Tax Analysts v. IRS ( 2002 )

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued May 7, 2002 June 14, 2002
No. 01-5231
Tax Analysts,
Appellant
v.
Internal Revenue Service,
Appellee
Consolidated with
No. 01-5232
---------
Appeals from the United States District Court
for the District of Columbia
(No. 96cv02285)
William A. Dobrovir argued the cause for appellant/cross-
appellee. With him on the briefs was Cornish F. Hitchcock.
Jonathan S. Cohen, Attorney, United States Department of
Justice, argued the cause for appellee/cross-appellant. With
him on the briefs were Roscoe C. Howard, Jr., United States
Attorney, and Karen D. Utiger, Attorney, United States
Department of Justice.
Before: Edwards, Henderson, and Garland, Circuit
Judges.
Opinion for the Court filed by Circuit Judge Edwards.
Edwards, Circuit Judge: Several cases over the last two
decades have required this court to consider whether records
and documents of the Internal Revenue Service ("IRS" or
"the Service") are exempt from public disclosure under the
Freedom of Information Act ("FOIA"), 5 U.S.C. s 552 (2000).
In this case, the District Court determined that the IRS'
Legal Memoranda ("LMs") and the Office of Chief Counsel's
("OCC") intradivisional Technical Assistance memoranda
("TAs") are exempt from disclosure pursuant to the delibera-
tive process privilege encompassed in FOIA Exemption 5, 5
U.S.C. s 552(b)(5). The District Court further held that IRS
need not segregate and release agency working law from TAs
withheld pursuant to Exemption 5's attorney work product
privilege. We affirm the District Court's judgment and adopt
its reasoning and conclusions on these points.
The District Court also ordered IRS to release eight TAs,
finding the information not exempt from disclosure under
FOIA Exemption 7(E), because the information did not con-
cern "investigations which focus directly on specifically al-
leged illegal acts, illegal acts of particular identified officials,
acts which could, if proved, result in civil or criminal sanc-
tions." Tax Analysts v. IRS, 152 F. Supp. 2d 1, 14, Mem.
Op., (D.D.C. Mar. 26, 2001) [hereinafter "Mem. Op. II"].
This was error. We therefore reverse and remand on this
point so that the District Court may reassess this material
pursuant to the correct legal standard.
Finally, the District Court ruled that IRS properly with-
held five TAs issued to program managers pursuant to Ex-
emption 5's deliberative process privilege, but held that IRS
must release five other such TAs. IRS appeals the latter
determination as to three of the five documents that were
ordered released. After reviewing the TAs in camera, we
hold that the District Court correctly distinguished between
TAs that are part of an internal give-and-take discussion and
TAs that reflect OCC's considered legal conclusions. We
therefore affirm the judgment of the District Court on these
issues.
I. Background
Tax Analysts is a non-profit organization that publishes
news and other material on taxation. In 1995, Tax Analysts
made a FOIA request for several categories of unpublished
IRS internal memoranda. In response, the Service released
certain documents but withheld others. Tax Analysts
brought an action in the District Court for the District of
Columbia. Pursuant to intervening legislation and a partial
settlement by the parties, most of the categories of memoran-
da were eventually released. The two categories still at issue
are LMs and certain sub-categories of TAs.
On the basis of a largely undisputed factual record, the
District Court described LMs as follows:
LMs are prepared by so-called "docket attorneys" in the
Office of Chief Counsel to assist in the preparation and
review of proposed revenue rulings. Revenue rulings
are official interpretations of the Internal Revenue Code
and other tax materials. Before a proposed revenue
ruling is published and achieves the status of precedent,
it must pass through a multi-faceted review process that
is not complete until the Office of the Assistant Secretary
(Tax Policy) at the Department of Treasury grants its
final approval. As a proposed revenue ruling works its
way through this process, it is accompanied by a "publi-
cation package." Sometimes, but not always, the publi-
cation package includes a LM. According to the Chief
Counsel Publications handbook, LMs may include a re-
statement of the proposed revenue ruling's issue and
holding; justification, arguments, and lines of research
that are not reflected fully in the proposed revenue
ruling; and the principal arguments for reaching a con-
trary position. The LM serves as briefing material for
the reviewers, providing a comprehensive summary of
the drafter's legal research as well as the drafter's
evaluation of the proposed ruling's strengths and weak-
nesses. At various points in the approval process the
publication package may be returned to the drafter for
revisions. Once approved by Treasury, revenue rulings
are published in the Internal Revenue Bulletin for the
information and guidance of taxpayers. There is no
formal process, however, whereby the LM is conformed
to reflect the final published revenue ruling.
