constituted return information within
statutory definition. 26 U.S.C.A. ss 6103 et seq., 6103(b)(2),
(b)(2)(A), 7213.
[3] INTERNAL REVENUE
Provision of Internal Revenue Code governing disclosure of return information
to persons having material interests therein is sole standard governing
disclosure or nondisclosure of tax return information, notwithstanding Freedom
of Information Act. 5 U.S.C.A. s 552 et seq.; 26 U.S.C.A. s 6103 et
seq.
[4] INTERNAL REVENUE
Since revelation of certain documents pertaining to ongoing tax court
litigation would affect defendant Internal Revenue Service's ability to defend
its position in that litigation, IRS had demonstrated that its withholding of
documents from taxpayer was rational, and not beyond bounds of its
discretionary authority under provision of the Internal Revenue Code governing
disclosure of return information to persons having material interests
therein. 26 U.S.C.A. s 6103 et seq.
[5] RECORDS
In determining whether claim of exemption for clearly unwarranted invasion of
privacy under Freedom of Information Act exemption may properly be asserted,
court must balance plaintiff's interest in disclosure, public interest in
disclosure, degree of invasion of personal privacy, and availability of any
alternative means of obtaining requested information. 5 U.S.C.A. s
552(b)(6).
[6] RECORDS
Portions of eight documents generated or received by defendant Internal Revenue
Service subsequent to its preparation of index submitted in tax court case, but
not relating to ongoing tax court litigation, were exempt from disclosure under
section of the Freedom of Information Act exempting from disclosure matters
that are personnel and medical files and similar files the disclosure of which
would constitute a clearly unwarranted invasion of personal privacy. 5
U.S.C.A. s 522(b)(6).
[7] INTERNAL REVENUE
Under provision of Internal Revenue Code governing disclosure of return
information to persons having material interests therein, return information
may be disclosed to third parties at discretion of agency if such parties can
demonstrate that they are acting in capacity of designee of individual
taxpayer. 26 U.S.C.A. s 6103 et seq.
[8] RECORDS
Defendant Internal Revenue Service properly construed relevant statutory and
regulatory requirements in determining that scope of taxpayer's Freedom of
Information Act request was limited to data pertaining to it. 5 U.S.C.A. s
552 et seq.
[9] INTERNAL REVENUE
Excised portions of certain documents were properly withheld by Internal
Revenue Service from taxpayer since they all related to individuals and
entities other than taxpayer. 5 U.S.C.A. s 552 et seq.
[10] RECORDS
Request for information under the Freedom of Information Act does not impose
burden upon agency to reorganize its files, but does impose a firm statutory
duty to make reasonable efforts to satisfy a FOIA request. 5 U.S.C.A. s 552
et seq.
[11] RECORDS
Efforts of defendant Internal Revenue Service to locate materials responsive to
taxpayer's request under Freedom of Information Act were reasonable and
adequate as a matter of law. 5 U.S.C.A. s 552 et seq.
[12] RECORDS
Since taxpayer in Freedom of Information Act action could not be found to have
met threshold requirement that it substantially prevailed, it was not entitled
to award of attorney fees. 5 U.S.C.A. s 552 et seq.
*1166 George T. Volsky, Washington, D.C., for plaintiff.
John J. McCarthy, Edward J. Snyder, Richard L. Switzer, U.S. Dept. of Justice,
Tax Div., Washington, D.C., for defendant.
MEMORANDUM OPINION
NORMA HOLLOWAY JOHNSON, District Judge.
Plaintiff Church of Scientology of California (hereinafter California Church)
brings this action under the Freedom of Information Act (FOIA) [FN1] to compel
the Internal *1167 Revenue Service (IRS) to release certain documents
claimed by that agency to be exempt from disclosure under FOIA. This matter is
now before the Court on defendant's motion for summary judgment. [FN2] For the
reasons set forth herein, the Court finds that no material issues of fact
remain in dispute, and that defendant is entitled to summary judgment as a
matter of law. Accordingly, defendant's motion for summary judgment will be
granted.
FN1. 5 U.S.C. s 552 et seq. (1976 & Supp V 1981).
FN2. Arthur L. Lappen, Chief Branch 3 Disclosure Litigation Division, IRS,
has been dropped as a named defendant in this action at the plaintiff's
request.
