Bacchetti el al v. Nationstar Mortgage LLC

Filing 20

Opinion and Order - Defendant Nationstar Mortgare LLC's Motion for Protective Order (ECF 1 ) is DENIED. Signed on 7/14/2017 by Judge Michael H. Simon. (mja)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON

Case No. 3:17-cv-834-SI

JOHN BACCHETTI and
JADEA BACCHETTI,

OPINION AND ORDER
Plaintiffs,
v.
NATIONSTAR MORTGAGE LLC, aka
Mr. Cooper,
Defendant.
Michael R. Fuller, OLSEN DAINES PC, 111 SW Fifth Avenue, Suite 3150, Portland, OR 97204.
Of Attorneys for Plaintiffs.
Joseph A. Rohner IV, ANGLIN FLEWELLING RASMUSSEN CAMPBELL & TRYTTEN LLP, 121 SW
Salmon Street, Suite 1100, Portland, OR 97204; Adam G. Hughes, ANGLIN FLEWELLING
RASMUSSEN CAMPBELL & TRYTTEN LLP, 701 Pike Street, Suite 1560, Seattle, WA 98101. Of
Attorneys for Defendant.
Michael H. Simon, District Judge.
Before the Court is a motion for protective order filed by Defendant Nationstar Mortgage
LLC (“Nationstar”). For the following reasons, Nationstar’s motion is denied.
STANDARDS
Rule 26(c)(1) of the Federal Rules of Civil Procedure provides, in relevant part:

PAGE 1 – OPINION AND ORDER

A party or any person from whom discovery is sought may move
for a protective order in the court where the action is pending . . . .
The court may, for good cause, issue an order to protect a party or
person from annoyance, embarrassment, oppression, or undue
burden or expense, including one or more of the following . . .
(F) requiring that a deposition be sealed and opened only on court
order . . . .
Fed. R. Civ. P. 26(c)(1); see also Phillips v. GMC, 307 F.3d 1206, 1210-11 (9th Cir. 2002)
(holding that Rule 26(c) authorizes a district court to prevent public dissemination of discovery
materials but only when good cause has been shown).
BACKGROUND
On January 20, 2017, Plaintiffs John and Jadea Bacchetti (the “Bacchettis”) sued
Defendant Nationstar Mortgage LLC (“Nationstar”) in Oregon state court, asserting a single
cause of action for unlawful trade practice in violation of Oregon Revised Statutes § 646.638.
The Bacchettis allege that Nationstar violated Oregon Administrative Rule 137-02-0805 in
connection with Nationstar’s servicing of the Bachchettis’s residential mortgage loan.
Specifically, the Bacchettis claim that Nationstar provided them with an erroneous mortgage
escrow amount, that they promptly called Nationstar, that Nationstar provided a recalculated
escrow amount, and that Plaintiff timely paid in full the recalculated amount. The Bacchettis
further allege that notwithstanding their timely payment in full of the recalculated escrow
amount, Nationstar failed properly to apply their payment, assessed unauthorized fees and
charges, and threatened the Bacchettis with foreclosure. Based on these allegations, the
Bacchetti’s requested money damages not to exceed $10,000, plus fees and costs, as well as
declaratory relief.
On March 10, 2017, Nationstar filed its answer to the complaint. On May 11, 2017, while
the lawsuit was still in state court, Plaintiffs took the videotaped deposition of Nationstar’s
corporate designee (the “Nationstar Deposition”), pursuant to Rule 39 C(6) of the Oregon Rules
PAGE 2 – OPINION AND ORDER

of Civil Procedure. On May 14, 2017, the Bacchettis filed a complaint in their Chapter 13
bankruptcy against Nationstar, seeking $100,000 in actual damages and $1 million in punitive
damages. The next day, May 15, 2017, the Bacchettis’ wrote to Nationstar’s counsel, leading
Nationstar to conclude that a reasonable estimate of the value that the Bacchettis place on their
state court claims exceeds $75,000. On May 26, 2017, Nationstar removed the Bacchettis’s state
lawsuit to this Court, and Plaintiffs do not challenge the timeliness of that removal. On June 21,
2017, Nationstar filed an unopposed motion to withdraw the reference of the adversary
proceeding to this Court. Nationstar also filed an unopposed motion to consolidate the adversary
proceeding with the removed state action. The Court granted both motions.
On May 26, 2017, in the removed action, Nationstar filed a motion for protective order.
Specifically, Nationstar asks the Court to order:
That the deposition of Nationstar taken on May 11, 2017, shall be
treated as confidential, and specifically that Plaintiffs shall not
publish or otherwise disseminate the deposition transcript, video
recording of the deposition, or audio recording of the deposition,
unless Plaintiffs seek and obtain from the Court permission to do
so.
ECF 1 at 2. The Bacchettis oppose Nationstar’s motion for protective order and also seek their
reasonable attorney’s fees and costs in opposing Nationstar’s motion.
DISCUSSION
Nationstar argues that it believes that the Bacchettis, or their counsel, intend to use
Nationstar Deposition in what Nationstar asserts are “inappropriate ways.” ECF 1 at 3.
Nationstar adds that it also susptects that the Bacchettis or their counsel “intend to provide local
media outlets with excerpts of the deposition, or perhaps the entire video transcript, for use in
upcoming news stories.” Id. at 4. Nationstar further argues that discovery materials, such as a
party’s deposition, are not entitled to the same presumption of public availability that attaches to
PAGE 3 – OPINION AND ORDER