After a proposed revenue ruling is definitively ap-
proved or rejected, the publication package is archived
and can be retrieved by reference to the number of the
proposed revenue ruling. The accompanying LM, if any,
is archived with the rest of the publication package, but
there is no indexing or retrieval system by which one can
identify those files that contain an LM. IRS attorneys
sometimes keep copies of LMs for their own reference,
and may retrieve the revenue ruling file if they wish to
probe the history behind a certain revenue ruling. At-
torneys may exchange LMs informally, but they are not
distributed through official channels.
Tax Analysts v. IRS, 97 F. Supp. 2d 13, 16, Mem. Op.,
(D.D.C. Mar. 31, 2000) [hereinafter "Mem. Op. I"] (internal
citations omitted).
As for TAs, the District Court offered the following de-
scription:
TAs are prepared by the four technical divisions within
the Office of Associate Chief Counsel (Domestic): the
Office of Assistant Chief Counsel (Passthroughs & Spe-
cial Industries), the Office of Assistant Chief Counsel
(Income Tax & Accounting), the Office of Assistant Chief
Counsel (Corporate), and the Office of Assistant Chief
Counsel (Financial Institutions & Products). These tech-
nical divisions prepare TAs in response to requests from
many different offices for many different purposes. The
IRS has attempted to categorize the TAs by requester.
One such category, TAs to the district or regional offices
of the IRS or Office of Chief Counsel, or Service Centers
("the field") were dismissed from the case in the context
of the IRS's motion to dismiss. Four categories remain:
TAs to program managers in the national office, TAs to
component offices of the national Office of Chief Counsel
(intra-national office TAs), TAs to specific taxpayers, and
TAs to federal and state government agencies. Within
each of these four categories, the TAs can be further
categorized by their purpose. For example, TAs to
program managers fall into eight different categories,
and intra-national office TAs fall into four different cate-
gories.
Id. at 20 (internal citations omitted).
The District Court reviewed sample documents in camera,
along with a Vaughn index prepared by IRS. Both parties
moved for summary judgment. The court granted IRS'
motion as to LMs, which IRS had claimed were exempt under
FOIA Exemption 5's deliberative process privilege. Id. at 16-
18. The District Court held that the withheld portions of
LMs did not constitute IRS working law and were therefore
exempt under the privilege. Id. The District Court rea-
soned that, like the Background Information Notes in Arthur
Andersen & Co. v. IRS, 679 F.2d 254 (D.C. Cir. 1982), LMs
were written by lower-level attorneys for use by senior
decisionmakers. Id. at 16-17. The District Court found that
LMs are not officially approved by the senior decisionmakers
and do not "emanate from [OCC] with any appearance of
authority." Id. at 17.
The District Court distinguished LMs from the General
Counsel's Memoranda at issue in Taxation With Representa-
tion Fund v. IRS, 646 F.2d 666, 670 (D.C. Cir. 1981) [herein-
after "TWRF"], which were used to promote uniformity in
IRS policy. Mem. Op. I at 17. The court found that, unlike
General Counsel's Memoranda, LMs are not updated to re-
flect the national office's current position, widely distributed
within IRS, or officially reconciled to reflect uniform policy.
Id. The District Court also distinguished LMs from the
Field Service Advice memoranda ("FSAs") at issue in Tax
Analysts v. IRS, 117 F.3d 607 (D.C. Cir. 1997), because LMs
flow "upward" from staffers to reviewers, while FSAs flow
"outward" from OCC to field personnel. Id. (citing Tax
Analysts, 117 F.3d at 617). Thus, the District Court upheld
IRS' policy of redacting the portions of LMs reflecting the
authors' opinions and analysis. Id. at 17-18.
