
USCA1 Opinion

	




        February 22, 1996       [NOT FOR PUBLICATION]                            UNITED STATES COURT OF APPEALS                                FOR THE FIRST CIRCUIT                                 ____________________        No. 95-1604                                  RICHARD NATHANSON,                                Plaintiff, Appellant,                                          v.                        FEDERAL DEPOSIT INSURANCE CORPORATION,                                 Defendant, Appellee.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                     [Hon. Nancy J. Gertner, U.S. District Judge]                                 ____________________                                        Before                                Selya, Stahl and Lynch,                                   Circuit Judges.                                   ______________                                 ____________________            Richard Nathanson on brief pro se.            _________________            Ann S. DuRoss, Assistant General Counsel, Robert D.  McGillicuddy,            _____________                             _______________________        Senior  Counsel,  and Barbara  S.  Woodall,  Counsel, Federal  Deposit                              ____________________        Insurance Corporation, on brief for appellee.                                 ____________________                                 ____________________               Per  Curiam.   In  March 1992,  plaintiff Richard  Nathanson               ___________          served as head of  the loan workout department at  Rockland Trust          Company ("Rockland") and was in line for promotion to senior vice          president.   During that period, James Moore, a bank examiner for          the  Federal   Deposit   Insurance  Corporation   ("FDIC"),   was          conducting a supervisory examination of Rockland.  Moore received          the impression,  during several  discussions of problem  loans in          the department, that plaintiff was being less than cooperative--a          concern  that   he  voiced  to  Rockland   executives.    Shortly          thereafter, Moore learned that plaintiff had been the subject  of          an Apparent Crime Report ("ACR"),  filed by another bank, arising          out of  a line of  credit in  excess of  $3 million  that he  had          guaranteed.    See 12  C.F.R.    353  (prescribing  ACR reporting                         ___          requirements).  Plaintiff had earlier disclosed this debt to both          Rockland and the FDIC--a fact of  which Moore was unaware.  In an          ensuing discussion with  Rockland's president, Moore  recommended          that  an  inquiry   be  conducted   into  plaintiff's   financial          obligations;  when pressed for  further information,  he revealed          that the  ACR had been filed  but did not disclose  its contents.          Moore  explained   that  he   was   not  requesting   plaintiff's          termination.   Plaintiff was nonetheless fired  from his position          shortly thereafter.                Plaintiff responded by filing the instant action against the          FDIC for  damages under the Privacy Act, claiming that disclosure          of the ACR had been unlawful.  See 5 U.S.C.    552a(g)(1)(D).  On                                         ___          the basis  of the  undisputed facts recited  above, the  district                                         -2-          court  ended up  granting summary judgment  for defendant  on two          independent grounds.  First,  it held that disclosure of  the ACR          fell within the Act's "routine use" exception.  Id.   552a(b)(3);                                                          ___          see 53 Fed.  Reg. 7396,  7398 (1988) (FDIC  "routine use"  notice          ___          permitting  disclosure  of  ACRs  to, inter  alia,  "a  financial                                                ___________          institution  affected  by   enforcement  activities  or  reported          criminal activities"); see, e.g., FLRA v. Department of Navy, 941                                 ___  ____  ____    __________________          F.2d 49, 52-53,  58 (1st Cir. 1991) (discussing  requirements for          applying routine  use exception).  Alternatively,  it ruled that,          even  if the  Act had  been violated,  no damages  were available          inasmuch  as  Moore's  conduct   had  not  been  "intentional  or          willful,"  as required by  the Act.   See 5 U.S.C.    552a(g)(4).                                                ___          This appeal ensued.               We  affirm on the  latter ground alone.   As  to the former,          plaintiff  contends on appeal that  the court erred  in two basic          respects:  in finding (1) that  disclosure of the  ACR was within          the scope  of the  published exception (i.e.,  that Rockland  was          "affected"  by the  report),  and (2)  that  such disclosure  was          compatible  with  the  purposes  for  which  the  ACR  had   been          collected.   It is difficult to fault either of these conclusions          based  on the arguments before  the court.   