Case 1:10-cv-01335-RCL Document 29-1

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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA ) ) ) ) ) ) ) ) ) ) ) )

SOUTHERN ALLIANCE FOR CLEAN ENERGY, Plaintiff, v. UNITED STATES DEPARTMENT OF ENERGY, Defendant.

Civil Action No. 10-1335 (RCL)

MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANTS MOTION FOR SUMMARY JUDGMENT This action arises from a Freedom of Information Act (FOIA), 5 U.S.C. 552, request that the plaintiff, Southern Alliance for Clean Energy (SACE), submitted on March 25, 2010 to the defendant, United States Department of Energy (DOE or Agency) for records pertaining to loan guarantees issued for the construction and operation of two nuclear reactors at the Vogtle Electric Generating Plant in Burke County, Georgia (Vogtle Project). As of this filing, DOEs Loan Programs Office, the office responsible for administering the Agencys Loan Guarantee Program, has conducted a search reasonably calculated to uncover documents relevant to SACEs FOIA request and produced all non-exempt responsive records. As the

accompanying declarations and Vaughn index demonstrate, DOE properly asserted Exemptions 4, 5, and 6 to withhold information protected from disclosure under the FOIA. As there are no material facts in dispute, DOE submits that summary judgment in its favor is appropriate and respectfully requests that the Court enter judgment for DOE.

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FACTUAL AND PROCEDURAL BACKGROUND DOE previously described the federal loan guarantee program in its partial summary judgment motion, Mem. of Points & Auth. in Support of Def.s Cross-Mot. for Partial Summ. J. [ECF No. 12] at 2-7, and will briefly summarize the relevant factual background for purposes of this motion. I. THE FEDERAL LOAN GUARANTEE PROGRAM A. DOE Invites Applications for Loan Guarantees for Nuclear Power Projects

Section 1703 of the Title XVII of the Energy Policy Act of 2005, 42 U.S.C. 1651116514, authorizes the Secretary of Energy to make loan guarantees to qualified projects that avoid, reduce or sequester air pollutants or anthropogenic emissions of greenhouse gases, and employ new or significantly improved technologies as compared to commercial technologies in service in the United States at the time of issuance of the guarantee. Declaration of David G. Frantz (Frantz Decl. [ECF No. 12-1]) 4. The Loan Programs Office administers the

Agencys Title XVII Loan Guarantee Program and is directed to accelerate the domestic commercial deployment of innovative and advanced clean energy technologies. Id. 5-6. In accordance with this mission, on July 11, 2008, DOE issued a solicitation entitled Federal Loan Guarantees for Nuclear Power Facilities inviting applications for loan guarantees for nuclear power projects. Id. 8. Pursuant to 10 C.F.R. Part 609, the solicitation specified the

requirements that a borrower or applicant must meet in order to obtain federal support of its project, including the submission of sensitive trade, financial, commercial and technological information. Id. 7-8. In response to the solicitation, applications seeking loan guarantees under Title XVII were filed in connection with 17 proposed new nuclear generating projects around the country. Id. 9.

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In September 2008, Georgia Power Company, Oglethorpe Power Company, and Municipal Electric Authority of Georgia (MEAG) (collectively, Applicants), the three joint owners of two new nuclear generating units under construction at the Alvin J. Vogtle Electric Generating Plant in Burke County, Georgia, each filed a Part I application. Id. Georgia Power, an investor-owned utility whose retail rates are regulated by the Georgia Public Service Commission, is a wholly-owned subsidiary of Southern Company engaged in the generation and purchase of electricity and the transmission, distribution and sale of electricity in Georgia. Id.; Declaration of Earl C. Long (Long Decl. [ECF No. 12-3]) 4. Georgia Power competes with other electric utilities, independent power producers, and cooperatives for short-term and longterm energy sales in the wholesale energy market in the Southeast. Long Decl. 4. Oglethorpe, a not-for-profit electric cooperative, provides wholesale electric power to its members which are consumer-owned electric cooperatives that provide retail electric service in Georgia on a not-forprofit basis. Frantz Decl. 9; Declaration of Elizabeth B. Higgins (Higgins Decl. [ECF No. 124]) 3. Oglethorpe competes in the wholesale power market in the southeastern United States with other wholesale power suppliers to provide wholesale power at the lowest possible cost to its members as well as off-system sales. Higgins Decl. 4. MEAG is a member-owned general and transmission authority supplying public power entities in Georgia. Frantz Decl. 9;

Declaration of James E. Fuller (Fuller Decl. [ECF No. 12-5]) 4. MEAG and its participants are engaged in competition with other electric service providers for the provision of retail and wholesale electric service, respectively. Fuller Decl. 4. The Part I applications outlined each Applicants proposed method of achieving the technical, budget, financial, personnel and project scheduling requirements of the solicitation, and defined the percentage of the cost of the Vogtle Project that each owner would pay based on

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its ownership interest. Frantz Decl. 10. Under the Applicants proposed financing structure, Georgia Power would be the direct borrower of the government funds and DOE would have full recourse to all of Georgia Powers assets in the event of a default on the guaranteed borrowing. Long Decl. 6. B. DOEs Processing of Loan Guarantee Applications

DOE determined that each Applicant satisfied the initial eligibility requirements. Frantz Decl. 11-12. DOE next provided guidance to each Applicant on its submission of a Part II application in December 2008. Id. 12. In the Part II application process, DOE and its independent consultants undertook a more comprehensive due diligence review of a projects financial, technical, regulatory, and legal strengths and weaknesses, along with a market analysis and environmental review to assesses compliance with the National Environmental Policy Act, Endangered Species Act, and other state and local environmental laws and regulations. Id. The loan guarantee application process involved negotiations between DOE and each Applicant regarding the terms and conditions of the loan guarantee. Id. 13-14. In October 2009, DOE offered to each Applicant an initial draft term sheet based on Loan Guarantee Program policy, federal laws governing the program, and each applicants particular loan needs and credit profile. Id. Each Applicant then responded to the term sheet offer with issues lists and through follow-up in-person and telephonic meetings to discuss and negotiate the terms and conditions contained in the initial term sheet. Id. The proposed terms and conditions in the drafts initial term sheet were subsequently revised by DOE and each Applicant to reflect each Applicants associated risk profile and to incorporate information provided by the Applicant. Id. From October 2009 to December 2009, DOE and the Applicants held a series of meetings to identify risk mitigation strategies and develop transaction terms to enhance the prospect for

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timely payment of principal and interest.

Id.

