Sevier County Schools Federal Credit Union et al v. Branch Banking and Trust Company

Filing 219

MEMORANDUM AND ORDER granting in part and denying in part 190 Motion to Compel; granting in part and denying in part 190 Motion for Sanctions. The parties SHALL meet and confer regarding Plaintiffs' award of attorney fees and expenses, and if they cannot agree on the reasonable amount, they may bring the matter to the Courts attention. Signed by Magistrate Judge Debra C Poplin on 8/3/23. (JBR)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF TENNESSEE
AT KNOXVILLE
GEOFFREY WOLPERT, et al.,
individually and on behalf of all others
similarly situated,

)
)
)
)
Plaintiffs,
)
)
v.
)
)
BRANCH BANKING TRUST & COMPANY, )
)
Defendant.
)

No. 3:19-CV-138-TRM-DCP

MEMORANDUM AND ORDER
This case is before the undersigned pursuant to 28 U.S.C. § 636, the Rules of this Court,
and Standing Order 13-02.
Now before the Court is Plaintiffs’ Motion to Compel Discovery and for Sanctions
[Doc. 190]. Defendant has responded in opposition to the motion [Doc. 191], and Plaintiffs filed
a reply [Doc. 193]. The motion is ripe for adjudication. See E.D. Tenn. L.R. 7.1(a). For the
reasons explained below, the Court GRANTS IN PART AND DENIES IN PART Plaintiffs’
motion [Doc. 190].
I.

BACKGROUND
This dispute relates to Plaintiffs’ First Request for Production of Documents [Doc. 190-

1], 1 and more specifically, Plaintiffs’ request “to produce, without redaction, full and complete
responses to their request for documents pertaining to Joseph Brooks, a subject account holder and
1

Plaintiffs served the Complaint and an initial set of written discovery on Defendant on
March 22, 2019, when Plaintiffs initially filed their action in state court. Defendant removed the
case to federal court on April 19, 2019, and Plaintiffs served Defendant with their first postremoval set of written discovery the same day [Doc. 78 pp. 1-2].

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putative class member” [Doc. 190 p.1]. In the alternative, Plaintiffs request that Defendant
produce the privilege log [Id.]. Plaintiffs also seek sanctions in the form of attorney’s fees [Id. at
7–9].
According to Plaintiffs, Defendant was originally concerned about producing such records,
claiming that they were protected by the Tennessee Financial Records Privacy Act (“TFRPA”)
[Id. at 2 (citing Doc. 190-2)]. On February 9, 2023, Plaintiffs provided Defendant a copy of the
Power of Attorney and Authorization for Joseph Brooks [Doc. 190-2 p. 1]. Specifically, Plaintiffs
sent Defendant the following:
I, Joseph C. Brooks of 301 Roberta Drive, Greenville SC 29615 do
hereby designate Attorney Donald K. Vowell and/or the Law Firm
of Lowe, Yeager and Brown of Knoxville TN as my true and lawful
attorney-in-fact and power of attorney for the purpose of obtaining
any and all records pertaining to my MMIA account at First National
Bank of Gatlinburg and the successor accounts at BankFirst and
BB&T/Truist, including any records relating to my complaint to the
FDIC or CFPB related to the fact that BB&T refused to honor the
guaranteed interest 6.5% rate and any signature cards or other
account-creating documents and I do authorize the said attorney and
law firm to request and obtain on my behalf any and all records
pertaining to my said account.
[Id.]
On February 24 and March 27, 2023, Plaintiffs inquired about the production of Joseph
Brooks’s documents [Doc. 190-3 p. 2]. Specifically, on March 27, 2023, Plaintiffs’ counsel wrote:
Under the circumstances, please be advised that this is our final
effort to meet and confer on this request. If [you] have not produced
the records or at least provided an explanation by 5:00 p.m. (Eastern
time) Wednesday, March 29, 2023, we will consider that you are
unwilling to cooperate, and we will file an appropriate motion.
[Id. at 2]. On March 29, 2023, defense counsel wrote, in relevant part, “As to the Joseph Brooks
account, we will be producing responsive, non-privileged documents to your requests next week”

