Case 1:11-cv-00408-ABJ Document 83

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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA __________________________________________ ) UNITED WESTERN BANK, ) ) Plaintiff, ) ) v. ) ) OFFICE OF THE COMPTROLLER, ) OF THE CURRENCY, et al., ) ) Defendants. ) __________________________________________)

CIVIL ACTION

Case No. 11-408 (ABJ)

AMENDED MOTION FOR PROTECTIVE ORDER AND FOR CLARIFICATION On November 2, 2011, Plaintiff moved to compel Defendants to produce certain materials created by the Federal Deposit Insurance Corporation in its corporate capacity (FDIC-C). The Court, on February 10, 2012, ordered the FDIC-C to deem Plaintiffs motion a request for discretionary disclosure under 12 C.F.R. 309.6(b)(8)(i), and either produce the documents to Plaintiff or submit them for the Courts in camera review by February 15, 2012. The FDIC-C undertook further review of the documents and elected to produce the majority of them. Because the regulation requires a protective order when the FDIC is making a discretionary disclosure, however, see 12 C.F.R. 309.6(b)(8)(i), the FDIC-C moved for entry of a protective order safeguarding the confidentiality of the produced material and limiting its use to this litigation. The Court, in a minute order entered on February 16, 2012 and a Memorandum Opinion and Order entered on February 24, 2012, directed the FDIC-C to revise and refile the proposed protective order. Specifically, the Court stated that the protective

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order should require that, in the event that any party intends to use the documents designated as confidential under the protective order in this litigation, such party must submit a Motion to Seal explaining the need for confidential treatment of those documents. The FDIC-C has accordingly revised the protective order to reflect that procedure. The FDIC-C respectfully requests clarification, however, as to who may submit such a Motion for Seal. As the Court directed in its order of February 10, 2012, the FDIC-C has deemed Plaintiffs motion to compel a request for discretionary disclosure pursuant to 12 C.F.R. 309.6(b)(8)(i), and has elected to make such a disclosure to Plaintiffs as to the majority of the materials at issue. The FDIC-C, by making a discretionary disclosure that would allow the use of the documents in this litigation, hoped to conserve the Courts and the parties resources by avoiding the need for a protracted inquiry into privilege claims for a substantial volume of documents. The FDIC did not waive its privileges outright, and indeed 309.6(b)(8)(i) requires that discretionary disclosure be made pursuant to a protective order. The Courts February 24, 2012 Order appears to indicate that the documents will be sealed only if Plaintiff so requests in order to keep its financial records confidential. The FDIC-C has a separate interest in maintaining the confidentiality of its bank examination records, however. As the D.C. Circuit has explained, the bank examination privilege is intended to safeguard candid communications between banks and regulators: Bank management must be open and forthcoming in response to the inquiries of bank examiners, and the examiners must in turn be frank in expressing their concerns about the bank. These conditions simply could not be met as well if communications between the

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bank and its regulators were not privileged. In re Subpoena, 967 F.2d 630, 633 (D.C. Cir. 1992). If the confidentiality of bank examination records could not be maintained in litigation, that would discourage examiners from candidly setting forth their impressions and opinions, and would chill frank communications between banks and regulators. Furthermore, the FDIC-C would be reluctant to make discretionary disclosures under 309.6(b)(8)(i) if it could not take steps to ensure that the disclosed materials were subject to the protective order required by that section.1 The FDIC-C therefore respectfully requests that the Court clarify its order to preserve the FDIC-Cs ability to request the continued confidentiality of the records. To minimize the burden on the parties, the FDIC-C is willing to file a motion to seal, consistent with the Courts direction in its February 24, 2012 order, upon notification that a party intends to use any of the documents at issue in this litigation. Such a motion to seal will explain the continued need for confidentiality of the documents at issue. The FDIC-C has discussed the proposed protective order with the parties. Plaintiff opposes this motion. Defendants take no position. Accordingly, the FDIC-C requests that the Court enter the attached protective order to safeguard the confidentiality of FDIC materials. Respectfully submitted, COLLEEN J. BOLES Assistant General Counsel BARBARA SARSHIK Senior Counsel
1

That the bank in question here has been placed in receivership does not destroy the privilege, as this Court has recognized in the analogous context of FOIA Exemption 8, 5 U.S.C. 552(b)(8) (which safeguards examination reports and related materials). Atkinson v. FDIC, 1980 WL 355660, *2 (D.D.C. Feb. 13, 1980) ([P]rotecting the candor of bank-supervisor relations is a reasonable predicate for the congressional determination that such documents should be exempt from disclosure. The number of problem banks is not insignificant and the need for openness between the parties becomes particularly acute at the time banks find themselves on the verge of failing.).

