No. 21-CV-31 _____________________________ District of Columbia Court of Appeals _____________________________ TAX ANALYSTS AND AARON DAVIS, Plaintiffs-Appellants, v. DISTRICT OF COLUMBIA, Defendant-Appellee. _____________________________________________ On Appeal from the Superior Court of of the District of Columbia, Civil Division _____________________________________________ BRIEF FOR PLAINTIFFS-APPELLANTS ____________________________________________ Cornish F. Hitchcock (D.C. Bar No. 238824) HITCHCOCK LAW FIRM PLLC 5614 Connecticut Avenue, NW, No. 304 Washington, D.C. 20015-2604 (202) 489-4813 conh@hitchlaw.com 31 March 2021 Attorney for Plaintiffs-Appellants District of Columbia Court of Appeals _________________________________________ ) TAX ANALYSTS and AARON DAVIS, ) ) Plaintiffs-Appellants, ) ) v. ) No. 21-CV-31 ) DISTRICT OF COLUMBIA,, ) ) Defendant-Appellee ) __________________________________________) CERTIFICATE PURSUANT TO RULE 28(a)(2) Plaintiffs-Appellants state that the following parties appeared below: Plaintiffs-Appellants Plaintiff Tax Analysts is a non-profit District of Columbia corporation. Pursuant to Rule 26.1(a), Tax Analysts states that it has no parent corporation and that no publicly held corporation owns 10% or more of its stock. Plaintiff Aaron Davis Plaintiffs-Appellants were and are represented by Hitchcock Law Firm PLLC and Cornish F. Hitchcock. Defendant-Appellee Defendant District of Columbia. Office of the Chief Financial Officer was named as a defendant, but was dismissed from the case in Superior Court. Defendants were and are represented by the Office of the Attorney General for the District of Columbia. ­­­ These representations are made, inter alia, so that judges of this Court may evaluate possible recusal. __________________________________ Cornish F. Hitchcock Attorney for Plaintiffs-Appellants TABLE OF CONTENTS STATEMENT REGARDING FINALITY AND JURISDICTION 1 BRIEF FOR PLAINTIFFS-APPELLANTS 1 QUESTION PRESENTED 1 STATEMENT OF THE CASE 1 STATEMENT OF FACTS 2 SUMMARY OF ARGUMENT ARGUMENT x THE TRIAL COURT ERRED IN DENYING ACCESS TO REDACTED PRIVATE LETTER RULINGS. X Standard of Review x A. Introduction and Overview x B. The “Other Statutes” Exemption Does Not Permit Withholding Private Letter Rulings in Their Entirety. x C. The trial court erred in granting summary judgment without first conducting an in camera review. x D. The personal privacy exception has no application here. x CONCLUSION x TABLE OF AUTHORITIES* Cases: Barry v. Washington Post Co., 529 A.2d 319 321 (D.C. 1987) Doe v. D.C. Metro. Police Dep't, 948 A.2d 1210 (D.C. 2008) (Follow federal) Dunhill v. Director, District of Columbia Dep’t of Transportation, 416 A.2d 244 (D.C. 1980) Fraternal Order of Police v. District of Columbia, 79 A.3d 347, 360 (D.C. 2013) x Fraternal Order of Police, Metro. Labor Committee v. District of Columbia, 82 A.3d 803 (D.C. 2014) x Fraternal Order of Police, Metro. Labor Comm. v. District of Columbia, 113 A.3d 198, ___ (D.C. 2015) x Fraternal Order of Police, Metropolitan Police Labor Committee v. District of Columbia, 124 A.3d 69 (D.C. 2015) X Fraternal Order of Police v. District of Columbia, 139 A.3d 853 (D.C. 2016) reasonably describe; no void for volume exception Hines v. Bd. of Parole, 567 A.2d 909 (D.C. 1989); Kane v. District of Columbia, 180 A.3d 1073 (D.C. 2018) affidavits filed Mays v. Drug Enforcement Admin., 234 F.3d 1324 (D.C. Cir. 2000) x McReady v. Dep't of Consumer & Regulatory Affairs, 618 A.2d 609 (D.C. 1992); fees Neufeld v. IRS, 646 F.2d 661, 646 (D.C. Cir. 1981) x Newspapers, Inc. v. Metro. Police Dep't, 546 A.2d 990 (D.C. 1988) x Padou v. District of Columbia, 29 A.3d 973, 982 (D.C. 2011) x People for the American Way Foundation v. v. Nat'l Park Serv., 503 F. Supp. 2d 284, 307 (D.D.C. 2007) x Riley v. Fenty, 7 A.3d 1014 (D.C. 2010) x Rugiero v. Department of Justice, 234 F. Supp. 2d 697 (E.D. Mich. 2002) x Solar Sources, Inc. v. United States, 142 F.3d 1033 (7th Cir. 1998) x Tax Analysts and Advocates v. IRS, 505 F.2d 350 (D.C. Cir. 1974) x U.S. Dep’t of Defense v. Fed. Labor Relations Auth., 510 U.S. 487 (1993) x Vaughn v. Rosen, 484 F.2d 820, 827 (D.C. Cir.1973) x Vining v. District of Columbia, 198 A.3d 738, 743 (D.C. 2018); fees Vining v. Council of District of Columbia, 140 A.3d 439 (D.C. 2016) x Washington Post Co. v. Minority Bus. Opportunity Comm'n, 560 A.2d 517 (D.C. 1989) X Statutes: District of Columbia Freedom of Information Act, D.C. Code § 2-531 et seq. D.C. Code § 2-531 x D.C. Code § 2-532 D.C. Code § 2-534(a)(1) x D.C. Code § 2-534(a)(2) x D.C. Code § 2-534(a)(6) x D.C. Code § 47-4406(a) x Internal Revenue Code, 26 U.S.C. § 1 et seq. I.R.C. § 6103 x I.R.C. § 6110 x * __________ * Authorities principally relied upon are indicated by an asterisk. Court rules: Superior Court Rules of Civil Procedure Rule 12(b)(6) x Rule 56(a) x Other authorities: Joint Committee on Taxation, General Explanation of the Tax Reform Act of 1976, 94^(th) Cong., 2d Sess. 304, 305 (1976), available at https://archive.org/stream/generalexplanati00jcs3376/generalexplanati00jcs3376_djvu.txt. x District of Columbia Court of Appeals __________________________________________ ) TAX ANALYSTS and AARON DAVIS, ) ) Plaintiffs-Appellants, ) ) v. ) No. 21-CV-31 ) DISTRICT OF COLUMBIA,, ) ) Defendant-Appellee. ) _________________________________________ ) BRIEF FOR PLAINTIFFS-APPELLANTS STATEMENT REGARDING FINALITY AND JURISDICTION This is an appeal from a final judgment that disposed of all parties’ claims. QUESTION PRESENTED At issue in this Freedom of Information Act (“FOIA”) case is public access to “private letter rulings” issued by the Office of Tax and Revenue (”OTR”) in response to requests from a taxpayer (or other party) for guidance about how District of Columbia tax laws apply to a specific fact pattern. The questions presented are; 1. Did the trial court err in denying access to private letter rulings, even with names and personal identifiers redacted, on the basis of D.C. Code § 47-4406, entitled Secrecy of Returns? 