DISCUSSION
I. Plaintiff's FOIA Request
In its original request under FOIA submitted on May 16, 1980, plaintiff sought
the release of virtually all materials contained in IRS files nationwide
which pertained specifically to the California Church, and to Scientology, in
general. [FN3] Included within the scope of plaintiff's request were documents
sought by plaintiff in its First Request of Production of Documents in an
ongoing action before the United States Tax Court entitled Church of
Scientology of California v. Commissioner of IRS, Docket No. 3352-78
(U.S.T.C.) (hereinafter referred to as Tax Court case). Plaintiff's FOIA
request thereby included all materials received or generated by IRS in
connection with the Tax Court case, as well as materials indexed, but adjudged
exempt from disclosure, in a previous FOIA action entitled Church of
Scientology of California v. IRS, Civil No. CV 74-3465-RJK (C.D.Cal. October
29, 1976), appeal dismissed, No. 77-1365 (9th Cir.1978) (hereinafter
referred to as a FOIA I).
FN3. Plaintiff's May 16, 1980, FOIA request sought
Copies of all information relating to or containing the names of
Scientology, Church of Scientology, any specific Scientology Church or
entity identified by containing the words Scientology, Hubbard, and/or
Dianetics in their names, L. Ron Hubbard or Mary Sue Hubbard in the form of
a written record, correspondence, document, memorandum, form, computer
tapes, computer program or microfilm; which is contained in any of the
following systems of records, including but not limited to those located at
the National office, Regional offices, Service Centers, District offices,
or local IRS offices [four page list identifying IRS record systems by
appropriate code numbers is omitted].
Plaintiff also sought IRS personnel training materials located in
Covington, Kentucky, and requested the release of "copies of file labels or
tabs identifying any and all files containing information requested
herein." Letter of Rev. James Morrow to Chief, Disclosure Staff, IRS,
dated May 16, 1980.
In its May 16, 1980, request, plaintiff acknowledged that the volumes of
materials involved would make it impossible for the IRS to respond within the
statutory ten-day period, but asked that the California Church be apprised of
an anticipated schedule for response. IRS wrote to plaintiff on July 22, 1980,
to ask plaintiff to agree to a voluntary extension of defendant's time for
response until August 29, 1980. Plaintiff filed an appeal with IRS on
September 17, 1980, after no further response from IRS had been forthcoming.
Plaintiff did not await defendant's response to the appeal, but instead
commenced the instant action.
Defendant's determination of plaintiff's FOIA appeal was issued on January 14,
1981. The scope of plaintiff's FOIA request was found to be properly limited
to materials pertaining to the California Church, and the proper extent of
the agency's search was found to be limited to the IRS National office. [FN4]
Further, defendant construed *1168 plaintiff's FOIA request as encompassing
materials falling into four categories: (1) those documents withheld from
disclosure and adjudged exempt in FOIA I; (2) those documents indexed in
connection with the Tax Court case and relating to that case; (3) those
documents generated subsequent to the Tax Court case; and (4) any documents
relating to the California Church which were generated subsequent to the Tax
Court case index and are located in the IRS National office. Letter of Gerald
G. Portney, Assistant Commissioner (Technical), IRS to Rev. James Morrow, dated
January 14, 1981, p. 3. Defendant denied plaintiff's appeal in substantial
part after determining that (1) principles of res judicata and collateral
estoppel barred plaintiff from relitigating its claim to access to FOIA I
documents; and (2) the remaining documents at issue were exempt from
disclosure under 26 U.S.C. s 6103 et seq. (1976 & Supp. V 1981) and 5
U.S.C. s 552(b)(6) (1976 & Supp. V 1981).
FN4. Although defendant limited its search to its National office,
defendant did search and locate documents lodged in Covington, Kentucky,
and in the offices of the District Counsel for Los Angeles. The other
sites searched by defendant included the following: Offices of the
Commissioner; Deputy Commissioner; Assistant Commissioner (Compliance);
Assistant Commissioner (Technical); Assistant Commissioner (Employee
Plans/Exempt Organizations); Assistant Commissioner (Inspection); Audit
Division; Criminal Investigation Division; Office of International
Operations; Covington, Kentucky office; Returns Processing and Accounting
Division; Collection Division; Appeals Division; Chief Counsel; Deputy
Chief Counsel (Administrative); Deputy Chief Counsel (Technical); Deputy
Chief Counsel (Litigation); Administrative Services; Criminal Tax
Division; Disclosure Litigation Division; Employee Plans and Exempt
Organization Division; General Litigation Division; Interpretive
Division; Legislation and Regulations Division; and Tax Litigation
Division.