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[Id. at 1]. On April 7, 2023, Defendant produced Joseph Brooks’s bank account statements and
noted that it would produce the remaining documents related to his regulatory complaints to the
Federal Deposit Insurance Corporation (“FDIC”) and the Consumer Financial Protection Bureau
(“CFPB”) the following week [Doc. 190-4 p. 2]. On April 14, 2023, Defendant sent Plaintiff an
email with a link to those documents, but thirteen (13) of the nineteen (19) were redacted [Doc.
190 p. 4 (citing 190-4 p. 1)]. Defendant stated that it would serve a revised privilege log the
following week, i.e., April 17, 2023 [Id. at 5 (citing Doc. 190-4 p. 1)]. Plaintiffs did not receive
the privilege log the week of April 17, so they followed up on April 27, April 28, and May 1, 2023
[Id.]. Plaintiffs warned that if they did not receive the privilege log by May 3, 2023, they would
file a motion to compel [Id.].
On May 5, 2023, Plaintiffs filed their instant motion. As mentioned above, Plaintiffs
request an order compelling Defendant “to produce, without redaction, full and complete responses
to their request for documents pertaining to Joseph Brooks, a subject account holder and putative
class member” [Id. at 1]. Alternatively, Plaintiffs seek the privilege log [Id.]. Plaintiffs argue that
Defendant has not explained why the privilege log has not been produced, and “[a]t this point, any
claimed privilege or protection should be deemed waived” [Id. at 6]. Plaintiffs also seek sanctions
against Defendant, arguing that this is not the first time they have had to seek relief with Court.
Claiming that it “has produced both the Joseph Brooks documents in question and a
privilege log[,]” Defendant responds that the motion is now moot [Doc. 191 p. 1]. Defendant
argues that Plaintiffs’ February 9 email did not attach a request for production of documents
pursuant to Rule 34 of the Federal Rules of Civil Procedure, and the documents Plaintiffs requested
are not encompassed in its First Requests for Production of Documents. Therefore, Defendant

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argues, it was never required to respond to Plaintiffs’ email request. In addition, Defendant states
that around this time, the parties were preparing for a motion hearing on February 26, 2023, on six
motions. On the day after the hearing, defense counsel advised Plaintiffs’ counsel that she would
confer with Defendant regarding the request related to Joseph Brooks, and on March 29, defense
counsel relayed to Plaintiffs’ counsel that Defendant would produce non-privileged documents.
According to Defendant, it produced Joseph Brooks’s account statements on April 7 and
produced the records related to his complaints on April 14, 2023. At that time, the parties were
also discussing whether to mediate the case, and Defendant “requested that discovery not proceed
to conserve further litigation costs as a condition to mediation” [Id. at 3]. Defendant states that
“Plaintiffs were aware of this fact that [it] was awaiting a response from Plaintiffs as to the stay of
discovery by Friday, May 5, when they instead filed the present [m]otion” [Id.]. Defendant
produced the privilege log on May 8, 2023.
Now that it has produced the privilege log, Defendant argues that there is no waiver of
privilege. Defendant states, “Rather, [it] was working in good faith on an attempt to mediate the
case and stay discovery, and Plaintiffs knew this” [Id. at 4]. According to Defendant, “District
courts in the Sixth Circuit have denied similar motions to compel production of a privilege log as
moot on the basis that the requested log was produced” [Id. at 6 (citations omitted)]. Even
assuming the issue is not moot, Defendant asserts that “this issue is not appropriately before the
Court as there was never a proper request for the discovery relating to a ‘complaint to the FDIC or
CFPB,’ and, therefore, there cannot be any obligation to produce a privilege log regarding such
request” [Id. at 4 (citation omitted)]. Defendant states that Plaintiffs’ request that it produce the