2. Did the trial court err in denying to conduct an in camera review of these rulings to determine if any portions could be disclosed because they were “reasonably segregable” from any exempt portions? STATEMENT OF THE CASE Plaintiffs-appellants are Tax Analysts, a non-profit publisher of periodicals on taxation issues, and Aaron Davis, one of its reporters at the time of the request (collectively “Tax Analysts”). The Office of Tax and Revenue is an agency of defendant-appellee District of Columbia, and this brief will refer to the defendant-appellee as “OTR” unless the context dictates otherwise. In an opinion and judgment dated 13 January 2021 the Superior Court (Rigsby, J.) granted OTR’s contested motion for summary judgment and denied Tax Analysts’ cross-motion seeking an in camera review of the letter rulings. This appeal followed. STATEMENT OF FACTS Tax Analysts’ FOIA request and OTR’s response. On 8 October 2019 plaintiffs Tax Analysts and Aaron Davis filed an FOIA request with the Office of the Chief Financial Officer, OTR’s parent agency.[1] Complaint ¶ 3-4. Their FOIA request sought access to several types of records, including the only category at issue in this case: “All private letter rulings (PLRs) . . . created by the District of Columbia's Office of Tax and Revenue between January 1, 2016 and October 8, 2019.” Complaint ¶ 7; Declaration of Aaron Davis (“Davis Decl.”) ¶ 3; Plaintiffs’ Exhibit (“Pl. Ex.”) 1. This request was denied on the basis of two FOIA exemptions: • Exemption 1, D.C. Code § 2-534(a)(1), which allows agencies with withhold records submitted by a third party if disclosure would cause substantial harm to that party’s competitive position; and • Exemption 6, D.C. Code § 2-534(a)(6), subsection (A) of which allows agencies to withhold information that is “specifically exempted from disclosure by statute (other than this section).” The trial court relied solely upon this exemption in entering judgment in OTR’s favor. Tax Analysts appealed to the Mayor. In response, OTR identified “24 private letter rulings that are responsive to Tax Analysts’ request.” However, OTR denied access on the basis of the two exemptions cited previously, as well as a third exemption: •Exemption 2, which allows agencies to withhold information that would lead to a “clearly unwarranted invasion of personal privacy.” The Mayor’s office, after examining one of the 24 rulings in camera, upheld OTR’s denial. A request for reconsideration went unanswered. Complaint ¶¶ 8-13, 15; Davis Aff. ¶ 5; & Pl. Exs. 4-5. Independently of whether any of these exemptions apply here, another element of the FOIA is pertinent here, namely, the requirement that if a record contains exempt and non-exempt portions, an agency must make available the “reasonably segregable,” non-exempt portions. D.C. Code § 2-534(b). Here OTR argued, and the Mayor agreed, that any non-exempt portions of the requested letter rulings were “inextricably intertwined” with exemption portions, thus rendering redaction “useless” and as providing “little or no informational value.” Complaint ¶ 14, Pl. Ex. ¶ 4 at 9. Before discussing proceedings in Superior Court and the legal issues, we it may be useful to describe briefly the nature of the records at issue here. Private letter rulings. OTR’s website describes private letter rulings as– . . . the official tax positions of the Office of Tax and Revenue (OTR). The rulings are OTR's response to taxpayer requests for guidance on specific tax matters. A ruling may be relied upon by a taxpayer in filing a return, as the ruling binds OTR with respect to the specific tax matter. Pl. Ex. 7. Letter rulings are an important element of federal and state tax laws, given the complexity of tax law and the fact that the application of tax laws to a specific individual’s situation is not always clear. Thus, the Internal Revenue Service and the revenue departments in the District of Columbia and over 40 states issue letter rulings as a means of providing guidance to taxpayers about how to structure a transaction, whether a deduction or credit is available in a specific situation, or whether a specific tax law applies to a particular event or situation. Private letter rulings are thus helpful not only to the individual who requests one, but to other taxpayers and practitioners, who can obtain an understanding how a revenue department construes specific provisions of the tax code, regardless of whether the letter rulings are binding or not.[2] Davis Decl. ¶¶ 7-9. At the federal level the IRS has been required since 1974 to disclose private letter rulings with names and identifiers redacted, Tax Analysts and Advocates v. IRS, 505 F.2d 350 (D.C. Cir. 1974). Private letter rulings and other “written determinations” that the IRS issues on various tax issues must be made public with redactions under 26 U.S.C. (“I.R.C.”) § 6110, and those documents are available online at the IRS’s “FOIA Library,” https://www.irs.gov/privacy-disclosure/foia-library. At the state level, 36 of the state revenue departments that issue letter rulings publish those rulings with personal identifiers redacted. The District of Columbia is one of only a small number of jurisdictions that do not routinely make such rulings available. Davis Decl. ¶ 13. Proceedings in Superior Court. Tax Analysts filed its complaint on 28 March 2020, and OTR moved to dismiss under Super. Ct. Civ. R. 12(b)(6), relying solely on Exemption 6, the “other statutes” exemption. Tax Analysts opposed the motion and submitted exhibits demonstrating that OTR has in the past published redacted versions of private letter rulings and similar guidance. (CITE). Tax Analysts also requested an in camera review of the letter rulings in order to assess OTR’s claim that no “reasonably segregable” portions of the rulings could be made public. The “other statute” upon which OTR relied is D.C. Code § 47-4406, entitled Secrecy of Returns, subsection (a) of which states: (a) Except as provided in subsections (b), (c), (d)(2), (e), (e-1), and (e-2) of this section, and except as to an official of the District of Columbia, having a right thereto in his official capacity, an officer, employee, or contractor, or a former officer, employee, or contractor, of the District of Columbia shall not divulge or make known in any manner the amount of reported value, or