Schneider et al v. CitiMortgage, Inc. et al, No. 5:2013cv04094 - Document 512 (D. Kan. 2017)
Court Description: MEMORANDUM AND ORDER denying 509 Motion for Review. No party will be granted more than one extension of time to meet any of the required court or ruledeadlines with the exception for circumstances that are truly urgent and/oremergency in character. Signed by U.S. District Senior Judge Sam A. Crow on 12/22/17. (msb)
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Schneider et al v. CitiMortgage, Inc. et al Doc. 512 I N THE UNI TED STATES DI STRI CT COURT FOR THE DI STRI CT OF KANSAS RANDALL A. SCHNEI DER and AMY L. SCHNEI DER Plaint iffs, v. No. 13- 4094- SAC CI TI MORTGAGE, I NC., et . al., Defendant s. MEMORANDUM AND ORDER This case com es before t he court on t he plaint iffs’ m ot ion for review ( ECF# 509) of t he m agist rat e j udge’s order ( ECF# 503) filed Oct ober 30, 2017. This order denied t he plaint iffs’ m ot ion which had asked for t he defendant Cit igroup, I nc.’s ( “ Cit igroup’s” ) designat ed corporat e represent at ive t o be found unprepared for t he Fed. R. Civ. P. 30( b) ( 6) deposit ion t hat occurred on June 13, 2017. I n seeking review, t he plaint iffs argue t he m agist rat e j udge erred, because Mr. Jason Cram er, t he wit ness designat ed and produced by Cit igroup, lacked personal experience wit h Cit igroup as a corporat ion, was not given full access t o Cit igroup inform at ion, and was acquaint ed only wit h inform at ion provided by Cit igroup’s counsel which was “ publicly available inform at ion on financial st at em ent s.” ECF# 510, p. 4. I n short , t he plaint iffs argue t hat Mr. Cram er Dockets.Justia.com was not capable of t est ifying, as required by Fed. R. Civ. P. 30( b) ( 6) , “ about inform at ion known or reasonably available t o t he organizat ion,” because he lacked experience specific t o t he plaint iffs’ claim s, and because he was not provided wit h t he necessary preparat ion and docum ent s so as t o t est ify on t he six court - ordered t opics. A m agist rat e j udge's order addressing non- disposit ive pret rial m at t ers is not reviewed de novo, but it is reviewed under t he m ore deferent ial st andard in which t he m oving part y m ust show t he order is “ clearly erroneous or cont rary t o t he law.” First Union Mort g. Corp. v. Sm it h, 229 F.3d 992, 995 ( 10t h Cir. 2000) ( quot ing Ocelot Oil Corp. v. Sparrow I ndust ries, 847 F.2d 1458, 1461- 62 ( 10t h Cir. 1988) ) ; see Fed. R. Civ. P. 72( a) . The clearly erroneous st andard governs review of t he m agist rat e j udge’s fact ual findings and requires affirm ing such findings unless t he court “ on t he ent ire evidence is left wit h t he definit e and firm convict ion t hat a m ist ake has been com m it t ed.” See Allen v. Sybase, I nc., 468 F.3d 642, 658 ( 10t h Cir. 2006) ( int ernal quot at ion m arks and cit at ions om it t ed) . The cont rary t o t he law st andard governs review of t he m agist rat e j udge’s “ purely legal det erm inat ions,” and aut horizes set t ing aside an order t hat fails t o apply t he correct legal st andard or t hat m isapplies t he correct legal st andard det erm ined from t he relevant st at ut es, case law, or rules of procedures. Aum an v. St at e of Kansas, 2017 WL 3977855, at * 2 ( D. Kan. Sep. 11, 2017) ( int ernal quot at ion m arks and cit at ion om it t ed) . The 2 plaint iffs’ m ot ion fails it s burden of showing t hat t he m agist rat e j udge’s order is clearly erroneous or cont rary t o t he law. I n his order, t he m agist rat e j udge out lined t he prot ract ed procedural hist ory t hat event ually culm inat ed in t he deposit ion of Mr. Cram er, a direct or of Cit iMort gat e, on t he following six t opics allowed by t he court : 10. The role and relat ionship of Cit iGroup, I nc. t o each Defendant ( Cit iMort gage, Cit iBank, f.k.a. Cit iCorpTrust Bank, Prim erica) and Cit iAssurance ( t he PWP adm inist rat or or t he a.k.a., Am erican Healt h and Life I nsurance Com pany) during t he t im e of t he Schneider's 2007 loan or 2010 refinance. 42rr. Whet her and, if so, what involvem ent Cit igroup had in t he servicing of t he Loan. 43ss. Whet her and, if so, what involvem ent Cit igroup had in com m unicat ing wit h t he Schneiders following t heir applicat ion in or around May 2010 t o refinance t he Loan wit h Cit ibank. 44t t . Whet her and, if so, what involvem ent Cit igroup had in evaluat ing t he Schneiders’ applicat ion in or around May 2010 t o refinance t he Loan wit h Cit ibank. 45uu. The corporat e st ruct ure as bet ween Cit iMort gage, Cit ibank, and Cit igroup, and Prim erica in 2007 t hrough 2010. 