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documents without redactions is meritless and that their request for sanctions should also be
denied.
Plaintiffs deny that their motion is moot [Doc. 193]. They argue that Defendant’s position
that there are no formal discovery requests is “disingenuous” [Id. at 2]. If this position were true,
Plaintiffs question why Defendant did not raise it early and why it produced Bates-stamped
documents. In addition, Plaintiffs state that their motion is not about Defendant’s document
production, but instead, Defendant’s failure to timely produce a privilege log. Plaintiffs argue that
Defendant only produced the privilege log after they had to seek relief with the Court. Based on
the untimely production, Plaintiffs assert that Defendant has waived the attorney-client privilege.
Further, Plaintiffs state that the privilege log is not sufficient. Plaintiffs argue that the
privilege log [Doc. 193-2] is the same as the original, except the addition of twenty-seven (27)
new entries. Out of the twenty-seven (27) new entries, thirteen (13) reference the TFRPA.
Plaintiffs argue, “A closer look at the TFRPA redactions reveals that the privilege is claimed as to
documents pertaining to Bobby Brooks, Joseph Brooks’ father, who has executed an authorization
permitting the production of his financial records” [Doc. 193 at 9]. Plaintiffs also object to the
attorney-client privilege assertions. 2 “Should the Court not be inclined to find that [Defendant]
has waived any privileges related to the Joseph Brooks documents on the grounds that the privilege
log was not timely produced,” Plaintiffs assert they “are still entitled to their fees and costs in
accordance with the Federal Rules of Civil Procedure” [Id. at 10].

2

The Court declines to address whether the privilege log is sufficient given that Plaintiffs
raised this issue in their reply brief, and it is separate from whether Defendant waived the attorneyclient privilege by not timely producing a log [See Doc. 196].

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II.

ANALYSIS
The Court has considered the parties’ positions, and for the reasons explained below, the

Court GRANTS IN PART AND DENIES IN PART Plaintiffs’ motion [Doc. 190].
Rule 37 of the Federal Rules of Civil Procedure states, “On notice to other parties and all
affected persons, a party may move for an order compelling disclosure or discovery.” Fed. R. Civ.
P. 37(a). This includes a failure to produce documents. Fed. R. Civ. P. 37(a)(3). Defendant asserts
that Plaintiffs emailed them a request for documents, which is not a formal discovery request.
Therefore, Defendant contends, it was not required to respond. Plaintiffs respond Joseph Brooks’s
documents are within the scope of RFP Nos. 1, 4, 6, 8, 10, and 18.
RFP Nos. 1, 4, 6, 8, and 10 provide as follows:
1.

Produce any and all writings and written communications of
First National Bank of Gatlinburg related to offering MMIA
accounts in which the interest rate would never fall or go
below 6.5%.

4.

Produce the First National Bank MMIA account agreement,
any First National Bank of Gatlinburg agreement setting up
the Maintenance Accounts, including any Response Form
related to the letters sent to the Subject Account Holders
proposing the Maintenance Accounts (similar to Ex. D to the
Complaint), and any BB&T agreement setting up the
“Subject BB&T Money Rate Savings Accounts” for each
Subject Account and/or Subject Account Holder.

6.

Produce any writings, written communications, things, or
tangible objects that are in your custody or control relating
to offering the MMIA Accounts to customers or potential
customers by the First National Bank of Gatlinburg,
including but not limited to notices, advertisements,
statements of promised or available interest rates, and the
commitment that the interest rate would “never fall below
6.5%,” and all writings and written communications related
to mailing, delivering or sending same to customers or
potential customers.

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8.

Produce any writings or written communications of First
National Bank of Gatlinburg, BankFirst and/or BB&T
relating to the interest rates on the Subject Accounts,
consideration of changing the interest rates on the Subject
Accounts, or leaving them unchanged.

10.

Produce any writings, written communications, things, or
tangible objects that are in your custody or control relating
to your efforts, attempts, or claims to change the terms of
your banking or legal relationship with the Subject Account
Holders, or to otherwise change your banking or legal
relationship with the Subject Account Holders (including
posting such changes in the bank or mailing or delivering a
notice to the Subject Account Holders in their monthly
statement) and all writings and written communications
related to mailing, delivering or sending same to the Subject
Account Holders.

18.

Produce any and all writings or written communications
related to any of your efforts to communicate with the
Subject Account Holders about the Subject Accounts at any
time since the Benchmark Date, including but not limited to
communications asking about the status of their accounts,
their intent regarding closing the accounts or leaving them
open, making withdrawals from the accounts, sending
abandoned property notices, or advising the Subject Account
Holders as to the unclaimed property law, or mentioning the
idea that their accounts might escheat or otherwise be
transferred to the State of Tennessee if they were not closed.