any information relating to value or the computation of value, disclosed in a return required to be filed under this title. The original (or a copy) of a tax return desired for use in litigation in court shall not be furnished where the District of Columbia or the United States is not interested in the result of the litigation, whether or not the request is contained in an order of the court. Nothing contained in this section shall prevent the furnishing to the taxpayer of a copy of his or her return upon the payment of a fee as provided by the Mayor. This subsection shall also be applicable to federal, state, or local tax returns (or copies of these returns) and to federal, state, or local tax information either submitted by the taxpayer or otherwise obtained. The trial court denied OTR’s motion to dismiss, citing as relevant the language in D.C. Code § 47-4406 that-- . . . an officer, employee, or contractor, or former officer, employee, or contractor of the District of Columbia shall not divulge or make known in any manner the amount of reported value, or any information relating to value or the computation of value disclosed in a [tax] return required to be filed under this title. (J.A. ___) The court added that, as indicated by its text and title, this statute governs the “secrecy of returns” or “the amount of reported value, or any information relating to value or computation of value” disclosed in a tax return. In this case, however, “private letter rulings predate tax returns, [and] therefore tax returns are not at issue (J.A. ___). The court continued: A taxpayer in a PLR is generally seeking advice on how a certain fact pattern should be treated under D.C. tax law when filing a hypothetical future return. As Plaintiffs point out in their opposition, the taxpayer may upon receipt of a PLR decide not to pursue a specific transaction, and thus there would be no information disclosed” about such a transaction in “a return to be filed.” (J.A. ____. Therefore, the court concluded, “section 47-4406 does not prevent the disclosure of the information contained in PLRs” (J.A. ___). The court declined to consider OTR’s request to hold that any non-exempt information in the letter rulings were not “reasonably segregable” from the exempt portions. The court found no reason to decide that issue, inasmuch as Section 47-4406 was “the only basis advanced by Defendants to withhold information” and that any determination about the segregability of specific documents would present “a question of fact that is not currently before the Court” (J.A. __). Tax Analysts’ in camera motion was thus denied as moot (J.A. __). Notwithstanding this decision rejecting OTR’s reliance on Exemption 6, OTR filed a Vaughn index[3] that identified the 24 letter rulings and re-iterated its position that all 24 rulings could be withheld in their entirety under the “other statutes” exemption plus the other two exemptions cited in its letter to the Mayor (J.A. __). OTR did not accompany this Vaughn index with an affidavit from an OTR official with relevant knowledge of the documents. OTR then moved for summary judgment on the basis of all three exemptions (J.A. __-__). Tax Analysts opposed and renewed its motion for in camera review of the 24 letters in order to address the segregability issue (J.A. __-__).[4] The trial court granted OTR’s motion for summary judgment and entered judgment in OTR’s favor (J.A. __-__). The court explained that its prior ruling had been based on OTR’s reliance on language in section 47-4406 that “an officer, employee, or contractor, or former officer, employee, or contractor of the District of Columbia shall not divulge or make known in any manner the amount of reported value, or any information relating to value or the computation of value disclosed in a [tax] return required to be filed under this title.” For this ruling, the court relief on OTR’s citation of additional language in section 47-4406 “shall also be applicable to federal, state, or local tax returns (or copies of these returns) and to federal, state, or local tax information either submitted by the taxpayer or otherwise obtained’” (J.A. __-__) (emphasis in decision). The court read this language as leaving OTR “no discretion” to disclose private letter rulings or any portion of them (J.A. __-__). The court also rejected Tax Analysts’ argument that the federal FOIA has been read to require disclosure of private letter rulings with redactions of names and personal identifiers, notwithstanding similar “tax information” language in the Internal Revenue Code, 26 U.S.C. § 6103 (“I.R.C. § 1603”), entitled Confidentiality and disclosure of returns and return information (J.A. __-__). As for segregability, the trial court did not mention its prior statement that segregability is “a question of fact.” Instead, the court granted summary judgment based on the court’s view, unsupported by an affidavit from OTR or similar evidence, that “PLRs are in their entirety an evaluation of the tax consequences of a taxpayer’s financial circumstances,” such that redaction of exempt information would “produce an edited document of little or no informational value” (J.A. __-__ ) (internal citation omitted). This appeal followed. SUMMARY OF ARGUMENT ARGUMENT THE TRIAL COURT ERRED IN DENYING ACCESS TO REDACTED PRIVATE LETTER RULINGS. Standard of Review. The standard of review on all issues in this FOIA case is de novo. D.C. Code § 2-537(b). A. Introduction and Overview. “The public policy of the District of Columbia is that all persons are entitled to full and complete information regarding the affairs of government and the official acts of those who represent them as public officials and employees,” and to that end the FOIA’s provisions “shall be construed with the view toward expansion of public access and the minimization of costs and time delays to persons requesting information.” D.C. Code § 2-531. The FOIA is structured to require disclosure in two situations: •First, and “[w]ithout limiting the meaning of other sections” of the FOIA, there are 12 “categories of information [that] are specifically made public information,” even without a request for access, D.C. Code § 2-536(a), and