This case is brought under the Freedom of Information Act (“FOIA”) against the Department of the Interior and the Department of Treasury, seeking documents and other records relating to the Trump Administration’s 2017 decision to withdraw the United States from the Extractive Industries Transparency Initiative (“EITI”), a global anti-corruption initiative that the U.S. has long supported.
Countries that participate in the EITI commit to implementing the EITI Standard, a common set of disclosure requirements covering the entire extractive value chain, and go through a rigorous multi-year compliance and validation process. This is meant to shine a light on the payments that oil, gas and mining companies make to the government to extract natural resources. The United States was in the process of coming into compliance until Trump reversed course. The decision came on the heels of Trump’s earlier move to gut a related anti-corruption rule promulgated by the Securities and Exchange Commission (SEC) that aligned closely to the EITI Standard by requiring U.S.-listed extractive companies to publicly disclose project-level payments to foreign governments and the federal government. (EarthRights has worked to secure strong SEC rules for more than a decade.)
Withdrawing from the EITI was a significant reversal in U.S. policy and raised serious questions about potential conflicts of interests, among other reasons for concern about the motivations behind the decision and how it was made. Of particular note, certain industry actors – the American Petroleum Institute, Exxon, and Chevron – had long sought to undermine the transparency required by both the SEC’s rule and US EITI implementation to be able to keep extractive payments secret. Those efforts gained traction under Trump when he installed industry actors and their allies as the heads of numerous relevant agencies who immediately sought to roll back transparency and other anti-corruption measures, in many cases with seemingly clear conflicts of interest given their prior work. (EarthRights previously raised concerns about potential involvement by then-Secretary of State Rex Tillerson in decisions relating to extractive transparency given his personal involvement in lobbying against revenue transparency rules while at ExxonMobil.)
EarthRights filed FOIA requests with the Interior Department and Treasury Departments, the two agencies central to EITI implementation and the management of natural resource revenues, seeking records relating to this decision to withdraw. Despite taking years to respond, both agencies failed to provide any responsive records, leading EarthRights to file suit in June 2022 in federal district court in Washington, D.C.
The Treasury Department took two years to respond to EarthRights’s FOIA request, and when it did, it denied it had any records at all, directing EarthRights to instead try asking the Department of Defense. EarthRights’ complaint alleges that Treasury failed to conduct a reasonable search, as FOIA requires.
The Interior Department acknowledged that it had records responsive to EarthRights’ FOIA request, but it repeatedly failed to release them.
The United States, under the Obama Administration, committed to joining the Extractive Industries Transparency Initiative (EITI).
The Board of the EITI approved the United States’ application to join the EITI and the United States was admitted as a Candidate country.
The US issued its first EITI country report, but without certain information – in particular, Exxon and Chevron refused to provide their tax payments to the United States Government. The EITI was clear that the US could not be found to be in compliance with the EITI standard without this tax information. Despite being on the board of the EITI and having committed to supporting EITI implementation, both companies continued to refuse to provide this information in the following years.
Shortly after taking office, Trump signed into law a resolution gutting the SEC’s landmark transparency and anti-corruption rule that required extractive companies to publicly disclose the payments they make to governments. The rule at issue closely mirrored the public reporting requirements of the EITI Standard. (EarthRights has worked for more than a decade on this rule, including representing Oxfam America in litigation against the SEC for undue delay in finalizing the rules, and on SEC’s side in defending against industry suit over the first version of the rules.)
The Interior Department announced that the U.S. was going to withdraw from implementing the EITI, suggesting it was somehow incompatible with U.S. law. This was widely condemned as untrue; nothing in U.S. law prevents the disclosures that were necessary to meet the EITI standard. Rather, certain companies wishing to hide how little they pay in taxes had refused to comply.
The announcement was a victory for companies like Chevron and Exxon that had long sought to keep their payments to the U.S. government secret.
EarthRights, along with other watchdog groups, sent a letter calling for then-Secretary of State Rex Tillerson to recuse himself from any involvement in decisions related to extractive industry transparency given his personal role in lobbying against the SEC’s extractive industry payment transparency regulations while he was CEO of ExxonMobil.
PWYP-US and other civil society members who had been involved in the USEITI implementation process filed a formal grievance with the international EITI board calling for Chevron and Exxon to be removed from the EITI Board. Companies on the board are required to commit to supporting the implementation of the EITI Standard, but it was clear that Exxon and Chevron had actively sought to undermine the standard in the United States.
EarthRights filed separate suits against Treasury and Interior in May 2022 in federal court in Washington, D.C. The cases were consolidated in front of the same judge shortly thereafter.
The Government filed its Answers to both complaints.
The parties filed a Joint Status Report in which the Government agreed that the Interior Department would turn over thousands of documents by the end of October 2022, and another batch of documents in December 2022. The Government further indicated that Treasury was conducting a new round of searches and believes there may be an individual with responsive documents.