Each Applicant received and responded to

numerous term sheet revisions until a final term sheet was agreed upon by both parties. Id. During this time, the Applicants also supplemented their Part I and Part II application materials in response to additional due diligence requests made by DOE seeking sponsor corporate matters such as resource plans, corporate capital expenditure plans, and financing plans. Id. As stated in their respective applications, each joint owner of the Vogtle Project is obligated to pay a certain percentage of the total cost to construct the units as well as its own separate financing costs. Id. 10, 14. Thus, each Applicant developed project cost estimates for DOE that contained assumptions about interest rates and financing costs that were specific to each company, including, in Georgia Powers role as agent for the other joint owners, the details of an Equipment, Procurement and Construction contract that represented a significant portion of the total capital cost of the project. Id. 14. In addition, Applicants provided historical and projected financial statements, financial models, resource plans and financing plans supporting their assumptions to fund, operate and own the Vogtle Project, as well as loan draw schedules reflecting projected eligible project costs and amortization schedules. Id. After extensive

negotiations between DOE and the Applicants, the information provided by each Applicant was incorporated into the final terms and conditions of conditional commitment letters. Id. Most of the terms and conditions in the initial term sheet drafts were negotiated and revised based on the information provided by Applicants. Id. 15. After reaching consensus on the terms and conditions, DOE issued final term sheets on February 13, 2010, thereby making each term sheet a conditional commitment to each Applicant. Id. 16. Pursuant to 10 C.F.R. 609.9, the requirements and conditions stated in the Conditional Commitment Letters must be satisfied or waived by the Contracting Officer prior to issuance of

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the loan guarantee, and the Secretary may terminate a Conditional Commitment for any reason at any time prior to issuance of the loan guarantee. Id. 16-17. Until and unless the parties negotiate and execute a definitive loan guarantee agreement, the Conditional Commitment Letters are not binding on DOE and there can be no assurance that any Applicant will receive a federal loan guarantee from DOE. Id. 17; Long Decl. 8; Higgins Decl. 10; Fuller Decl. 8. In the course of negotiations over the Vogtle Project, DOE relied upon consultants and contractors, including subcontractors, who provided opinions, recommendations, expert advice, and assistance in the Agencys decision-making. See Supp. Frantz Decl. 7-9; see also Declaration of David G. Frantz dated Oct. 17, 2011. II. FOIA REQUEST FOR RECORDS PERTAINING TO VOGTLE PROJECT On March 25, 2010, Plaintiff submitted a FOIA request to DOE seeking certain records pertaining to loan guarantees for the Vogtle Project. Am. Compl. 6; Supplemental Declaration of Wendy Pulliam (Supp. Pulliam Decl.) Ex. A. Specifically, SACEs FOIA request sought seven categories of records relating to: (1) the Part I and Part II applications that DOE received for the Vogtle loan guarantees; the Vogtle loan guarantee application, including all correspondence between DOE and the Applicants; any environmental critique or evaluation prepared by DOE regarding the Vogtle loan guarantee application; the involvement of DOEs Credit Review Board with the Vogtle loan guarantee applications; the use of union labor as a condition, criteria, prerequisite, or factor in DOEs decision on the Vogtle loan guarantee applications; the issuance of a term sheet, or the drafting of any final or proposed term sheet, that sets forth the general terms and conditions under which DOE may issue a loan guarantee for the Vogtle Project; and

(2)

(3)

(4)

(5)

(6)

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(7)

the issuance of a loan guarantee for the Vogtle Project, including records related to the process and/or objective criteria used by DOE in its evaluation and records pertaining to DOEs evaluation of the relative strengths and/or weaknesses of the Vogtle applications.

See Supp. Pulliam Decl. Ex. A. A. The Agencys Search for Responsive Records

On April 5, 2010, the LPO FOIA team began its search for documents responsive to SACEs FOIA request. See Declaration of Wendy Pulliam (Pulliam Decl. [ECF No. 12-2]) 6. In October and November 2010, after SACE filed this action, the parties engaged in discussions to narrow the terms of Item 2 of the FOIA request, which sought all correspondence between DOE and the Applicants pertaining to the Vogtle Project. See Supp. Pulliam Decl. 6. In accordance with the parties agreement, the LPO FOIA team performed searches for Credit Review Board documents and correspondence that post-dated September 2009 between LPO and the Georgia Power Company, and agreed to limit its production to final versions of draft documents. Id. The LPO FOIA team conducted searches for hard copy documents contained in personal files and electronic mail correspondence. Id. 7. With regard to the search for physical files, the FOIA team contacted LPO staff who were intimately involved with the Vogtle loan guarantee, including LPOs Chief Counsel, the Senior Investment Officer assigned to the loan application, and the LPO attorney who oversaw the legal aspects of the Vogtle project, provided each individual with a copy of the FOIA request, and asked them to search their files for responsive documents. Id. The FOIA staff also contacted the head of the In-Take Review Division in LPO and another LPO Program Analyst, but learned that the Chief Counsel, the Senior Investment Officer, and the LPO attorney would have the relevant records pertaining to the Vogtle Project. Id. 7

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Separately from the search for hard copy files, the FOIA team conferred with the key members of the Vogtle team to identify other DOE employees who participated in the project within the given timeframe for purposes of searching for relevant correspondence. Id. 8. This discussion was ongoing throughout the processing of this FOIA request, and resulted in numerous additions to the original parties searched. Id. As a result, the LPO FOIA team identified 16 individuals, including a former DOE employee, whose electronic mail accounts needed to be searched for correspondence based on their significant participation in the Vogtle review process. Id. 9, 11. The FOIA team submitted search requests using terms that would flag any correspondence related to Georgia Power Company. Id. 9. Specifically, for Matt McMillen, Vic Trebules, Susan Richardson, Kwan Shin, Ed Davis, Markus Popa, Janet Barsy, Terry Hulihan, Jean Stucky, and Tom OConnor, the search terms used were: Georgia Power Company or Georgia Power or GPC or Vogtle. Id. For Nick Whitcombe, Ken Cestari, David Frantz, Dong Kim, and Jonathan Silver, the search terms used were Georgia Power Company or Georgia Power or GPC.1 Id. In addition to the non-exempt, responsive correspondence, DOE also disclosed all non-draft, non-duplicate, responsive email attachments, which numbered approximately 4,000 pages. Id. 10. B. The Agencys Processing of Records Responsive to SACEs FOIA Request

Upon its initial review of documents identified as potentially responsive, DOE determined that Plaintiffs request called for the disclosure of sensitive commercial and financial information that potentially fell within the scope of Exemption 4. Id. 13, 14. The Agencys regulations require that DOE, in the course of responding to a FOIA request, promptly notify the
1

One individual, Kelly Colyar, was treated differently because she was no longer employed by DOE at the time of the search. Supp. Pulliam Decl. 9. Upon discovering that Ms. Colyars electronic mail files were maintained by Nick VanDusen, the FOIA team had Mr. VanDusen conduct a search for Ms. Colyars relevant correspondence. Id. 8

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submitter of the commercial and/or financial information and provide the submitter an opportunity to submit his view on whether information contained in the requested document . . . is exempt from the mandatory public disclosure requirements of the Freedom of Information Act. See id. 13 (citing 10 C.F.R. 1004.11(c)). Agency regulations also require that DOE give the submitter of potentially exempt information no less than seven days prior to intended public disclosure to provide their views and submit an explanation addressing whether such information is subject to FOIA exemptions. Id. Because the Applicants provided information to DOE related to the financing of the Vogtle Project, the LPO FOIA team notified each Applicant of SACEs FOIA request and directed the companies to submit their views on any information that should be withheld along with an explanation as to why such information was subject to withholding under FOIA. Id. 14. DOE took into consideration the views and justifications provided by the Applicants in making an independent determination on whether the information in question should be released. Id. 15. In addition, LPO subject matter experts reviewed the records to determine if

information contained therein may otherwise be exempt from disclosure under FOIA. Id. 16. Upon completion of this multi-step review process, the FOIA team processed and released all responsive documents, whether withheld in part or full. Id. 19. The FOIA team conducted a line-by-line review of the records recommended for withholding in part or in full to ensure that the FOIA exemptions were applied appropriately and that all non-exempt portions were segregated and released. Id. Between March and September 2011, the Agency made rolling productions of responsive records on a monthly basis. Id. 17. On October 20, 2011,

November 29, 2011, and December 9, 2011, the Agency made three amended and supplemental disclosures to release additional information that had previously been withheld. Id.