46vv. All sources of direct and indirect revenue and t ot al am ount of revenue ant icipat ed t o be received by Cit igroup in connect ion wit h t he Schneiders’ init ial refinance loan applicat ion t o Cit ibank in or around May 2010, if t he applicat ion had been approved, and t he percent age of incom e t o be derived from t he approved applicat ion. ECF# 503, pp. 4- 5) . The m agist rat e j udge underst ood t he plaint iffs’ argum ent s t o be t hat Mr. Cram er was not prepared t o address “ m any” of t he t opics, was not provided sufficient inform at ion t o answer, was sim ply guessing at som e answers, and was inaccurat e and conflict ed wit h “ act ual docum ent s.” I d. at 5. 3 The m agist rat e j udge plainly art iculat ed and applied t he correct Rule 30( b) ( 6) requirem ent s not ing t hat a designat ed wit ness is “ t o t est ify about inform at ion known or reasonably available t o t he organizat ion,” t hat t he t est im ony “ represent s t he knowledge of t he corporat ion, not of t he individual deponent s,” and t hat it is t he corporat ion’s dut y t o designat e a wit ness “ who is knowledgeable in order t o provide binding answers on behalf of t he corporat ion.” I d. at pp. 5- 6 ( int ernal quot at ion m arks and foot not es om it t ed) . The plaint iffs argue t he m agist rat e j udge m isapplied t hese legal st andards by only j udging Mr. Cram er’s personal effort s rat her t han assessing whet her Mr. Cram er was knowledgeable on behalf of Cit igroup despit e his lack of experience and his lim it ed cont act wit h corporat e knowledge and docum ent s of Cit igroup. There is not hing in t he m agist rat e j udge’s decision showing a m isapplicat ion of legal st andards. Rat her, t he decision reflect s a reasoned applicat ion of t he proper legal st andards: Wit h regard t o Cit igroup’s involvem ent wit h t he servicing of t he loan or t he refinance applicat ion, Mr. Cram er t est ified t hat Cit igroup did not service plaint iffs’ loan or int eract wit h plaint iffs concerning t heir request for refinancing. He t est ified t hat Cit igroup was a bank holding com pany, and as such, it is t he corporat e vehicle for financial report ing and public disclosures on behalf of it self and ot her Cit i ent it ies. He confirm ed on num erous occasions t hat Cit igroup does not originat e or service m ort gage loans. I n m aking t hese st at em ent s, Mr. Cram er indicat ed t hat he relied upon docum ent s provided t o him by Cit igroup’s counsel as well as his personal knowledge of t he responsibilit ies of Cit igroup and Cit iMort gage. The court finds t hat Mr. Cram er was adequat ely prepared t o respond t o t hese t opics. Mr. Cram er also provided t he request ed inform at ion under each of t hese t opics. His t est im ony was responsive t o plaint iffs’ counsel’s quest ions. Alt hough plaint iffs’ counsel did not 4 approve of Mr. Cram er’s answers, t he court finds t hat he was adequat ely prepared, and did properly respond t o t he quest ions. Plaint iffs also cont end t hat Mr. Cram er was unable t o specify any am ount of revenue t hat Cit igroup realized from t he loan or would have realized from t he refinancing. Mr. Cram er st at ed he was unable t o provide t his inform at ion and why he was unable t o provide it . He explained t hat Cit igroup is a holding com pany and “ [ t ] hey’re not in t he day- t o- day m anagem ent of individual sources of revenue for each of [ t he ot her] ent it ies.” The court finds t hat Mr. Cram er was adequat ely prepared for t his t opic. He provided all of t he inform at ion he was able t o procure and explained why he could not provide any addit ional answers. Again, t he court believes t hat Mr. Cram er’s responses were sufficient . As t he court has recognized on num erous occasions in t his case, t he court cannot decide t he accuracy of inform at ion provided in discovery. Finally, plaint iffs com plain t hat Mr. Cram er failed t o adequat ely address t he t wo t opics on t he role and relat ionship bet ween Cit igroup and t he ot her defendant s as well as a non- part y. Plaint iffs cont end t hat Mr. Cram er was unprepared t o address t hese t opics. Plaint iffs suggest t hat his review of only public docum ent s was inadequat e. Once again, t he court finds Mr. Cram er properly prepared t o respond t o t hese t opics. He did rely upon “ publicly available docum ent s t hat showed t he corporat e st ruct ure of [ t he] ent it ies,” but he also relied upon his own experience as a direct or of Cit iMort gage. He addressed all of t he ent it ies not ed in t he t opics and discussed t heir various roles. He