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Ballard v. Citadel Servicing Corp.

2024 WL 3009322 (C.D. Cal. 2024)

April 26, 2024

Spaeth, Autumn D., United States Magistrate Judge

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Summary

The plaintiffs requested all communications between the defendant and credit reporting agencies regarding the loan, but the defendant argued that these communications were protected by the attorney work product doctrine. The court ultimately found that the defendant did not meet its burden of establishing the attorney work product protection and ordered the defendant to produce the requested documents. However, the court denied the plaintiffs' request for attorneys' fees.

Falon Ballard, et al.
v.
Citadel Servicing Corporation, et al

Case No.: 8:22-01679 FWS (ADSx)

United States District Court, C.D. California

Filed April 26, 2024

Counsel

Raymond Yoon Ho Kim, Ray Kim Law, APC, Los Angeles, CA, for Falon Ballard, et al.
T. Robert Finlay, Cathy Knecht Robinson, Wright Finlay and Zak LLP, Newport Beach, CA, for Citadel Servicing Corporation, et al.

Spaeth, Autumn D., United States Magistrate Judge

Proceedings: (IN CHAMBERS) FURTHER ORDER REGARDING PLAINTIFFS' MOTION TO COMPEL AND PLAINTIFFS' REQUEST FOR ATTORNEYS' FEES

I. INTRODUCTION

*1 Plaintiffs Falon Ballard and Matthew Ballard previously filed a Motion to Compel Discovery. (Dkt. No. 41.) The Court held a hearing on the motion to compel and granted the motion in part and denied it in part. (Dkt. No. 54.) At the request of Plaintiffs and Defendant Citadel Servicing Corporation, the Court ordered supplemental briefing on two at-issue discovery requests: RFP No. 22 (Set 1) and RFP No. 2 (Set 3). (Id.) The Court also took Plaintiffs' request for attorneys' fees under submission. (Id.)

II. RFP NO. 22 (SET 1)

Defendant filed supplemental briefing regarding RFP No. 22 (Set 1) (the “Request”). The Request sought “All COMMUNICATIONS with credit reporting agencies RELATING TO the LOAN.” (Dkt. No. 43 at 11.) The Court granted Defendant's request for supplemental briefing so that Defendant could explain its position that the communications the Request seeks are covered by the attorney work product doctrine. (Dkt. No. 61 at 2.)

In its supplemental briefing, Defendant asserts that the only documents responsive to the Request are communications between Defendant and Equifax regarding the accuracy of Plaintiffs' credit reporting history. (Id. at 2-3.) Defendant argues that the communications are subject to the attorney work product doctrine because Defendant and Equifax had a common interest and the communications reflect the mental impressions, conclusions, opinions, or legal theories of an attorney for Defendant concerning the litigation. (Id. at 4-5.) In opposition, Plaintiffs argue that the communications are not protected by the attorney work product doctrine because (1) they are not attorney work product; and (2) Defendant did not have a common interest with Equifax. (Dkt. No. 63 at 1.)[1]

A. Legal Standard

The attorney work product doctrine shelters the mental processes of the attorney, providing a privileged area within which they can analyze and prepare their client's case, and protects both materials prepared by agents for the attorney as well as those prepared by the attorney themselves. United States v. Nobles, 422 U.S. 225, 237–38 (1975). The purpose of the attorney work product doctrine is to shield litigation strategy from disclosure to a litigation adversary. Skynet Elec. Co., Ltd. v. Flextronics Int'l, Ltd., No. C 12-06317 WHA, 2013 WL 6623874, at *3 (N.D. Cal. Dec. 16, 2013). To qualify as attorney work product, documents must have two characteristics: (1) they must be prepared in anticipation of litigation or for trial, and (2) they must be prepared by or on behalf of a party. Fed. R. Civ. P. 26(b)(3)(A). The party asserting attorney work product protection has the burden of establishing that the work product doctrine applies to the document or tangible thing in question. Hernandez v. Tanninen, 604 F.3d 1095, 1102 (9th Cir. 2010); McMorgan & Co. v. First Cal. Mortgage Co., 931 F.Supp. 703, 709 (N.D.Cal.1996).

B. Analysis

*2 As best the Court can determine, Defendant argues that its communications with Equifax are attorney work product because they were created “at the request of counsel to assist in the preparation of the defense of Citadel in this matter.” (Dkt. No. 61 at 5.) However, the communications were not materials created for the purposes of litigation so much as they were communications with a third party. That type of communication would not constitute work product. See Bofi Fed. Bank v. Erhart, No. 15cv2353 BAS (NLS), 2016 WL 1644726, at *4 (S.D. Cal. Apr. 26, 2016) (overruling party's work product objection because “communications, such as a letter or email between Gillam and a third party, would ordinarily not be protected as work product.”). Defendant does not articulate any reason for why the communications themselves would be work product beyond the conclusory assertion that the communications were in preparation for its defense. Defendant bore the burden of establishing that communications between it and Equifax were subject to the attorney work product doctrine. Defendant did not meet its burden to establish the attorney work product protection applies to the communications with Equifax.