With regard to TAs, the District Court ordered further
briefing. Id. at 21-23. The court then rejected Tax Analysts'
argument that IRS was required to demonstrate that it had
complied with the so-called "harm rule," a policy set forth in
the Internal Revenue Manual ("Manual"). Id. at 15 n.3. The
"harm rule" stated that IRS would grant FOIA requests
unless the record is exempt and disclosure would significantly
impede IRS actions in carrying out a responsibility or func-
tion. Id. The District Court found that the rule is non-
binding. Id. Tax Analysts moved for reconsideration of this
ruling. In Mem. Op. II, the District Court denied Tax
Analysts' motion as untimely. The District Court also revisit-
ed the merits and found that the Manual's harm rule, which
had been revised, was still not binding because it lacked
mandatory language and did not demonstrate that IRS in-
tended to be bound by the policy. Id. at 7-8.
The District Court then turned to TAs. With respect to
TAs withheld pursuant to FOIA Exemption 7(E), the court
held that eight of the TAs were not exempt because they did
not focus on "a specifically alleged illegal act of any particular
identified case or individual," and therefore were not compiled
for law enforcement purposes as the exemption requires. Id.
at 15. With respect to TAs withheld in their entirety pursu-
ant to the attorney work product privilege encompassed by
Exemption 5, the court held that IRS was not required to
segregate and release the portions of the TAs that constituted
agency working law. Id. at 18-19.
With respect to TAs withheld pursuant to Exemption 5's
deliberative process privilege, the District Court made two
rulings that Tax Analysts now appeals. First, the court
addressed certain TAs to program managers. These TAs
contain OCC's answers to questions submitted by program
managers in IRS' national office, sometimes concerning indi-
vidual taxpayers. The District Court ordered IRS to release
five of these TAs and rejected the request for disclosure of
another five. Id. at 22-24. The court found that the five TAs
that were held subject to disclosure are treated as final
documents that represent the considered position of OCC,
while those held to be exempt are merely part of a delibera-
tive process involving OCC and IRS' program managers. Id.
at 22-23. The court likened the TAs it ordered released to
the FSAs at issue in Tax Analysts. Id. at 22.
Second, the District Court addressed intra-divisional TAs,
which are issued when one component of OCC advises anoth-
er component that has been assigned to create a private letter
ruling or other official document. Id. at 24. The District
Court found that these TAs are "predecisional and delibera-
tive," because they are solicited from a component of the
agency that lacks the authority to issue a final legal decision.
Id. at 24. The content of these TAs is "subject to modifica-
tion or rejection prior to the finalization into the final work
product." Id. The District Court thus found that these TAs
are exempt from disclosure under the deliberative process
privilege. Id. at 25.
Both parties moved for reconsideration. In Tax Analysts
v. IRS, 152 F. Supp. 2d 1, 27, Mem. Op. (Motion for Reconsid-
eration), (D.D.C. May 21, 2001) [hereinafter "Mem. Op. III"],
the District Court denied both parties' motions in relevant
part. The court rejected Tax Analysts' argument that TAs
withheld pursuant to the attorney work product privilege
should not be protected in their entirety. Id. at 29. The
court also restated its holding that TAs not focusing on an
individual investigation were not records compiled for law
enforcement purposes as required by Exemption 7(E). Id. at
30-31.
II. Discussion
A. LMs, Intra-divisional TAs, the Attorney Work Product
Privilege, and the IRS Manual
FOIA Exemption 5 protects "inter-agency or intra-agency
memorandums or letters which would not be available by law
to a party other than an agency in litigation with the agency."
5 U.S.C. s 552(b)(5). The exemption allows an agency to
withhold those materials that would be privileged from dis-
covery in civil litigation. NLRB v. Sears, Roebuck & Co., 421
U.S. 132, 149 (1975). As such, it is interpreted to encompass,
inter alia, three evidentiary privileges: the deliberative pro-
cess privilege, the attorney-client privilege, and the attorney
work product privilege. Burka v. HHS, 87 F.3d 508, 516
(D.C. Cir. 1996).
The District Court correctly found that LMs and intra-
divisional TAs do not constitute agency working law and are
exempt pursuant to the deliberative process privilege. The
District Court also correctly determined that the harm rule
articulated in the Manual does not bind IRS or create rights
in Tax Analysts. Finally, the District Court correctly deter-
mined that IRS need not segregate and release agency
working law from TAs withheld in their entirety pursuant to
the attorney work product privilege. Because the District
Court's analysis and conclusions on these points are eminent-
ly sound, no further elaboration is necessary. We therefore
affirm the District Court's judgment on these issues and
adopt its reasoning and conclusions.
