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its sound administration." Because of FOIA's strong presumption in favor of disclosure,

the burden is on Defendants to justify withholding any documents. See 5 U.S.C.

§ 552(a)(4)(B) ("the burden is on the agency to sustain its action."). See also United States Dep't of State v. Ray, 112 S.Ct. 541, 547 (1991); Times Journal Co. v. Department of Air Force, 793 F. Supp. 1, 3 (D.D.C. 1991).

In this instance, Defendants have invoked blanket FOIA exemptions to withhold documents in an arbitrary manner. The arbitrariness is shown in two ways. First, throughout their history, Defendants have made available identical categories of documents -- examination reports, board minutes, staff investigative files, criminal

referrals, internal agency memoranda, and other documents -- pertaining to failed thrifts upon request of the Ranking Minority Member. (Stmt. ¶ 7.) As set forth in more detail in the Seidel Declaration:

At the request of then-Ranking Minority Member Chalmers P. Wylie, Defendant RTC produced extensive documentation relating to Columbia Savings & Loan Association of Beverly Hills, California, including board of directors minutes, examination reports, securities portfolios, compensation plans, and other documents, some of which were protected by the attorney-client privilege and work product doctrine. Subsequently, Defendant RTC provided the Ranking Minority Member and his staff with full access to RTC investigative files relating to Columbia Savings and Loan at the office of Defendant RTC. Both of these requests were

pursuant to an independent Minority investigation of the savings and loan industry. (Seidel Decl. ¶ 9(a) and Exs. 4, 5, 6.)

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During the extensive investigations of Charles Keating and Lincoln Savings

& Loan Association of Irvine, California, the OTS provided the Ranking Minority Member as well as individual Members of the Committee

unrestricted access to pertinent documents, including examination reports

and all supervisory materials. (Seidel Decl. ¶ 9(b).)

Defendant OTS made available to the Committee's minority staff

documents pertaining to Silverado Savings & Loan Association of Denver,

Colorado, including examination reports, supervisory memoranda,
enforcement memoranda, and other documents, many of which were
protected by the attorney-client privilege, work product doctrine, and
agency privacy regulations. (Seidel Decl. ¶ 9(c) and Ex. 8.)

During the Congressional investigation by the 101st Congress of Centrust
Savings & Loan Association of Miami, Florida, Defendants OTS and RTC
allowed the Ranking Minority Member and his staff full independent access
to pertinent records, including but not limited to, examination reports,
criminal referrals, telephone logs, desk calendars, and internal

memoranda. Subsequently, during the 102nd Congress, individual

members of the Committee and Minority staff also received full access to

RTC investigative materials pursuant to an independent Minority

investigation of Centrust. (Seidel Decl. ¶ 9(d).)

Especially in view of the mandated semiannual oversight hearing which by statute is

required to occur before May 31, 1994, and in light of the hearings required by House

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Resolution No. 394, Defendants have articulated no cogent reason for treating

differently the documents at issue here.

Moreover, the documents at issue relate to a defunct savings and loan institution that has already received, like the individuals involved with it, widespread

publicity. It is doubtful that any legitimate regulatory, investigative, or privacy interest would be furthered by withholding these documents from Plaintiff. Indeed, having previously provided identical categories of documents pertaining to failed thrifts to numerous Committees of Congress -- making them accessible to many Members and a multitude of staff personnel -- it seems odd for Defendants to assert confidentiality against an individual Member and his staff here. And, of course, they apparently recognize an obligation to produce these documents to the entire Committee upon request from the Chairman. In any event, if confidentiality is a valid concern, Plaintiff has offered to accept reasonable confidentiality restrictions."

II.

DEFENDANTS' REFUSAL TO PRODUCE THE REQUESTED
DOCUMENTS VIOLATES THE ADMINISTRATIVE

PROCEDURE ACT.

Quite apart from their failure to comply with FOIA, Defendants' refusal to produce the requested documents is arbitrary, capricious, an abuse of discretion, and contrary to law, and is therefore agency action in violation of the Administrative Procedure Act ("APA"), 5 U.S.C. §§ 551 et seq.

71 In the event the Court determines that Plaintiff is not entitled to all the requested documents for the reasons set forth in this Memorandum, Plaintiff reserves his rights to receive a Vaughn index, and to challenge Defendants' determinations regarding individual documents or categories of documents. See Vaughn v. Rosen, 484 F.2d 820 (D.C. Cir. 1973), cert. denied, 415 U.S. 977 (1974).

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A. Defendants' Refusal To Produce the Requested
Documents is an Arbitrary and Unexplained
Departure from a Presidential Directive.

For more than a decade, the Executive Branch has acted on

Congressional requests for information pursuant to a Presidential directive "to comply with Congressional requests for information to the fullest extent consistent with the Constitutional and statutory obligations of the Executive Branch." Memorandum for the Heads of Executive Departments and Agencies regarding Procedure Governing Responses to Congressional Requests for Information (Nov. 4, 1982) ("the November 4, 1982 Memorandum") (attached hereto as Exhibit F). In that Memorandum, President Ronald Reagan directed all Executive Branch departments and agencies to provide information to Congress upon request, without the need for formal Committee action or subpoenas, unless the President himself invoked executive privilege. The continuing validity of this directive was confirmed as recently as February 18, 1994, in a letter from then-Associate Attorney General Webster L. Hubbell to Congressman John Dingell (attached hereto as Exhibit G).

Executive branch statements such as the November 4, 1982 and October 4, 1993 Memoranda govern the agencies' use of discretion in responding to Congressional requests for information. Unexplained deviations from these directives are arbitrary, capricious, and contrary to law. In Anne Arundel County v. EPA, 963 F.2d 412 (D.C. Cir. 1992), for example, the Environmental Protection Agency had altered its testing methods for groundwater in deciding to designate a landfill as a hazardous waste site. Although the Court conceded that EPA was entitled to some deference on "technical" questions, it held the agency's action "arbitrary and capricious" because, like

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Defendants here, EPA "offered no explanation or justification" for acting "in direct

conflict with the stated policy. . . ." Id. at 416.

Accordingly, Defendants' unexplained failure to comply with the

November 4, 1982 Memorandum, as reaffirmed by the present Administration,

Documents Constitutes a Deviation from Defendants'
Well-Settled Practice.

A federal agency may not deviate without explanation from its prior practices, whether formal or informal. See, e.g., Briscoe v. Kusper, 435 F.2d 1046, 1055 (7th Cir. 1970) ("An agency may be bound by its own established custom and practice as well as by its formal regulations."). Since their creation in 1989, Defendants RTC and OTS have consistently provided documents requested by the Ranking Minority Member of the Committee. As shown (pp. 20-21 above), Defendants have provided their most sensitive documents

including materials claimed to be subject to the

attorney-client privilege, work product doctrine, and privacy regulations -- to the Ranking Minority Member and his staff on an independent basis. As far as Plaintiff is aware, Defendants have never before relied upon FOIA exemptions or the Privacy Act to withhold information from the Ranking Minority Member of the Committee, and it is undeniable that Plaintiff is similarly situated to the Ranking Minority Members to whom Defendants have provided requested documents in similar situations.

It is well-established that "[a]gency decisions that depart from established precedent without a reasoned explanation will be vacated as arbitrary and capricious."