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Reply Brief for Plaintiff-Appellant

Posted on Jan. 6, 2021

Citations: Tax Analysts v. U.S. Dept. of Justice et al.; No. 96-5109

SUMMARY BY TAX ANALYSTS

Reply Brief for Plaintiff-Appellant, Tax Analysts v. U.S. Dept. of Justice, D.C. Cir., 96-5109

Tax Analysts v. U.S. Dept. of Justice et al.

TAX ANALYSTS,
Plaintiff-Appellant
v.
U.S. DEPARTMENT OF JUSTICE,
Defendant-Appellee,
WEST PUBLISHING COMPANY,
Intervenor Defendant-Appellee.

INFORMATION INDUSTRY ASSOCIATION,
Amicus Curiae for Appellee.
GERONIMO DEVELOPMENT CORPORATION,
Amicus Curiae for Appellant.

In The
United States Court of Appeals
For The District of Columbia Circuit

SCHEDULED FOR ORAL ARGUMENT
MONDAY, JANUARY 13, 1997

Appeal from the United States District Court for the District of Columbia

REPY BRIEF FOR PLAINTIFF-APPELLANT

ELEANOR J. LEWIS
CONSTANCE SPHEERIS
I AX ANALYSTS
Attorney for Plaintiff-Appellant
6830 North Fairfax Drive
Arlington, Virginia 22213
(703) 533-4402


TABLE OF CONTENTS

Introduction and Summary of the Argument

West’s and the Department's Arguments are Based on Facts Not in the Record

The Department

West

Where Jurisdiction and the Merits Are Intertwined in One Statute, and No Discovery Was Allowed Below. Remand is Required

Certificate of Word Count

TABLE OF CITATIONS

Bell v. Hood. 327 U.S. 678 (1945)

Crane v. Carr. 814 F.2d 758 (D.C. Ctr. 1987)

Edmond v. United States Postal Serv. General Counsel. 953 F.2d 1398 (DC. Cir. 1981)

El Fadi v. Central Bank of Jordan, et al. 75 F 3d 668 (D.C. Ctr. 1996)

Goland v. CIA, 607 F 2d 339(D.C. Cir. 1978), cert. denied, 445 U.S 927 (1980)

Greenery Rehabilitation Group, Inc. v. Sabol. 841 F. Supp. 58 (N.D.N.Y. 1993)

Herbert v. National Academy of Sciences. 974 F.2d 192 (D.C. Cir. 1992)

Holt v. United States, 46 F.3d 1005 (10th Cir. 1995)

Kamen v. American Telephone & Telegraph Co. 791 F.2d 1006

Matthew Bender & Co., Inc. and Hyperlaw, Inc. v. West Publishing Co., Civil Action No. 94-0589 (S.D.N.Y. Filed in August, 1994)

Meeropol v. Meese, 790 F.2d 942 (D.C. Cir. 1986)

Tax Analysts v. U.S Department of Justice, 492 U.S 136 (1989)

Wilderness Society v. Griles, 824 F.2d 4 (D.C. Cir. 1987)

Williamson v. Tucker, 645 F 2d 404 (5th Cir. 1981)

Statutes Cited:

44 U.S.C. § 3301

48 C.F.R. § 1.101. et seq.


 Introduction and Summary of the Argument

A fundamental factual dispute lies at the heart of this Freedom of Information Act (FOIA) case. The Department of Justice ("Justice”) and West Publishing Co. ("West") contend that Tax Analysts is requesting something called the "West database" which is outside the control of the Department. Tax Analysts, in contrast contends that this case is about the Department's JURIS database, which was electronically formatted using government-owned software and public-domain caselaw and statutes.

If allowed discovery, Tax Analysts will prove that this case in fact involves electronic formatting by use of government-owned software which was applied by a computer-services contractor, West, to the words written by Congress and the courts. The result was a government-owned database totally unlike Westlaw or any other West publication. The Department describes JURIS as "a computerized legal research system designed and maintained by the Department of Justice." DOJ Br. 2, n.2.

This case actually involves a public-private working relationship very different from the mythical chimera that West and the Department parade through their briefs. For example:

1. Justice claims (DOJ Br. 6) that West "electronically formatted" the texts of opinions, but conveniently omits the fact that the formatting was accomplished by use of government-owned software loaned to West by the Department of Justice. This made the format of the resulting legal database government property, not West's property.

2. Justice claims (DOJ Br. 21) that “West created the database at issue. . . ." This is not correct. The database was created by application of government-owned software to create a format that was appropriate for the JURIS system. West created nothing; it merely applied software that it did not own to data that it did not own.