III. RFP NO. 2 (SET 3)

Plaintiffs filed a supplemental brief seeking to compel Defendant and/or non-party ServiceMac, LLC to produce documents responsive to RFP No. 2 (Set 3) (the “RFP”). The RFP seeks

[t]he credit reporting history from subservicer ServiceMac, LLC (“ServiceMac”) for the California BORROWERS' loans reflected in Bates Nos. 1700-5353 after April 30, 2021. Michael Riola, Citadel's person most knowledgeable witness, testified Citadel has access to ServiceMac's system and can also obtain the information from ServiceMac.

(Dkt. No. 43-1, Ex. I at 6.) This dispute centers around two versions of the credit reporting history that ServiceMac (a subservicer for Defendant) produced to Plaintiffs in response to a subpoena. (Dkt. No. 64 at 2-3.) Plaintiffs allege these credit report histories, produced as charts, are “incomplete, modified, and even contained fabricated credit reporting data.” (Id. at 3.) Plaintiffs seek a “complete credit reporting history” in Excel format. (Id.) In opposition, Defendant argues that it and ServiceMac produced sufficient responsive documents in response to the RFP and that Plaintiffs' allegations of fabricated and incomplete reports lack merit. (Dkt. No. 66 at 2.)

A party may request that another party produce documents that are relevant to any party's claim or defense and is proportional to the needs of the case. Fed. R. Civ. P. 26(b)(1), 34(a)(1). If a party fails to serve an adequate written response or produce responsive documents, a party may move for an order compelling such information. Fed. R. Civ. P. 37(a)(3)(B)(iv). On a motion to compel discovery, the requesting party bears the initial burden of demonstrating the discovery is relevant. Netlist Inc. v. Samsung Elecs. Co., 341 F.R.D. 650, 661 (C.D. Cal. 2022) (Spaeth, J.). Once relevance has been shown, the party resisting discovery bears the burden to show discovery should be disallowed and to support any objections. Laub v. Horbaczewski, 331 F.R.D. 516, 521 (C.D. Cal. 2019).

Plaintiffs seek to compel Defendant and ServiceMac to produce responsive documents to the RFP. However, the Court notes that there are two distinct discovery requests at issue here. The RFP, reproduced above, was served on Defendant. Plaintiffs served a subpoena on ServiceMac with distinct document requests. Most importantly for present purposes, that subpoena included Demand for Production No. 1, which states as follows:

The credit reporting history (in Microsoft Excel format) for the California BORROWERS' loans reflected in the documents production from defendant Citadel Servicing Corporation, a/k/a and d/b/a Acra Lending (“Citadel”), Bates Nos. 1700-5353 after April 30, 2021 to the present. The credit reporting history must include, among other information: (i) the Account Status reported each month (e.g. 11 means “Current” account. See Exhibit A attached from Consumer Data Industry Association credit reporting guidelines (“CDIA Guidelines”)); (ii) Past Due Balance reported each month; and (iii) with the 24 month Payment History Profile, for each loan. Upon request, Plaintiff can provide a copy of Bates Nos. 1700-5353 produced by Citadel.

*3 (Dkt. No. 43-3, Ex. M at 4.) Hence, while Plaintiffs seem to argue that ServiceMac did not fully respond to the RFP, they were not obligated to. ServiceMac was obligated to respond to Demand for Production No. 1 in the subpoena served on it.

With the foregoing in mind, the Court finds that Defendant sufficiently responded to the RFP, while ServiceMac sufficiently responded to Demand for Production No. 1. Defendant asserts that it produced all responsive documents in response to the RFP. (Dkt. No. 66 at 2-3.) Plaintiffs do not dispute that in their briefing. Rather, the gravamen of Plaintiffs' brief is that ServiceMac's charts are insufficient. But Demand for Production No. 1 requested “credit reporting history [that] must include, among other information” the Account Status reported each month, the Past Due Balance reported each month, and the 24-month Payment History Profile, for each loan. The chart that ServiceMac produced included the Account Status code, the Past Due Amount, and the 24-month Payment History Profile as of the date ServiceMac created the chart, in addition to other information. (Dkt. No. 49, Ex. 4.) On its face, the charts are responsive to Demand for Production No. 1, as they included the information Plaintiffs requested.

