Obama Lawyers Say Ruling on Fed Loan Disclosure Should Stand

Feb. 19 (Bloomberg) -- The U.S. Supreme Court should reject a banking industry appeal aimed at stopping release of details about the Federal Reserve’s emergency 2008 bank loans, the Obama administration said as it changed course on the corporate secrecy case.

A group representing the largest U.S. commercial banks is seeking review of a federal appeals court decision requiring disclosure of the lending records. Government lawyers yesterday urged the justices to leave that ruling intact, even while criticizing it as improperly forcing release of commercially sensitive information.

The opposition of the government, which until now had fought alongside the banking industry against disclosure, reduces the likelihood that the justices will agree to hear the case. The government said the underlying issues lacked enough practical significance to warrant Supreme Court scrutiny in part because Congress last year laid out new rules for disclosing Fed loans.

“Congress has resolved the question of whether and when the type of information at issue in this case must be disclosed” in the future, the administration said in a brief filed by acting Solicitor General Neal Katyal, President Barack Obama’s top Supreme Court lawyer.

The Fed at one point had sought to join the banking industry in seeking high court review, only to be overruled by Katyal, according to court documents.

Bloomberg LP, the parent company of Bloomberg News, sued the Fed for the release of the information under the Freedom of Information Act, known as FOIA.

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