National Credit Union Administration Board v. Deutsche Bank National Trust Co.

Filing 367

ORDER granting 294 Letter Motion to Seal. SO ORDERED. (Signed by Judge Sidney H. Stein on 5/13/22) (yv)

Case 1:14-cv-08919-SHS Document 367 Filed 05/13/22 Page 1 of 4

May 10, 2022
Via ECF
Honorable Sydney H. Stein
United States District Court, Southern District of New York
Daniel Patrick Moynihan United States Courthouse
500 Pearl Street
New Yark, NY 10007
Re:

MEMO ENDORSED

NC UA, et al. v. Deutsche Bank National Trust Co., No. l 4-cv-8919-SHS

Dear Judge Stein :
We represent the parties in the above-referenced action and write jointly to seek leave to
file certain materials with redactions or under seal. Plaintiffs and Defendant (the "Parties") have
engaged in discussions regarding the appropriate scope of redaction of confidential information
and have reached agreement. The Parties write jointly to respectfully request permission to file
portions of the Parties' summary judgment motions and the accompanying exhib its (the "Motion
Papers") with redactions or under seal.
The Parties seek the Court' s permission to (l) redact or file under seal nonpublic personal
borrower information found in the Motion Papers ; (2) file under seal complete documents that
contain voluminous amounts of nonpublic personal borrower information; and (3) publicly file
documents containing full loan numbers where those loan numbers are not connected to any
nonpublic personal borrower information . Notably, Judge Netburn and Judge Schofield each
granted nearly identical requests in NC UA, et al. v. Wells Fargo Bank, N.A . Case No. 14-cv10067-KPF-SN, ECF 526 (S.D .N .Y.) and NCUA, et al. v. HSBC Bank, N.A ., No. 15-cv-02144LGS-SN (S.D.N.Y.).
Discussion
Courts may, for good cause, issue an order "requiring that a trade secret or other
confidential research, development, or commercial information not be revealed or be revealed
only in a specified way." Fed, R, Civ, P, 26(c)(l)(G). Courts enjoy " considerable discretion in
determining whether good cause exists to overcome the presumption of open access to
documents ." Geller v. Branic Int '/ Reality Co., 212 F,3d 734,738 (2d Cir. 2000). In considering
whether to allow parties to file documents under seal , the Court must determine whether the
interest in public access to the documents outweighs the privacy interests of the party seeking to
file the documents under seal. See Lugosch v Pyramid Co. of Onodonaga, 43 5 F,3d 1I 0, 119-20
(2d Cir. 2006). Specifically with respect to personal financial information, courts have found
such information private and granted motions to seal. See Strauss v. Credit Lyonnais, SA ., No.
06-cv-702, 2011 WL 4736359, at *4 (E.D.N.Y. 2011) ("Both financial records and certain
reports by banks to government authorities have historically not been subject to public access in
the United States"); United States Sec. & Exch. Comm 'n v. Ahmed, No. l 5-cv-675, 2018 WL
4266079. at *2 (D . Conn. 2018) ([F]inancial records .. . are among those privacy interests which
may support sealing of documents) (internal quotations omitted); Ly tle v. JPMorgan Chase , .81.Q
F, Sui:2,12, 2d 616,629 (S.D .N.Y. 2011) (listing " sensitive personal financial information" as a

Case 1:14-cv-08919-SHS Document 367 Filed 05/13/22 Page 2 of 4

Honorable Sidney H. Stein
May 10, 2022
Page 2
category of financial information that is sufficient to overcome the presumption of public access)
(citations omitted).

I.

