Fannie Mae-No Politics (FNMA)

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It's 18 pages, but here's starting at the bottom of 14-18.
But wherever the burden of persuasion lies, there is no basis on this record for concluding that these two depositions deserve confidentiality.9 The Government says that the transcripts
contain “market-sensitive and confidential information regarding the future of the conservatorships and the wind down of Fannie Mae and Freddie Mac and confidential testimony regarding the projections of profitability for these entities.” (Govt. Mem. at 15.) To make its case, the Government principally cites to the declaration of Melvin L. Watt, Director of the Federal Housing Finance Agency, that “disclosure of projections that suggested (or that market participants interpreted as suggesting) that the Enterprises’ financial conditions were worse than previously assumed could . . . increase current prices in the primary and secondary market.” (Id. at 16.) The Government also expresses concern that disclosure might improperly provide certain types of confidential information to Freddie Mac and Fannie Mae. (Id.) But Mr. Watts was not speaking to the deposition testimony of either Mr. DeMarco or Mr. Ugoletti. His declaration was made a year before either one of them testified and was based on his review of plaintiffs’ document requests. (See Declaration of Melvin L. Watt (“Watt Dec.”) (Docket No. 49, Appendix A), ¶ 3.) Mr. Watts may be correct that certain documents called for by plaintiffs’ request could be market-sensitive, but that says nothing about the sensitivity of the testimony actually given in the two depositions at issue here. Currently, the only subject before the court is a jurisdictional dispute, and as a result, the testimony in the depositions was limited to the time period prior to September 30, 2012. (Govt. Mem. at 15-16.) The two deponents were speaking to their former roles at Treasury and FHFA and their actions in the period from 2008, when the bailout occurred, to the 2012 cutoff date. The Government states that projections made before that date “cover years far in the future.” (Gov. Mem. at 16.) But the Government conveniently stops short of saying whether any such projections were in the deposition transcripts themselves and stands silent on whether the information is so stale – three
or more years later – as to eliminate any concern about market-sensitivity. While the Government cannot be expected to reveal confidential information in making its argument against de-designation, describing the testimony actually given by these two witnesses in their depositions does not require any disclosure of secret information. For the same reason, the Government errs in relying on the Court’s decision on the Howard motion (see Gov. Mem. at 3), which did not and could not address the contents of the two deposition transcripts at issue. Tellingly, Mr. Watt did speak directly at one point in his declaration to information that dates to a time before his administration. He said that disclosure of older documents “that reflect prior thinking of Agency personnel concerning matters about which the Agency may follow a different course during my tenure as Director are likely to lead to the public and market participants second-guessing every decision . . .” (Watt Dec. at ¶ 13 (emphasis added).) Stated plainly, Mr. Watt is not concerned with the financial sensitivity of the information, but whether the public will have the temerity to raise questions about the decisions his agency makes. Putting aside that breathtaking “don’t bother me” view of the public from a public servant, it is clear that a fear of public criticism does not rise to either good cause under Rule 26(c) or protected information under the Protective Order. Before finding good cause for confidentiality the Court should be satisfied that the record shows “defined, specific, and serious injury” will arise from disclosure and that the harm is established through “particular and specific demonstration of fact, as distinguished from stereotyped and conclusory statements.” Wright & Miller, Federal Practice and Procedure: Civil § 2035; Carlson v. Geneva City Sch. Dist., 277 F.R.D. 90, 94 (W.D.N.Y. 2011); see also Allen v. City of New York, 420 F. Supp. 2d 295, 302 (S.D.N.Y. 2006); Havens, 1995 U.S. Dist. Lexis
5183, at *29. Nothing approaching that exists in this record, and the necessarily dated nature of the testimony undermines the case for continued confidentiality.10 The Government’s case is not helped by its half-hearted claim that the witnesses “reasonably relied” on the Protective Order. (Govt. Mem. at 21.) Where confidentiality designations are specifically subject to review and challenge, reliance is not reasonable. See, e.g., Schiller, 2007 U.S. Dist. LEXIS 4285, at *14; Allen, 420 F.Supp.2d at 300-0; In re Iwasaki, No. M19-82, 2005 U.S. Dist. LEXIS 10185, at *4-5 (S.D.N.Y. May 26, 2005); Fournier v. McCann Erickson, 242 F.Supp.2d 318, 341 (S.D.N.Y. 2003); see also SEC v. TheStreet.com, 273 F.3d 222, 230-31 (“some protective orders may not merit a strong presumption against modification [such as] protective orders that are on their face temporary or limited”). Here, of course, prior to the depositions the parties had agreed that confidentiality would be subject to review and negotiation and, ultimately, court adjudication in the event of a dispute. More than that, both witnesses, like all witnesses, had an obligation to testify fully and truthfully and cannot now say they would have testified otherwise except for the Protective Order. There can be no doubt that protection of sensitive market information is a proper basis for a protective order. But there is also no doubt that the public has a powerful interest in monitoring this litigation and understanding more fully the consequential decision-making that led to the conservatorship and to the steps taken by the Government in the years that followed. Here, broad and unspecified generalities about possible market effects, none anchored to the specific transcripts at issue, are insufficient to warrant confidentiality. The Court advised the parties that they were required to “explain [their] reasoning” for the confidentiality of particular documents in a “meaningful” way. (Transcript of July 16, 2014 Status Conference (Docket No. 75) at 41.) That is notably absent here. CONCLUSION For all of the foregoing reasons, the Court should grant The Times motion to intervene, order that the “protected information” designations be removed from the Transcripts, and grant such other relief as the Court deems just and proper. Dated: New York, New York August 17, 2015 __/s/____________________________ David E. McCraw, Esq. Legal Department The New York Times Company 620 8th Avenue New York, NY 10018 Phone: [phone] Fax: [phone] [e-mail]