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In its releases, DOE redacted (1) commercial and financial information supplied by the Applicants pursuant to Exemption 4; (2) inter- and intra-agency predecisional communications pursuant to Exemption 5; (3) personally identifiable information pursuant to Exemption 6, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy, and (4) information that was not responsive. Id. 18. The portions of documents marked as exempt pursuant to Exemption 5 were withheld because they pertained to recommendations, analyses, speculation, and other non-factual information prepared during the Agencys decision-making process relating to the loan guarantee for the Vogtle Project. Supp. Frantz Decl. 10. III. PROCEDURAL HISTORY The parties jointly requested, and the Court ordered, briefing on DOEs response to Item 6 of SACEs FOIA request while DOE continued to process the remaining portions of the request. ECF No. 9. In its challenge to DOEs response to Item 6 of the FOIA request, SACE contested DOEs application of Exemption 4 to withhold in part three conditional term sheets setting forth the terms and conditions underlying federal loan guarantees for the construction and operation of nuclear reactors at the Vogtle Plant. The parties have fully briefed the adequacy of DOEs response to Item 6 of the FOIA request. See ECF Nos. 11-15, 19. With regard to the remaining portions of SACEs FOIA request, following discussions between the parties, SACE identified two categories of documents that it intends to challenge: (1) DOEs application of Exemption 4 to letters to Georgia Power Company, Municipal Electric Authority of Georgia, and Oglethorpe Power Corporation, concerning the credit subsidy cost estimates relating to the Vogtle Project; and (2) DOEs application of Exemptions 4, 5, and 6 to

10

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specific records and groups of records identified by SACE on November 16, 2011.2 See Supp. Pulliam Decl. 20 & Ex. B. LEGAL STANDARD Summary judgment is appropriate when the pleadings and evidence show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Tao v. Freeh, 27 F.3d 635, 638 (D.C. Cir. 1994). The party seeking summary judgment must demonstrate the absence of a genuine issue of material fact. See Celotex, 477 U.S. at 248. A genuine issue of material fact is one that might affect the outcome of the suit under the governing law. Anderson, 477 U.S. at 248. Once the moving party has met its burden, the nonmoving party may not rest upon the mere allegations or denials of his pleading, but . . . must set forth specific facts showing that there is a genuine issue for trial. Anderson, 477 U.S. at 248. The vast majority of FOIA cases are decided on motions for summary judgment. See Brayton v. Office of U.S. Trade Rep., 641 F.3d 521, 527 (D.C. Cir. 2011); Citizens for Responsibility & Ethics in Washington v. U.S. Dept of Labor, 478 F. Supp. 2d 77, 80 (D.D.C. 2007) (CREW); Wheeler v. Dept of Justice, 403 F. Supp. 2d 1, 5-8 (D.D.C. 2005). An agency may be entitled to summary judgment in a FOIA case if it demonstrates that no material facts are in dispute, it has conducted an adequate search for responsive records and each responsive record that it has located either has been produced to the plaintiff or is exempt from disclosure. See Weisberg v. Dept of Justice, 627 F.2d 365, 368 (D.C. Cir. 1980). To meet its burden, a defendant may rely on reasonably detailed and non-conclusory declarations. See McGehee v.
2

Although the fifth group of records identified in SACEs November 16, 2011, letter is labeled Documents Not Produced, these records were released to SACE on December 9, 2011. See Supp. Pulliam Decl. 17(k). 11

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C.I.A., 697 F.2d 1095, 1102 (D.C. Cir. 1983); Vaughn v. Rosen, 484 F.2d 820 (D.C. Cir. 1973), cert denied, 415 U.S. 977 (1974); Wheeler, 403 F. Supp. 2d at 6. [T]he Court may award summary judgment solely on the basis of information provided by the department or agency in declarations when the declarations describe the documents and the justifications for nondisclosure with reasonably specific detail, demonstrate that the information withheld logically falls within the claimed exemption, and are not controverted by either contrary evidence in the record nor by evidence of agency bad faith. CREW, 478 F. Supp. 2d at 80 (quoting Military Audit Project v. Casey, 656 F.2d 724, 738 (D.C. Cir. 1981)). In support of its motion, DOE has submitted the Supplemental Declarations of David G. Frantz and Wendy Pulliam and detailed Vaughn indices for the documents at issue to explain and justify the Agencys withholdings in response to Plaintiffs FOIA request. DOE additionally relies upon the previously submitted declarations of Mr. Frantz and Ms. Pulliam, and the declarations of Earl C. Long, Assistant Treasurer of Georgia Power Company, Elizabeth B. Higgins, Executive Vice President and Chief Financial Officer of Oglethorpe, and James E. Fuller, Senior Vice President and Chief Financial Officer of MEAG, to explain the competitive harm that would result from disclosure of the commercial and financial information in the records at issue. ARGUMENT I. DOE PROPERLY RELEASED ALL RESPONSIVE, NON-EXEMPT RECORDS IN RESPONSE TO SACES FOIA REQUEST The FOIA requires that an agency release all records responsive to a properly submitted request unless such records are protected from disclosure by one or more of the Acts nine exemptions. 5 U.S.C. 552(b); U.S. Dept of Justice v. Tax Analysts, 492 U.S. 136, 150-51 (1989). Once the court determines that an agency has released all nonexempt material, it has no further judicial function to perform under the FOIA and the FOIA claim is moot. Perry v. Block,

12

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684 F.2d 121, 125 (D.C. Cir. 1982); Muhammad v. U.S. Customs & Border Prot., 559 F. Supp. 2d 5, 7-8 (D.D.C. 2008). As shown below, DOE conducted an adequate search for records responsive to SACEs FOIA request and properly withheld information pursuant to Exemptions 4, 5, and 6. A. DOE Conducted A Thorough Search Reasonably Calculated to Uncover All Records Responsive to SACEs FOIA Request