one such category consists of “statements of policy and interpretations of policy, acts, and rules which have been adopted by a public body,” D.C. Code §§ 2-536(a)(4); • Second, agencies must respond to public requests for access to specific records, and those records must be provided except to the extent that a specific exemption allows withholding, D.C. Code §§ 2-532(a), 2-534. In order to promote the FOIA’s overarching disclosure policy, courts are required to construe exemptions “narrowly” and “with ambiguities resolved in favor of disclosure.” Fraternal Order of Police, Metro. Labor Comm. v. District of Columbia, 82 A.3d 803, 813 (D.C.2014) (internal citation and quotation omitted). Accord Washington Post Co. v. Minority Bus. Opportunity Comm'n, 560 A.2d 517, ___ (D.C. 1989) (“Just as the provisions of the Act giving citizens the right of access are to be generously construed, so the nine statutory exemptions must be approached with a jaundiced eye”). OTR has described private letter rulings as OTR’s “official tax positions,” which are prepared in “response to taxpayer requests for guidance on specific tax matters. A ruling may be relied upon by a taxpayer concerning a specific tax matter, since the ruling binds OTR as to the specific tax matter” (J.A. __). In other words, private letter rulings are the sort of “statements of policy and interpretations of policy, acts, and rules” that should be ordinarily be made public under D.C. Code § 2-536(a)(4), except to the extent an exemption may apply. In the sections that follow, we explain why none of the exemptions cited by OTR warrant withholding private letter rulings in their entirety and why the judgment should be reversed. B. The “Other Statutes” Exemption Does Not Permit Withholding Private Letter Rulings in Their Entirety. In entering summary judgment on OTR’s favor, the trial court relied on Exemption 6 of the FOIA, D.C. Code § 2-534(a)(6), which allows agencies to withhold– Information specifically exempted from disclosure by statute (other than this section), provided that such statute: (A) Requires that the matters be withheld from the public in such a manner as to leave no discretion on the issue; or (B) Establishes particular criteria for withholding or refers to particular types of matters to be withheld. In considering Exemption 6 claims, “we are required to interpret this exemption ‘narrowly,’ ‘with ambiguities resolved in favor of disclosure.’” Vining v. Council of the District of Columbia, 140 A.3d 439, 445 (D.C. 2016), quoting Fraternal Order of Police, Metro. Labor Comm. v. District of Columbia, 82 A.3d 803, 813 (D.C. 2014) (quoting in turn Fraternal Order of Police, Metro. Police Labor Comm. v. District of Columbia, 79 A.3d 347, 354 (D.C. 2013) (“FOP 2013”). Consistent with that general principle, this Court has generally rejected an agency’s resort to Exemption 6 except when the “other statute” is clear on its face. Compare, e.g., Vining (Legislative Privilege Act not covered by the exemption); Newspapers, Inc. v. Metro. Police Dep't, 546 A.2d 990 (D.C. 1988) (pre-home rule “Duncan Ordinance” not a “statute” under the exemption); Barry v. Washington Post Co., 529 A.2d 319 321 (D.C. 1987) (statute creating mayor's discretionary and ceremonial funds does not exempt any material) with Riley v. Fenty, 7 A.3d 1014 (D.C. 2010) (request for records that “pertain to” certain youths in custody barred by statute allowing agency to withhold “records pertaining to youths in custody”). There are two reasons why Exemption 6 does not permit withholding private letter rulings in their entirety. 1. The cited statute does not protect rulings in their entirety. The statute upon which OTR and the trial court rely is D.C. Code § 47-4406(a), quoted in full at p. __, supra. As the trial court noted, the two pertinent portions of that statute state that– . . . an officer, employee, or contractor, or a former officer, employee, or contractor, of the District of Columbia shall not divulge or make known in any manner the amount of reported value, or any information relating to value or the computation of value, disclosed in a return required to be filed under this title. and that– This subsection shall also be applicable to federal, state, or local tax returns (or copies of these returns) and to federal, state, or local tax information either submitted by the taxpayer or otherwise obtained. We address each part in turn. With respect to the first quoted excerpt, private letter rulings plainly fall outside the scope of the statutory text. The trial court acknowledged the point in denying OTR’s motion to dismiss (J.A. ___). The reason is that this portion of section 47-4406(a) bars disclosure of certain specified types of information that are “disclosed in a return required to be filed.” By contrast, private letter rulings predate returns. The person requesting the ruling is generally seeking advice on how a certain fact pattern should be treated under the tax laws when filing a future return. “Does the fact pattern in my request letter qualify for a certain tax credit?” “If I structure a proposed deal this way, will there by any tax liability?” OTR will respond by addressing the tax consequences of that hypothetical, and OTR’s conclusion is binding on OTR as to the requester. Private letter rulings do not, however, involve disclosure of a “return.” Indeed, if OTR’s conclusion is not to the taxpayer’s liking, the requester may choose not to pursue the transaction as laid out to OTR. As a result, the disclosure of a private letter ruling would not “disclose[ ]” any “information” that is in “a return required to be filed.” D.C. Code § 47-4406(a). This point is not theoretical: Plaintiffs’ Exhibit 12, which is a public OTR ruling (seemingly possibly taken from a private letter ruling, by judging the format, compare Pl. Ex. 10). In that exhibit OTR responded to a request for advice about whether the requester is required to file a District of Columbia income tax return; OTR concluded that, on the facts specified, the requester was not obligated to file such a return (Pl. Ex. 12). We turn now to second excerpt of D.C. Code § 47-4406(a), which allows OTR to withhold “federal, state, or local tax returns (or copies of these returns) and to federal, state, or local tax information either submitted by the taxpayer or otherwise obtained” (emphasis added). The trial court erred in reading this phrase as shielding private letter rulings in their entirely, with OTR having “no discretion” to release any portion of such rulings (J.A. __). Specifically, the trial court ignored a definition of “tax information” in section 47-4406 that suggests a more narrow scope of what may withheld. In addition, the trial court was clearly wrong on the facts in holding that OTR had “no discretion” to release private letter rulings, given record evidence that OTR can – and has – disclosed private letter rulings with names and identifiers redacted – which is precisely the result that Tax Analysts seeks here.