court proceedings and materials filed in court in connection with court proceedings. The
Bacchettis do not deny that they intend to share the Nationstar Deposition with other litigants,
potential litigations, and legislators. Instead, they argue that Nationstar has failed to show good
cause in support of its motion.
In Macias v. City of Clovis, 2015 WL 7282841 (E.D. Cal. Nov. 18, 2015), the court
summarized well the law in this area:
Generally, the public has a common law presumptive right of
access to “judicial documents,” which are items filed with the
court that are relevant to the performance of the judicial function
and useful in the judicial process. Father M. v. Various Tort
Claimants (In re Roman Catholic Archbishop), 661 F.3d 417, 421
(9th Cir. 2011). However, dissemination of confidential discovery
documents for non-judicial purposes is unusual and rightly so. The
discovery rules are “a matter of legislative grace.” Seattle Times
Co. v. Rhinehart, 467 U.S. 20, 32 (1984). They compel parties,
including third parties, to divulge information “for the sole purpose
of assisting in the preparation and trial, or the settlement, of
litigated disputes.” Id. at 34. The liberality of this process creates
“a significant potential for abuse” such as delay, expense, misuse
of court process and damage to the reputation and privacy of
litigants and third parties. Id. at 34-35. Courts therefore must be
mindful that the purpose of discovery is “to facilitate orderly
preparation for trial, not to educate or titillate the public.” Joy v.
North, 692 F.2d 880, 893 (2d Cir. 1982).
Id. at *6.
Similarly, in Burgess v. Town of Wallingford, 2012 WL 4344194 (D. Conn. Sept. 21,
2012), the court explained:
When the materials in question “are deemed non judicial, then
there is no presumption of public access, and the movant need only
make a baseline showing of good cause in order to justify the
imposition of a protective order.” Ello v. Singh, 531 F. Supp. 2d
552, 583 (S.D.N.Y. 2007) (citing Standard Inv. Chartered, Inc. v.
National Ass’n of Securities Dealers, 621 F. Supp. 2d 55, 62
(S.D.N.Y. 2007) and Lugosch v. Pyramid Co. of Onondaga, 435
F.3d 110, 119-20 (2d Cir. 2006)). As the Second Circuit explained
in [United States v. Amodeo, 71 F.3d 1044, 1050 (2d Cir. 1995)],
“[d]ocuments that play no role in the performance of Article III
PAGE 4 – OPINION AND ORDER

functions, such as those passed between the parties in discovery,
lie entirely beyond the . . . reach” of the presumption of public
access.” 71 F.3d at 1050 (internal quotations and citation omitted).
Such documents “stand[ ] on a different footing than . . . a motion
filed by a party seeking action by the court, . . . or, indeed, than
any other document which is presented to the court to invoke its
powers or affect its decisions.” Id. (internal quotations and citation
omitted).
In the case of non judicial documents, the Court may therefore
issue a protective order under Fed. R. Civ. P. 26(c) upon a baseline
showing of “good cause” that the order is necessary to “to protect a
party or person from annoyance, embarrassment, oppression, or
undue burden or expense.”
Id. at *9 (ellipses in original).
Because the Nationstar Deposition has not been filed in Court, there is no presumptive
right of public access to that evidence. For the Court to grant the protective order that Nationstar
seeks, however, Nationstar must show good cause. Nationstar has failed to identify anything
contained in the Nationstar Deposition that might cause Nationstar unreasonably to suffer
“annoyance, embarrassment, [or] oppression” if disclosed. Thus, Nationstar has failed to show
good cause, and the Court has no grounds for providing the relief sought.1
CONCLUSION
Defendant Nationstar Mortgare LLC’s Motion for Protective Order (ECF 1) is DENIED.
IT IS SO ORDERED.
DATED this 14th day of July, 2017.
/s/ Michael H. Simon
Michael H. Simon
United States District Judge

1

The Bacchettis seek their reasonable expenses incurred in opposing Nationstar’s
motion, pursuant to Fed. R. Civ. P. 37(a)(5)(B). Because Nationstar’s motion raises important
and sometimes subtle issues about what may be done with non judicial materials obtained in
discovery, the Court finds it would be unjust under the circumstances to award expenses.
PAGE 5 – OPINION AND ORDER