3. Justice claims (DOJ Br. 22) that "it is irrelevant exactly how West formatted the West database and how the software functions." (Emphasis in original) In fact, nothing could be more relevant. The fundamental architecture of any database is created by software. Here, the software was government owned. Hence, the resulting database is also government owned.

4. Justice claims (DOJ Br. 22) that “plaintiff has asked for the fruits of West's commercial enterprise — the "electronic compilation" it produced and created for the Department's limited use on JURIS." Nothing could be more false. The enterprise of government computer programmers was loaned to West Publishing under the contract at issue in this case. The programmers worked for the government, not West. The computer code they wrote represented government enterprise, not commercial enterprise. West simply rented computer time to the government, just as do thousands of other computer services contractors who work for the government.

5. Justice claims (DOJ Br. 23) that 'nothing prohibits corporations like West from charging their private and governmental customers in order to cover the costs of capital, labor, time, and effort invested in electronically formatting data to create their compilations of public domain material." But there was no investment by West to create the JURIS electronic format. That format was created by the government, at government expense, when it wrote the computer code that the Department of Justice loaned to West, and which, presumably, West has now returned to the Department of Justice under the terms of the contract.

Tax Analysts has brought a simple and narrow appeal based solely on procedural grounds. The absence of facts established in a record below on which to argue the substantive issues presented by Tax Analysts' underlying FOIA request, highlighted by the divergent factual pictures cited above, makes it impossible to argue substantive points of law. This factual void results from the district's court procedural error in granting the Rule 12(b)(1) motions to dismiss without any discovery, where the merits of the claim and jurisdiction are intertwined in one federal statute. The court's reliance, therefore, on an ex parte record of defendants' affidavits and declarations was inappropriate and constitutes grounds for reversal.

West's and the Department's Arguments are Based on Facts Not in the Record

in this appeal, Tax Analysts does not discuss substantive conclusions of law — other than to point out they are based on erroneous fact-finding — because there is no record on the basis of which to challenge such conclusions. Similarly, arguments of the Department and of West that address substantive matters of law, such as the effect of the license provisions in the Contract, must be discarded for lack of a factual  foundation below.

The Department and West base their arguments on assertions never proven below. These assertions have never seen the light of discovery or withstood an offer of proof. The “facts” relied on by both defendants are mere beliefs or assumptions that simply do not exist in the record. The failure of both the Department and of West to cite to the record when making these assertions is testimony to the absence of a fact-based record.

Tax Analysts docs not concede the substantive conclusions of law made by the district court, including its ultimate finding that JURIS is not an agency record. A328. Tax Analysts asserts error in the court's refusal to allow discovery in the face of Rule 12(b)(1) motions to dismiss, when jurisdiction and the merits of the underlying FOIA action are intertwined. As Tax Analysts demonstrates in its opening Brief and in this Reply, there are simply no facts in the record on which to base this conclusion of law, and the court's unsupported effort at fact-finding produced clearly erroneous results.

When ruling on 12(b)(1) motions where jurisdiction and the merits are intertwined, if the court looks beyond the pleadings, the nonmoving party must be permitted procedural safeguards “to assure that a full airing of the facts pertinent to a decision on the jurisdictional question" is provided. Herbert v. National Academy of Sciences, 974 F.2d 192, 198 (D.C. Cir. 1992); Holt v. United States, 46 F.3d 1005 (10th C1r. 1995); Williamson v. Tucker, 645 F.2d 404 (5th Cir. 1981) (where the challenge to a court's jurisdiction is also a challenge to the existence of a federal cause of action, the proper course of action for the district court . . . is. to find jurisdiction exists and deal with the objection as a direct attack on the merits of the plaintiffs claim), citing Bell v. Hood, 327 U.S. 678, 682 (1945) (strict Supreme Court standard for dismissals for lack of subject matter jurisdiction when the basis of jurisdiction is also an element in the plaintiffs federal cause of action) (emphasis added). The most obvious protection in such a situation is discovery.

As Tax Analysts has shown in its opening Brief, despite the court's commitment to all parties in the hearing of November 16, 1995, that it would not rely on or refer to facts contained in the affidavits, it did exactly that in reaching its conclusions of law. TA Br. 30-33. Because all of the facts needed to establish both the jurisdictional issue and the merits of the FOIA action are under the absolute control of West and of the Department, Tax Analysts agreed to this commitment in good faith with the belief that any and all of the representations made in defendants' exhibits would not be considered. In fact, the court relied heavily on them.