[Doc. 190-1 pp. 3, 4, 5, and 7].
Defendant states that none of the RFPs seek customer complaints or communications with
the FDIC or CFPB. Most of the RFPs request documents of First National Bank of Gatlinburg
and its successors (see, e.g., RFP Nos. 1, 8 and 18). RFP No. 4 requests account agreements and
Defendant’s response form related to letters, and RFP No. 6 targets Defendant’s advertisements.
But RFP No. 10 requests documents relating to Defendant’s “efforts, attempts, or claims to change

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the terms” of the parties’ relationship, which appears to encompass Joseph Brooks’s complaints to
the FDIC and CFPB [Doc. 190-1 p. 5].
Even so, the Court declines to find that Defendant waived the attorney-client by producing
the privilege log after Plaintiffs filed their motion. While many courts have noted that “[t]he
complete failure of a party to provide a privilege log may result in a waiver of the claimed
privileged[,] . . . such a waiver is not automatic given the harshness of such a sanction.” Jones v.
Varsity Brands, LLC, No. 20-CV-02892-SHL-TMP, 2022 WL 1913043, at *2 (W.D. Tenn. June
3, 2022) (citing Brown v. Tax Ease Lien Servicing, LLC, No. 3:15-CV-208-CRS, 2017 WL
6939338, at *14 (W.D. Ky. Feb. 16, 2017)). “Minor procedural violations, good faith attempts at
compliance, and other such mitigating circumstances militate against finding waiver. In contrast,
evidence of foot-dragging or a cavalier attitude towards following court orders and the discovery
rules supports finding waiver.” Brown, 2017 WL 6939338, at *14 (quoting Ritacca v. Abbott Lab.,
203 F.R.D. 332, 334-335 (N.D. Ill. 2001)); see also Green v. Platinum Restaurants Mid-Am., LLC,
No. 3:14-CV-439-RGJ, 2018 WL 11426960, at *14 (W.D. Ky. July 12, 2018) (explaining the two
schools of thought when a party waives the attorney-client privilege by not timely producing a
privilege log).
Based on the circumstances, the Court cannot find that Defendant engaged in foot-dragging
or had a cavalier attitude towards the discovery process. Here, Plaintiffs requested Joseph
Brooks’s records on February 9, 2023, and Defendant made two productions—one on April 7 and
the other one on April 14, 2023. Thereafter, the parties began discussing mediation. When
Plaintiffs filed their motion, Defendant produced the privilege log within three days. The Court
does not find the harsh sanction of waiver appropriate here. Bowman v. Home Depot U.S.A., Inc.,

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No. 3:21-CV-00885, 2022 WL 2294051, at *3 (M.D. Tenn. June 24, 2022) (“While it would have
been preferable for [the defendant] to provide its privilege log . . . sooner, under the circumstances
its delay does not warrant the extreme result of a waiver of its attorney-client privilege and work
product protection”).
But Plaintiffs contend that they are still entitled to their attorney’s fees and expenses in
filing the motion.3 Rule 37 provides as follows:
(5) Payment of Expenses; Protective Orders.
(A)

If the Motion Is Granted (or Disclosure or Discovery Is
Provided After Filing). If the motion is granted--or if the
disclosure or requested discovery is provided after the
motion was filed--the court must, after giving an opportunity
to be heard, require the party or deponent whose conduct
necessitated the motion, the party or attorney advising that
conduct, or both to pay the movant’s reasonable expenses
incurred in making the motion, including attorney's fees. But
the court must not order this payment if:
(i)

the movant filed the motion before attempting in
good faith to obtain the disclosure or discovery
without court action;

(ii)

the opposing party’s nondisclosure, response, or
objection was substantially justified; or

(iii)

other circumstances make an award of expenses
unjust.

3

In their motion, Plaintiffs seek attorney’s fees pursuant to Rule 26(g), Rule 37, and/or the
Court’s inherent authority [Doc. 190 pp. 7–8]. With respect to the latter, the Supreme Court has
“made clear that courts must proceed with discretion in invoking their inherent authority, and
generally should not rely on their inherent authority in situations where the Federal Rules provide
an appropriate mechanism for sanctioning the conduct at issue.” Diamond Consortium, Inc. v.
Hammervold, 386 F. Supp. 3d 904, 915 (M.D. Tenn. 2019) (citing Chambers v. NASCO, Inc., 501
U.S. 32, 50 (1991)). Given that Plaintiffs have also relied on the Federal Rules of Civil Procedure
in seeking sanctions, the Court does not need to address its inherent authority to award sanctions.
Further, the Court will not address Rule 26(g) given that Plaintiffs do not explain how it is
applicable here and instead focus their arguments on Rule 37 in their reply brief.

