TAX ANALYSTS' SUIT AGAINST IRS, NATIONAL ARCHIVES UNDER FEDERAL RECORDS ACT IS DISMISSED.

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

Judge June L. Green

MEMORANDUM

[1] This matter is before the Court on Plaintiffs' Tax Analysts' Motion for Injunctive and Declaratory Relief, Defendant Internal Revenue Service's Motion to Dismiss, and Plaintiffs' opposition thereto; Plaintiffs' motion for a stay of dismissal pending discovery and Defendants' opposition thereto; and Defendants' motion for a protective order from discovery and Plaintiffs' opposition thereto. For the reasons set out below, the Court grants IRS's Motion to Dismiss, and deems all other related motions moot.

Standard

[2] This Court finds that this case is not ripe for judicial review under Federal Rule of Civil Procedure 12(b)(1). In considering whether a case is ripe for judicial review, the Court must evaluate "both the fitness of the issue for judicial decision and the hardship to the parties of withholding court consideration." Abbott Labs. v. Gardner, 387 U.S. 136, 149 (1967). To determine whether an issue is fit for review, the Court is to consider whether the issue tendered is a purely legal one; whether immediate judicial review is calculated to avoid a multiplicity of litigation; and whether the agency decision is definitive and not likely to be reconsidered. See Independent Bankers Assn. of America v. Smith, 534 F.2d 921, 927-29 (D.C. Cir.), cert. denied, 429 U.S. 862 (1976). The Court determines the finality of agency action by questioning whether the agency has completed its decision-making process. See Franklin v. Massachusetts, 505 U.S. 788, 797 (1992) (stating that such questioning defines the finality of agency action).

Background

[3] Plaintiffs represent journalists, researchers, and others with an academic or scholarly need to have access to the materials that illustrate how federal agencies -- in this case, the Internal Revenue Service (IRS) -- conduct their business and reach determinations about policy and process. The complaint contends that 1) the IRS has failed to meet its statutory responsibilities under the Federal Records Act (FRA) to preserve and manage certain historical records, transfer those records to the National Archives and make those records available to the public, and 2) the National Archives and Records Administration (NARA) has similarly failed under the FRA to take action to ensure the IRS's compliance with its statutory obligations. Plaintiffs seek an order to compel IRS and NARA compliance with the FRA, 44 U.S.C. section 2905(a), and protect agency records which Plaintiffs say are being improperly handled or destroyed. Cases Plaintiffs cite in support of their request for extended discovery address the issue of the Cout's jurisdiction over the case, not ripeness of the issue in dispute.

[4] Defendants claim that Plaintiffs' concerns are currently being addressed in an ongoing agency process to improve the IRS's records management program, ² and therefore Plaintiffs' claims are not ripe and should be dismissed. Defendants point to the Administrative Procedure Act ("APA") in arguing that an agency action must reach finality before review by a court; 5 U.S.C. section 704 ("Agency action made reviewable by statute and final agency action for which there is no other adequate remedy in a court are subject to judicial review"). In this instance, the collaborative process currently engaged in by the IRS and NARA is by no means a final one, and is hence unreviewable by this Court. Nothing in the Federal Records Act contradicts this; and language in the FRA (set out further below), appears to prefer an intra-agency solution before a judicially imposed one.

Discussion

[5] Case law has established that Plaintiffs have an interest in preserving some of the records maintained by the IRS. See Armstrong v. Bush, 924 F.2d 282, 287 (D.C. Cir. 1991) ("[O]ne of the reasons that Congress mandated the creation and preservation of federal . . . records was to ensure that private researchers and historians would have access to the documentary history of the federal government"). If Plaintiffs' interests are not protected, documents maintained by the IRS that Plaintiffs would otherwise be able to study may be destroyed.

[6] However, a perceived need to protect Plaintiffs' interests does not necessarily mandate judicial interference. See Am. Friends Svc. Comm. v. Webster, 720 F.2d 29, 44 (D.C. Cir. 1983) (holding that Congress intended, through delegation of authority over records disposal plans to NARA, an alternative method of supervision over agency action other than judicial review). Through the FRA, Congress gave NARA a direct supervisory role over the maintenance of IRS and other federal agency documents. The FRA-mandated procedure currently being utilized to improve the IRS' records management may ultimately resolve this issue without judicial intervention.

[7] The FRA reflects a congressional intent to ensure that agencies adequately document their policies and decisions, S. Rep. No. 2140, 81st Cong., 2d Sess. 2 (1950), and that their records management programs strike a balance "between developing efficient and effective records management, and the substantive need for Federal records." S. Rep. No. 94-1326, 94th Cong., 2d Sess. 2 (1976), reprinted in 1976 U.S. CODE CONG. & ADMIN. NEWS 6150, 6150-51; see also 44 U.S.C. section 2902.

[8] Through amendments to the FRA in 1984, Congress enhanced the Archivist's (NARA's) authority to prevent the unlawful removal or destruction of records by requiring the Archivist to notify Congress and independently request that the Attorney General initiate an action if the agency head refused to do so. See Id. at 27, 1984 U.S. CODE CONG. & ADMIN. NEWS at 3902; 44 U.S.C. section 2905(a). The conferees, "mindful of the protracted private litigation" involved in Kissinger v. Reporters' Committee for Freedom of the Press, 445 U.S. 136 (1980) ("Nothing in the Federal Records Act of 1950, which establishes a records management program for federal agencies, or the complementary Records Disposal Act, which provides the exclusive means for record disposal, expressly confers a right of action on private parties nor can such a right of action be implied.") thus chose to strengthen the administrative enforcement mechanism rather than explicitly sanction litigation at the behest of private citizens. See H.R. Conf. Rep. No. 98-1124 at 28, 1984 U.S. CODE CONG. & ADMIN. NEWS at 3903. The Archivist's responsibilities are triggered once an unlawful destruction of federal records has or will likely occur. Armstrong v. Bush, 924 F.2d 282, 295 (D.C. Cir. 1992).