[5] The phrase “tax information” is not defined in Title 47 of the D.C. Code, and neither are the more specific phrases “state tax information” or “local tax information.” However, D.C. Code § 47-4406(h)(3) does define “federal tax information” in a way that, as we shall demonstrate, argues in favor of disclosing the letter rulings at issue here. D.C. Code § 47-4406(h)(3) defines “federal tax information” as– a return or return information received directly from the Internal Revenue Service or obtained through an authorized secondary source, such as the Social Security Administration or any entity acting on behalf of the Internal Revenue Service pursuant to an Internal Revenue Code section 6103(p)(2)(B) agreement. By defining “federal tax information” as either a “return” or “return information,” section 47-4406 tracks I.R.C. § 6103, the key provision of the Internal Revenue Code with respect to taxpayer confidentiality. • I.R.C. § 6103(b)(1) defines a “return” as “any tax or information return, declaration of estimated tax, or claim for refund,” plus amendments, supplements, schedules and the like. • I.R.C. 6103(b)(2) defines “return information” in several contexts, along with a general definition in I.R.C. § 6103(b)(2)(A) bars disclosure of: 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 the Secretary with respect to a return or with respect to 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. . . . This language indicates the sort of specific, personal identifiers that can be redacted in order to protect taxpayer privacy. Tax Analysts’ position, in brief, is that D.C. Code § 47-4606(a) should be construed to require disclosure of private letter rulings with the names and similar identifiers redacted. This approach is consistent with the FOIA’s requirement that exemptions be narrowly construed in light of the pro-disclosure policy in the Act. Disclosure of identifiers redacted is an approach that harmonizes the two important policy goals that are implicated here: the FOIA’s goal of disclosing “statements of policy and interpretations of policy, acts, and rules” with section 47-4406’s goal of protecting individual taxpayer privacy. This approach is also consistent with how the IRS has been disclosing private letter rulings since the 1970s. As noted above (at p. _), in 1974, the District of Columbia Circuit held in Tax Analysts and Advocates that private letter rulings are not protected from disclosure under I.R.C. § 6103, which IRS had argued was the sort of “other statute” that forbade disclosure under the federal FOIA’s analogue to Exemption 6 (5 U.S.C. § 552(b)(3)). Later that year, the Sixth Circuit reached the same conclusion in a similar case. Those decisions came at a time when the Watergate Congress was focused on striking the right balance between government transparency and the protection of personal privacy. The Watergate Congress in 1974 passed significant liberalizing amendments to the FOIA (Pub. L. 93-502, 93d Cong., 2d Sess., codified in various sections of 5 U.S.C. § 552), as it also passed the Privacy Act, which created significant protections with respect to information about individuals that were contained in government agencies (Pub. L. 93-579, 93d Cong., 2d Sess., codified as 5 U.S.C. § 552a). The history was cited when the next Congress enacted the Tax Reform Act of 1976, which formed the framework for current federal disclosure policies with respect to tax returns and return information. A report accompanying that Act from the Joint Committee on Taxation explained that even with enactment of the Privacy Act, “Congress did not specifically focus on the unique aspects of tax returns in the Privacy Act.” Joint Committee on Taxation, General Explanation of the Tax Reform Act of 1976, 94^(th) Cong., 2d Sess. 315 (1976), available at https://archive.org/stream/generalexplanati00jcs3376/generalexplanati00jcs3376_djvu.txt.[6] The Joint Committee outlined the situation as follows: It has been argued that the private ruling system developed into a body of law known only to a few members of the tax profession. For example, an accounting or law firm with offices in Washington could have a library of all the private ruling letters issued to its clients. Such a firm was in a position to advise other clients as to the current IRS ruling position because of its special access to these rules of law. This, in turn, tended to reduce public confidence in the tax laws. Additionally, the secrecy surrounding letter rulings generated suspicion that the tax laws were not being applied on an even-handed basis. (303) Id. at 303. The Joint Committee then added: The Congress agrees with the previous court decisions that private rulings should be made public. Only in this way can all taxpayers be assured of access to the ruling positions of the IRS. Id. at 304. The 1976 Act struck the balance between disclosure vs. privacy by (1) amending I.R.C. § 6103 to provide more stringent privacy protections for “returns” and “return information” while (2) enacting a new I.R.C. § 6110, entitled Public inspection of written determinations. This Code section 6110 mandated the disclosure of IRS private letter rulings and technical advice memoranda (the two types of guidance at issue in the cited litigation) and all other “written determinations” that the IRS may issue regarding the proper interpretation of federal tax law.