The Court should not be diverted from the fundamental procedural error by the sirens' call made by the defendants in their efforts to argue substantive issues. This call is intended to divert the Court into rendering a decision based on substantive matters of law when the factual foundation for a decision is absent. There is no factual record below on which to make the conclusions of law propounded by the Department and by West. Tax Analysts amply demonstrates in its opening Brief that the district court erred by relying on an ex parte record gleaned from untested affidavits and declarations of the defendants regarding procedures and practices — even employees' opinions — under their sole control. The court's frequent reference to the information in these materials, which Tax Analysts strongly contests, is not dicta, as West asserts, but clear error. The untested statements formed the factual underpinning of the court's decision to grant the motions to dismiss, including the ruling that JURIS is not an agency record, and yielded clearly erroneous fact-finding.

West is misrepresenting to the Court the meaning of statements of Tax Analysts counsel below when he agreed to the exclusion of outside material from the court's consideration. West Brief at 12, 15. A full reading of counsel's statement in Plaintiff's Supplemental Memorandum, R17 at 2, makes very clear that when stating that the contract is "easily construed" without the use of outside affidavits, Mr. Dobrovir was referring to the obvious application of section H to only one of the two sections C in the contract. "It [section H] refers to proprietary data and therefore can only apply to the second, "proprietary” data section C, which is not at issue in this case." As is clear, Mr. Dobrovir was saying the opposite of what West represents in their brief. Tax Analysts' position is unchanged. The West license can apply only to “proprietary" data, such as headnotes and synopses covered by the second section C (A80), not "nonproprietary" public domain data covered by the first section C (A40). 

The Department's and West's reliance on facts not proven below is well illustrated by the following examples taken from the defendants' Briefs where assertions [Editor's Note: Text missing in original.]

The Department

1. "When JURIS was first created in the early 1970's . . .” DOJ Br. 5. (JURIS's genesis has never been established and there are several conflicting accounts of both the year of its establishment and its early contents);

2. “Eventually, a substantial portion of the material contained on JURIS, including most federal case law, was procured commercially from West. Pursuant to a series of contracts and licensing agreements, West created and provided a database to the Department for use on JURIS.” DOJ Br. 5. (Prior contractual arrangements between DOJ and West are not in the record, nor has it been established that West created anything for JURIS, or its impact on JURIS, or how West processed data for JURIS.);

3. "The contract required West to . . . create a unique commercial product . . . that was ready for use on JURIS." DOJ Br. 5. (It was never established below that West created a unique commercial product ready for use on JURIS; in fact, the contract indicates that West input public domain data using government-provided software according to specific government specifications. A43-79);

4. “. . . West electronically formatted the texts of the opinions to create the West database." DOJ Br. 6. (This is the most controversial unproven assertion which goes to the core of what constitutes so-called "West Licensed Data" and to the question of what material is covered by the license in section H. This factual claim is key to Tax Analysts' contention that public domain data retains its nature regardless of the medium in which it appears, whether in print or electronic form, and that government-owned formatting instructions dictated the electronic format of the JURIS database.)

West

1. "As the bulk of the JURIS database consisted of West Licensed Data. . . ." West Br. 2 (There is no proof in the record regarding what constitutes "West Licensed Data" and whether any portion of the nonproprietary parts of JURIS is “West Licensed Data." Another question is whether as a matter of law public domain data in a government database, electronically formatted according to government-owned software specifications, can ever be subject to ownership claims by a private party, even if hidden under a licensing veil in a government contract. Also unexplored but material to whether JURIS is an agency record under FOIA is the status of the substantial portion of JURIS that existed before West began providing computer services to JURIS.);

2. “Pursuant to the 1988 contract, West agreed to license data, primarily consisting of West case reports and West digest materials (as contained in WESTLAW, West's computer-assisted legal research database), to DOJ for use in JURIS." West Br. 3. (The relationship of West law to the nonproprietary public domain data that West processed for JURIS was never established below and goes to the heart of the dispute regarding the proprietary and nonproprietary data processed under the contract as evidenced by the inclusion of a “nonproprietary" section C in the contract as well as a "proprietary" section C, A40 and A80;1)

3. “Rather, the West Licensed Data either is subject to the restrictive licensing provisions of the 1988 Contract or it is not." West Br. 11. (The most material and relevant piece of fact-finding in this action is what precisely constitutes the “West Licensed Data”; West and the Department bandy this term about as much as "Westlaw," yet there has never been any finding of fact to establish any relationship between Westlaw and JURIS: no amount of presumptive argumentation can take the place of offers of proof);2

4. West refers repeatedly to Tax Analysts' FOIA request as seeking something proprietary to West. To the contrary, and conceded by the Department, DOJ Br. 9, n.6, Tax Analysts seeks nothing privately authored or originally compiled or arranged by West. A135, 137-139.