Plaintiffs allege that ServiceMac's charts are incomplete and fabricated in three ways. (Dkt. No. 64 at 3.) First, ServiceMac allegedly removed certain account status codes from a version of the chart produced on January 12, 2024, that had been present in a version of the chart produced on January 3, 2024. (Id. at 7-10.) Second, the payment history profile only shows the most recent 24-month period as of the date the report was generated, rather than whichever past 24-month period would have been contemporaneously reflected on each of the reports. (Id. at 10-12.) Third, the chart does not include a column for special comment codes. (Id. at 12-13.)

In opposition, Defendant argues that ServiceMac did not fabricate any information and that ServiceMac sufficiently responded to Demand for Production No. 1. First, Defendant asserts that ServiceMac included certain account codes in the January 3 version of the chart for Plaintiffs' convenience and reference, but they were removed from the January 12 chart to remove any confusion regarding whether or not those codes had been transmitted to credit bureaus or had only been included for reference and contextual purposes. (Dkt. No. 66 at 7-9.) Second, Defendant asserts that the payment profile history accurately reflects the 24-month period as of the date the information was pulled, and does not contain fabricated information. (Id. at 9-10.)

The Court agrees with Defendant and ServiceMac. Alishea Prince, the ServiceMac employee who created the charts, testified about the “omitted” account status codes and sufficiently explained why they were removed from the January 12 chart. (Dkt. No. 65 at 56-57, 64.) Even though Plaintiffs' briefing cites Ms. Prince's testimony, Plaintiffs simply conclude the account status codes were fabricated despite Ms. Prince's reasonable explanation. The Court finds that ServiceMac used a reasonable interpretation of Demand for Production No. 1, which requested “the 24 month Payment History Profile, for each loan.” (Dkt. No. 43-3, Ex. M at 4-5.) Plaintiffs have not established ServiceMac fabricated information in the charts.

*4 To the extent Plaintiffs seek to compel ServiceMac to respond to the RFP, Plaintiffs have not shown that request is proportional to the needs of the case. Plaintiffs' supplemental briefing does not address the relevance of the information sought by the RFP and Demand for Production No. 1. The original motion to compel briefing only makes the conclusory assertion that the “information [sought by the RFP] is relevant to the Credit Reporting Class and Plaintiffs' credit reporting claims.” (Dkt. No. 41 at 20.) On the other hand, Ms. Prince declares that it would take one to two weeks to prepare documents responsive to the RFP which would be “a huge cost to [ServiceMac], and a burden on its staff and its resources.” (Dkt. No. 66-1, ¶ 24.) This would be in addition to the two full weeks ServiceMac and Ms. Prince spent creating the existing charts. (Id. ¶ 23.) Given the burden that ServiceMac asserts regarding the RFP and Plaintiffs' failure to meet their burden to establish the relevance of the RFP, the Court denies Plaintiffs' request to compel ServiceMac to respond to the RFP. Plaintiffs' request to sanction Defendant regarding the charts and supplemental briefing (Dkt. No. 64 at 15) is likewise denied.

IV. ATTORNEYS' FEES

Plaintiffs' initial motion to compel briefing requested $8,824.50 in fees incurred by Plaintiffs bringing the motion to compel. (Dkt. No. 41 at i.) While Plaintiffs do not specify on what grounds they seek fees, the Court presumes Plaintiffs move pursuant to Fed. R. Civ. P. 37(a)(5)(A). Rule 37(a)(5)(A) states that the court must order the party

whose conduct necessitated the motion ... 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.

Id. Given that the Court denied many of the requests in the initial motion to compel, the Court finds that Defendant's responses and objections were substantially justified. See Lang Van, Inc. v. VNG Corp., No. 8:14-cv-00100-AG (JDEx), 2019 WL 8107874, at *8 (C.D. Cal. May 28, 2019) (denying request for sanctions pursuant to Rule 37 because non-moving party's position was substantially justified in light of the fact many of the motion to compel's requests were denied). Plaintiffs' request for $8,824.50 in fees is denied.

V. CONCLUSION

The Court grants Plaintiffs' request regarding RFP No. 22 (Set 1). The Court denies Plaintiffs' request regarding RFP No. 2 (Set 3). The Court also denies Plaintiffs' request for attorneys' fees. Defendant must produce documents in response to RFP No. 22 (Set 1) by no later than May 3, 2024, or a date mutually agreed upon by the parties.

IT IS SO ORDERED.

Footnotes

[1]

Plaintiffs also argue that the communications are not protected by the attorney-client privilege. (Dkt. No. 63 at 3-4.) However, while Defendant's supplemental brief does make a brief reference to the privilege (Dkt. No. 61 at 4), Defendant's overall brief makes clear they are only raising the attorney work product doctrine. (Id. at 2) (Defendant's supplemental briefing “relates to whether communications between Citadel and Equifax, which were made at the request of counsel, are covered by the attorney work product doctrine.”)