Nonpublic Personal Borrower Information

The parties seek to redact nonpublic borrower information that appears in the Motion
Papers . The Gramm-Leach Bliley Act ("Gramm-Leach-Bliley") requires that, as a general rule,
"financial institution[s] [] not disclose nonpublic personal information to a nonaffiliated third
party." Gramm-Leach-Bliley, § 502 (6)(1), 15 U.S,C, § 6802(b)(l). Likewise, federal courts
recognize the need to protect the personal identifiable information of non-affiliated third parties.
See Dodona I, LLC v. Goldman, Sachs & Co., 112 F. Supp, 3d 152, 156 (S.D.N.Y. 2015)
(allowing redaction of information relating to "customer names, account numbers, and pricing
information"); see also SOHC, Inc. v. Zentis Sweet Ovations Holding LLC, No. l 4-cv-2270,
2014 WL 5643683. at *5 (S.D.N.Y. Nov . 4, 2014) (allowing redaction of customer information
that is " not relevant to the parties' legal dispute and implicate legitimate privacy interests"). The
Parties therefore request to redact or file under seal nonpublic borrower information.
II.

Exhibits Containing Voluminous Amounts of Nonpublic Personal Borrower
Information

The Parties seek leave to file documents under seal , including Excel spreadsheets and
PDF documents listed in Exhibit A (the "Exhibit A Documents"), which relate to loan files and
contain nonpublic personal borrower identifiable information throughout the entirety of the
documents . The Parties seek to seal the Exhibit A Documents in their entirety because, to the
extent that the documents contain information that is not personal identifiable information, the
documents are so voluminous as to make redactions impracticable. In determining whether to
allow parties to file documents under seal, rather than redact them, courts in the Second Circuit
have allowed for documents to be filed under seal if, following the application of redactions, the
" remainder of [a] document provides minimal information." Strauss, 2011 WL 4736359, at *6;
see also Travelers Indem. Co. v. Excalibur Reinsurance Corp., No. l l-cv-1209, 20) 3 WL
4012772, at *8 (D. Conn. 2013) (" [T]he contents of the two Exhibits to be sealed in their entirety
make redaction impracticable."); United States v. Amodeo. 71 F,3d 1044. I053 (2d Cir. 1995)
(redaction was not viable since redactions would include "virtually the entire text").
In addition, many exhibits with nonpublic borrower information contain voluminous
granular data (such as lengthy lists of alleged mortgage file exceptions, breach narratives, and
rebuttals) that also should be filed completely under seal given the excessive burden of creating
redactions . For such granular and voluminous data materials, the Parties ' respective experts
have presented aggregate analyses in their expert reports that encapsulate all such relevant
granular data, which along with the legal briefs that discuss those aggregate analyses will be filed
publicly on the ECF docket, thus satisfying the public ' s interest in access to judicial documents.
And, to the extent the expert reports or legal briefs discuss an illustrative alleged breach or

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Honorable Sidney H. Stein
May 10, 2022
Page 3
granular data point, those discussions will be publicly filed on ECF. In another residential
mortgage-backed securities case, the Seventh Circuit granted a motion to seal complete
documents without redactions based on these very same grounds. See Exhjbjt B hereto (Joint
Motion at 3-4: "The parties propose that these exhibits be maintained completely under seal in
this Court. Redacting such documents would be laborious, redacted versions of such granular
data would make little sense to a reader, and expert witnesses in any event have provided
aggregate analyses of loans in expert reports that are not proposed to be sealed."); Exhjbjt C
hereto (Order at 2, granting motion).
The Parties thus seek to file the Exhibit A Documents completely under seal, rather than
redact them, because of the significant burden of reviewing such voluminous documents when
compared to the relatively marginal benefit to the public of viewing these documents with
redactions, and because any granular data are subsumed in the aggregate data analyses that will
be filed publicly.

III.

Exhibits Containing Loan Numbers Without Any Other Personal Borrower
Identifiable Information