also t alked about t heir policies and t he oversight at each of t he ent it ies. Plaint iffs are skept ical about som e of Mr. Cram er’s answers, but again t he court cannot det erm ine t he accuracy of t hose answers. I n sum , t he court finds t hat plaint iffs’ m ot ion does not support t heir claim t hat Cit igroup’s deponent was inadequat e in specific request s. Cit igroup properly produced a deponent t o speak on it s behalf. The court finds t hat Mr. Cram er was adequat ely prepared and he properly responded t o plaint iffs’ counsel’s quest ions. ECF# 503, pp. 6- 8. The deposit ion excerpt s subm it t ed t o t he court fully support t he m agist rat e j udge’s findings which t racked a proper applicat ion of t he governing legal st andard. Anot her argum ent cent ral t o t he plaint iffs’ m ot ion is t hat Mr. Cram er could not have been sufficient ly prepared, because he did not have 5 access t o all corporat e inform at ion and relied on public filings and financial st at em ent s rat her t han “ act ual corporat e knowledge.” ECF# 510, p. 4. Am ong t he argued exam ples of t his, t he plaint iffs refer t o Mr. Cram er’s deposit ion t est im ony indicat ing t hat he had looked at Cit igroup’s financial st at em ent s which reflect ed only t ot al revenue figures for t he ot her ent it ies and t hat he discerned from t hese annual report s no evidence of Cit igroup’s involvem ent in servicing or refinancing loans. Mr. Cram er, however, also t est ified repeat edly t hat Cit igroup as a holding com pany deals wit h and report s t he ent it y earnings of t he different subsidiary corporat ions and does t his wit hout m anaging or report ing t he individual revenue sources of t he underlying ent it ies. ECF# 511- 2, pp. 20- 22. Mr. Cram er explained t hat t his t est im ony was based on m ore t han his conclusions drawn from t he public financial report s: A. My underst anding is t he ent it ies generat e revenue, and Cit igroup report s t hat and m akes it available t o shareholders. They don’t have— Cit igroup does not have individualized specific revenue generat ing depart m ent s rolling up specific t o Cit igroup it self. Q. And do you form t hat underst anding? A. Based on m y underst anding and review of t he corporat e docum ent s and how t he ent it ies are st ruct ured and as being a direct or of a fairly large ent it y such as Cit iMort gage. I d. at p. 22. From reading t hose port ions of Mr. Cram er’s deposit ion subm it t ed as exhibit s, t he court ’s fair im pression is t hat Mr. Cram er was careful t o link his conclusions on t he corporat e act ivit ies and pract ices t o t he relevant t im e period based on docum ent s cont em porary t o t hat period. This is because he did not work for t he defendant s during t hat earlier period. But , 6 Mr. Cram er also t est ified t o conclusions drawn from his own work and experience wit h t he defendant as being consist ent wit h t hese earlier docum ent s: Q. As t o t he discussion t hat you didn’t specifically use in num ber 2, which is for sim plicit y’s sake, is t here anot her organizat ional chart t hat you were able t o rely on? A. Not in t he m at erial, but from m y t wo years of being a direct or at Cit iMort gage, you’re obviously shown docum ent s, m at erials around Cit i Holdings and ot her ent it ies t hat roll up int o Cit igroup. So you know, j ust from m y knowledge of t he workings of t he com pany and being at ot her servicers t hat had holding com panies sim ilar t o Cit i, j ust – t hese docum ent s j ust sort of solidified m y underst anding of t he organizat ional st ruct ure. ECF# 511- 2, p. 25. The court disagrees wit h t he plaint iffs’ charact erizat ion of Mr. Cram er’s experience here being lim it ed “ in default ” and not having “ any bearing on t he t opics.” ECF# 510, p. 7. The court finds no basis for concluding t hat t he m agist rat e j udge’s underst anding of Mr. Cram er’s t est im ony was m ist aken as a m at t er of law or fact . Finally, t he plaint iffs com plain t hat Mr. Cram er had not been given and asked t o review “ cont ract s” bet ween t he different corporat e ent it ies in order t o t est ify as t o t he role and relat ionship bet ween Cit igroup and t he ot her corporat ions. The defendant s right ly not e t hat none of t he court - ordered t opics reference any part icular cont ract s being at issue or relevant here. The plaint iffs apparent ly produced such cont ract s at t he deposit ion, and t he wit ness had not seen t hem before and was unable t o t est ify about t hem . The plaint iffs do not explain how t hese cont ract s are relevant in est ablishing any relat