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_____/s/__________________________ DUNCAN N. STEVENS D.C. Bar No. 473550 Counsel Federal Deposit Insurance Corporation 3501 N. Fairfax Drive, D-7028 Arlington, VA 22226 dstevens@fdic.gov (703) 562-2402 (phone) (703) 562-2477 (fax) dstevens@fdic.gov Attorney for Federal Deposit Insurance Corporation in its corporate capacity March 2, 2012

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UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA __________________________________________ ) UNITED WESTERN BANK, ) ) Plaintiff, ) ) v. ) ) OFFICE OF THE COMPTROLLER, ) OF THE CURRENCY, et al., ) ) Defendants. ) __________________________________________)

CIVIL ACTION

Case No. 11-408 (ABJ)

PROTECTIVE ORDER WHEREAS, counsel for one or more of the parties to the above-captioned action (Litigation) have requested the discretionary disclosure of certain privileged and confidential records of the Federal Deposit Insurance Corporation (FDIC) pursuant to 12 C.F.R. 309.6(b)(8); and WHEREAS, the FDIC has determined that the requirements for discretionary disclosure under 12 C.F.R. 309.6(b)(8) have been satisfied, and has therefore authorized disclosure of the records identified in Exhibit 1 hereto (Confidential Records), provided that such disclosure is made strictly under the terms and conditions of this Protective Order; NOW THEREFORE, the Court hereby orders the following: 1. The Confidential Records, and all information contained therein or related thereto,

shall be held strictly confidential and may be examined and used only in connection with the preparation, discovery in connection with, trial, and appeal of the Litigation.

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No person, including, without limitation, the parties to the Litigation, their counsel,

the Court, the Clerk of the Court, court reporters, or any employee or agent of any of the foregoing, shall transcribe, copy, or disclose in any manner any information contained in or related to the Confidential Records, except upon order of the Court or as necessary for the limited purpose of the preparation, discovery in connection with, trial, and appeal of the Litigation. Subject to paragraphs 4 and 5 below, nothing in the preceding sentence is intended to prevent or prohibit the use of information contained in the Confidential Records for the purpose of interrogating witnesses at depositions or in the trial of the Litigation. 3. Plaintiff may, if it includes any of the Confidential Records or portions therefore in

discovery documents filed with the Clerk of the Court, move to seal those Confidential Records pursuant to Local Rule 5.1(j)(1) to protect its financial information. Separately, if the parties intend to include any of the Confidential Records or portions thereof in discovery documents filed with the Clerk of the Court, the party seeking to use the Confidential Records or related information shall provide the FDIC with at least five business days notice of such proposed use before including any Confidential Records or portions thereof in a public filing. The notice will provide that, absent objection, the Confidential Records may be filed with the Clerk of the Court. If the FDIC opposes the proposed disclosure, the FDIC shall file within three business days of receipt of the notice a Motion to Seal pursuant to Local Rule 5.1(j)(1), explaining the need for the seal. Such notice will be provided to the FDIC via electronic mail to Barbara Sarshik and Duncan Stevens, Corporate Litigation Unit, General Litigation Section, FDIC Legal Division. 4. Any party offering any of the Confidential Records into evidence in the trial of the

Litigation, or in connection therewith, shall offer only those pages or portions thereof that are relevant and material to the issues in dispute. The name of any person or entity contained on any

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page of the Confidential Records who is not a party to the Litigation, or whose name is not otherwise relevant and material to the issues in dispute, shall be blocked out prior to the admission of such page into evidence. 5. Plaintiff may, if it includes any of the Confidential Records or portions therefore for

any purpose in the Litigation, including without limitation, use in any deposition, hearing, trial, or appeal, move to seal those Confidential Records pursuant to Local Rule 5.1(j)(1) to protect its financial information. Separately, if a party intends to use, attach as an exhibit, or quote from any portion of the Confidential Records for any purpose in the Litigation, including without limitation, use in any deposition, hearing, trial, or appeal, the party shall provide the FDIC with at least five business days notice of such proposed use prior to including any Confidential Records or portions thereof in a public filing. The notice will provide that, absent objection, the Confidential Records may be filed with the Clerk of the Court. If the FDIC opposes the proposed disclosure, the FDIC shall file within three business days of receipt of the notice a Motion to Seal pursuant to Local Rule 5.1(j)(1), requesting that the Confidential Records in question be sealed against any disclosure inconsistent with the terms and conditions of this Protective Order, and further requesting that any quote from the Confidential Records be redacted from publicly filed briefs, transcripts or other writings. Such notice will be provided to the FDIC via electronic mail to Barbara Sarshik and Duncan Stevens, Corporate Litigation Unit, General Litigation Section, FDIC Legal Division. 6. At the conclusion of the Litigation (including any appeal), all Confidential Records

in the possession or control of any person granted access to the Confidential Records under this Protective Order, including all copies, extracts and summaries thereof, shall forthwith be returned to the Assistant General Counsel, FDIC Legal Division, General Litigation Section, at