What complicates the          issue is a matter  that the parties inexplicably failed  to raise          below  (but that plaintiff  has emphasized  on appeal):  the fact          that  the  FDIC  has  elsewhere  specifically  indicated  to  the          contrary.    See  58 Fed.  Reg.  28772,  28773 (1993)  (rejecting                       ___          proposal  that  ACRs   be  made  available  to  banks   that  are                                         -3-          considering   employing  or   doing  business   with  individuals          mentioned therein,  on ground that "privacy  restrictions prevent          FDIC  from sharing information in reports  of apparent crime with          anyone   other   than   appropriate   federal   law   enforcement          authorities").  The FDIC concedes that such commentary, published          in connection with a 1993 revision to 12 C.F.R.    353, conflicts          with the routine use notice at issue here.  And  while it insists          that  the matter can be ignored because of plaintiff's failure to          mention  it below, we think the agency is equally responsible for          failing to alert  the court to  obviously relevant commentary  of          its own  making.  If the appeal hinged on this question, we would          deem it  appropriate to remand  for consideration thereof  by the          district court in the first instance.               Yet  such commentary, published  in 1993, has  no bearing on          whether Moore acted in an intentional or willful fashion in 1992.          And on the basis of the evidence presented, we agree that summary          judgment  for  defendant is  warranted on  this  ground.   As the          parties agree, the intentional or willful standard is a stringent          one which is viewed as "somewhat greater than gross  negligence."          Britt  v. Naval  Investig. Service,  886 F.2d  544, 551  (3d Cir.          _____     ________________________          1989)  (quoting legislative  history); accord,  e.g.,  Wilborn v.                                                 ______   ____   _______          Department of HHS, 49 F.3d 597, 602 (9th Cir. 1995).   In typical          _________________          formulations,  courts  have held  that  an  agency violates  this          standard by  "committing the act without grounds for believing it          to be lawful, or by flagrantly  disregarding others' rights under          the Act," Albright v. United States, 732 F.2d 181, 189 (D.C. Cir.                    ________    _____________                                         -4-          1984), or by  committing a violation  "so patently egregious  and          unlawful that anyone undertaking the conduct should have known it          unlawful,"  Laningham v. United States Navy,  813 F.2d 1236, 1242                      _________    __________________          (D.C.  Cir.  1987)  (internal  quotations  omitted);  see,  e.g.,                                                                ___   ____          Andrews v.  Veterans  Admin., 838  F.2d 418,  424-25 (10th  Cir.)          _______     ________________          (reviewing caselaw), cert. denied, 488 U.S. 817 (1988).                               ____________               Even with the record  construed in the light  most favorable          to plaintiff, there is nothing to suggest that Moore acted in any          such fashion.  The 1986 routine use notice, permitting disclosure          of  an  ACR to  an  "affected"  institution, afforded  reasonable          grounds for believing that his conduct was lawful.  Moore himself          so  averred, stating  that  it was  his  understanding of  agency          policy  to  bring   information  concerning  potential   criminal          activity to the attention of bank officials "in order for them to          be alerted to or correct potential problems."  And his failure to          uncover the fact  that plaintiff had  earlier disclosed his  loan          obligations--even   if  negligent--fell   well  short   of  being          "somewhat greater than gross negligence."                In this regard, plaintiff voices two procedural  complaints:          that  the court  resolved the  willfulness issue  (1) only  after          earlier  announcing  that  it would  not  do  so  at the  summary          judgment  stage, and (2) without  addressing his request that any          such ruling be deferred pending further discovery.  Yet plaintiff          acknowledged  below  that  defendant's  motion   to  dismiss  was          properly converted into  one for  summary judgment.   He  himself          filed a motion for partial summary judgment.  While he now claims                                         -5-          to have been  caught by surprise by the  court's ruling, he filed          no motion for reconsideration  below.  And on appeal, he does not          seek to vacate the judgment  on this basis.  Instead, he  pursues          quite a  different route--arguing,  in the alternative,  that the          evidence is  sufficient  for him  to prevail  on the  willfulness          issue or,  at a minimum,  that a genuine  issue of fact  has been          demonstrated in this regard.   We disagree in both respects.   We          therefore find no error.               Affirmed.                _________                                         -6-