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Fed. R. Civ. P. 37(a)(5)(A)(i)–(iii).
The Court does find an award of attorney’s fees appropriate here. In support of its position,
Defendant argues, “Courts deny requests for fees and expenses in these circumstances as
unwarranted” [Doc. 191 p. 7 (citing Ham v. Marshall Cnty., Ky., No. 5:11-CV-11, 2012 WL
4340655, at *1 (W.D. Ky. Sept. 21, 2012) and Kenney v. Strauss Troy Co., LPA, No. CV 16-208DLB-CJS, 2019 WL 13212433, at *4 (E.D. Ky. Oct. 31, 2019)]. But the Court finds these cases
inapposite to the circumstances here. In Ham, the court found an award of attorney’s fees not
appropriate because the defendants (1) “did not act in bad faith[,]” (2) the defendants “acted with
reasonable promptness and their initial refusal to disclose the requested information appear[ed]
grounded in a good faith belief they were legally entitled to do so under the Federal Rules[,]” (3)
the defendants “voluntarily disclosed the privilege log by attaching it to their response” and
“without an order from this [c]ourt,” and (4) the plaintiff did not “argue that it had been prejudiced
by the [d]efendants’ delay in disclosing the requested information.” Ham, 2012 WL 4340655, at
*1.
And in Kenney, the court found the plaintiff’s position was substantially justified. Kenney,
2019 WL 13212433, at *4. In addition, the court found that other circumstances made an award
of attorney’s fees unjust in light of the “[p]laintiff’s good faith attempt to resolve the dispute, both
parties’ failure to further discuss the issue later in the dispute process, and [the p]laintiff’s prompt
production of the unredacted fee statements after the motion to compel was filed[.]” Id.
The Court appreciates Defendant’s prompt production of the privilege log after Plaintiffs
filed their motion; however, Defendant has not argued that its untimely production was

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substantially justified. 4 Defendant states that the Court should deny an award of attorney’s fees
because Plaintiffs acted “contrary to the Court’s request that the parties seek to amicably resolve
discovery disputes without Court intervention” and Plaintiffs’ actions are “nothing more than a
fruitless attempt to place pressure on [Defendant] in its good faith discussions and inquiries as to
whether Plaintiffs prefer to mediate the case and stay discovery, or proceed to litigate this action”
[Doc. 191 p. 7]. But Plaintiffs represent to the Court that, prior to filing their motion, they followed
up with defense counsel on April 27, April 28, and on May 1, 2023, regarding the privilege log
[Doc. 190 p. 5; Doc. 190-4 p. 1]. And discussions about mediation and whether to stay discovery
does not effectuate a stay of the discovery.
Under the circumstances, the Court must award attorney’s fees under Rule 37(a)(5)(A).
The Court, however, will only award Plaintiffs a portion of their attorney’s fees and expenses for
filing the motion and reviewing Defendant’s response. More specifically, the Court finds Plaintiffs
are entitled to half of their attorney’s fees incurred in filing their motion and all their attorney’s
fees incurred for reviewing Defendant’s response. The Court finds such fees and expenses
reasonable given that Plaintiffs did not prevail on their arguments that Defendant waived the
attorney-client privilege, which they argued in their motion and in their reply brief, and Defendant
provided the privilege log shortly after Plaintiffs filed their motion.
III.

CONCLUSION
For the reasons explained below, the Court GRANTS IN PART AND DENIES IN PART

Plaintiffs’ Motion to Compel Discovery and for Sanctions [Doc. 190]. The parties SHALL meet
4

In fact, Defendant argued that it was never required to respond. This argument appears to
be contrary with its own actions. In any event, the Court does not find this position substantially
justified for the reasons explained above.

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and confer regarding Plaintiffs’ award of attorney fees and expenses, and if they cannot agree on
the reasonable amount, they may bring the matter to the Court’s attention.
IT IS SO ORDERED.
ENTER:
_________________________
Debra C. Poplin
United States Magistrate Judge

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