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550 17th Street, NW, Washington, DC 20429, or shall be otherwise destroyed with notice provided to the Assistant General Counsel, General Litigation Section, FDIC Legal Division, or her designee. 7. Any person granted access under this Protective Order to any of the Confidential

Records, or to information contained therein or related thereto, who uses such Confidential Records or such information for any purpose other than the preparation, discovery in connection with, trial, or appeal of the Litigation, or otherwise violates the terms or conditions of this Protective Order, shall be subject to sanction by the Court. 8. The terms and conditions of this Protective Order shall apply to any subsequent or

supplemental process that may be issued and served on the FDIC in connection with the Litigation. 9. The Confidential Records shall include all records identified in any amendments or

modifications of Exhibit 1. Any such amendment or modification shall be effective, without need for approval by the Court, upon agreement between the parties and the FDIC. 10. Disclosure of the Confidential Records under the terms and conditions of this Protective Order shall not constitute a waiver of any privileges or confidentiality with respect to such Confidential Records or with respect to any matters that relate in any way to any aspect of the Confidential Records. ORDERED this day of _________________ 2012.

By: ________________________________ Amy Berman Jackson United States District Judge

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Protective Order Exhibit 1

CONFIDENTIAL RECORDS Subject to the terms and conditions of the Protective Order, disclosure of the privileged and confidential FDIC records listed or described below (Confidential Records) is hereby authorized under 12 C.F.R. 309.6(b)(8)(ii). 1. 809) 2. 816) 3. 822) 4. 828) 5. 833) 6. 837) 7. 841) 8. 45) 9. 850) 10. 857) 11. 12. 868) 13. 874) 14. 880) 15. 886) 16. 892) 17. 898) 18. 904) 19. E-mail dated 12/17/10 from Joseph Meade to Philip Gerbick et al (OCC-UWB 00799E-mail dated 12/17/10 from Thomas Trujillo to Philip Gerbick et al (OCC-UWB 00810E-mail dated 12/20/10 from Thomas Trujillo to Philip Gerbick et al (OCC-UWB 00817E-mail dated 12/21/10 from Thomas Trujillo to Philip Gerbick et al (OCC-UWB 00823E-mail dated 12/22/10 from William Spangler to Philip Gerbick et al (OCC-UWB 00829E-mail dated 12/23/10 from Thomas Trujillo to Philip Gerbick et al (OCC-UWB 00834E-mail dated 12/23/10 from William Spangler to Philip Gerbick et al (OCC-UWB 00838E-mail dated 12/23/10 from William Spangler to Philip Gerbick et al (OCC-UWB 00842E-mail dated 12/23/10 from William Spangler to Philip Gerbick et al (OCC-UWB 00846E-mail dated 12/23/10 from William Spangler to Philip Gerbick et al (OCC-UWB 00851E-mail dated 12/27/10 from Philip Nieto to Philip Gerbick et al (OCC-UWB 00858-863) E-mail dated 12/28/10 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00864E-mail dated 12/29/10 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00869E-mail dated 12/30/10 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00875E-mail dated 01/03/11 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00881E-mail dated 01/03/11 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00887E-mail dated 01/04/11 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00893E-mail dated 01/05/11 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00899E-mail dated 01/06/11 from Cynthia Spenner to Nicholas Dyer et al (OCC-UWB 00905-

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910) 20. E-mail dated 01/07/11 from Cynthia Spenner to Nicholas Dyer et al (OCC-UWB 00911916) 21. E-mail dated 01/10/11 from Cynthia Spenner to Nicholas Dyer et al (OCC-UWB 00917922) 22. E-mail dated 01/11/11 from Cynthia Spenner to Nicholas Dyer et al (OCC-UWB 00923928) 23. E-mail dated 01/12/11 from Cynthia Spenner to Nicholas Dyer et al (OCC-UWB 00929934) 24. E-mail dated 01/13/11 from Cynthia Spenner to Nicholas Dyer et al (OCC-UWB 00935940) 25. E-mail dated 01/14/11 from Cynthia Spenner to Nicholas Dyer et al (OCC-UWB 00941946) 26. E-mail dated 01/18/11 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00947952) 27. E-mail dated 01/19/11 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00953958) 28. E-mail dated 01/20/11 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00959964) 29. E-mail dated 01/21/11 from Cynthia Spenner to Philip Gerbick et al (OCC-UWB 00965970) 30. E-mail dated 11/08/10 from Legal ESS Agenda to John Bowman et al (OCC-UWB 01012)