[9] The mandatory statutory language of the FRA indicates that the agency head and Archivist are required to take action to prevent the unlawful destruction or removal of records and, if they do not, private litigants may sue to require them to do so. However, this does not imply that the Archivist and agency head must initially attempt to prevent the unlawful action solely by seeking the initiation of legal action. Instead, the FRA contemplates that the agency head and Archivist may proceed first by invoking the agency's "safeguards against the removal or loss of records," 44 U.S.C. section 3105, and taking such intra-agency actions as disciplining the staff involved in the unlawful action, increasing oversight by higher agency officials, or threatening legal action. Armstrong, 924 F.2d at 296.

[10] Further, as Defendants point out in their motion to dismiss, "IRS may not destroy any records that are not listed on a records schedule approved by the Archivist. Through NARA's oversight, as well as that of various governmental entities, including Congress, [P]laintiffs' interests in preserving historical IRS records are well represented."

[11] Injunctive relief under section 706(1) of the APA is appropriate where a reviewing court concludes that the "defendant official has failed to discharge a duty that Congress intended him to perform." Covelo Indian Community v. Watt, 551 F.Supp. 366 (D.D.C. 1982) (citations omitted); see Environmental Defense Fund, Inc. v. Costle, 657 F.2d 275 (D.C. Cir. 1981). Such is not the case here. At least, not at this point. Because NARA and the IRS are working to resolve the circumstances which gave rise to the improper handling of agency records, a call for injunctive relief is premature. Any claim that the Archivist has "failed to perform" is incorrect because NARA and the IRS are, in fact, currently in the course of performing as required.

[12] In determining whether agency decisions are committed to agency discretion by law, courts weigh several pragmatic considerations that may militate for or against judicial review of appellants' guidelines and directives. These factors include: "(1) the need for judicial supervision to safeguard the interests of the plaintiffs; (2) the impact of review on the effectiveness of the agency in carrying out its congressionally assigned role; and (3) the appropriateness of the issues raised for judicial review." American Friends, 720 F.2d at 41 (internal quotations omitted).

[13] In this case, while the Court acknowledges the importance of protecting Plaintiffs' interests because, if the guidelines are both inadequate and unreviewed, documents that plaintiffs would otherwise be able to study may be destroyed. However, judicial review of the guidelines and directives at this stage will clearly impede the "effectiveness of the agency in carrying out its congressionally assigned role." Id. at 44. Because the issue raised for judicial review is the inadequacy of the IRS's guidelines and procedures, and because those very things are in the process of being addressed, the guidelines' adequacy or lack thereof is a process which the Court should not stop simply so the Court can study it. While courts review the adequacy and conformity of agency regulations and guidelines with statutory directives every day, they do not generally do so while those guidelines are in a state of flux.

[14] In sum, the balance of the factors prompting review weigh against this case. If the agency head or Archivist did nothing while agency records were destroyed or removed in contravention of the FRA, Plaintiffs would clearly have a ripe action; but at this stage, in this instance, their action is premature. "The core question is whether the agency has completed its decision making process, and whether the result of that process is one that will directly affect the parties." Franklin v. Massachusetts, 505 U.S. 788, 797 (1992). The collaborative process between the IRS and NARA has not been completed, and the IRS, while having addressed the lion's share of its record maintenance problems, still has some changes yet to make. In the meantime, NARA is overseeing these changes, and IRS documents are not currently imperiled due to NARA's involvement. The Court is going to allow the agency the time to complete its changes.

[15] In further opposition to Defendants' motion to dismiss, Plaintiffs argue that at least one issue is ripe for review: whether NARA may inspect for appraisal purposes IRS records containing tax return information protected from disclosure by 26 U.S.C. section 6103 of the Internal Revenue Code (IRC). Plaintiffs want NARA to have access to these records in order to determine their historic value, so that ultimately, the public might have access to them. Under both the IRC and case law, the IRS may not legally show such documents to NARA, and certainly cannot reveal such documents to the public. Under the IRC the law is clear: "Returns and return information shall be confidential, and . . . no officer or employee of the United States . . . shall disclose any return or return information obtained by him in any manner in connection with his service as such an officer or an employee;" 26 U.S.C. section 6103(a). There is no exception in the Code that would allow Plaintiffs access to confidential tax returns or information gathered from them. See Church of Scientology of California v. IRS, 484 U.S. 9 (1987) (holding no right of access even to redacted confidential tax returns and "return information"); and Webster at 70 (holding that tax laws, including section 6103(a), restricting the use of tax return and tax return information contain no exception for records management inspection by NARA).

Conclusion

[16] For the reasons stated above, Defendants' motion to dismiss is granted. The Plaintiffs' action is dismissed without prejudice. And all other motions relating to this action are dismissed as moot. An appropriate Order is attached.

                                   JUNE L. GREEN