Under the FOIA, an agency must undertake a search that is reasonably calculated to uncover all relevant documents. Weisberg v. Dept of Justice, 705 F.2d 1344, 1351 (D.C. Cir. 1983). An agencys search for records is adequate if it was reasonably calculated to uncover all relevant documents. Valencia-Lucena v. U.S. Coast Guard, 180 F.3d 321, 325 (D.C. Cir. 1999) (internal quotation marks omitted); Oglesby v. Dept of the Army, 920 F.2d 57, 68 (D.C. Cir. 1990) ([T]he agency must show that it made a good faith effort to conduct a search for the requested records, using methods which can be reasonably expected to produce the information requested.). A search is not inadequate merely because it failed to uncover[] every document extant. SafeCard Servs., Inc. v. S.E.C., 926 F.2d 1197, 1201 (D.C. Cir. 1991). Rather, a search is inadequate only if the agency fails to show, with reasonable detail, that the search method . . . was reasonably calculated to uncover all relevant documents. Oglesby, 920 F.2d at 68. Once an agency demonstrates the adequacy of its search, the agencys position can be rebutted only by showing that the agencys search was not made in good faith. Maynard v. C.I.A., 986 F.2d 547, 560 (1st Cir. 1993). Hypothetical assertions are insufficient to raise a material question of fact with respect to the adequacy of an agencys search. Oglesby, 920 F.2d at 67 n.13. Agency affidavits enjoy a presumption of good faith that withstands purely speculative claims about the existence and discoverability of other documents. Chamberlain v. U.S. Dept of Justice, 957 F. Supp. 292, 294 (D.D.C. 1997), affd, 124 F.3d 1309 (D.C. Cir. 1997).

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As the supplemental declaration of Wendy Pulliam, the Project Manager of the FOIA Team for the Loan Programs Office, establishes, DOEs search was reasonably calculated to uncover all records in its possession that were responsive to SACEs FOIA request. Here, the Loan Programs Office had responsibility for administering the Agencys loan guarantee program. See Frantz Decl. [ECF No. 12-1] 5-6. The LPO FOIA team searched for hard copy documents contained in the personal files of three LPO staff members who had primary involvement with the Vogtle loan guarantee -- the Chief Counsel, the Senior Investment Officer assigned to the Vogtle loan application, and the LPO attorney who oversaw the legal aspects of the Vogtle Project -- provided each with a copy of the FOIA request, and asked them to search their physical files for responsive documents. Supp. Pulliam Decl. 7. In addition to the searches for hard copy files, the FOIA team, working in conjunction with the key members of the Vogtle team, identified 16 DOE employees (including one who was no longer an employee at the time of the search) who had participated in the project and were therefore likely to have relevant correspondence. Id. 8. For each of these 16 individuals, the LPO FOIA team conducted searches of their electronic mailboxes using broad terms to flag any items of correspondence related to Georgia Power Company, consistent with the parties agreement. Id. 6, 9. Specifically, for Matt McMillen, Vic Trebules, Susan Richardson, Kwan Shin, Ed Davis, Markus Popa, Janet Barsy, Terry Hulihan, Jean Stucky, and Tom OConnor, the FOIA team searched for Georgia Power Company or Georgia Power or GPC or Vogtle. Id. For Nick Whitcombe, Ken Cestari, David Frantz, Dong Kim, and Jonathan Silver, the FOIA team searched for Georgia Power Company or Georgia Power or GPC. Id. The search of the electronic mail files of the former DOE employee, Kelly Colyar, contained a string of disjunctive terms that included Vogtle, Georgia

14

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Power, or GPC.

Id. 9.

The LPO staff regularly exchanged Vogtle-related analysis,

financing schedules, and draft documents through electronic mail, so the search of electronic mail, which included attachments, functioned as the equivalent of a search of the individual files of all 16 individuals. In sum, DOE identified the relevant persons within the Loan Programs Office who were involved with the Vogtle Project, searched the hard copy files of the three staff members primarily involved with the Vogtle Project, and searched the electronic files (including attachments) of 16 individuals using broad terms such as Georgia Power or Vogtle that were reasonably likely to yield relevant documents -- all of which underscores the reasonableness of its search. See Techserve Alliance v. Napolitano, No. 10-353 (RCL), 2011 WL 3606525, at *4 (D.D.C. Aug. 17, 2011) (The adequacy of an agencys search is governed by principles of reasonableness.) (quoting Oglesby, 920 F.2d at 68). B. DOE Properly Withheld Confidential Commercial Information Pursuant to Exemption 4

Of the contested records, DOE withheld portions of 41 records under FOIA Exemption 4, which exempts from disclosure [1] trade secrets and commercial or financial information [2] obtained from a person and [3] privileged or confidential. 5 U.S.C. 552(b)(4) (bracketed material added); Supp. Pulliam Decl. 12-16, 21; Vaughn Index Appendix A.3 As explained below, the withheld records meet each of these criteria.

For ease of reference, the attachments to an email are grouped on the Vaughn index as one entry and referred to in this brief as one record. The records on which DOE applied Exemption 4 are: CR7-8; CR34-35; CR155; NW124-127; NW277-279; NW288-291; NW302-303; NW308310; NW562-564; NW606-609; NW707-708; NW709; NW738-740; NW750; NW784-785; NW802-804; NW813-814; KC194; KC240-243; DF7-9; DF55-56; DF58; SR165-167; Attachments to DF58; Attachment to JS18; Attachments to NW592; Attachments to NW812; Attachments to SR295; Attachment to JB10; Attachments to SR2; Attachments to KyC113; Attachments to KyC129; Attachments to KyC176; SR189-191; KC88; Attachments to KC88; 15

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1.

The Redacted Information Contains Commercial and Financial Information Obtained From A Person

First, the D.C. Circuit has instructed that the terms commercial and financial be given their ordinary meaning. Pub. Citizen Health Research Group v. FDA, 704 F.2d 1280, 1291 (D.C. Cir. 1983) (interpreting these terms to mean that records are commercial so long as the submitter has a commercial interest in them). As explained in Ms. Pulliams supplemental declaration and in Appendix A to the Vaughn index, the withheld information concerns highly sensitive commercial and financial information provided by the Applicants in connection with the financing arrangement for the Vogtle loan guarantee. See Supp. Pulliam Decl. 14, 21; Vaughn Index Appendix A. Specifically, the withheld information pertains to the rights,

obligations, contractual arrangements with DOE and other third parties, estimated project costs, credit analyses and rating, equity commitment, and reporting and other requirements related to the loan guarantee for the Vogtle Project. See Vaughn Index Appendix A at 1. With respect to Georgia Power, the types of commercial or financial information include: credit subsidy cost estimates (Vaughn Index No. CR7-8; Attachments to SR2); annual maintenance fee/agency fee (CR34-35); provisions in term sheet and the Equipment, Procurement and Construction agreement (NW124-127); draft of term sheet for financing (NW277-279); proposed amortization schedule (NW288-291); issues regarding Davis Bacon Act (NW 308-310); freeze on program requirements issue (NW562-564); conditional commitment signature and payment (NW707-708); terms of loan guarantee (NW 709); Davis Bacon Act provisions and loan rates (NW 738-740); amortization template (KC194); proposed list of discussion points related to draft term sheets (DF7-9); and executive summary for Credit Committee (Attachments to SR295). See Vaughn Index Appendix A p. 3. With regard to JS120; Attachments to JS120; Attachments to NW19; Attachments to NW567-568; Attachments to NW701. See Vaughn Index. 16