[7] The Joint Committee report explained that the goal of these provisions was to make public IRS’s written guidance with the text of those determinations– . . . sanitized so that there are no identifying details, is to be made open to public inspection. Identifying details consist of names, addresses, and any other information which the Secretary determines could identify any person, including the taxpayer's representative. Joint Committee, supra, at 316). See I.R.C. § 6110(c). Why do we recount this history regarding the federal FOIA? This Court has stated, the District’s FOIA is “modeled on the corresponding federal statute patterned on and construed in accordance with the federal” Act. Barry v. Washington Post Co., 529 A.2d at 321 (cited by the trial court at J.A. __). The trial court cited this language (J.A. __), but reached a result that is the exact opposite of how federal courts have construed parallel provisions of federal law – court rulings that Congress affirmatively endorsed and even went one step further by mandating disclosure not just to IRS private letter rulings, but to a whole range of IRS “written determinations” with names and personal identifiers redacted. Tax Analysts asks the Court to hold that Exemption 6 does not allow OTR to withhold private letter rulings in their entirety, but requires disclosure of those rulings with names and identifiers redacted. 2. OTR has discretion to disclose redacted private letter rulings – and has done so previously. Independently of the reasons cited above, there is an independent basis for rejecting OTR’s broad reading of D.C. Code § 47-4406. FOIA Exemption (6)(A), which the trial court found dispositive, allows the withholding of “[i]nformation specifically exempted from disclosure by statute (other than this section), provided that such statute: (A) Requires that the matters be withheld from the public in such a manner as to leave no discretion on the issue.” As noted above, the record reveals clearly that OTR can – and has – exercised its “discretion” to disclose the contents of private letter rulings with redactions of names and identifiers. Indeed, an OTR official candidly admitted as much to Tax Analysts several years ago (Pl. Ex. 10): “We sometimes convert PLRs to Notices which are then published on our website under ‘Law & Guidance’” [the latter web page reproduced here as J.A. __] OTR’s public notices and rulings appear to redact only names and potential identifiers, thus undercutting OTR’s claim that the exempt portions of a private letter ruling are “inextricably intertwined” with the non-exempt portions, so much so that attempting to redact exempt information would produce a “useless” document. Pl. Ex. 4, p. 2. For example, Plaintiffs’ Exhibit 9, an OTR “General Counsel Memorandum,” states that it was “originally issued as a private letter ruling.” This memorandum addresses liability for certain fees as between an unnamed hotel and an unnamed client. The memorandum refers to these parties as “HOTEL” or “CLIENT” and contains statements such as “Convention CLIENT entered into a contract with HOTEL for the reservation of X number of rooms for Y number of days in the month of Z.” If this example is any indication, OTR knows full well how to redact identifiers and to issue rulings that protect taxpayer privacy while still providing significant guidance to taxpayers. Moreover, OTR allows taxpayers to request and obtain “declaratory orders” that opine on the tax treatment of certain events or transactions in much the same way as private letter rulings. As with PLRs, these orders omit or redact the name of the petitioner/taxpayer, and they are deemed binding on OTR as to the requesting taxpayer. As with PLRs, the format includes the issues presented, the pertinent facts and the legal analysis of the issue. Unlike PLRs, however, declaratory orders are posted on the OTR website. Davis Decl. ¶ 19; Pl. Ex. 11. Private letter rulings and declaratory orders are similar in format and substance, and OTR offers no explanation on its website as to why the former is kept secret while the latter is made public.[8] Accordingly, for these reasons, Tax Analysts submits that Exemption 1 does not allow OTR to withhold private letter rulings in their entirety. C. The trial court erred in granting summary judgment without first conducting an in camera review. It is axiomatic that summary judgment must be denied if there is “a genuine dispute as to any material fact.” Super. Ct. Civ. R. 56(a). Here, the trial court granted OTR’s motion for summary judgment, even though there is a genuine dispute about whether the private letter rulings contain non-exempt portions that are “reasonably segregable” from any exempt portions and therefore must be produced to Tax Analysts. D.C. Code § 2-534(b). Given that conflict, the trial court should have denied summary judgment and instead granted Tax Analysts’ consent motion to review the letter rulings in camera in order to resolve the segregability issue. The record plainly supports the need for such an in camera review. OTR did not file any affidavits on segregability, and its Vaughn index simply asserted (without supporting details) that each letter ruling was exempt in its entirety. Significantly, OTR never disputed that these letter rulings contain non-exempt portions; instead, OTR argued that any non-exempt portions were so “inextricably intertwined” with the exempt portions that redaction would produce a document having “little or no informational value,” relying upon Mays v. Drug Enforcement Admin., 234 F.3d 1324, 1327 (D.C. Cir.2000), and Neufeld v. IRS, 646 F.2d 661, 666 (D.C. Cir. 1981). Ex. P 24 (SJ memo pp 9- 10). To rebut this claim, Tax Analysts provided an affidavit from appellant Aaron Davis, who stated – without contradiction – that OTR can and does publish redacted versions of letter rulings and other forms of taxpayer guidance (J.A. __-__). This evidence included a statement from OTR that– “We sometimes convert PLRs to Notices which are then published on our website under ‘Law & Guidance.’” (J.A. __, referring to J.A. __). Mr. Davis also submitted examples of such published guidance, which indicate that redacting a taxpayer’s name and other identifiers can be accomplished while leaving 95 percent of the ruling intact and thus able to provide useful guidance to taxpayers about how OTR is construing the District’s tax laws (J.A. __). In camera review is the obvious way to resolve this issue. As this Court has explained, in camera review allows a court to conduct the sort of de novo review required by the FOIA, thus enabling “the court – not the agency – to be the final arbiter of the propriety of the agency's decision to withhold information.” Riley v. Fenty, 7 A.3d at ___. See also FOP 2013, which noted that a trial court “may and often does examine the document in camera to determine whether the Government has properly characterized the information as exempt.” 