Spears et al v. Washington Mutual, Inc. et al
Filing
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ORDER by Magistrate Judge Howard R. Lloyd re 353 Discovery Dispute Joint Report No. 8. (hrllc2, COURT STAFF) (Filed on 12/20/2013)
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NOT FOR CITATION
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UNITED STATES DISTRICT COURT
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NORTHERN DISTRICT OF CALIFORNIA
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SAN JOSE DIVISION
United States District Court
Northern District of California
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FELTON A. SPEARS, JR. and SIDNEY
SCHOLL, on behalf of themselves and all
others similarly situated,
Plaintiffs,
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Case No. 5:08-cv-00868 RMW (HRL)
ORDER RE DISCOVERY DISPUTE
JOINT REPORT NO. 8
[Re: Docket No. 353]
v.
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FIRST AMERICAN EAPPRAISEIT (a/k/a
eAppraiseIT, LLC), a Delaware limited
liability company,
Defendant.
Plaintiffs sue for themselves and on behalf of a certified class of “[a]ll consumers in
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California and throughout the United States who, on or after June 1, 2006, received home loans
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from Washington Mutual Bank, FA in connection with appraisals that were obtained through
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eAppraiseIT.” They claim that defendants engaged in a scheme to inflate the appraised values of
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homes receiving loans in order to sell the aggregated security interests at inflated prices. First
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American EAppraiseIT (EA) is the only defendant left. Plaintiffs’ sole remaining claim for relief
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is that the complained-of conduct violates the anti-kickback provision of the Real Estate
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Settlement Practices Act (RESPA), 12 U.S.C. § 2607(a).
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At issue in Discovery Dispute Joint Report (DDJR) No. 8 is whether non-party JPMorgan
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Chase Bank (Chase) should be compelled to produce class members’ HUD Settlement Statements
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(i.e., HUD-1 forms) pursuant to a document subpoena plaintiffs served on December 2, 2012. The
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matter is deemed suitable for determination without oral argument. Civ. L.R. 7-1(b). Upon
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consideration of the respective positions set out in DDJR 8, the court grants plaintiffs’ requested
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discovery.
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For the better part of the past year, plaintiffs and Chase have conferred numerous times
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over the requested HUD-1 forms. Chase eventually agreed to produce certain data about class
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members’ loans in lieu of producing the HUD-1 forms and other documents plaintiffs requested.
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Chase ultimately produced two spreadsheets that, plaintiffs say, did not contain all of the data
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Chase agreed to provide.
Since then, Chase has produced additional information (and will produce more before the
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United States District Court
Northern District of California
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December 22, 2013 discovery cutoff) addressing plaintiffs’ concerns---except for one. Thus far,
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Chase says it has been unable to confirm whether the appraisal fee listed in the spreadsheets
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actually was the fee paid by the class member (as opposed to the fee Washington Mutual paid EA
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for the appraisal service). Plaintiffs contend that this information is critical because it will have a
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direct impact on their ability to prove the amount of their claimed statutory damages. Plaintiffs
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and Chase quibble about whether plaintiffs asked for clarification re the appraisal fees on October
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17, 2013 or some three weeks later on November 6, 2013. But the bottom line is this: Because
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the requested information is in the HUD-1 forms, plaintiffs argue that the forms must now be
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produced for the approximately 200,000 loans in question and that production must be made prior
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to the December 22 discovery cutoff. (Alternatively, if Chase at some point advises that it can
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confirm by declaration that the listed fees are the appraisal fees paid by class members, then
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plaintiffs will forego production of the HUD-1 forms and rely on the declaration instead.)
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Pointing out that neither party has reimbursed its significant costs incurred, Chase says that
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it has already devoted a substantial amount of time and resources to gathering and producing the
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information plaintiffs subpoenaed, and that it continues to do so for certain outstanding categories
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of data. As such, Chase says that it simply cannot gather and produce some 200,000 HUD-1
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statements, in addition to its other production efforts, before the December 22 discovery cutoff.
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Chase suggests that plaintiffs review the sample of 300 loan files it previously produced. Those
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files contain the HUD-1 statements, and Chase believes that plaintiffs could reasonably ascertain
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who paid the appraisal fees. Plaintiffs agree that this may be a viable option, but claim that they
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only recently obtained the sampling of loan files and have not yet had a chance to review the
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HUD-1 statements. In any event, they express concern that relying on the sample, even if
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statistically significant, leaves them vulnerable to an argument by EA that the sampling is not
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100% accurate. Additionally, if the sample shows that Washington Mutual sometimes paid the
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appraisal fee, then plaintiffs are worried that Judge Whyte might question the propriety of their
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reliance on the sample in proving up damages for the class.