On June 18, 1982, the Court denied plaintiff's motion for a detailed
justification, itemization and indexing by the defendant of the withheld
materials as approved by the Court in Vaughn v. Rosen, 484 F.2d 820
(D.C.Cir.1973), cert. denied, 415 U.S. 977, 94 S.Ct. 1564, 39 L.Ed.2d 873
(1974), and granted defendant's motion to submit for in camera inspection
certain documents located at the IRS National office. The Court also ordered,
sua sponte, that all documents responsive to plaintiff's request and related to
the Tax Court case be submitted for in camera review. Submission of the
documents within the scope of the Court's June 18, 1982, Order has been
accomplished, and defendant now urges the Court to find that the documents
remaining at issue are properly exempt from disclosure. [FN5]
FN5. Plaintiff no longer seeks disclosure of the documents indexed by
defendant in the Tax Court case.
II. Defendant's Motion For Summary Judgment
A. FOIA I Documents
In moving for summary judgment, defendant first contends that plaintiff is
barred by the operation of the doctrine of res judicata from relitigating its
claim to access of the documents at issue in FOIA I. In opposition, plaintiff
asserts that defendant must demonstrate that the res judicata effect of the
final judgment in FOIA I has not been suspended by subsequent material changes
in law or fact. Plaintiff has, however, cited no authority which supports its
contention that the burden falls upon the defendant to prove that the absence
of any material changes in circumstances leaves undisturbed the bar to
relitigation erected by the prior judgment.
[1] In Commissioner of Internal Revenue v. Sunnen, 333 U.S. 591, 68 S.Ct.
715, 92 L.Ed. 898 (1948), the Court considered the applicability of res
judicata and collateral estoppel doctrines to determinations of income tax
liability in different tax years. The Court held that in the interest of
justice, the operation of collateral estoppel "must be confined to situations
where the matter raised in the second suit is identical in all respects with
that decided in the first proceeding and where the controlling facts and
applicable legal rules remain unchanged." Id., at 600, 68 S.Ct. at 720
(citations omitted). The instant case presents the very situation defined in
Sunnen as one in which the operation of collateral estoppel is appropriately
confined. There is no question that the documents at issue in both FOIA I and
the instant case are identical, as are the parties. Further, defendant does
not seek to assert claims of exemption different from those asserted in FOIA I,
see Wolfe v. Froehlke, 358 F.Supp. 1318, 1319-20 (D.D.C.1973), affirmed,
510 F.2d 654 (D.C.Cir.1974) (res judicata not a bar to relitigation of
plaintiff's claim to access to document under FOIA when agency asserts new
basis for exemption from disclosure). Plaintiff in the instant case correctly
cites Sunnen for the proposition that the binding *1169 effect of a prior
final judgment might be altered or even nullified by a "subsequent modification
of the significant facts or a change or development in the controlling legal
principles..." Id., 333 U.S. at 599, 68 S.Ct. at 720. Plaintiff, however,
has not even alleged that any such modification in law or fact has occurred
with regard to this action. Nothing in the legislative history of FOIA or the
language of that Act suggests that a defendant in an action brought under FOIA
who alleges res judicata as an affirmative defense bears a special burden of
proving that documents already adjudged exempt remain exempt. See Church of
Scientology of California v. U.S. Dep't of the Army, et al., 611 F.2d 738, 750
fn. 7 (D.C.Cir.1979). Where the issues, documents, and plaintiffs are
identical in both the prior and present FOIA litigation, "[t]he issue of
exemption cannot be relitigated." Id. at 751. The Court notes that
defendant, in responding to plaintiff's FOIA request in the action sub judice,
reviewed the 290 documents found to be exempt from disclosure in FOIA I and
identified twenty of that total number which had been withheld in full or in
part on the basis of 5 U.S.C. s 552(b)(7)(A). [FN6] Affidavit of Charles W.