Because the court disallowed discovery, the relationship, if any, between Westlaw and JURIS has never been established. Indeed, West's decision in 1993 to cease processing the public domain court opinions and statutes, among other things, for JURIS and instead to license Westlaw to the Department would seem to indicate the opposite. West, perhaps, may have chosen to use Westlaw as an easy source from which to fulfill the nonproprietary requirement of the Contract for public domain material — a choice that has not been demonstrated — but JURIS is not Westlaw. R.1, exh 3. Software is what gives a database its unique character, and government-owned JURIS software loaned to West by Justice gave JURIS a character that is totally different from Westlaw.

West has never proven that "JURIS is Westlaw” yet this notion is bandied about as though it has survived the test of discovery. It is a false notion. This factual assumption is key to whether the nonproprietary portion of JURIS — the words of federal judges in court opinions and of Congress in statutes, as formatted with government-owned software — is an agency record, or whether, as West and the Department contend, it is subject to the license provisions in Section H of the Contract. Tax Analysts repeats its reasonable expectation that it would prove otherwise through discovery on remand.

In short, none of the "facts” used to bolster West's and the Department's interpretation of the effect of the license provision in the Contract were proven below. They are not in the record. Given a record devoid of proven facts, no legal conclusion can be reached as to whether the public domain, nonproprietary material in the electronic compilation known as JURIS is an agency record.

Where Jurisdiction and the Merits Are Intertwined in One Statute, and No Discovery Was Allowed Below, Remand is Required

A clear distinction separates Tax Analysts' situation in the district court from the line of cases both the Department and West have cited. Remand was ordered in every case cited which has reviewed the procedural situation in a Rule 12(b)(1) motion to dismiss, particularly with intertwining, or a Rule 12(b)(6) motion, and the court below dismissed the plaintiff's action with no discovery. El Fadi v. Central Bank of Jordan, et al., 75 F.3d 668 (D.C. Cir. 1996) (case reversed and remanded for reasonable discovery on jurisdictional issue where no discovery had been permitted on basic questions of fact relating to jurisdiction, noting that situation where no discovery is permitted is distinguishable from those in which some discovery is granted below, citing Crane v. Carr, 814 F.2d 758 (D.C. Cir. 1987) and Edmond v. United States Postal Serv. General Counsel; 953 F.2d 1398, 1401 (D.C. Cir 1981)); Crane v. Carr (case remanded for reasonable discovery on jurisdictional issue where relevant information was under defendant's control), Wilderness Society v. Griles, 824 F.2d 4 (D.C. Cir. 1987) (district court abused its discretion in denying plaintiff discovery when it dismissed a claim based on use of extra-pleading material); Greenery Rehabilitation Group. Inc. v. Sabol, 841 F. Supp 58 (N.D.N.Y. 1993) (in a . . . Rule 12(b)(1) [motion] the party opposing the motion must be allowed discovery of facts demonstrating jurisdiction “at least where the facts are peculiarly within the knowledge of the opposing party," analogizing situation to a Rule 56(f) context) citing Kamen v. American Telephone & Telegraph Co., 791 F.2d 1006, 1011).

Conversely, where some discovery was allowed below — however limited — remand was not ordered. Herbert v. National Academy of Sciences, 974 F.2d 192, 200 (D.C. Cir. 1992) (where some discovery allowed below, but no intertwining of jurisdiction and merits, and plaintiff did not seek additional discovery, court's failure to offer additional discovery not erroneous), Meeropol v. Meese, 790 F.2d 942 (D.C. Cir. 1986) (in extraordinary FOIA request where information sought relating to federal prosecution files involved in infamous case of trading national security secrets to the enemy, and relevant agencies had made concerted and ongoing effort to find and search files over 5 year period, denial of additional discovery not grounds for reversal for largest period covered; remand ordered for time period where FOIA response inadequate, including further discovery).

