Court refuses to unseal AIG files

By Megan R. Wilson - 02/01/13 01:46 PM ET

A federal judge on Friday rejected a request to unseal documents related to an American International Group (AIG) settlement with the government.

Sue Reisinger, a reporter for Corporate Counsel and American Lawyer magazine, sued the Securities and Exchange Commission (SEC) and American International Group (AIG) seeking access to files from a 2004 settlement over securities violations.

A district court judge ruled last year that Reisinger should have the right to view the documents, which were assembled by an independent corporate monitor and reviewed AIG’s transactions and internal policies.

But the federal appeals court overturned that decision on Friday.

“Unfortunately for Reisinger, the value of the reports for proper oversight of the Executive does not itself justify disclosure under the judicial records doctrine,” wrote U.S. Appeals Court Judge Janice Rogers Brown. “If the agency can appropriately refuse to disclose the reports under [the Freedom of Information Act] ... then so be it.”

The Freedom of Information Act allows citizens to request documents and records from the federal government, but there are several exceptions aimed at protecting state secrets and privacy.

While Brown acknowledged the public has an interest in “keeping a watchful eye on the workings of public agencies,” she said the files in question do not qualify as federal records.

“Documents created by the independent consultant are not government documents,” wrote Brown, a President George W. Bush appointee to the court. “Reisinger appears to argue that the reports became public documents when they were provided to the government, but such a transfer of possession is not itself sufficient to render them public records.”

Reisinger remains convinced that the files should be a matter of public record, according to her attorney.

"We are in the process of reviewing the court's opinion to determine what options are available to us,” J. Joshua Wheeler said in a statement to The Hill. “For now, all I can say is today's decision does not alter our belief that the public interest would be served by the release of the reports."

In 2004, AIG agreed to settle with the federal government over $126 million in securities violations. Out of that battle came an independent audit of the company’s actions before the financial crisis of 2008, which a district court judge ruled were subject to public review last year.

This story was updated at 1:35 p.m.