79 A.3d at 359 n.50 (internal citation omitted). In rejecting in camera review, the trial court did not acknowledge its prior observation that segregability issues present questions of fact (J.A. __). Instead, the court declared that private letter rulings “are in their entirety an evaluation of the tax consequences of a taxpayer’s financial circumstances,” citing a page from the OTR web page (J.A. __, citing J.A. __). “Redacting the tax-exempt information from an analysis of the same would ‘[p]roduce an edited document with little informational value,’” Mays 243 F.3d at 1327, and therefore it is appropriate to withhold the documents in their entirety” J.A. __). In effect, the trial court treated the letter rulings as categorically exempt in their entirety, regardless of whether there are non-exempt portions. However, that was not what OTR argued. OTR argued that the non-exempt portions of the letter rulings are “inextricably intertwined” with the exempt portions and that excising the exempt portions would produce an edited document with little or no informational value. Ex. P 24 (SJ memo p 10). The arguments are analytically distinct, and the cited case law, even if taken on its own terms, is irrelevant.. Both OTR and the trial court relied on Mays v. Drug Enforcement Admin., 234 F.3d 1324, 1327 (D.C. Cir. 2000), which in turn quoted Neufeld v. IRS, 646 F.2d 661, 666 (D.C. Cir. 1981). However, Neufeld held that an “inextricably intertwined” argument is available only if the volume of requested records is significant and the non-exempt material is slight, such that any effort at redaction would significantly strain agency resources. Only in that situation has a court allowed a claim of “inextricably intertwined,” i.e., when the “excision of exempt information would impose significant costs on the agency and produce an edited document with little informational value.” Neufeld v. IRS, 646 F.2d 661, 646 (D.C. Cir. 1981), quoted in Mays v. DEA, 234 F.3d 1324, 1237 (D.C. Cir. 2000). Neither Neufeld nor Mays had occasion to rule on the specifics of when a burden might outweigh any value, but subsequent cases make it clear that OTR would need to make a far more compelling showing that it has made here. Compare Solar Sources, Inc. v. United States, 142 F.3d 1033, 1039 (7th Cir. 1998) (records not “reasonably segregable” when it would take eight work-years to identify all nonexempt documents in millions of pages of files, and only a small percentage could be released) with Rugiero v. Department of Justice, 234 F. Supp. 2d 697, 707-09 (E.D. Mich. 2002) (segregating non-exempt portions is not a significant burden for a 364-page request). Here, by contrast, we deal with only 24 documents, and based on the rulings that OTR has published (J.A. __-__), each ruling is likely to be no more than a few pages in length, for a total of probably 100 or so pages. Moreover, since OTR does redact and publish these rulings, doing so here would hardly strain OTR’s resources to a point that the request must be denied in its entirety. See People for the American Way Foundation v. v. Nat'l Park Serv., 503 F. Supp. 2d 284, 307 (D.D.C. 2007) (Sullivan, J.) (in camera review may be warranted when the number of records involved is relatively small, a disparity exists between the agency’ exemption claim and publicly available information, and the dispute turns on the contents of the documents). In short, there is no factual or legal basis for the trial court to reject an in camera review of records and to grant summary judgment without making a factual determination as to segregability. * * * A final observation In Fraternal Order of Police, Metropolitan Police Labor Committee v. District of Columbia, 124 A.3d ___ (D.C. 2015), this Court noted that in cases where trial courts “have reviewed records in camera to evaluate the government's claimed exemptions, appellate courts generally find it necessary to review the documents in camera as well.” Id. at 77 n.12. We respectfully submit that it would be appropriate for this Court to undertake an in camera review of the private letter rulings in this case, given the disparities in the parties’ descriptions of those documents. The volume of material is slight (100 pages or so), and it should be obvious from even a cursory review whether non-exempt material is “inextricably intertwined” with personal identifying information or whether the rulings more closely resemble those rulings that OTR has in the past made public with names and identifiers redacted (J.A. __-__). D. The personal privacy exception has no application here. OTR also sought summary judgment under Exemption 2, which allows agencies to withhold information that would lead to a “clearly unwarranted invasion of personal privacy.” D.C. Code § 2-534(a)(2). Although the trial court did not rule on this issue, we ask this Court to do so because, as we demonstrated in Part B above, a proper application of D.C. Code § 47-4406 is more than adequate to protect taxpayer privacy. Indeed, OTR has already demonstrated its ability to protect sensitive information in the redacted guidance it has been making available for years (J.A. __-__). Moreover, the text of the privacy exemption is limited to disclosures that “would constitute” a “clearly unwarranted” invasion of personal privacy. This is a very stringent standard,[9] and it requires the agency to identify a privacy interest, which the court will