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Oglethorpe, the withheld information pertains to credit subsidy cost estimates (Vaughn Index No. Attachments to SR2); provisions in the term sheet and Equipment, Procurement and Construction agreement (NW124-127); Davis Bacon Act provisions and loan rates (NW738740); cost-benefit analysis (NW750); credit policy for term sheet (NW784-785); discussion points related to draft term sheets (DF7-9); executive summary for Credit Committee (Attachments to SR295); and valuation and Vogtle project sensitivity model (KyC129 attachment). Id. at p. 6. Finally, the types of MEAG commercial or financial information that have been withheld include credit subsidy cost estimates (Vaughn Index No. Attachments to SR2); provisions in the term sheet and the Equipment, Procurement and Construction agreement (NW124-127); Davis Bacon Act provisions and loan rates (NW738-740); cost-benefit analysis (NW750); discussion points related to draft term sheets (DF7-9); and an executive summary for Credit Committee (Attachments to SR295). Id. at p. 7. This information falls squarely within the type of information which the courts have typically regarded as commercial. See, e.g., Baker & Hostetler LLP v. U.S. Dept of Commerce, 473 F.3d 312, 320 (D.C. Cir. 2006) (concluding that letters describing favorable market conditions for domestic lumber companies, the disclosure of which would help rivals identify the companies competitive weaknesses, plainly contain commercial information within the meaning of Exemption 4); Allnet Communication Servs., Inc. v. FCC, 800 F. Supp. 984, 986-88 (D.D.C. 1992); Durnan v. Dept of Commerce, 777 F. Supp. 965, 965-67 (D.D.C. 1991). Second, the information contained in the 41 records was obtained from a person, which FOIA defines as an individual, partnership, corporation, association, or public or private organization other than an agency. 5 U.S.C. 551(2). The withheld information has been provided to DOE by Georgia Power, Oglethorpe, and MEAG, each of which is a corporation that

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qualifies as a person under FOIA. Pub. Citizen Health Research Group v. Natl Inst. of Health, 209 F. Supp. 2d 37, 44 (D.D.C. 2002) (There is no doubt that a corporation may be considered a person for the purposes of exemption 4.). The fact that certain of the terms of the financing arrangement were generated as a result of extensive negotiations between DOE and the Applicants, see Frantz Decl. 13-14, does not alter the fact that the [Applicants] were the ultimate source of this information. See Pub. Citizen, 209 F. Supp. 2d at 44. Indeed, courts have held that documents containing summaries or reformulations of information supplied by a source outside of the government are protected under Exemption 4. Judicial Watch, Inc. v. Exp.-Imp. Bank, 108 F. Supp. 2d 19, 28 (D.D.C. 2000) (citing Gulf & W. Indus. v. United States, 615 F.2d 527, 529-30 (D.C. Cir. 1979)); see OSHA Data/CIH, Inc. v. U.S. Dept of Labor, 220 F.3d 153, 162 n.23 (3d Cir. 2000) (concluding that the release of a ratio derived by an agency from numbers submitted to the agency would result in the disclosure of commercial information obtained from a person and would thus come within Exemption 4 if the information was confidential). On this basis, the court in Public Citizen upheld the application of Exemption 4 to withhold the royalty rate in an agreement between a licensee and the National Institutes of Health based upon its determination that the licensee still must provide the information in the first instance, even if the final royalty rates may be the result of negotiation between the licensee and the agency. See Pub. Citizen, 209 F. Supp. 2d at 44-45. In sum, because each of the Applicants was the ultimate source of the commercial and financial information incorporated into discussions and negotiations over the Vogtle loan guarantee, the requested records contain information obtained from a person and are therefore protected from disclosure pursuant to Exemption 4.

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2.

The Redacted Information Is Confidential

Under the third prong of Exemption 4, courts examines whether the information is privileged or confidential. 5 U.S.C. 552(b)(4). As the D.C. Circuit has articulated, whether commercial information should be considered confidential and therefore protected under Exemption 4 is guided by the substantial competitive harm test. National Parks and Conservation Assn v. Morton, 498 F.2d 765, 770 (D.C. Cir. 1974) (Natl Parks I), as modified by National Parks and Conservation Assn v. Kleppe, 547 F.2d 673, 679 (D.C. Cir. 1976) (Natl Parks II). This standard remains the definitive measure for evaluating whether information falls within the scope of Exemption 4 where, as here, the materials in question were not volunteered, but required to be provided, to DOE in order to be considered for loan guarantees under the Title XVII Loan Program. See Judicial Watch, Inc. v. U.S. Dept of Treasury, No. 09-1508 (BAH), 2011 WL 2678930, at *21 n.8 (D.D.C. July 11, 2011) (concluding that information submitted by bank in the course of its application for an initiative under Treasurys Troubled Asset Relief Program should be considered required and applying National Parks standard); Lykes Bros. Steamship Co. v. Pena, No. 922780, 1993 WL 786964, at *4, *8 n.4 (D.D.C. Sept. 2, 1993) (finding submission can be mandatory if it is a condition necessary to receiving approval of [an] application made to the Government, or if submissions are required to realize the benefits of a voluntary program . . .). In National Parks I, the D.C. Circuit held that commercial or financial information qualified as confidential if disclosure of the information would likely: (1) cause substantial harm to the competitive position of the person from whom [it] was obtained, or (2) impair the Governments ability to obtain necessary information in the future. Disclosure here threatens both harms. 498 F.2d at 770.

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a.

Disclosure Would Cause Substantial Harm to the Applicants

The D.C. Circuit does not require that a party show actual competitive harm in order to make an adequate showing of the likelihood of substantial competitive harm. Pub. Citizen Health Research Group, 704 F.2d at 1291 (quoting Gulf & W. Indus., 615 F.2d at 530). Rather, evidence revealing [a]ctual competition and the likelihood of substantial competitive injury is sufficient to bring commercial information within the realm of confidentiality. Kahn v. Fed. Motor Carrier Safety Admin., 648 F. Supp. 2d 31, 36 (quoting Pub. Citizen, 704 F.2d at 1291). Although conclusory and generalized allegations of substantial competitive harm are insufficient to justify the application of Exemption 4, the court need not engage in a sophisticated economic analysis to determine whether there is a likelihood of substantial competitive injury. Id. (citing Public Citizen, 704 F.2d at 1291). Each of the three Applicants, Georgia Power, Oglethorpe, and MEAG, submitted declarations explaining that they face actual competition in the market for energy sales and the likelihood of substantial competitive injury that would result from disclosure of their commercial and financial information. See Natl Parks II, 547 F.2d at 684 (concluding that it is virtually axiomatic that disclosure of commercial and financial information is likely to cause competitive harm in light of the extremely detailed and comprehensive nature of the financial records requested). To begin with, the Georgia Power information withheld under Exemption 4 included the credit subsidy cost estimate (Vaughn Index No. Attachments to SR2) and related details of the loan guarantee, such as contractual terms and obligations, estimated project costs, credit analyses, and reporting terms and requirements. See Vaughn Index Appendix A at p. 3. Because Georgia Power competes with other electric utilities, independent power producers, and cooperatives for short-term and long-term energy sales in the wholesale energy market in the

