Appeals underway in bailout records cases

The first in a string of lawsuits over records that detail last year’s unprecedented taxpayer-funded financial bailout began yesterday in a federal appeals court in New York.

The Federal Reserve has asked the U.S. Court of Appeals in New York City (2nd Cir.) to block a lower court’s August ruling that favored Bloomberg LP in a freedom-of-information suit that would force the government to reveal the names of financial institutions that benefited from last year’s $2 trillion emergency lending program, Business Week reported.

The Reporters Committee for Freedom of the Press joined 12 other media organizations to file a friend-of-the-court brief that supports Bloomberg’s position.

The lawsuit began in 2008 when the board denied Bloomberg’s request to access the records, claiming that the Freedom of Information Act does not apply to the loan records and disclosing them would cause competitive injury to the borrowing banks. The government reiterated those same points in yesterday’s arguments before the appeals court.

Both Bloomberg attorneys and judges on the appeals panel raised the issue of whether the government is drawing out the process so that the information Bloomberg seeks — records from 2007 and 2008 — will grow stale, reported Business Week.

The appeals court ruling is not expected for months and is likely to be appealed further by the losing side, according to Business Week.

The same appeals panel heard arguments later that day in Fox News Network’s parallel case in which the lower court sided with the government and refused to order the release of the bailout records under FOIA, Business Week reported. The New York Times also has a pending suit for similar records in the district court.