Rumph, Technical Advisor, Tax Litigation Director, IRS, P 2. These twenty
documents were then reviewed, and defendant concluded that Exemption (b)(7)(A)
no longer provided a basis for non-disclosure. Id., P 3. All documents
previously withheld solely on the basis of Exemption (b)(7)(A) were, therefore,
released by the defendant. Id. Plaintiff's contention that defendant's
failure to justify anew the bases for non-disclosure of the documents at issue
in FOIA I must, therefore, be rejected as without merit, and the Court must
find that plaintiff is estopped from relitigating its claim to access to the
FOIA I documents.
FN6. Exemption (b)(7)(A) exempts from disclosure under FOIA those
documents which constitute "investigatory records compiled for law
enforcement purposes, but only to the extent that the production of such
records would (A) interfere with enforcement proceedings..." 5 U.S.C. s
552(b)(7)(A) (1976 Supp. V 1981).
B. Documents Pertaining to Ongoing Tax Court Litigation
Although plaintiff has dropped its claim to documents indexed by the defendant
in the ongoing litigation in the U.S. Tax Court, a substantial number of
documents relating to that action but generated or received by defendant
subsequent to its preparation of the index in the Tax Court case remain in
dispute. Defendant contends that the documents constitute confidential tax
return information within the meaning of 26 U.S.C. s 6103 et seq. (1976 &
Supp. V 1981) and, as such, are exempt from disclosure.
[2] The first question presented with respect to these "post-index"
documents is whether they can, indeed, be properly characterized as
confidential tax return information within the definition of 26 U.S.C. s
6103(b)(2)(A). [FN7] The Court's in camera examination of a representative
number of the documents in question reveals that the documents each identify a
specific taxpayer, and contain "private facts taken directly from tax returns
or IRS comment upon the private tax situations of specific taxpayers." King
v. IRS, 688 F.2d 488, 494 (7th *1170 Cir.1982). See also Neufeld v. IRS,
646 F.2d 661 (D.C.Cir.1981). The Court concludes, therefore, that these "post-
index" documents clearly constitute return information within the statutory
definition.
FN7. "Return information" is defined as encompassing
a taxpayer's identity, the nature, source or amount of his income,
payments, receipts, deductions, exemptions, credits, assets, liabilities,
net worth, tax liability, tax withheld, deficiencies, overassessments, or
tax payments, whether the taxpayer's return was, is being, or will be
examined or subject to other investigation or processing, or any other data
received by, recorded by, prepared by, furnished to, or collected by
Secretary with respect to a return or with the determination of the
existence, or possible existence, of liability (or the amount thereof) of
any person under this title for any tax, penalty, interest, fine,
forfeiture, or other imposition, or offense...
26 U.S.C. s 6103(b)(2)(A) (1976 & Supp. V 1981). Criminal penalties
attach to the unauthorized disclosure of data as set forth in s 6103.
26 U.S.C. s 7213. In addition to the specified instances where
disclosure is authorized, disclosure of data under s 6103 may be made
"in a form which cannot be associated with, or otherwise identify, directly
or indirectly, a particular taxpayer." s 6103(b)(2).
Having concluded that the contested materials are return information, it must
be determined to what extent, if any, the provisions of section 6103 affect
plaintiff's claim to access to those materials under FOIA. Defendant relies
on Zale v. IRS, 481 F.Supp. 486 (D.D.C.1979) to support its contention that
the "particularized disclosure scheme" of section 6103 effectively pre-empts
the more general disclosure criteria of FOIA. Id. at 489. Defendant thus
contends that in accordance with Zale, the Court's review of defendant's
decision to withhold the return information sought by plaintiff will not be
subject to the de novo review available under FOIA, but will properly be
limited to the determination of whether "the decision to withhold was ... an
arbitrary or unconscionable abuse of discretion." Id. at 490.
[3] This Court has had the opportunity to consider the applicability of FOIA
to disclosure requests for confidential return information in a prior action
entitled Service Employees International Union v. IRS, No. 82-1081 (decided
January 1, 1981). Consistent with the decision in that action, the Court today
again adopts the rationale of Zale in holding that section 6103 "must be
viewed as the sole standard governing release of tax return information."
Zale v. IRS, 481 F.Supp. at 490. Accord King v. IRS, 688 F.2d 488 (7th
Cir.1982); Anheuser-Busch, Inc. v. IRS, 493 F.Supp. 549 (D.D.C.1980); but
see, e.g. Britt v. IRS, 547 F.Supp. 808 (D.D.C.1982).