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Southeast and with other electric suppliers for the acquisition of additional generating resources, its ability to compete in the marketplace is greatly affected by its ability to manage borrowing costs. Long Decl. [ECF No. 12-3] 4. In the event the DOE loan guarantee were to evaporate, Georgia Power would have to negotiate financing from alternative sources of financing and would do so in competition with other parties also seeking capital. Id. 8. Consequently, disclosure of the detailed terms and conditions of financing of the Vogtle Project would harm Georgia Powers competitive position if it had to secure alternative financing in the amount of $3.4 billion for the construction of the Vogtle Units. Id. 8; see Vaughn Index Appendix A at pp. 2-3. Georgia Powers competitors who are seeking federal loan guarantees under the Title XVII Loan Program would benefit from public disclosure of the terms, conditions, analyses and review of its loan guarantee with DOE, as information relating to the terms upon which DOE may be willing to make federal loan guarantees for new nuclear projects would be highly valuable to these competitors. Long Decl. 13; see Vaughn Index Appendix A at pp. 2-3. Disclosure of information such as the credit fee subsidy cost estimates in the DOE letter to Georgia Power dated January 15, 2009 (see Vaughn Index No. Attachments to SR2) would permit competitors to better evaluate financing alternatives for new nuclear generating units, and such information would be provided at essentially no cost given that it was developed through the resources and efforts of Georgia Power. See Vaughn Index Appendix A at pp. 2-3. See Natl Parks II, 547 F.2d at 684 (Disclosure would provide competitors with valuable insights into the operational strengths and weaknesses of a [company], while [its competitors] could continue in the customary manner of playing their cards close to their chest.).

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Similarly, Oglethorpe participates in the wholesale power market in the southeastern United States, and its ability to construct, acquire and finance power and capacity sources in the most cost-efficient manner possible is critical to its competitive position. Higgins Decl. [ECF No. 12-4] 3-5. The project cost estimates that Oglethorpe has developed for and provided to DOE are subject to revision up until the final terms of Oglethorpes financing for the Vogtle Project are determined. Id. 10. Thus, disclosure of different estimates of the project cost would likely cause substantial competitive harm to Oglethorpe by creating confusion in the credit market and presenting difficulties for Oglethorpe in future public debt offerings. Id. Moreover, the disclosure of confidential financial data and loan terms, such as the credit fee subsidy cost estimates in the DOE letter to OPC dated January 15, 2009 (Vaughn Index No. Attachments to SR2), could adversely affect Oglethorpes negotiating position for short-term borrowings, as well as its ability to negotiate favorable financing terms in any alternative financing scenario should the DOE loan guarantee falter. Id. 11-17; see Vaughn Index Appendix A pp. 4-5. Finally, MEAGs competitive position in the wholesale power market has a direct effect on its participants competitive position in the retail power market in that reduced wholesale power costs lead to reduced retail prices. Fuller Decl. [ECF No. 12-5] 5. MEAG also competes in the wholesale power market in and outside of the State of Georgia through its participation in a wholesale power trading organization and through bilateral long-term sales of power to wholesale power consumers. Id. 6. Disclosure of these specific restrictive financing terms and conditions in connection with the loan guarantee would provide unfair bargaining advantage to current and future lenders in negotiations with MEAG in that other lenders may demand inclusion of same or similar restrictions that have the effect of increasing financing costs

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to MEAG and its participants. Id.; see Vaughn Index Appendix A at pp. 6-7. Should the withheld information, such as the credit fee subsidy cost estimates in the DOE letter to MEAG dated January 15, 2009 (see Vaughn No. Attachments to SR2), be disclosed, this would provide unfair bargaining advantage to MEAGs current and future lenders in their negotiations with MEAG and embolden them to insist on recovering these types of costs based on MEAGs agreement with DOE in this transaction, and potentially result in increases in cost that substantially harm MEAGs competitive position. See Vaughn Index Appendix A at p. 7. Moreover, because MEAGs competitors are not subject to having the terms and conditions of their financing arrangements disclosed, this places MEAG at a competitive disadvantage to other similar entities in negotiating with credit providers or underwriters. See id. Based upon the above concerns, DOE correctly concluded that release of the commercial and financial information pertaining to the Vogtle loan guarantee would cause substantial harm to the competitive position of each of the Applicants. b. Disclosure of the Confidential Information Would Impair DOEs Ability to Effectively Implement the Loan Guarantee Program

In evaluating the interests protected by Exemption 4, courts have recognized interests beyond the impairment of an agencys ability to obtain necessary information in the future, such as the interest in the effectiveness of a government program. See Pub. Citizen, 209 F. Supp. 2d at 51-52 (observing that impairment of the effectiveness of a government program is a proper factor for consideration in conducting an analysis under FOIA exemption 4); Comstock Intl (U.S.A.), Inc. v. Ex.-Im. Bank of the United States, 464 F. Supp. 804, 808 (D.D.C. 1979) (citing Natl Parks I, 498 F.2d at 770 n.17) (upholding agencys application of Exemption 4 to withhold information obtained through the product of negotiation on the ground that the effectiveness of a government program would be impaired by disclosure).

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In addition to the competitive harm that may result, disclosure of the requested information would have an adverse impact on DOEs ability to implement the loan guarantee program established in Title XVII of the Energy Policy Act. In enacting the loan guarantee program, Congress envisioned a cooperative relationship between DOE and business or nonfederal governmental entities whereby DOE would issue loan guarantees to encourage business or non-federal governmental entities to develop and finance clean energy projects that employ innovative technologies. Frantz Decl. 18. Due to the risks associated with high technology, such projects are typically unable to obtain conventional private financing risks. Id. In light of the competitive application process, which demands a competitive review of confidential and sensitive trade, financial, commercial and technical information, loan applicants have a legitimate expectation that the confidential financial and commercial information revealed during negotiations with DOE will not be disclosed to the public. Id. The public disclosure of sensitive and confidential information could significantly and adversely impair the Applicants performance and completion of the Vogtle Project, particularly by complicating negotiations with other third parties involved in the Vogtle Project, which would in turn impair DOEs fulfillment of its mission to work with non-federal entities to facilitate the development of clean energy projects. Id. For these reasons, the district court upheld the Export-Import Banks withholding of export-insurance documents based upon the courts conclusion that disclosure would interfere with the agencys ability to carry out its statutory purpose of promoting the exchange of goods between the United States and foreign countries. Judicial Watch, Inc., 108 F. Supp. 2d at 30. Finally, disclosure of confidential and sensitive business and technical information would discourage prospective applicants from seeking federal loan guarantees because there would be

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no assurances that sensitive and confidential information provided by applicants will be protected from disclosure. Id.; Long Decl. 12 (It is not customary for financing parties to publicly disclose the particular proposed terms of a financing transaction that is pending negotiation of binding agreements. . . . In the event DOE is required to make premature disclosure of proposed terms of its loan guarantee transactions, this may jeopardize the willingness of parties such as Georgia Power or other borrowers with similar access to capital to negotiate freely and come to proposed terms with a government agency such as DOE that is interested in supporting projects.); Vaughn Index Appendix A at pp. 2-3. As demonstrated above, disclosure of the confidential commercial information would likely dissuade private entities from seeking loan guarantees from DOE. Because this would have a deleterious effect on DOEs ability to effectively fulfill its statutory mandate of promoting and financing the construction of clean energy projects to meet the growing energy needs of the country, DOE properly applied Exemption 4 to withhold commercial and financial information in the financing arrangements for the Vogtle loan guarantee. C. DOE Properly Withheld Predecisional Deliberative Communications Pertaining to the Vogtle Loan Guarantees Pursuant to Exemption 5

