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Schreiber v. Society for Sav. Bancorp

United States Court of Appeals for the District of Columbia Circuit

October 4, 1993, Argued ; December 28, 1993, Decided

Nos. 93-5100, 93-5102

Opinion

 [*219]  GINSBURG, Circuit Judge: 

Leonard Schreiber, the plaintiff representative in a shareholder class action, appeals from an order of the district court denying enforcement of subpoenas duces tecum served upon the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation. The subpoenas are for various documents relating to Society for Savings Bancorp: bank examination reports;  [**2]  any factual portions of interview notes and memoranda prepared by the banking agencies; and any responses Bancorp and its management may have made to the bank examination reports or other agency communications. The agencies object to the subpoenas on the ground that the documents sought are protected by the bank examination and the deliberative process privileges.

After a hearing, but without inspecting the requested documents in camera, the district court refused to enforce the subpoenas. Because we think that the court misapplied the standards for evaluating a subpoena demanding bank examination documents, see In re Subpoena Served Upon the Comptroller of the Currency and the Secretary of the Bd. of Governors of the Fed. Reserve Sys., 296 U.S. App. D.C. 263, 967 F.2d 630 (D.C. Cir. 1992), we reverse its order and remand the matter to the district court for further proceedings.

I. BACKGROUND

Schreiber sued Bancorp and some of its officers in a class action filed in the United States District Court for the District of Connecticut, alleging that during the period January 19, 1989 to November 30, 1990 the defendants knowingly published false and misleading financial reports [**3]  and public statements in violation of federal securities laws. In particular, the plaintiff alleged that the defendants had misstated the condition of Bancorp's loan portfolio and the adequacy of its loan loss reserve in order to inflate the market price of Bancorp's securities, thereby defrauding the public in violation of the Securities and Exchange Act of 1934.

Schreiber then set out to get evidence that the defendants were aware at the relevant time of the true state of Bancorp's financial condition and the adequacy of its loan loss reserve. Initially, he asked the FDIC and the Board to produce all documents provided by Bancorp to the agency or by the agency to Bancorp, as well as all agency documents referring to Bancorp or created in conjunction with the agency's examination or investigation of Bancorp. The FDIC declined to produce the documents without a subpoena or court order. The Board also refused to produce the documents, stating that examination and inspection reports are privileged and confidential, that the request was overbroad, and that insofar as factual material was involved, the information was available from Bancorp.

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11 F.3d 217 *; 1993 U.S. App. LEXIS 33643 **; 304 U.S. App. D.C. 173; Fed. Sec. L. Rep. (CCH) P98,016

LEONARD I. SCHREIBER, APPELLANT v. SOCIETY FOR SAVINGS BANCORP, INC., ELLIOT MILLER, ALBERT E. FIACRE, JR., AND LYNNE MICHAELS, DEFENDANT-APPELLEES v. THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM, APPELLEE; LEONARD I. SCHREIBER, APPELLANT v. SOCIETY FOR SAVINGS BANCORP, INC., ELLIOT MILLER, ALBERT E. FIACRE, JR., AND LYNNE MICHAELS, DEFENDANT-APPELLEES v. FEDERAL DEPOSIT INSURANCE CORPORATION, APPELLEE

Prior History:  [**1]  Appeal from the United States District Court for the District of Columbia (92ms00365).

CORE TERMS

documents, district court, subpoenas, agencies, examination report, factual material, in camera, portions, inspection, asserts

Civil Procedure, Appeals, Standards of Review, General Overview, Discovery, Methods of Discovery, Inspection & Production Requests, Discovery & Disclosure, Subpoenas, Evidence, Privileges, Government Privileges, Judicial Officers, Masters