B. Exemption 7(E)
The Service withheld portions of 16 TAs pursuant to Ex-
emption 7(E). This exemption allows an agency to withhold:
records or information compiled for law enforcement
purposes, but only to the extent that the production of
such law enforcement records or information ... (E)
would disclose techniques and procedures for law en-
forcement investigations or prosecutions, or would dis-
close guidelines for law enforcement investigations or
prosecutions if such disclosure could reasonably be ex-
pected to risk circumvention of the law....
5 U.S.C. s 552(b)(7). The dispute in this case turns on
whether IRS has shown that the disputed records or informa-
tion were compiled for "law enforcement purposes."
There are several overarching principles that the courts
follow in assessing whether records or information satisfy the
threshold requirement of s 552(b)(7). First, "law enforce-
ment purposes" under Exemption 7 includes both civil and
criminal matters within its scope. Pratt v. Webster, 673 F.2d
408, 420 n.32 (D.C. Cir. 1982). Second, the FOIA makes no
distinction between agencies whose principal function is crimi-
nal law enforcement and agencies with both law enforcement
and administrative functions. Id. at 416. Therefore, agen-
cies like IRS, that combine administrative and law enforce-
ment functions, as well as agencies like the Federal Bureau of
Investigation ("FBI"), whose principal function is criminal law
enforcement, may seek to avoid disclosure of records or
information pursuant to Exemption 7. Finally, "courts can
usually assume that government agencies act within the scope
of their legislated authority." Id. at 418. However, courts
apply a more deferential standard to a claim that information
was compiled for law enforcement purposes when the claim is
made by an agency whose primary function involves law
enforcement. Id. This point was amplified in Pratt v. Web-
ster:
On the one hand, the assumption that a mixed-function
agency is acting within the scope of its authority tells a
court nothing about whether it has met the Exemption 7
threshold requirement of a "law enforcement purpose."
Law enforcement, indeed, is often one of such an agen-
cy's proper functions, but other functions are also a
major part of the agency's day-to-day business. Thus, a
court must scrutinize with some skepticism the particular
purpose claimed for disputed documents redacted under
FOIA Exemption 7.... If courts accept a mixed-
function agency's claims of "law enforcement purpose"
without thoughtful consideration, the excessive withhold-
ing of agency records which Congress denounced and
sought to avoid ... might well result.
On the other hand, the generally accurate assumption
that federal agencies act within their legislated purposes
implies that an agency whose principal mission is crimi-
nal law enforcement will more often than not satisfy the
Exemption 7 threshold criterion. Thus, a court can
accept less exacting proof from such an agency that the
purpose underlying disputed documents is law enforce-
ment. This less exacting judicial scrutiny of a criminal
law enforcement agency's purpose in the context of the
FOIA Exemption 7 threshold is further bolstered by
Congress' concern that inadvertent disclosure of criminal
investigations, information sources, or enforcement tech-
niques might cause serious harm to the legitimate inter-
ests of law enforcement agencies.
Id. (internal citations and footnotes omitted).
In the instant case, the District Court correctly identified
IRS as a mixed-function agency, subject to an exacting stan-
dard when it comes to the threshold requirement of Exemp-
tion 7. The District Court, however, relied on Rural Hous-
ing Alliance v. United States Department of Agriculture, 498
F.2d 73, 81 (D.C. Cir. 1974), in holding that a mixed-function
agency may only withhold information pursuant to Exemption
7 when the information concerns "investigations which focus
directly on specifically alleged illegal acts, illegal acts of
particular identified officials, acts which could, if proved,
result in civil or criminal sanctions." Mem. Op. II at 14
(quoting). This was error.
Rural Housing and its progeny apply only when an agency
seeks to invoke Exemption 7 in a situation in which there is
an ongoing law enforcement "investigation." The court re-
cently explained the development of this line of authority in
Jefferson v. Department of Justice, 284 F.3d 172 (D.C. Cir.
