Tinsley v. OneWest Bank, FSB

Filing 72

MEMORANDUM OPINION AND ORDER granting in part and denying in part Plaintiff's 46 MOTION to Compel Production of Discovery Requests from the Defendant; denying Plaintiff's 46 REQUEST for Reasonable Attorney Fees. Signed by Magistrate Judge Cheryl A. Eifert on 12/10/2014. (cc: attys) (mkw)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA
HUNTINGTON DIVISION
BETTY TINSLEY,
Plaintiff,
v.

Case No.: 3:13-cv-23241

ONEWEST BANK, FSB, D.B.A.
FINANCIAL FREEDOM,
Defendant.
MEMORANDUM OPINION AND ORDER
Pending before the Court is Plaintiff’s Motion to Compel Production and Request
for Reasonable Attorney Fees. (ECF No. 46). Defendant filed a response in opposition to
the motion to compel, (ECF No. 51), and the time to file a reply memorandum has
expired. On December 9, 2014, the parties appeared for oral argument. After
considering the arguments of counsel, the Court GRANTS, in part, and DENIES, in
part, the motion to compel as set forth below. In addition, the Court DENIES Plaintiff’s
motion for reasonable expenses under Fed. R. Civ. P. 37(a)(5)(A) and 37(a)(5)(C).
I.

Relevant Procedural History
Plaintiff filed the instant action in the Circuit Court of Putnam County, West

Virginia on August 16, 2013, seeking damages related to a reverse mortgage she entered
into with Financial Freedom Senior Housing Funding Corporation, the direct
predecessor of defendant Financial Freedom. Plaintiff claimed breach of contract, fraud,
intentional misrepresentation, violations of the West Virginia Consumer Credit and
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Protection Act (“WVCCPA”), intentional infliction of emotional distress, negligence, and
reckless or negligent misrepresentation stemming from allegedly inappropriate service
fees imposed by Defendant, and from Defendant’s practice of force-placing and charging
Plaintiff for excessive and unnecessary flood insurance. Defendant removed the action
to this Court on September 19, 2013. On October 9, 2013, Plaintiff filed a Second
Amended Complaint with the consent of Defendant, and on November 8, 2013,
Defendant filed a Motion to Dismiss the Second Amended Complaint.
In late January 2014, Defendant moved the Court to stay written discovery
pending the Court’s consideration of the Motion to Dismiss. The Court granted the
motion to stay. In March, the Court ruled on the Motion to Dismiss, granting it in part
and denying it in part. The Court dismissed all of Plaintiff’s fraud and intentional
misrepresentation claims, all of her intentional infliction of emotional distress claims,
all of her negligence and reckless or negligent misrepresentation claims, and some of
her breach of contract and WVCCPA claims. Remaining are: (1) Plaintiff’s claim that
Defendant required her to get flood insurance in excess of what was required under the
Deed of Trust, force-placed the insurance, and charged the cost to Plaintiff; and (2) her
claims under the WVCCPA that (a) Defendant wrongfully implied Plaintiff was required
by company policy and federal law to purchase additional flood coverage, and (b)
Defendant twice threatened to foreclose on her property if she did not pay a property
charge of $1,369.70. In April, the Court issued a Scheduling Order, and discovery on the
surviving claims began.
In May, Plaintiff filed a motion for leave to file a Third Amended Complaint.
Shortly thereafter, in June, Plaintiff filed the instant motion to compel discovery
responses to her first and second sets of written discovery. The first set of discovery
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apparently was served with the complaint when it was initially filed in state court, and
the second set of discovery was served in late March after the Court’s ruling on the
Motion to Dismiss. The motion to compel was set for hearing in August; however, the
hearing was continued at the request of the parties so that they could discuss the
possibility of resolving the matters in dispute. In the meantime, Plaintiff was granted
leave and filed a Third Amended Complaint, which Defendant answered on August 19,
2014. A revised Scheduling Order was entered with a discovery deadline of March 2,
2015. According to the docket sheet, no formal activity occurred in the case after entry of
the Scheduling Order in August until November, when the parties notified the Court
that they had not resolved their differences and desired to proceed with discovery. At
that time, the motion to compel and for costs was scheduled for hearing.
II.

Discussion
After hearing from the parties regarding each disputed discovery response, the

Court ORDERS as follows:
1.