[4] The Court must, therefore, determine whether defendant's decision to
withhold the "post-index" documents can be upheld as rational and supported in
the record. Section 6103 provides but a few limited exceptions to the
general prescription of confidentiality of return information. Disclosure of
return information may be made to persons deemed to have a "material interest"
in such information as defined under section 6103(e)(1) [FN8], barring a
determination by the IRS that disclosure "would seriously impair Federal tax
administration." 26 U.S.C. s 6103(c) and (e)(6) (1976 & Supp. V 1981). In
the instant action, defendant concedes that plaintiff has a material interest
in the documents in question, but has determined that disclosure would
seriously interfere with defendant's duties in connection with the ongoing Tax
Court litigation by revealing its litigation strategy and attorney work
products. In view of the ongoing nature of the Tax Court litigation, and after
in camera inspection of a representative number of the relevant documents, the
Court finds that those documents do relate to defendant's litigation strategy,
and reflect the work product of attorneys employed by the defendant. Since
revelation of the documents would thus affect the defendant's ability to defend
its position in the Tax Court case, the Court finds that defendant has
demonstrated that its withholding of the documents was rational, and not beyond
the bounds of its discretionary authority under section 6103. [FN9]
FN8. 26 U.S.C. s 6103(e)(1) (1976 & Supp. V 1981). Individual
taxpayers are deemed to have a "material interest" in disclosure of their
own return information under section 6103(e)(1).
FN9. Even assuming, arguendo that section 6103 must be viewed as a
qualifying exempting statute under 5 U.S.C. s 552(b)(3), see e.g.
Chamberlain v. Kurtz, 589 F.2d 827 (5th Cir.1979), cert. denied, 444
U.S. 842, 100 S.Ct. 82, 62 L.Ed.2d 54 (1979), and that judicial review
would thus be in accord with the provisions of FOIA, the Court is persuaded
after its in camera inspection of the pertinent documents that defendant's
non-disclosure is not improper under the criteria of either section 6103
or FOIA Exemption 3.
C. Disclosure of Documents From IRS National Office
Defendant has located and indexed twenty-one documents in its National office
which are responsive to plaintiff's FOIA request. These documents were
generated or received by defendant subsequent to its preparation of the index
submitted in the Tax Court case, but do not relate to the *1171 ongoing Tax
Court litigation. Ten of the twenty-one documents have been released in full;
portions of the remaining eleven documents have been withheld by the defendant.
Defendant contends that the deleted portions of eight of the eleven documents
at issue are exempt from disclosure under 5 U.S.C. s 552(b)(6) ("Exemption
6"), which exempts from disclosure under FOIA matters that are "personnel and
medical files and similar files the disclosure of which would constitute a
clearly unwarranted invasion of personal privacy." 5 U.S.C. s
552(b)(6) (1976 & Supp. V 1981).
[5][6] In determining whether a claim of exemption for a "clearly
unwarranted invasion of privacy" under FOIA Exemption 6 may properly be
asserted, a court must balance "(1) the plaintiff's interest in disclosure;
(2) the public interest in disclosure; (3) the degree of the invasion of
personal privacy; and (4) the availability of any alternative means of
obtaining the requested information." Church of Scientology of California
v. Dept. of the Army, et al., 611 F.2d 738, 746 (9th Cir.1979). See
Department of The Air Force v. Rose, 425 U.S. 352, 96 S.Ct. 1592, 48 L.Ed.2d
11 (1976); Rural Housing Alliance v. U.S. Dep't of Agriculture, 498 F.2d
73 (D.C.Cir.1974). The Court has examined in camera those portions of each of
the eight documents claimed by defendant to be exempt under Exemption 6 and has
concluded that the balance of factors clearly weighs in favor of non-disclosure
by the defendant.
Document A-1 is comprised of "log cards" maintained by defendant. Document A-
6 is a ten-page document dealing largely with a draft legal opinion concerning
plaintiff's tax-exempt status. Document A-10 consists primarily of a letter to
Senator Inouye from the Acting Director of defendant's Tax Litigation
Division. Document A-12 is a two-page memorandum concerning a prior summons
enforcement suit against the plaintiff. Documents A-13 and A-15 are
"buckslips" concerning litigation against the plaintiff. Document A-15 is a
single-page handwritten memorandum relating to defendant's response to
plaintiff's motion for summary judgment. Document A-18 is a transmittal
memorandum dealing with the filing of defendant's answer in the Tax Court case.