then balance against the public interest in disclosure. Padou v. District of Columbia, 29 A.3d 973, 982 (D.C. 2011). When OTR raised this argument in the trial court, it relied upon Fraternal Order of Police, Metro. Labor Comm’n v. District of Columbia, 124 A.3d 69 (D.C. 2015), but the case supports the sort of disclosure Tax Analysts seeks here. At issue in FOP 2015 were internal disciplinary records of MPD lieutenants, captains and senior officer. The requester agreed that names and identifying information (such as address, SSN, rank, district and birth date) could be redacted, 124 A.3d at 72, and the only issue was whether MPD had to disclose the gender and race of the disciplined officials and the date of the event. In conducting the requisite balancing of public interests versus private interest, this Court agreed that a significant privacy interest was at stake in disclosing names and personal identifiers, particularly given the ability of the requester’s members (who were police officers, after all) to use this information to ferret out the identities of the individuals in the “small subset” of senior officials who might have been disciplined. 124 A.3d at 79. However, this Court found no countervailing public interest (although disclosure might have served the FOP’s private interest). Access was thus denied. Accord U.S. Dep’t of Defense v. Fed. Labor Relations Auth., 510 U.S. 487, 795 (1993) (unions' request for home addresses of agency employees – many of whom are not union members – may advance unions’ interest, but would not inform citizens about “what their government is up to”) (internal citation omitted). Here, Tax Analysts agrees that OTR can redact names and personal identifiers of the sort that OTR now redacts when it publishes these documents. That will address any privacy concerns. The countervailing public interest is obvious, as evidenced by the fact that the IRS and 36 state revenue departments publish similar rulings with redactions that protect taxpayer privacy. But the Court need not take our word for it. Perhaps the best argument for disclosure appears in that portion of the OTR web site that the trial court did not quote in its opinion, i.e., the statement in which OTR acknowledges that private letter rulings are valuable because they 7 (the OTR website) acknowledges the public interest in access to PLRs because they “provide guidance to other District taxpayers as to the interpretation and development of the D.C. tax code” (J.A. __). Tax Analysts agrees. That is why we are pursuing this case and that is why we ask this Court to reverse the judgment and to order disclosure of the requested private letter rulings and names and personal identifiers redacted. CONCLUSION For these reasons the judgment should be reversed. Respectfully submitted, _________________________________________ Cornish F. Hitchcock (D.C. Bar No. 238824) HITCHCOCK LAW FIRM PLLC 5614 Connecticut Avenue, NW No. 304 Washington, D.C. 20015-2604 (202) 489-4813 Fax: (202) 315-3552 E-mail: conh@hitchlaw.com Attorney for Plaintiffs-Appellants __ March 2021 CERTIFICATE OF SERVICE I hereby certify that copies of this brief and the joint appendix were served electronically and by courier this _____ day of March, 2021 upon Caroline Van Zile, Principal Deputy Solicitor General, 400 Sixth Street, NW, Washington, DC 20001. _________________________________________ Cornish F. Hitchcock [1] ¹ The Office of the Chief Financial Officer was named as an additional defendant in the complaint, but was dismissed as a party for being non sui juris (J.A. __). [2] ² OTR’s private letter rulings are binding on OTR as to the individual taxpayer, but not necessarily as to other taxpayers or situations. (J.A. ___). [3] ³ “A Vaughn index itemizes any withheld documents and explains why each document is exempt from disclosure. See Vaughn v. Rosen, 484 F.2d 820, 827 (D.C.Cir.1973).” Fraternal Order of Police, Metro. Labor Comm. v. District of Columbia, 113 A.3d 198, ___ (D.C. 2015). [4] ⁴ The motion for in camera review erred in stating that OTR opposed in camera review. A praecipe was filed to advise the court and correct the record (J.A. __), to which OTR responded with a praecipe confirming that OTR consented to in camera review, though not to Tax Analysts’ request that summary judgment be denied (J.A. __-__). [5] ⁵ Indeed, in its motion to dismiss (at p. 8), OTR noted that D.C. Code § 47-4406(f) makes it a criminal offense for anyone to “willfully” disclose information that is protected by section 47-4406. OTR never tried to square its publication of documents Tax Analysts produced (J.A. __-__) with this criminal statute. [6] ⁶ Joint Committee reports are particularly influential in explaining tax legislation. The staff assists the tax writing committees as legislation is developed, and when a House-Senate conference committee has completed its work, the Joint Committee staff prepares “the statement of managers and the final revenue table” and then assists “the tax-writing committee staffs in preparation of explanatory materials of the conferees' decisions.” Joint Committee on Taxation, Role of JCT, available at https://www.jct.gov/operations/role-of-jct/. [7] ⁷ Technical advice memoranda are another form of IRS written guidance that the FOIA requesters had sought in both the D.C. Circuit case and the Sixth Circuit case. The former court held that these memoranda were exempt from disclosure and the latter court holding that they must be disclosed. Joint Committee Report at ___. [8] ⁸ We emphasize what Tax Analysts is not arguing. Plaintiffs’ Exhibit 9 is an edited version of a private letter ruling in which OTR substituted the word “HOTEL” for the name of the taxpayer and made similar changes for other identifiers. Tax Analysts’ request does not ask OTR to create a new document in this fashion, but simply to take the existing PLRs and delete names and personal identifiers. Redaction software or a Sharpie pen should suffice. [9] ⁹ The “clearly unwarranted” standard contrasts with the FOIA’s exemption protecting law enforcement records if disclosure of those records would produce an “unwarranted” invasion of personal privacy. D.C. Code ' 2-534(a)(3)(C).