ionship bet ween t he corporat e ent it ies t hat 7 is different from t he deponent ’s t est im ony. Wit hout t his est ablished relevance connect ion, t here is not hing but speculat ion t hat Mr. Cram er was unprepared because he had not reviewed t hese cont ract s. The excerpt s of Mr. Cram er’s deposit ion subm it t ed t o t he court show he was prepared t o t est ify on t he role and relat ionship bet ween Cit igroup and t he ot her corporat e ent it ies. His deposit ion was consist ent and clear t hat Cit igroup was a holding com pany t hat did not provide, did not supervise, and was not involved wit h t he banking services in quest ion. See, e.g., ECF# 511- 2, pp. 11, 15, 20- 23, 29- 30, 32- 34, and 39. As t he m agist rat e j udge reit erat ed, t he plaint iffs’ speculat ive skept icism about t he accuracy of t he deponent ’s answers is not a basis for det erm ining t hat t he defendant Cit igroup did not com ply wit h Rule 30( b) ( 6) . For all of t he reasons st at ed above, t he court denies all relief request ed in t he plaint iff’s m ot ion for review. Before closing, t he court want s t o highlight t his single- sent ence paragraph t hat is a part ing plea m ade by t he plaint iffs: There is no doubt t he case has drug out in t im e and been a st ruggle however, t his Court should cont inue on t he pat h t o j ust ice and require Cit igroup t o com ply wit h t he rules expect ed as t o t he 6 court ordered t opics t hat are all ruled relevant and t ied t o t he Plaint iff’s t heory of t he case and t his Court ’s order for discovery when denying sum m ary j udgm ent rat her t han let t hem escape t heir dut ies being rewarded for t he failure frust rat ing t he ult im at e purpose of discovery at t em pt ing t o avoid liabilit y t o creat e an absence of fact s by failing t o provide Mr. Cram er wit h corporat e knowledge, not even a cont ract bet ween t he part ies. 8 ECF# 510, p. 10. The court shares t he plaint iffs’ opinion t hat t his case exem plifies prot ract ed and cont ent ious lit igat ion. I ndeed, t his is t he oldest pending case on t his cham ber’s docket . The num ber of filings in t his case cert ainly is excessive in light of t he subj ect m at t er, fact s, and legal issues in t his case. As evidenced by t he above quot at ion and by ot her st at em ent s in m any ot her filings, t here seem s t o be som e m ist aken not ions. Just ice need not be like a slow m achine grinding out result s wit h ext ended delays. Just ice need not accom m odat e part ies’ repeat ed request s for ext ensions of t im e. Just ice is not served when t he part ies’ engage in unabat ed effort s t o disput e and disagree over alm ost every m at t er, t o m ake personal accusat ions, t o regularly supplem ent filings and seek leave for filing sur- replies, t o file m ot ions t o reconsider and review on m any discovery orders, and t o lit igat e wit h lit t le regard t o t he expense and cost upon all. These point s should be evident because t he Rules of Civil Procedure are t o be “ const rued, adm inist ered, and em ployed by t he court and t he part ies t o secure t he j ust , speedy, and inexpensive det erm inat ion of every act ion and proceeding.” Fed. R. Civ. P. 1. Thus, t his case is in a post ure t hat warrant s t aking an addit ional Rule 1 st ep t o fost er a j ust , speedy, and less expensive det erm inat ion. From t his dat e forward, no part y will be grant ed m ore t han one ext ension of t im e t o m eet any of t he required court or rule deadlines wit h t he except ion for circum st ances t hat are t ruly urgent and/ or em ergency in charact er. The court adm onishes t he part ies t hat t he court is act ively 9 considering im posing addit ional m easures consist ent wit h Rule 1 should t he part ies not m ove t his lit igat ion forward in an expedit ious and reasonable m anner. Not hing t hat appears here is int ended t o reflect negat ively upon t he m agist rat e j udge who has worked diligent ly and expert ly in an effort t o bring som e Rule 1 sem blance t o t he progress of t his case. I T I S THEREFORE ORDERED t hat t he plaint iffs’ m ot ion for review ( ECF# 509) of t he m agist rat e j udge’s order ( ECF# 503) filed Oct ober 30, 2017, is denied; I T I S FURTHER ORDERED t hat no part y will be grant ed m ore t han one ext ension of t im e t o m eet any of t he required court or rule deadlines wit h t he except ion for circum st ances t hat are t ruly urgent and/ or em ergency in charact er. Dat ed t his 22nd day of Decem ber, 2017 at Topeka, Kansas. s/ Sam A. Crow Sam A. Crow, U.S. Dist rict Senior Judge 10
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