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CITY OF NEW YORK v. BERETTA U.S.A. CORP.

April 1, 2005.

CITY OF NEW YORK, Plaintiff,
v.
BERETTA U.S.A. CORP., et al., Defendants.



The opinion of the court was delivered by: JACK WEINSTEIN, Senior District Judge

MEMORANDUM & ORDER

I. Introduction

Plaintiff City of New York ("the City") sues handgun manufacturers, importers, and distributors for common law and statutory public nuisance. The City has served subpoenas on the Bureau of Alcohol, Tobacco, Firearms and Explosives ("ATF") for production of firearms licensing and tracing data. Federal licensing information exists for manufacturers, wholesalers and retail distributors. Tracing allows the use of a gun's stamped serial number to show its movement from manufacturer to sale by a retailer.

  ATF opposes discovery of a subset of information, claiming that: (1) the information was not identified in the subpoena; and (2) it is prohibited from disclosure by the terms of the Consolidated Appropriations Act of 2005. It previously made a similar argument with regard to the Consolidated Appropriations Act of 2004 that was rejected by the Magistrate Judge and the district court. See City of New York v. Beretta U.S.A. Corp., 222 F.R.D. 51, 54 (E.D.N.Y. 2004); City of New York v. Beretta, 222 F.R.D. 48 (E.D.N.Y. 2004).

  The Magistrate Judge rejected the argument by ATF that the 2005 Act precludes it from supplying information to the parties. The decision reaffirmed a fundamental of federal jurisprudence that, within reasonable limits, civil litigants be able to discover the facts relating to arguably valid claims and defenses. Courts cannot adjudicate fairly unless their judgments are based on available evidence. It cannot be assumed — as is claimed by defendants and ATF — that Congress is unaware of these fundamental principles, and that it has interjected itself into the instant case to tilt the scales of justice against the plaintiffs by changing the applicable discovery rules.

  ATF appeals, pursuant to Federal Rule of Civil Procedure 72(a), from the Magistrate Judge's February 22, 2005 order granting discovery. For the reasons set forth below, the order of the Magistrate Judge is affirmed.

  II. Facts

  A. Basis for Discovery

  The City seeks injunctive relief and abatement of the public nuisance allegedly caused, contributed to and maintained by defendants' negligent marketing and distribution practices for handguns. According to the City, a public nuisance exists in New York in the form of widespread access to illegal handguns, harming the population at large. It alleges:
Because virtually every gun used in a crime starts off as a legal firearm, it is evident that guns manufactured by defendant gun manufacturers and distributed by defendant gun distributors are diverted into an illegal gun market catering to juveniles, criminals and other persons prohibited from owning guns. That diversion is a result of defendants' failure to institute appropriate marketing and distribution practices. Defendants have reason to know or should know that (a) some of the firearms they manufacture and/or distribute will be diverted into the hands of those who would violate the law, and (b) they could take steps to reduce the number of firearms that fall into the hands of criminals by changing their merchandising practices.
Second Amended Complaint at 2. Information about the marketing and distribution of firearms is critical both to the City's case and to the defense by members of the firearms industry.

  On April 20, 2004, the City served a subpoena upon ATF calling for the production of licensing and tracing information previously produced in NAACP v. Acusport, 210 F.R.D. 268 (E.D.N.Y. 2002). The NAACP action was brought by a private advocacy group against gun manufacturers and distributors, alleging that the improper distribution of guns constituted a public nuisance. The case was dismissed because the NAACP could not demonstrate that its members had suffered the particular harm required for a private plaintiff to prove a public nuisance. See NAACP v. Acusport, 271 F.Supp.2d 435, 526 (E.D.N.Y. 2003).

  B. Information Produced in NAACP Case

  In the NAACP action, ATF produced firearms data for the period 1989 through 2000. Law enforcement sensitive trace data was made available in that case subject to the terms of an Order of Protection. The NAACP Order of Protection included restrictions on the dissemination and use of sensitive data. See NAACP v. Acusport, 210 F.R.D. 268, 429-45 (E.D.N.Y. 2000). Trace data elements that were subject to the NAACP Order of Protection included some, but not all, of the trace data elements for open cases. An "open case" and an "incomplete trace" are defined in Part II.I.1, infra. The trace data elements that were produced pursuant to the NAACP Order of Protection were specified in an appendix to that order. See id. at 433-40.