In each of the documents described above, the excised portions consist of the
names of attorneys and other personnel employed by the defendant. The Court
agrees with the defendant that the interest of plaintiff and the public in
knowing which attorneys and other personnel have been assigned to certain cases
is de minimus when weighed against the interest of the individuals involved in
maintaining anonymity as a means of avoiding potential harassment and find,
therefore, that the excised portions are exempt from disclosure under Exemption
6.
Portions of Documents A-9 and A-21 have also been withheld by defendant on the
basis that the excised data constitute confidential third-party return
information whose release to plaintiff is unauthorized under 26 U.S.C. s
6103(a) (1976 & Supp. V 1981). A single deletion in Document A-6 is also
claimed by defendant to be proper on this basis. Document A-20 has also been
partially withheld as being outside the scope of plaintiff's request.
Defendant's claims of exemption with respect to these four documents thus raise
the threshold question of whether defendant has properly construed the scope of
plaintiff's FOIA request to exclude all materials not pertaining to the
California Church.
[7] As discussed, infra, the Court finds that defendant's non-disclosure of
data constituting return information within the definition of 26 U.S.C. s
6103(b)(2)(A) is subject to judicial review in accordance with the criteria set
forth under section 6103. Under section 6103, return information may be
disclosed to third-parties at the discretion of the agency if such parties can
demonstrate that they are acting in the capacity *1172 of designee of the
individual taxpayer. [FN10] It is undisputed that in its May 16, 1980, FOIA
request, plaintiff's representative provided defendant with the authorization
of only the California Church. Defendant asserts that release to plaintiff of
any return information pertaining to the individuals and Scientology entities
other than the California Church as listed in plaintiff's request is
unauthorized and, therefore, proscribed under section 6103.
FN10. Section 6103(c) provides:
The Secretary may, subject to such requirements and conditions as he may
prescribe by regulations, disclose the return of any taxpayer, or return
information with respect to such taxpayer, to such person or persons as the
taxpayer may designate in a written request for or consent to such
disclosure, or to any other person at the taxpayer's request to the extent
necessary to comply with a request for information or assistance made by
the taxpayer to such other person. However, return information shall not
be disclosed to such person or persons if the Secretary determines that
such disclosure would seriously impair Federal tax administration.
See also 26 U.S.C. s 6103(e)(6) (1976 & Supp. V 1981); 26 C.F.R. s
601.702(c)(4)(ii)(c) (1982).
An actionable request under FOIA for records in the possession of the IRS is
defined under 26 C.F.R. s 601.702(c)(1) (1982) as one "which conforms in
every respect with the rules and procedures set forth in this subpart." A FOIA
request which includes within its scope materials properly classified as
"return information" under section 6103 must "establish the identity and the
right of the person making the request to the disclosure of the records..."
26 C.F.R. s 601.702(c)(v) (1982). Plaintiff concedes that in accordance
with these pertinent statutory and regulatory requirements, defendant is
obligated to protect against the unauthorized disclosure of third-party return
information, but contends that the California Church is so "clearly related" to
the third parties at issue as to make additional authorization superfluous.
Plaintiff also asserts that defendant was required by its own regulations to
request the additional authorizations from plaintiff at the time it first
determined such proofs were necessary, and before defendant responded to
plaintiff's FOIA request.
[8][9] The regulatory language quoted by the plaintiff in support of this
latter contention provides in relevant part:
Additional proof of a person's identity shall be required before the request
will be deemed to have met the requirement of paragraph (c)(3)(v) of this
section if it is determined that additional proof is necessary to protect
against unauthorized disclosure of information in a particular case.