To qualify for protection under the deliberative process privilege, a record must be both predecisional and deliberative. Mapother v. Dept of Justice, 3 F.3d 1533, 1537 (D.C. Cir. 1993). A document is pre-decisional if it was generated before the adoption of an agency policy, and deliberative if it reflects the give-and-take of the consultative process. Coastal States Gas Corp. v. Dept of Energy, 617 F.2d 854, 866 (D.C. Cir. 1980). The purpose of the deliberative process privilege is to prevent injury to the quality of agency decisions. Sears, 421 U.S. at 151. The privilege applies to documents reflecting advisory opinions,

recommendations and deliberations comprising part of a process by which governmental

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decisions and policies are formulated. Id. at 150; Coastal States, 617 F.2d at 866 (explaining that the deliberative process privilege protects documents which would inaccurately reflect or prematurely disclose the views of the agency). The privilege also protects factual materials that are closely intertwined with opinions, recommendations, and deliberations. Ancient Coin

Collectors Guild, 641 F.3d at 513 ([T]he legitimacy of withholding does not turn on whether the material is purely factual in nature or whether it is already in the public domain, but rather on whether the selection or organization of facts is part of an agencys deliberative process.); Mapother, 3 F.3d at 1538-39. The privilege ensur[es] that persons in an advisory role would be able to express their opinions freely to agency decision-makers without fear of publicity. . . . Such consultations are an integral part of its deliberative process; to conduct this process in public view would inhibit frank discussion of policy matters and likely impair the quality of decisions. McKinley v. Bd. of Governors of Fed. Reserve Sys., 647 F.3d 331, 339-40 (D.C. Cir. 2011) (quoting Ryan v. Dept of Justice, 617 F.2d 781, 789-90 (D.C. Cir. 1980)); Tax Analysts v. IRS, 117 F.3d 607, 617 (D.C. Cir. 1997) (noting that the privilege reflect[s] the legislative judgment that the quality of administrative decision-making would be seriously undermined if agencies were forced to operate in a fishbowl because the full and frank exchange of ideas on legal or policy matters would be impossible). Under the consultant corollary, opinions and recommendations that are submitted by non-governmental parties as part of the deliberative process, and are solicited by the Agency, may be deemed intra-agency communications within the scope of Exemption 5. McKinley, 647 F.3d at 336; Natl Inst. of Military Justice v. U.S. Dept of Defense, 512 F.3d 677, 680 (D.C. Cir.), cert. denied, 129 S. Ct. 775 (2008) (When an agency record is submitted by outside consultants as part of the deliberative process, and it was solicited by the agency, we

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find it entirely reasonable to deem the resulting document to be an intra-agency memorandum for purposes of determining the applicability of Exemption 5.). Whether a document is predecisional does not depend on the agencys ability to identify a specific decision for which the document was prepared. Sears, 421 U.S. at 151 n.18. Here, the portions of documents withheld pursuant to Exemption 5 are both predecisional and deliberative. First, as Mr. Frantz explained in his supplemental declaration, DOE redacted portions of documents pursuant to Exemption 5 because they contained recommendations, analyses, speculation, and other non-factual information prepared by DOE employees, consultants, and contractors during the decision-making process relating to the issuance of the loan guarantee for the Vogtle Project.4 Supp. Frantz Decl. 7-10. Although DOE issued Conditional Commitment Letters on February 13, 2010, the parties have not yet negotiated and executed a definitive loan guarantee agreement and, as such, there are no assurances that any Applicant will receive a federal loan guarantee. Frantz Decl. 17; Long Decl. 8; Higgins Decl. 10; Fuller Decl. 8. Thus, the withheld records precede the issuance of the final loan guarantee agreement for the Vogtle Project. See Ancient Coin Collectors Guild v. U.S. Dept of State, 641 F.3d 504, 513 (D.C. Cir. 2011) (noting that committees recommendations were predecisional because they were created [a]ntecedent to the adoption of an agency policy) (quoting Jordan v. U.S. Dept of Justice, 591 F.2d 753, 774 (D.C. Cir. 1978) (en banc)). Second, the deliberative process privilege applies as long as the document is generated as part of a continuing process of agency decision-making.
4

See McKinley, 647 F.3d at 340

In four instances, certain material marked as Exemption 5 was withheld as not responsive because the information did not relate to the Vogtle Project, but instead pertained to a different loan guarantee program. See Supp. Frantz Decl. 10; Vaughn Index Doc. KS27, VT75, MM912, MM37-43. See Wilson v. U.S. Dept. of Transp., 730 F. Supp. 2d 140, 156 (D.D.C. 2010) (finding information in EEO counseling log to be properly redacted where the request sought only formal EEO complaints [b]ecause an agency has no obligation to produce information that is not responsive to a FOIA request), affd, 2010 WL 5479580 (D.C. Cir. Dec. 30, 2010). 27

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(upholding pursuant to Exemption 5 deliberative process privilege the withholding of detailed, highly sensitive commercial information provided to the Board of Governors of the Federal Reserve System as part of the bank supervisory process). The withheld documents pertain to discussions among agency personnel and consultants pertaining to various aspects of the loan guarantee, including the drafting of terms sheets, proposed financing terms, and discussions of the benefits and status of the Vogtle Project. See, e.g., Vaughn Index No. NW124-127

(discussing provisions in the term sheets and the Equipment, Procurement and Construction contract); NW277-279 (discussing draft term sheet for Georgia Power financing); NW288-291 (discussing proposed amortization schedule); NW308-310 (discussing issues regarding compliance with Davis Bacon Act); NW709 (discussing terms of the loan guarantee); NW750 (engaging in cost-benefit analysis); SR228 (discussing the proposed statement from the Credit Committee); NW17 (discussing the status of the Vogtle Project). The discussions with

consultants and contractors, such as Greengate LLC, MPR, Chadbourne & Parke, and others, are within the scope of Exemption 5 because they provided DOE with opinions, recommendations, expert advice, and assistance relating to the Vogtle Project at the Agencys request. See Supp. Frantz Decl. 7-9; Declaration of David G. Frantz dated Oct. 17, 2011. See Natl Inst. of Military Justice, 512 F.3d at 678-79 (applying consultant corollary to protect opinions and recommendations of non-governmental lawyers that were submitted to the Department of Defense regarding the establishment of military commissions after September 11, 2001); Citizens for Responsibility & Ethics in Wash. v. U.S. Dep't of Homeland Sec., 514 F. Supp. 2d 36, 44 (D.D.C. 2007) (concluding that materials prepared by contractors in connection with FEMAs catastrophic planning initiatives were properly deemed intra-agency where there was no evidence that the contractors had interests adverse to the agency).