In Goland v. CIA, 607 F.2d 339 (D.C. Cir. 1978), cert. denied. 445 U.S. 927 (1980), a starkly different factual setting is presented. The FOIA request in Goland, described by the court as ambiguously worded, sought from the CIA, Congressional materials from hearings including broadly worded “legislative history." A limited amount of discovery was permitted before the court granted the government's motion for summary judgment. It is odd that West chooses to rely heavily on this case as the defect in the FOIA request — which was at the heart of the government's motion for summary judgment as well as the court's ruling — appears to be that the most rudimentary aspects of the records sought were not clarified in the request. It was not clear exactly what the plaintiff was seeking beyond a broad description of “legislative history" involved in the Congressional records. Discovery seemed to become a vehicle for the plaintiff to define its request, rather than to discover facts relevant to an already defined request for agency records

In Tax Analysts' case, the FOIA request itself is clear. The requests made for discovery were clear and narrowly defined regarding the agency record issue. The obstruction arises from a third party's claims of ownership that have nothing to do with identifying the record sought. Goland is not on point with this FOIA action, either with respect to the substance of the underlying FOIA request or with respect to the nature of Tax Analysts' four requests for discovery.

The Department's and West's attempts to discredit Tax Analysts' credibility and interest in seeking discovery and fact-finding regarding whether JURIS is an agency record is not surprising, but a bit foolish. Obviously, Tax Analysts would not waste the Court's or the parties' time and resources on a frivolous appeal. Tax Analysts has every expectation that it will meet its burden of proof through discovery of relevant, material facts, particularly in contravention of the licensing picture portrayed by the untested affidavits and declarations submitted by the Department and by West on which the court relied in resolving disputed facts. These facts go to the heart of whether the JURIS database is an agency record.3

The November 22, 1996, decision by U.S. Judge John S. Martin, Jr. in the Southern District of New York in Matthew Bender & Co., Inc. and Hyperlaw, Inc. v. West Publishing Co., Civil Action No. 94-0589 (S.D.N.Y filed in August, 1994), illuminates the importance of fact-finding with respect to a similar issue,. See Addendum in the Bender/Hyperlaw case, West again attempted to circumvent fact-finding by seeking preliminary dismissal — on a Rule 56 motion for summary judgment — of the plaintiffs challenge of West's claim that it holds a copyright on the page numbers in West reporters, as well as of West's proprietary claims over the use of the public domain text in judges opinions devoid of any West-created private material. While ruling that West cannot claim copyright in its page numbers, a long controverted claim, the judge also has required West to go to trial on the broader issue of its longstanding-proprietary claims over this public domain text. While the specific issues are somewhat different here, the Bender/Hyperlaw case illustrates a West practice of asserting dominion in every available forum over entirely public domain, government material. The case illustrates the importance of permitting fact-finding to occur.

The Department's suggested alternative ground for affirmance as a library collection is not an available defense in the FOIA. The term "library collection" is not even mentioned in the statute. The Department illustrates perfectly the intertwining of jurisdiction and the merits in this action by suggesting that the court's decision on the jurisdictional challenge can be affirmed substantively by reference to the same statute.

The analogy made to the Records Disposal Act, 44 U.S.C. §3301, is inapposite because that Act related to records appropriate for disposal rather than dissemination. The Supreme Court rejected this analogy in Tax Analysts v. U.S. Department of Justice. 492 U.S. 136, 145, n.5 (1989).

For these reasons and those set forth in our opening brief, the decision of the district court should be reversed and the case remanded tor a full hearing on the merits after an appropriate opportunity tor discovery.

FOOTNOTES

1West's sudden attempt to redefine the two conflicting section “C's" in the Contract, A40 and A80, which separate “nonproprietary” from “proprietary" material, by referring to them as "both parts of section C" is either disingenuous or reflects a lack of familiarity with standard contract practice. West Br. 19. Standard practice dictates that multiple components of one section are referred to as “subsections" in appropriate alternative upper and lower case alphabetical or numerical order, not repetitive, identical uppercase letters as West argues.

2Tax Analysts is in agreement with West regarding the legal and economic significance of the Federal Acquisition Regulation, 48 C.F.R. §1101 et seq., with which it is of course familiar. West attempts to hide its illegitimate proprietary claims to entirely public domain material under an appropriate and well conceived federal regulation intended to protect the legitimate commercial interests of private business in contractual relationship with the government. The possibility that West may have commingled public domain data with proprietary material, thereby attempting to claim the entire database, or compilation, as its own, as well as to shield its input in JURIS from the light of discovery, should not dissuade this Court from requiring West to submit to discovery so that the scope of the "license" in the Contract can be truly ascertained.

3Contra DOJ Br. 28, n. 10; at 29, n. 12. West Br. 13, n.3: 14. Given that Tax Analysts expects that its discovery will reveal material and relevant facts that go to the heart of whether JURIS is an agency record, it appears that the Department and West concede that the casa law supports reversal and remand for full fact-finding where it is expected that discovery would lead to "admissible, relevant evidence." West Br. 14.

END FOOTNOTES

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