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There is no serious dispute that the requested information is important to plaintiffs’ ability
to prove their claimed damages. No one suggests that the information is obtainable or could be
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United States District Court
Northern District of California
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verified through some source other than the HUD-1 forms. True, there are a large number of loans
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at issue, but that is commensurate with the nationwide certified class. The specific focus of
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Chase’s distress appears to be the large volume of documents to be produced, coupled with the
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very short time frame for production requested by plaintiffs. Indeed, this matter was brought
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before the court less than two weeks before the December 22 cutoff, and at a time when Chase
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says it is already swamped with efforts to produce other information subpoenaed by plaintiffs.
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This court is not prepared to require plaintiffs to proceed by way of a statistical sampling. There is
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disagreement among courts as to the propriety of statistical sampling in class actions, see
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generally, Brown v. Wal-Mart Stores, Inc., No. 5:09-cv-03339 EJD, 2012 WL 5918300 at *3 (N.D
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Cal., Nov. 15, 2012) (citing cases), and the determination whether plaintiffs properly may prove
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damages through a statistical sampling in this case is not one for this court to make anyway.
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While the court must protect against undue burden in discovery, Fed. R. Civ. P. 26(b)(2)(C)(iii),
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45(c)(1), under the circumstances here, this court concludes that the burden imposed, while not
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insignificant, is not undue. Plaintiffs’ request for an order compelling production of the HUD-1
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forms therefore is granted. However, the court will not require Chase to produce them before the
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discovery cutoff, but by a date mutually agreed by plaintiffs and Chase and, if necessary, approved
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by Judge Whyte. Additionally, Chase will not be obliged to re-produce HUD-1 forms that were
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already provided in the 300 sample files.
SO ORDERED.
Dated: December 20, 2013
______________________________________
HOWARD R. LLOYD
UNITED STATES MAGISTRATE JUDGE
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United States District Court
Northern District of California
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5:08-cv-00868-RMW Notice has been electronically mailed to:
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Allison Lauren Libeu alibeu@irell.com
Alvin Matthew Ashley mashley@irell.com, sknight@irell.com
Angela M. Papalaskaris apapalas@dl.com, courtalert@dl.com
Christopher J Clark cjclark@dl.com
David A. Super david.super@bakerbotts.com
Ellen Mary M. Doyle edoyle@fdpklaw.com, filings@fdpklaw.com, gbrown@fdpklaw.com
Gretchen Freeman Cappio gcappio@kellerrohrback.com, cbrewer@kellerrohrback.com,
eknerr@kellerrohrback.com, tlin@kellerrohrback.com
Harry Williams , IV hwilliams@kellerrohrback.com
Janet Lindner Spielberg jlspielberg@jlslp.com
Jenny Lee Merris jmerris@alvaradosmith.com, mault@alvaradosmith.com
Joel R. Hurt jhurt@fdpklaw.com
John C. Hueston jhueston@irell.com
John Charles Hueston jhueston@irell.com, lhiles@irell.com
John M. Sorich jsorich@alvaradosmith.com
Jonathan Mark Lloyd jonathanlloyd@dwt.com, jeannecadley@dwt.com
Joseph N. Kravec , Jr jkravec@fdpklaw.com, filings@fdpklaw.com, jnk561@yahoo.com
Justin Nathanael Owens jowens@irell.com
Kevin C Wallace kwallace@dl.com
Khesraw Karmand kkarmand@kellerrohrback.com
Kris Hue Chau Man kman@dl.com, sholstrom@dl.com
Lynn Lincoln Sarko lsarko@kellerrohrback.com, cengle@kellerrohrback.com,
kwarner@kellerrohrback.com
Margaret Anne Keane margaret.keane@dlapiper.com, carol.stewart@dlapiper.com,
marianne.haines@dlapiper.com
Martin L. Fineman martinfineman@dwt.com, edithshertz@dwt.com, sfodocket@dwt.com
McKean James Evans mevans@fdpklaw.com
Michael D. Braun service@braunlawgroup.com, clc@braunlawgroup.com
Ryan E. Bull Ryan.Bull@bakerbotts.com
Sam N. Dawood samdawood@dwt.com, allanpatterson@dwt.com, cassandrabaines@dwt.com,
nickverwolf@dwt.com
Stephen M. Ng stephen.ng@bakerbotts.com, leanna.gutierrez@bakerbotts.com
Stephen Michael Rummage steverummage@dwt.com, jeannecadley@dwt.com,
seadocket@dwt.com
Sung-Min Christopher Yoo cyoo@alvaradosmith.com, crosas@alvaradosmith.com,
jyoung@alvaradosmith.com, mault@alvaradosmith.com
Tana Lin tlin@kellerrohrback.com, esiegel@kellerrohrback.com, rfarrow@kellerrohrback.com
Wyatt A. Lison wlison@fdpklaw.com, filings@fdpklaw.com
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United States District Court
Northern District of California
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