2002):
In assessing whether records are compiled for law
enforcement purposes, this circuit has long emphasized
that the focus is on how and under what circumstances
the requested files were compiled, ... and "whether the
files sought relate to anything that can fairly be charac-
terized as an enforcement proceeding." ... In Rural
Housing Alliance v. Dep't of Agriculture, 498 F.2d 73(D.C. Cir. 1974), the court identified two types of investi-
gatory files that government agencies compile: (1) files
in connection with government oversight of the perfor-
mance of duties by its employees, and (2) files in connec-
tion with investigations that focus directly on specific
alleged illegal acts which could result in civil or criminal
sanctions. Id. at 81. Again, the court emphasized that
the purpose of the investigatory files "is the critical
factor." Id. at 82. Thus, if the investigation is for a
possible violation of law, then the inquiry is for law
enforcement purposes, as distinct from customary sur-
veillance of the performance of duties by government
employees. Id. Then, in Pratt v. Webster, 673 F.2d 408(D.C. Cir. 1982), the court set forth a two-part test
whereby the government can show that its records are
law enforcement records: the investigatory activity that
gave rise to the documents is "related to the enforcement
of federal laws," and there is a rational nexus between
the investigation at issue and the agency's law enforce-
ment duties. Id. at 420, 421. The court again distin-
guished the need "to establish that the agency acted
within its principal function of law enforcement, rather
than merely engaging in a general monitoring of private
individuals' activities." Id. at 420.
The court applied these principles in Kimberlin v.
Dep't of Justice, 139 F.3d 944 (D.C. Cir. 1998). In that
case, the requester asked for "all papers, documents and
things pertaining to the OPR investigation" of another
AUSA. Id. at 947. Applying the distinction between law
enforcement records and internal agency investigations
set forth in Rural Housing, 498 F.2d at 81, the court
stated that "[m]aterial compiled in the course of ...
internal agency monitoring does not come within Exemp-
tion 7(C) even though it 'might reveal evidence that later
could give rise to a law enforcement investigation.' "
Kimberlin, 139 F.3d at 947. Concluding, however, that
"the OPR investigation here at issue was conducted in
response to and focused upon a specific, potentially ille-
gal release of information by a particular, identified
official," id. at 947, the court held that the information in
the OPR files was compiled for law enforcement pur-
poses. Id.Id. at 176-77.
Appellant Tax Analysts argues that, under the Rural
Housing test, the scope of Exemption 7 is limited to situa-
tions in which the agency can show that the disputed material
relates to an investigation focusing directly on specific al-
leged illegal acts which could result in civil or criminal
sanctions. We disagree. The Rural Housing standard is
still good law, but it has no bearing on the issue in this case.
The information here at issue does not relate to any ongoing
"investigation" by IRS. Rather, IRS seeks to avoid disclo-
sure of internal agency material relating to guidelines, tech-
niques, and procedures for law enforcement investigations
and prosecutions outside of the context of a specific investiga-
tion. Such materials clearly satisfy the "law enforcement
purposes" threshold of Exemption 7. The District Court's
holding to the contrary failed to take adequate account of
1986 amendments to Exemption 7.
Prior to 1986, Exemption 7 required a threshold showing
that the materials in question were "investigatory records
compiled for law enforcement purposes." 5 U.S.C.
s 552(b)(7) (1982). However, in 1986, Congress amended the
exemption to protect "records or information compiled for law
enforcement purposes," deleting any requirement that the
information be "investigatory." Anti-Drug Abuse Act of
1986, s 1802(a), Pub. L. No. 99-570, 100 Stat. 3207, 3207-48
(1986) (amending 5 U.S.C. s 552(b)(7)). See North v. Walsh,
881 F.2d 1088, 1098 n.14 (D.C. Cir. 1989) (stating that the
1986 amendment "changed the threshold requirement for
withholding information under exemption 7: the exemption
formerly covered 'investigatory records compiled for law en-
forcement purposes'; it now applies more broadly to 'records
or information compiled for law enforcement purposes' ");
Keys v. United States Dep't of Justice, 830 F.2d 337, 340
(D.C. Cir. 1987) (same). And the legislative history makes it
clear that Congress intended the amended exemption to
protect both investigatory and non-investigatory materials,
including law enforcement manuals and the like. See S. Rep.
No. 98-221, at 23 (1983) (expressing intent to protect "sensi-
tive non-investigative law enforcement materials" and to
broaden the exemption to include records "regardless of
whether they may be investigatory or noninvestigatory").
Congress also amended Exemption 7(E) to permit withhold-
ing of "guidelines for law enforcement investigations or pros-
ecutions if such disclosure could reasonably be expected to
risk circumvention of the law," thus giving further indication
that the statutory threshold was not limited to records or
information addressing only individual violations of the law.