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As Mr. Frantz attests, DOE employees would hesitate to offer their candid opinions to superiors or co-workers if they knew that their opinions of the moment regarding the Vogtle Project might be made a matter of public record at some future date. Supp. Frantz Decl. 10. Accordingly, releasing the internal, pre-decisional analysis leading up to a final decision on the terms and conditions of the loan guarantee for the Vogtle Project would defeat the purpose of the deliberative process privilege, which rests on the obvious realization that officials will not communicate candidly among themselves if each remark is a potential item of discovery and front page news. Judicial Watch, Inc. v. U.S. Dept of the Treasury, No. 10-302 (BAH), 2011 WL 3582152, at *8 (D.D.C. Aug. 16, 2011) (quoting Dept of Interior v. Klamath Water Users Protective Assn, 532 U.S. 1, 8-9 (2001)). D. DOE Properly Withheld Personal Email Addresses and Cell Phone Numbers Pursuant to Exemption 6

FOIA Exemption 6 permits the withholding of personnel and medical files and similar files when the disclosure of such information would constitute a clearly unwarranted invasion of personal privacy. 5 U.S.C. 552(b)(6). The term similar files is broadly construed and includes Government records on an individual which can be identified as applying to that individual. U.S. Dept of State v. Wash. Post Co., 456 U.S. 595, 602 (1982); Lepelletier v. Fed. Deposit Ins. Corp., 164 F.3d 37, 47 (D.C. Cir. 1999) (The Supreme Court has interpreted the phrase similar files to include all information that applies to a particular individual.); Govt. Accountability Project v. U.S. Dept of State, 699 F. Supp. 2d 97, 105-06 (D.D.C. 2010). In assessing the applicability of Exemption 6, courts employ a balancing test to weigh the privacy interest in non-disclosure against the public interest in the release of the records in order to determine whether, on balance, the disclosure would work a clearly unwarranted invasion of personal privacy. Lepelletier, 164 F.3d at 46; Chang v. Dept of Navy, 314 F. Supp. 2d 35, 43

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(D.D.C. 2004). [T]he only relevant public interest in the FOIA balancing analysis [is] the extent to which disclosure of the information sought would she[d] light on an agencys performance of its statutory duties or otherwise let citizens know what their government is up to. Lepelletier, 164 F.3d at 47 (quoting U.S. Dept of Def. v. Fed. Labor Relations Auth., 510 U.S. 487, 497 (1994)) (alterations in original); Beck v. Dept of Justice, 997 F.2d 1489, 1492 (D.C. Cir. 1993) (quoting Dept of Justice v. Reporters Comm. for Freedom of the Press, 489 U.S. 749, 773 (1989)). Information that reveals little or nothing about an agencys own conduct does not further the statutory purpose. Beck, 997 F.2d at 1492. Here, DOE invoked Exemption 6 to withhold personal contact information of DOE and other Federal employees, including personal email addresses and cell phone numbers of DOE employees and contractors, and the email addresses of employees of the White House Office of Management and Budget, whose email addresses are not public information. See Supp. Pulliam Decl. 21; see, e.g., Vaughn Index No. NW124-127; NW707-708; NW802-804; KC240-243; DF40-41; SR165-167; SR189-191; NW17; NW523; JS1 5-8; Consultation Package 104-107. There is no public interest in these individuals personal contact information because the withheld information plainly does not shed any light on their performance of official duties. See Pinson v. Lappin, No. 10-1844 (BAH), 2011 WL 3806160, at *2 (D.D.C. Aug. 30, 2011) (concluding that, where BOP redacted telephone numbers and email addresses of staff, this determination is proper both because this information was not requested and was not responsive to the request and because this information is exempt from disclosure); Am. Fedn of Govt Employees, Local 812 v. Broadcasting Bd. of Governors, 711 F. Supp. 2d 139, 156 (D.D.C. 2010) (upholding redaction of names and other information relating to another individual pursuant to Exemption 6); Govt. Accountability Project, 699 F. Supp. 2d at 105-06 (upholding

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redaction of personal email addresses of applicants for positions because releasing their email addresses serves no public interest because these email addresses would not reveal what the government is up to). Indeed, courts have held that [w]hile there may be some public interest in obtaining the identifying information of the Federal employees at issue, disclosure would not shed any light on the workings of [an agency]. Canaday v. U.S. Citizenship & Immigration Servs., 545 F. Supp. 2d 113, 118 (D.D.C. 2008). Accordingly, because there is no countervailing public interest that can overcome the privacy interest of Government employees and members of the public, DOE properly redacted the personal information pursuant to Exemption 6. E. DOE Properly Complied With FOIAs Segregability Requirement

Under the FOIA, if a record contains information exempt from disclosure, any reasonably segregable, non-exempt information must be disclosed after redaction of the exempt information. 5 U.S.C. 552(b). Non-exempt portions of records need not be disclosed if they are inextricably intertwined with exempt portions. Mead Data Cent., Inc. v. Dept of the Air Force, 566 F.2d 242, 260 (D.C. Cir. 1977). To establish that all reasonably segregable, non-exempt information has been disclosed, an agency need only show with reasonable specificity that the information it has withheld cannot be further segregated. Armstrong v. Executive Office of the President, 97 F.3d 575, 578-79 (D.C. Cir. 1996); Canning v. Dept of Justice, 567 F. Supp. 2d 104, 110 (D.D.C. 2008). Where non-exempt information could be segregated from exempt information, DOE segregated and disclosed the non-exempt information from the records withheld in part. See Supp. Pulliam Decl. 19. DOE has established, with reasonable specificity, that responsive documents were withheld under Exemptions 4, 5, and 6 after a line-by-line review and determination that there were no reasonably segregable portions

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of documents appropriate for release. Id. For instance, it has narrowly applied Exemption 6 to withhold only personal information as explained above, and released all non-exempt information from those records. See Vaughn Index No. NW17; NW523; JS1 5-8. It has done the same with records that contain information subject to Exemptions 4 and 5. Id. Nos. NW277-279; NW709; KC240-243; Attachment to JS18. And it has conducted multiple reviews to ensure segregability, resulting in amended disclosures and releases. See Supp. Pulliam Decl. 17(i)-(k). Therefore, the Court should find that DOE has properly complied with its duty to segregate exempt from non-exempt information. CONCLUSION For the reasons set forth above, Defendant respectfully requests that this Court grant its motion for summary judgment as to all claims asserted in Plaintiffs First Amended Complaint. Date: December 16, 2011 Respectfully submitted, RONALD C. MACHEN JR., D.C. Bar #447889 United States Attorney for the District of Columbia RUDOLPH CONTRERAS, D.C. Bar #434122 Chief, Civil Division By: /s/ Michelle Lo MICHELLE LO Assistant United States Attorney 555 4th Street, N.W. Washington, D.C. 20530 Tel: (202) 514-5134 Fax: (202) 514-8780 Michelle.Lo2@usdoj.gov

Of counsel: Marilyn M. Madarang, Esq. Office of General Counsel U.S. Department of Energy

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