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LINKER v. HILLS

June 28, 1978

KAHLMAN LINKER, Plaintiff, against RODERICK M. HILLS, et al., Defendants.


The opinion of the court was delivered by: TENNEY

MEMORANDUM

TENNEY, J.

 Kahlman Linker appears pro se in this suit under the Freedom of Information Act, 5 U.S.C. § 552 ("FOIA"). He seeks access to records allegedly withheld from him by the Securities and Exchange Commission ("SEC"). These documents concern a merger between Informatics, Inc. ("Informatics") and Equimatics, Inc. ("Equimatics"), the latter a subsidiary of the Equitable Life Assurance Society. The case was transferred to this district from the United States District Court for the District of Columbia by order dated November 24, 1976 (C.A. 76-0057, Green, J.) and there are two motions now before this Court. The defendants--Philip R. Farnsworth, Branch Chief, SEC Division of Corporation Finance, certain Commissioners of the SEC and its ex-Chairman--have moved for dismissal of the complaint pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure ("Rules") or, alternatively, for summary judgment in their favor pursuant to Rule 56. Plaintiff has cross-moved for summary judgment on the first and third counts of his three-count complaint. For the reasons stated below, summary judgment is granted for defendants on the first and third counts and the defendants' motion to dismiss the second count is granted.

 Facts

 This contretemps with the SEC began in 1974, the same year the Informatics/Equimatics merger was effected. Plaintiff had been an Informatics shareholder, and his dissatisfaction with the merger and subsequent "freeze-out" of minority shareholders led him to commence suit in this district against the executive officers and directors of all the corporations and underwriting and appraisal firms involved in consummating the merger. That suit, Linker v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 76 Civ. 3543 (S.D.N.Y.), was dismissed with prejudice by Judge Werker of this district by Order dated September 15, 1976, and the dismissal was affirmed by the United States Court of Appeals for the Second Circuit. Docket No. 76-7453 (2d Cir. March 16, 1977). During the period following the merger, Linker also began to have a series of face-to-face encounters and written communications with various officials at the SEC, particularly Farnsworth, in which he alleged fraud in the merger transaction. For purposes of the instant suit, the first official request for SEC-held information occurred in a letter written by Linker to the SEC's Office of Public Information on May 16, 1975. His letter reads in pertinent part:

 Pursuant to the Freedom of Information Act (5 U.S. 6 . [sic] 552), I hereby request access to information relating to the following, so that I may determine which, if any, documents I may request photo copying:

 The file of the Corporation Finance Division of the S.E.C. in Washington relating to the complaint Kahlman Linker made to Philip Farnsworth (verbally on February 28, 1974 and by letter dated April 23, 1974)

 in respect to INFORMATICS, Inc.

 Defendants' Local Rule 1-9(g) Statement (D.D.C.) Exh. 1. (Emphasis in the original). The SEC responded by offering for inspection three items of Linker correspondence with Farnsworth and "[a] memorandum from Mr. Farnsworth and Lee C. Jones, dated February 5, 1975, to Lawrence E. Nerheim, General Counsel, except for one sentence reflecting the work product and decisional process of the staff." The SEC informed Linker that the one sentence was "being withheld pursuant to the exemption from disclosure contained in the Freedom of Information Act, 5 U.S.C. § 522(b)(5), and Commission Regulations, 17 CFR 200.80(b)(5)." Letter from S. James Rosenfeld, Director, SEC Office of Public Information, to Kahlman Linker, dated May 28, 1975, Complaint, Exh. B.

 The claimed exemption from disclosure is the subject of the first count of plaintiff's complaint. Further correspondence between Linker and Rosenfeld led to the second and third counts. On June 4, 1975 Linker wrote requesting:

 (1) A written statement from the SEC Office of Information to the effect that the 4 documents indicated in your letter [of May 28, 1975]... were the only documents in such file or files, to the best of your knowledge as of May 15, 1975...; and

 (2) An affidavit from Philip Farnsworth that the four documents... were the only documents that were in any (files) on Informatics, Inc. beginning with February 28, 1974.

 Letter from Kahlman Linker to S. James Rosenfeld, Complaint, Exh. D (emphasis in original). Rosenfeld replied to Linker stating:

 According to the information provided to me by the staff, the four documents described in my letter to you of May 28, 1975, were, to the best of my knowledge, the only documents in the Commission's files with respect to your request of May 16, 1975. Neither the Commission nor its staff customarily provides ...


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