Plaintiff’s motion to compel is GRANTED, and Defendant shall provide

full and complete answers to Plaintiff’s First Set of Interrogatories, Interrogatory
Nos. 3, 4, and 9. Although Defendant argues that it has provided Plaintiff with
documents showing the names and contact information requested in response to
Interrogatory No. 3, Plaintiff disagrees. Defendant says the information is contained in
approximately four letters that have been produced. Accordingly, it should not be
difficult for Defendant to provide the information even if it has already been supplied
pursuant to Fed. R. Civ. P. 33(d). In regard to Interrogatory No. 4, Defendant states that
it has provided Plaintiff will a call log and all recordings. Plaintiff agrees that she has
received these documents and simply wants to make sure she has everything responsive.
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Defendant will confirm that all responsive information has been provided.
Finally, Interrogatory No. 9 requests training materials. Defendant contends that
these materials are no longer relevant given that Judge Chambers has dismissed all
claims related to negligent training. However, Plaintiff asserts that she needs to discover
these materials to substantiate her claim that Defendant’s employees made oral
statements to her in violation of the WVCCPA. Plaintiff believes that Defendant’s
employees are trained to make incorrect and improper statements regarding the
required flood insurance to be obtained by mortgagees, which led to her improper
charges for excessive forced-placed flood insurance. Plaintiff argues that Defendant’s
training materials are relevant to prove that such statements were made.
Federal Rule of Civil Procedure 26(b)(1) provides that “[p]arties may obtain
discovery regarding any matter, not privileged, that is relevant to the claim or defense of
any party, including the existence, description, nature, custody, condition, and location
of any books, documents, or other tangible things and the identity and location of
persons having knowledge of any discoverable matter ... Relevant information need not
be admissible at the trial if the discovery appears reasonably calculated to lead to the
discovery of admissible evidence.” Although the Federal Rules of Civil Procedure do not
define what is “relevant,” Rule 26(b)(1) makes clear that relevancy in discovery is
broader than relevancy for purposes of admissibility at trial.1 Caton v. Green Tree
Services, LLC, Case No. 3:06-cv-75, 2007 WL 2220281, at *2 (N.D.W.Va. Aug. 2, 2007)
(the “test for relevancy under the discovery rules is necessarily broader than the test for
Under the Federal Rules of Evidence, relevant evidence is ‘evidence having any tendency to make the
existence of any fact that is of consequence to the determination of the action more probable or less
probable than it would be without the evidence.’ Boykin Anchor Co., Inc. v. Wong, Case No. 5:10-cv-591FL, 2011 WL 5599283 at * 2 (E.D.N.C. Nov. 17, 2011) (citing United Oil Co., v. Parts Assocs., Inc, 227
F.R.D. 404. 409 (D.Md. 2005)).