See 5 U.S.C. s 552(b)(7)(E) (emphasis added); S. Rep. No. 98-
221, at 24 (1983).
It is clear that, under the amended threshold of Exemption
7, an agency may seek to block the disclosure of internal
agency materials relating to guidelines, techniques, sources,
and procedures for law enforcement investigations and prose-
cutions, even when the materials have not been compiled in
the course of a specific investigation. See, e.g., PHE, Inc. v.
Dep't of Justice, 983 F.2d 248, 250-51 (D.C. Cir. 1993) (holding
that portions of a FBI manual describing patterns of viola-
tions, investigative techniques, and sources of information
available to investigators were protected by Exemption 7(E)).
The amended threshold to Exemption 7 "resolve[s] any doubt
that law enforcement manuals and other non-investigatory
materials can be withheld under (b)(7) if they were compiled
for law enforcement purposes and their disclosure would
result in one of the six recognized harms to law enforcement
interests set forth in the subparagraphs of the exemption."
S. Rep. No. 98-221, at 23 (1983). Accordingly, we reverse and
remand the District Court's judgment on this point.
It will be up to the District Court in the first instance to
apply the correct threshold and then to determine, as Exemp-
tion 7(E) requires, whether release of the disputed agency
materials "would disclose techniques and procedures for law
enforcement investigations or prosecutions, or would disclose
guidelines for law enforcement investigations or prosecutions
if such disclosure could reasonably be expected to risk cir-
cumvention of the law." The District Court may conclude
that some or all of the disputed TAs must be released, but
this conclusion cannot be based on the fact that they do not
relate to the investigation of a particular act of wrongdoing.
C. TAs to Program Managers
IRS appeals the District Court's decision with regard to
three of the five TAs to program managers that the court
ordered released. IRS argues that these three TAs should
have been withheld pursuant to the deliberative process
privilege of Exemption 5. IRS does not appeal the release of
the other two TAs to program managers. Br. for Appel-
lee/Cross-Appellant at 57 n.5 (stating that IRS does not
appeal the District Court's ruling with respect to TAs num-
bered TR-45-1383-93 and TR-45-1974-93). The three TAs on
appeal are issued to program managers within the national
office of IRS.
The deliberative process privilege protects "confidential
intra-agency advisory opinions ... disclosure of which would
be injurious to the consultative functions of government."
Sears, 421 U.S. at 149 (internal citations and quotation marks
omitted). It encompasses "documents reflecting advisory
opinions, recommendations, and deliberations comprising part
of a process by which governmental decisions and policies are
formulated, as well as other subjective documents that reflect
the personal opinions of the writer prior to the agency's
adoption of a policy." TWRF, 646 F.2d at 677 (citing Sears,
421 U.S. at 150). It does not, however, apply to final state-
ments of agency policy or to statements that explain actions
that an agency has taken. Id. In other words, it protects
"predecisional communications" reflecting an agency's inter-
nal deliberations, but not communications that explain a
decision that has already been made. Sears, 421 U.S. at 151-
52. In order to determine whether the District Court applied
these principles correctly, we have reviewed the three disput-
ed TAs in camera, along with the five that the court ordered
withheld and the two not appealed, for comparative purposes.
The District Court grouped the five TAs it ordered re-
leased into two categories. First, the court ordered the IRS
to release TAs that concerned specific taxpayers or classes of
taxpayers. These included the following TAs: TR-45-2233-93
(presenting OCC's legal analysis regarding a particular class
of taxpayers engaged in specified activities); TR-45-1383-93
(not appealed) (presenting OCC's legal analysis and computa-
tions regarding certain transactions of a particular taxpayer);
TR-45-1974-93 (not appealed) (presenting OCC's legal analy-
sis and conclusion regarding how the program manager
should apply a certain statutory provision to a particular
taxpayer); and TR-45-2473-93 (presenting OCC's conclusion
as to whether a particular taxpayer qualified for a specified
exemption). Second, the District Court ordered the IRS to
release a TA that addressed the interpretation of the internal
revenue laws generally: TR-45-2820-92 (answering a question
concerning whether taxpayers at large may use a particular
procedure).
The District Court correctly likened these five TAs to the
FSAs at issue in Tax Analysts, 117 F.3d 607. Like FSAs,
TAs are issued by OCC and sent to IRS personnel in
response to official queries. FSAs were issued to field attor-
neys, revenue agents, and appeals officers, while TAs are
issued to program managers. Tax Analysts, 117 F.3d at 609.