  ATF produced various other types of trace data to the NAACP outside of the NAACP Order of Protection, based on its conclusion that such elements were not law enforcement sensitive. At the time ATF produced documents in the NAACP action, it was routinely providing similar information in response to requests under the Freedom of Information Act, 5 U.S.C. § 552. Among the nonsensitive elements provided to the NAACP outside of the NAACP Order of Protection were data about purchasers of firearms. Information that ATF produced to the NAACP concerning open cases was produced subject to the NAACP Order of Protection.

  C. City's April 5, 2004 Letter

  On April 5, 2004, the City sent a letter to ATF defining the ATF Trace Data it sought:
Pursuant to the directions received from Judge Weinstein and Magistrate Judge Pollak, please allow this letter to serve as notice to the Bureau of Alcohol, Tobacco, Firearms & Explosives ("ATF") of the City of New York's request for information related to the ATF's Firearms Trace Database:
i) The City requests all information made available by the ATF to the parties in the NAACP case, under the same terms and conditions that govern disclosure in that case. . . .
Apr. 5, 2004 Ltr. at 1. Following receipt of the letter, ATF requested that the City provide this request in the form of a subpoena.

  D. City's April 2004 Subpoena

  On April 20, 2004, the City served ATF with a subpoena calling for production of:

  1. The firearms tracing system ("FTS") data included in the Oracle Table & Data Elements previously produced by ATF under protective order in the NAACP action updated to reflect data elements for the period from 1989 through the most currently available data;

  2. The firearms licensing system ("FLS") data previously produced by ATF under protective order in the NAACP action updated to reflect data elements for the period from 1989 through the most currently available data; and

  3. All data produced in response to the Subpoena served by plaintiff, Joan Truman Smith, in Smith v. Bryco Arms, 02-CV-3029, dated April 15, 2004, and served upon ATF on April 16, 2004.

  E. Objections Based on Consolidated Appropriations Act of 2004

  ATF objected to the April 20, 2004 subpoena on the grounds that the subpoenaed documents were immune from disclosure under the Consolidated Appropriations Act of 2004 ("the 2004 Act") and were protected under the law enforcement privilege. Congress enacted the 2004 Act on January 23, 2004. Pub.L. 108-199, 118 Stat. 3 (2004), codified as amended at 28 U.S.C. § 530C. The 2004 Act provided: [N]o funds appropriated under this or any other Act may be used to disclose to the public the contents or any portion thereof of any information required to be kept by licensees pursuant to section 923(g) of title 18, United States Code, or required to be reported pursuant to paragraphs (3) and (7) or section 923(g) of title 18, United States Code, except that this provision shall apply to any request for information made by any person or entity after January 1, 1998[.]

 118 Stat. at 53 (emphasis added).

  ATF argued that the 2004 Act prohibited the disclosure to plaintiffs of any trace data, multiple sales records, or other federal firearms licensing information required to be kept pursuant to Section 923(g). See City of New York v. Beretta U.S.A. Corp., 222 F.R.D. 51, 54 (E.D.N.Y. 2004). Defendants supported ATF's contentions, but argued, in the alternative, that if the court ordered any production of ATF data, the defendants would be entitled to "full access to and an unfettered right to use" such data. See id. (citation omitted). Plaintiff contended that the ATF data was necessary in order to prove its case against the defendants. See id.

  The Magistrate Judge held that the 2004 Act did not bar the disclosure of the information at issue:
[T]he 2004 Act does not . . . prohibit disclosure of the information. Instead, the 2004 Act prohibits the use, by the [ATF], of appropriated funds in making the disclosure of information to the public.
Id. at 59. The opinion of the Magistrate Judge was affirmed. See City of New York v. Beretta, 222 F.R.D. 48 (E.D.N.Y. 2004). The United States Court of Appeals for the Second Circuit denied ATF's petition for a Writ of Mandamus seeking to overturn the district court decision. In re Bureau of Alcohol, Tobacco, Firearms, and Explosives, 04-3738-op (2d Cir. Aug. 24, 2004).

  F. Objections Based on Consolidated Appropriations Act of 2005 ATF now objects to producing data based upon the Consolidated Appropriations Act of 2005. See the discussion in Part III.B and IV.B, infra.

  G. Scope of the May 19, 2004 Order

  In granting the City's request for discovery, the Magistrate Judge, by order dated May 19, 2004, described its scope as follows: "The City and the defendants in all three actions seek that data which was previously produced in ...


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