Many documents cited by the Parties in their Motion Papers contain references to a loan
number, without a connection to personal identifiable information such as borrower names,
addresses, or other information by which the borrower could be identified. Such a loan number,
without more, cannot reasonably be used to uncover personal identifiable information.
Accordingly, the Parties jointly seek leave to publicly file such documents without redacting
these loan numbers, which would be burdensome and unnecessary given the size of the record .
First, a number of courts have published RMBS or other loan numbers in their entirety in
judicial opinions and orders, implicitly concluding that such loan numbers, without more, would
not reasonably reveal a borrower's identity. See, e.g., US. Bank v. UBS, 205 F. Supp, 3d 386,
ill (S.D.N.Y. 2016) ("The Court makes the following findings as to the specifically identified
loans: A. Loan 1456451."); UBS Real Estate Secs. v. Cty. Trust Mortg. Bankers, 2008 WL
4566288. at *l (S.D.N.Y. 2008) ("Two ofthese five loans, identified as UBS Loan ID numbers
777021609 and 777013706, were re-sold at a loss of $294,714.43."); In re ResCap Liquidating
Trust Litig., 2020 WL 4728 I 09, at *25-*33 (D. Minn . 2020) (reviewing detailed re-underwriting
findings for many complete loan numbers); id. at *25 ("Loans []4115211 , 4550405, 4413350,
4375505, 4962418, 4117058, and 4380515 ."); Radiance Capital Receivables v. MEO
Investments , 2019 WL 330463 , at *6 & n. l O (E.D. Mo. 2019) ("Each time the Note changed
hands it was assigned a new identifying number [setting out those numbers]."); Matter of Nelson,
2015 WL 13672410, at *l n.l (Bankr. S.D. Iowa 2015) (" Loan number 20050575 dated July 25,
2011; loan number 20052550 dated June 5, 2012; loan number 20052560 dated June 5, 2012;
loan number 20052760 dated July 5, 2012 and loan number 20052940 dated August 9, 2013.").

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Honorable Sidney H. Stein
May 10, 2022
Page 4

Second, one court in this District has reasoned expressly in the RMBS context that a loan
number without more would not logically reveal the borrower's identity. See United States ex
rel. Amico v. Citigroup, Inc., 2015 WL 13814187, at *2 (S.D.N.Y. 2015) ("The Registration
Statements included a prospectus, prospectus supplement, and other documents including the
pooling and servicing agreement, mortgage loan purchase agreement, underwriting agreement,
and loan tapes. The loan tapes listed the loans within the RMBS loan pool with columns of
figures for each loan. The headings of these columns, however, were either abbreviated or not
defined, and the loans were identified by loan number only. Thus, the identity of the borrower
and property of each loan was not readily apparent.from the loan tapes." (emphasis added;
citations omitted)).
Third, in another residential mortgage-backed securities case, Seventh Circuit concluded
that bare loan numbers (even when associated with a lender) need not be redacted or filed under
seal. Compare Ex. B (Joint Motion at 5, describing such as Category 5 documents: "The parties
have considered a document to contain [nonpublic borrower information] when it has enough
information to identify a particular borrower by name or address. The parties therefore have
excluded a number of documents that list or discuss individual loans by lender and loan number,
without more. Such isolated data points would not seem reasonably capable of being used to
identify a particular borrower. The parties nevertheless identify such documents here for the
convenience of the Court, in the event the Court finds that they merit protection as well.") with
Ex. C (Order at 2: Category 5 documents not required to be sealed or redacted).
Finally, under the factual circumstances presented by these Motions and in view of the
substantial authorities just cited, Federal Rule of Civil Procedure 5.2(a)( 4) - which provides
that, "in an electronic or paper filing with the court that contains ... a financial-account number,
a party or nonparty making the filing may include only ... the last four digits of the financialaccount number" - is inapplicable here. Among other things, the purpose of Rule 5.2(a)(4) is to
"to protect privacy and security concerns relating to electronic filing of documents." Fed. R.
Civ. P. 5.2 advisory committee note to 2007 adoption (quoting E-Government Act of 2002,
Public Law 107-347 § 205(c)(3)). The Parties agree that, with respect to these Motions only,
publishing loan numbers, without more, does not implicate privacy or security concerns.
Accordingly, we respectfully suggest that Rule 5.2(a)(4) should not apply to loan numbers
without other borrower information for these Motions.
Conclusion
The Parties respectfully request the Court grant the Parties' motions to (I) redact or file
under seal nonpublic personal borrower information found in the Motion Papers; (2) file under
seal complete documents that contain voluminous amounts of nonpublic personal borrower
information; and (3) publicly file documents containing full loan numbers where those loan
numbers are not connected to any nonpublic personal borrower information. We are available to
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Dated: New York, New York
May 13, 2022