FSAs usually dealt with particular taxpayers, as do four of
the TAs in this case. Id. The TA concerning general
procedures reflects OCC's considered position on a precise
issue. FSAs and these TAs both contain legal analysis,
conclusions, and advice. Id. It is therefore unsurprising
that, as the District Court found, IRS conceded that taxpay-
er-specific TAs to program managers are all but identical to
FSAs. Mem. Op. II at 22; Def. Statement of Genuine Issues
in Opp. to Pl.'s Statement of Material Facts p 3.12 (stating
that IRS did not object to Tax Analysts' statement that, in
many cases, the only difference between FSAs and taxpayer-
specific TAs is the originating office), reprinted at Joint
Appendix 383, 344.
The five TAs that the District Court ordered withheld,
while not before us on appeal, nevertheless provide a useful
contrast and an illustration of the kinds of documents that
truly reflect a debate among equally-positioned decisionmak-
ers. For example, in TR-955-93, OCC comments on a draft
tax form and instructions for filling out another form. The
TA uses markedly different language from that found in the
TAs that the District Court ordered released, repeatedly
prefacing comments with such phrases as "We believe" and
"We suggest" and advising the recipient that the form
"should" reflect a certain principle. Similarly, in TR-45-2164-
93, OCC proposed solutions to a potential legal problem. In
TR-45-307-93, OCC commented on a legislative proposal,
expressing legal "concern[s]" about some of its language.
The tone of these TAs suggest that they were prepared
merely to "discuss the wisdom or merits of a particular
agency policy, or recommend new agency policy, raising the
possibility that their disclosure would mislead the public."
Coastal States Gas Corp. v. Dep't of Energy, 617 F.2d 854,
869 (D.C. Cir. 1980). By contrast, the TAs that the District
Court ordered released use such language as "It is the
position of the Treasury Department that ..." (TR-45-2233-
93) and "We conclude" (TR-45-2473-93). The tone of these
TAs indicates that they "simply explain and apply established
policy." Coastal States, 617 F.2d at 869.
IRS argues that while the disputed TAs to program manag-
ers may be the final word of OCC, they are issued to program
officers who make the final decisions about their programs.
IRS characterizes the TAs as part of a dialogue among
equals, rather than pronouncements from senior officials to
junior field agents. These arguments are unpersuasive. It is
not necessary that the TAs reflect the final programmatic
decisions of the program officers who request them. It is
enough that they represent OCC's final legal position con-
cerning the Internal Revenue Code, tax exemptions, and
proper procedures. We reach this conclusion in reliance on
the fact that the disputed TAs travel horizontally, from the
OCC to program officers. By contrast, documents that rep-
resent the final legal position of the OCC and travel upward -
for example, memoranda to the Commissioner of Internal
Revenue advising him on legal issues - may still be part of
the agency's deliberative process and thus fall within Exemp-
tion 5. See Coastal States, 617 F.2d at 868 (noting that "a
document from a subordinate to a superior official is more
likely to be predecisional," and that "this court recently
identified as 'a classic case of the deliberative process at
work' a series of memoranda to the Assistant Secretary of the
Army from the General Counsel in his department, recom-
mending legal strategy in light of a particular controversy")
(quoting Murphy v. Dep't of the Army, 613 F.2d 1151, 1154
(1979)).
Under the FOIA, "working law" must be disclosed whether
or not those who use the working law make the final decisions
about program implementation. See id. (holding that the
disputed documents, "whatever the formal powers of [the
issuing officials] to issue binding interpretations of the regula-
tions, in practice represent interpretations of established
policy on which the agency relies in discharging its regulatory
responsibilities" and that they must be disclosed). Thus, the
District Court correctly ordered the disputed three TAs
released.
The distinction between deliberative TAs and TAs that
represent the OCC's considered legal conclusions is not ame-
nable to a categorical formula. It can turn on the subject
matter of the TA, on its recipient, on its place in the decision-
making process, and even on its tone. Nonetheless, after
reviewing the ten TAs in camera, we are satisfied that the
District Court committed no error in its judgment regarding
these materials
III. Conclusion
For the foregoing reasons, we affirm in part, reverse in
part, and remand the case to the District Court for further
proceedings consistent with this opinion.