26 C.F.R. s 601.702(c)(4)(ii)(C) (1982). The Court finds that the plain
language of the cited regulation is devoid of any requirement that defendant
notify a requester such as plaintiff of the need for additional proof prior to
responding to a FOIA request encompassing third-party data. We conclude,
therefore, that defendant properly construed the relevant statutory and
regulatory requirements in determining that the scope of plaintiff's FOIA
request was limited to data pertaining to the California Church. In view of
defendant's conceded obligation to protect against the unauthorized disclosure
of third-party return information, the Court finds that the plaintiff's
contention that additional proof would be superfluous is without merit. [FN11]
Having determined that the scope of plaintiff's request was properly construed
by defendant as limited to documents relating to the California Church, the
Court turns to the portions of the four documents withheld from disclosure as
outside the proper scope of plaintiff's request. After an in camera
examination of these four documents in their entirety, it is clear that the
excised portions all relate to individuals and entities other than the
California Church. The Court thus finds that the excised portions were
properly withheld.
FN11. That plaintiff's contention is without merit is particularly
apparent when the absence of any indication by plaintiff of any legal
relationship between plaintiff and the third-parties at issue is
considered.
[10] The sole remaining question concerning defendant's response to
plaintiff's *1173 request is whether defendant has demonstrated, as a matter
of law, that its search for responsive documents was adequate. Plaintiff
contends that the Court cannot find defendant's search to be adequate in view
of defendant's arbitrary and capricious refusal to search all IRS field
offices. It is established in this Circuit that a request for information
under FOIA does not impose a burden upon an agency to reorganize its files,
"but does [impose] a firm statutory duty to make reasonable efforts to satisfy"
a FOIA request. Founding Church of Scientology v. NSA, 610 F.2d 824, 837
(D.C.Cir.1979). (Emphasis added). The Court must, therefore, test the
adequacy of defendant's search in the instant case against a standard of
reasonableness. See McGehee v. CIA, 697 F.2d 1095 (D.C.Cir.1983). It is
undisputed that plaintiff directed its May 16, 1980, FOIA request to
defendant's National office. In its FOIA request, plaintiff stated that "this
request is being directed to the National office so proper coordination and
handling can occur." Letter of Rev. Morrow to Chief, Disclosure Staff, IRS,
p. 7. No similar request was made by plaintiff to each IRS field office, as
required under 26 C.F.R. s 601.702(c)(iii) (1982).
[11] From the variety of offices searched by the defendant, it is evident
that there is no single office or recordkeeping system which is the repository
of all data relating to the California Church. [FN12] Defendant has produced
for in camera inspection a voluminous amount of materials responsive to
plaintiff's request. The record in this action reflects that these documents
were located through a search of all the offices specifically identified by
plaintiff in its request, including the Covington, Kentucky, office where IRS
personnel have received instruction in audit procedures affecting plaintiff.
In addition, defendant searched the District Counsel offices in Los Angeles,
the IRS district in which plaintiff is located. Plaintiff's assertions that
the extent of defendant's search was inadequate would thus appear to bear only
upon its claims, rejected today, for materials relating to individuals and
entities other than the California Church. In view of all of the foregoing
considerations, the Court finds that plaintiff has failed to raise a genuine
dispute on the issue of the adequacy of defendant's search. The Court
concludes, therefore, that defendant's efforts to locate materials responsive
to plaintiff's request were reasonable and, therefore, adequate as a matter of
law.
FN12. The Court also notes that the documents sought by the plaintiff are
not summaries or other compilations effected by defendant which might
conceivably be lodged at a central site.
[12] The final issue before the Court is plaintiff's claim for the award of
attorney fees. It is well-established that, at a minimum, an award of
reasonable attorney fees to a plaintiff in a FOIA action must be based upon the
finding that such plaintiff has "substantially prevailed." See, e.g.,
Chamberlain v. Kurtz, 589 F.2d 827 (5th Cir.1979), cert. denied 444 U.S.
842, 100 S.Ct. 82, 62 L.Ed.2d 54 (1979). It is clear that since plaintiff in
this action cannot be found to have met this threshold requirement, plaintiff
is not entitled the award of attorney fees.
An Order consistent with this Memorandum Opinion will be entered on this date.
ORDER
Upon consideration of the motion by defendant for summary judgment,
plaintiff's opposition thereto, supporting and opposing memoranda of law and
affidavits, the in camera inspection of documents at issue in the above-
entitled action, and the entire record herein, it is this 24th day of June,
1983,
ORDERED that defendant's motion for summary judgment be, and hereby is,
granted; and it is further
ORDERED that this action be, and hereby is, dismissed with prejudice.