Free Order - District Court of Arizona - Arizona

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 A discovery dispute exists regarding Defendants' pending Motion for Reconsideration. 17 (Doc. 323). In this motion, Defendants rely upon a letter, dated August 7, 2007, from Eric 18 Solomon, Assistant Secretary (Tax Policy), Department of the Treasury, to Jim McCrery, 19 Ranking Member, House Comm. on Ways & Means ("Treasury Letter"). Id. Ex. A. This 20 letter states the agency's position on the meaning of a 1977 regulation interpreting ERISA's 21 anti-cutback provision, 29 U.S.C. § 1054(g)(1), which is at the heart of this lawsuit. 22 Plaintiffs would like to conduct discovery regarding the "historical context, sequence of 23 events and surrounding circumstances that caused Treasury to produce the letter as well as 24 what was considered, encouraged, incorporated and/or excluded from its content." (Doc. 25 337). It is clear that Plaintiffs purpose in requesting such discovery is to impeach the letter 26 in order to reduce the deference normally accorded such a letter. See id. ("Plaintiffs [] 27 believe the timing of the letter, peculiar circumstances surrounding its existence and what 28
Case 2:04-cv-00424-ROS Document 349 Filed 12/18/2007 Page 1 of 4

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

) ) ) Plaintiffs, ) ) vs. ) ) Honeywell Retirement Earnings Plan, et) ) al., ) ) Defendants. ) ) Barbara Allen, et al.,

No. CV 04-424-PHX-ROS ORDER

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role Defendants may have played in the genesis and evolution of the letter are all relevant to what deference, if any, the Court should give to the [Treasury Letter]."); Bassiri v. Xerox Corp., 463 F.3d 927, 930 (9th Cir. 2006) ("Where an agency interprets its own regulation, even if through an informal process, its interpretation of an ambiguous regulation is controlling under [Auer v. Robbins, 519 U.S. 452 (1997)] unless plaingly erroneous or inconsistent with the regulation." (internal quotations omitted)). "Inquiry into mental processes of administrative decision-makers is usually to be avoided." Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 420 (1971), abrogated on other grounds by Califano v. Sanders, 430 U.S. 99 (1977); see also United States v. Morgan, 313 U.S. 409, 422 (1941) (disapproving of the questioning of the Secretary of Agriculture regarding "the process by which he reached the conclusions of his order, including the manner and extent of his study of the record and his consultation with subordinates," Justice Frankfurter writing for the unanimous Court concluded "the short of the business is that the Secretary should never have been subjected to this examination"). The D.C. Circuit explains: Agency opinions, like judicial opinions, speak for themselves. And agency deliberations, like judicial deliberations, are for similar reasons privileged from discovery. Subjecting judges to questioning about how they reached their decisions "would be destructive of judicial responsibility." United States v. Morgan, 313 U.S. 409, 422 (1941). "Just as a Judge cannot be subjected to such a scrutiny, so the integrity of the administrative process must be equally respected." Id. In passing on final agency action, we therefore have refused to consider transcripts of closed agency meetings or "intra-agency memoranda and documents recording the deliberative process leading to" the agency's decision. Kansas State Network, Inc. v. FCC, 720 F.2d 185, 191 (D.C. Cir. 1983). Requiring an agency to produce such internal materials and allowing litigants to depose agency officials about such matters would be warranted only in the rarest of cases. Checkosky v. SEC, 23 F.3d 452, 489 (D.C. Cir. 1994) (some citations omitted). Therefore, attempts to probe the motivations or mental processes of agency decisionmakers are rejected by the courts absent "a strong showing of bad faith or improper behavior" by the agency decision-makers. Volpe, 401 U.S. at 420; Advanced Comm'n Corp.

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v. FCC, 376 F.3d 1153, 1157-58 (D.C. Cir. 2004); Animal Defense Council v. Hodel, 840 F.2d 1432, 1437 (9th Cir. 1988) ("Normally there must be a strong showing of bad faith or improper behavior before the court may inquire into the thought processes of administrative decisionmakers." (quoting Public Power Council v. Johnson, 674 F.2d 791, 195 (9th Cir. 1982))); McCrary v. Gutierrez, 495 F. Supp. 2d 1038, 1043 (N.D. Cal. 2007) (agency regularity is presumed; party needs to make a strong showing of bad faith or improper behavior to overcome this presumption); Modesto Irrigation District v. Gutierrez, No., 2007 WL 763370, at *11 (E.D. Cal. 2007) ("Actual subjective motivation of agency decisionmakers is immaterial as a matter of law--unless there is a showing of bad faith or improper behavior."). Mere speculation of bad behavior is not enough. Hercules, Inc. v. EPA, 598 F.2d 91, 123 (D.C. Cir. 1978) ("The speculative possibility that the Administrator accepted the staff view, not because he was persuaded by the evidence, but for some improper reason, fails to overcome the strong presumption of regularity.") Plaintiffs have pointed to nothing that is sufficient to overcome the "strong presumption of agency regularity." Louisiana Ass'n of Indep. Producers v. FERC, 958 F.2d 1101, 1111 (D.C. Cir. 1992). Therefore, they will not be allowed discovery into the motivation of the Treasury Department regarding the letter. Accordingly, IT IS ORDERED that Plaintiffs shall file their Response to Defendants' Motion to Reconsider (Doc. 323) no later than December 21, 2007.

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DATED this 18th day of December, 2007.

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