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relevancy under Rule 402 of the Federal Rules of Evidence”); Carr v. Double T Diner,
272 F.R.D. 431, 433 (D.Md. 2010) (“The scope of relevancy under discovery rules is
broad, such that relevancy encompasses any matter that bears or may bear on any issue
that is or may be in the case”). The party resisting discovery, not the party seeking
discovery, bears the burden of persuasion. See Kinetic Concepts, Inc. v. ConvaTec Inc.,
268 F.R.D. 226, 243–44 (M.D.N.C. 2010)(citing Wagner v. St. Paul Fire & Marine Ins.
Co., 238 F.R.D. 418, 424–25 (N.D.W.Va. 2006). Taking in to account the broad scope of
discovery, the training materials are relevant.
Nevertheless, simply because information is discoverable under Rule 26, “does
not mean that discovery must be had.” Schaaf v. SmithKline Beecham Corp., 233 F.R.D.
451, 453 (E.D.N.C. 2005) (citing Nicholas v. Wyndham Int'l, Inc., 373 F.3d 537, 543
(4th Cir. 2004)). Here, Defendant also objects to producing the materials on the basis of
burdensomeness and privilege. For good cause shown under Rule 26(c), the court may
restrict or prohibit discovery that seeks relevant information when necessary to protect
a person or party from annoyance, embarrassment, oppression, or undue burden or
expense. Fed. R. Civ. P. 26(c). To succeed under the “good cause” standard of Rule
26(c), the party resisting discovery must make a particularized showing as to why a
protective order should issue. Baron Fin. Corp. v. Natanzon, 240 F.R.D. 200, 202
(D.Md. 2006). Conclusory and unsubstantiated allegations are simply insufficient to
support an objection based on the grounds of annoyance, burdensomeness, oppression,
or expense. Convertino v. United States Department of Justice, 565 F. Supp.2d 10, 14
(D.D.C. 2008) (the court will only consider an unduly burdensome objection when the
objecting party demonstrates how discovery is overly broad, burdensome, and
oppressive by submitting affidavits or other evidence revealing the nature of the
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burden); Cory v. Aztec Steel Building, Inc., 225 F.R.D. 667, 672 (D.Kan. 2005) (the
party opposing discovery on the ground of burdensomeness must submit detailed facts
regarding the anticipated time and expense involved in responding to the discovery
which justifies the objection); Bank of Mongolia v. M & P Global Financial Services,
Inc., 258 F.R.D. 514, 519 (S.D.Fla. 2009) (“A party objecting must explain the specific
and particular way in which a request is vague, overly broad, or unduly burdensome. In
addition, claims of undue burden should be supported by a statement (generally an
affidavit) with specific information demonstrating how the request is overly
burdensome”).
In the case of information withheld from discovery on the basis of privilege, the
party withholding the information is required to produce contemporaneously with its
responses a privilege log that satisfies the requirements of Fed. R. Civ. P. 26(b)(5).
Failure to serve such a log on the requesting party may result in a waiver of the privilege.
See Mezu v. Morgan State Univ., 269 F.R.D. 565, 577 (D.Md. 2010) (“Absent consent of
the adverse party, or a Court order, a privilege log (or other communication of sufficient
information for the parties to be able to determine whether the privilege applies) must
accompany a written response to a Rule 34 document production request, and a failure
to do so may constitute a forfeiture of any claims of privilege.”).
Defendant’s objection to Interrogatory No. 9 based on burdensomeness is not
persuasive given that Defendant submits no detailed facts in support of that contention.
Indeed, at the hearing, defense counsel admitted that the training materials may not
even contain specific references to forced-placed flood insurance. Moreover, Defendant
served no privilege log with its responses. Therefore, its claim of privilege also appears
to be without merit.
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2.

Plaintiff is granted leave to replace Interrogatory Nos. 11 and 12 with

amended versions, but her motion to compel answers to these interrogatories, as
currently written, is DENIED. Interrogatory Nos. 11 and 12 ask for information
regarding Defendant’s dealings with all flood insurance companies, not just Lexington
Insurance Company, the carrier involved in Plaintiff’s case. In light of the dismissal of
all of Plaintiff’s fraud, misrepresentation, and emotional distress claims, Plaintiff could
not demonstrate that these interrogatories sought relevant information. Moreover, Rule
26(b)(2)(C)(iii) requires the court, on motion or on its own, to limit the extent of
discovery, when “the burden or expense of the proposed discovery outweighs its likely
benefit, considering the needs of the case, the amount in controversy, the parties’
resources, the importance of the issues at stake in the action, and the importance of the
discovery in resolving the issues.” This rule “cautions that all permissible discovery must
be measured against the yardstick of proportionality.” Lynn v. Monarch Recovery
Management, Inc., 285 F.R.D. 350, 355 (D. Md. 2012) (quoting Victor Stanley, Inc. v.
Creative Pipe, Inc., 269 F.R.D. 497, 523 (D. Md. 2010)). Even if the answers could
provide tangentially relevant information, the anticipated burden on the Defendant in
collecting the information would far outweigh its potential usefulness to Plaintiff.
3.

Plaintiff’s motion to compel is GRANTED, and Defendant shall provide

full and complete answers to Plaintiff’s Second Set of Interrogatories, Interrogatory
Nos. 1, 5, and 6. Both Plaintiff and Defendant agree that Defendant has already
provided the information requested in Interrogatory Nos. 1 and 6. As far as
Interrogatory No. 5, Defendant shall supply Plaintiff with the names, titles, and contact
information of each and every employee or agent who played any role in the decisionmaking, or other process, that resulted in forced-placed flood insurance on Plaintiff’s
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property.
4.

Plaintiff’s motion to compel Interrogatory No. 2 is DENIED at this

time. At this point in discovery, Plaintiff has shown no relevancy to the information
requested. However, if Plaintiff can lay a foundation for the discovery, the Court will
reconsider its ruling.
5.

Plaintiff’s motion to compel Interrogatory No. 7 is DENIED. In light of

the dismissal of Plaintiff’s fraud, misrepresentation, and intentional infliction of
emotional distress claims, this interrogatory does not seek information relevant to any
claim or defense.
6.

Having ruled on Plaintiff’s motion to compel, the Court considers

Plaintiff’s motions for reasonable expenses and DENIES the motion for the following
reasons. First, under L. R. Civ. P. 37.1(b) and Fed. R. Civ. P. 37(a), prior to filing a
motion to compel, the moving party must arrange to meet and confer with the nonresponding party in an effort to resolve the discovery dispute before resorting to court
action. That did not happen in this case. To “meet and confer” under the local rule
means to either speak on the telephone or to confer in person. L. R. Civ. P. 37.1(b).
Sending adverse counsel a letter complaining about the inadequacies of his or her
client’s discovery responses is not the same as arranging a “meet and confer” session.
Filing a motion to compel before attempting in good faith to obtain the discovery
through a meet and confer session may result in a forfeiture of the right to receive
reasonable expenses under Rule 37(a)(5)(A). See Frontier–Kemper Constructors, Inc. v.
Elk Run Coal Co., Inc., 246 F.R.D. 522, 526 (S.D.W.Va.2007) (“[T]he sanction for failing
to meet and confer is the denial of a request for expenses incurred in making a motion,
including attorney's fees.”)
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In this case, Plaintiff’s counsel sent four letters regarding Defendant’s deficit
discovery responses. The first letter was dated February 3, 2014, the same day that
Judge Chambers stayed written discovery. Not surprisingly, nothing was done by either
side to immediately follow-up that correspondence. The next letter was sent on May 8,
2014. The letter identified itself as a “notice” to Defendant that its discovery answers
were “seriously inadequate” and advised that a “failure to respond adequately” would
“result in a motion to compel.” Although Plaintiff’s counsel included his telephone
number if defense counsel wanted to speak with him, this letter does not comply with
the local rule. Plaintiff’s counsel was required to contact defense counsel and arrange a
meeting, or discuss the matter by telephone.
In any event, Defendant supplied additional materials after the May 8
correspondence, but again Plaintiff was not completely satisfied. Another letter was sent
on May 22, 2014 explaining why the supplemental production was insufficient and
advising that the remainder of the requested information needed to be produced within
five days or a motion to compel would be filed. On May 23, 2014, defense counsel
responded in writing. On Sunday, May 25, 2014, Plaintiff’s counsel answered again by
letter, noting that there appeared to be little room for compromise. Therefore, no meet
and confer was conducted, which generally is a prerequisite to reasonable expenses.
Second, the complicated course of the case provides a justification for some of the
discovery issues. With all of the amendments to the complaint, the tweaking of the
causes of action, the motion to dismiss and subsequent dismissal of a substantial
number of claims, determining what was relevant and thus discoverable was something
of a moving target. In addition, the parties attempted to negotiate a resolution of the
remaining claims, which delayed the process. Taking all of these factors into
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consideration, when a settlement could not be reached, both parties were justified in
seeking guidance on discovery issues without fear of an award of reasonable expenses
against them.
Finally, under Rule 37(a)(5)(C), when a motion to compel is granted in part and
denied in part, the court may apportion the award of reasonable expenses authorized
under Rule 37(a)(5)(A). Here, the motion to compel was only partially granted. When
comparing what additional discovery Defendant is compelled to produce against that
which Defendant is not compelled to produce,2 the undersigned finds that neither party
substantially bested the other. Accordingly, an award of reasonable expenses simply is
not justified in this case.
The Clerk is instructed to provide a copy of this Order to counsel of record.
ENTERED: December 10, 2014

2 Although Rule 37(a)(5)(A) measures a movant’s success based upon whether the requested discovery is
provided after the motion is filed, rather than what happens at a later-held hearing, due to the unusual
time frames in this case and the fact that a meet and confer did not occur until well after the motion was
filed, if at all, the undersigned can only look at what remained unproduced at the time of the hearing.

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