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Hernandez v. Ocwen Loan Servicing, LLC

United States District Court, S.D. Florida

May 21, 2018




         THIS CAUSE is before the Court upon Defendants', Ocwen Loan Servicing, LLC ("Ocwen") and U.S. Bank National Association, as Trustee, successor-in-interest to Wachovia Bank National Association, as Trustee for GSMPS Mortgage Loan Trust 2005-RP3, Mortgage Pass-through Certificates, Series 2005- RP3 (the "Trustee") (collectively, "Defendants") Motion to Compel Production of Documents from Non-Party Tennessee Department of Children Services [DE 44]. This matter was referred to the undersigned upon an Order referring all discovery matters to the undersigned for appropriate disposition. See DE 28. Non-Party Tennessee Department of Children's Services ("DCS") filed a Response to the Motion [DE 63] and Defendants filed a Reply. [DE 64]. The Court held a hearing on the Motion on May 15, 2018. The matter is now ripe for review.

         I. BACKGROUND

         Plaintiff, Jennifer Ford Hernandez, has asserted claims for fraud, conversion, trespass, wrongful foreclosure, intentional infliction of emotional distress, misrepresentation, violation of the Truth in Lending Act and Regulation Z, unjust enrichment, and breach of contract against Defendants because Defendants allegedly wrongfully foreclosed on Plaintiffs home. [DE 1]. During Ms. Hernandez' deposition, Ms. Hernandez alleged that the actions of Defendants in improperly foreclosing on her home caused Ms. Hernandez to lose her home and subsequently lose custody of her grandchildren. Defendants then issued a subpoena to the Tennessee Department of Children's Services ("DCS"), seeking the following documents:

"Any and all documents relating to the custody of B.A.L. (DOB redacted) and A.L or any other children of M.L.L. in custody of the Department of Children's Services. Any and all records related to Jennifer Ford Hernandez's custody of any grandchildren and/or foster care."[1]

[DE 44-1, pg. 2]. DCS objected to Defendants' request as the "Department's interest in protecting confidential documents relating to children outweighs the stated need for the documents by the defendants." [DE 44-3, pg. 2].

         Defendants filed their Motion to Compel Production of Documents from DCS on April 27, 2018. [DE 44]. In their Motion, Defendants seek all DCS documents concerning when the state took custody of Plaintiff s grandchildren, when Plaintiff took custody of her grandchildren, the reasons her grandchildren were in the custody of the state and then in the custody of Plaintiff, and why Plaintiffs custody of her grandchildren was terminated. [DE 44, pg. 2]. Defendants argue that the DCS records are relevant in order to defend against Plaintiffs claim that "Ocwen took away her ability to care for and maintain custody of her grandchildren." [DE 44, pg. 3]. Defendants argue that a specific exception delineated in Tennessee Code Annotated § 37-5-107(c)(2) permits disclosure in this case.

         In DCS's Response [DE 63], DCS first argues that this Court lacks jurisdiction to enforce this subpoena pursuant to Federal Rule of Civil Procedure 45, which states that a subpoena "may command...production of documents, electronically stored information, or tangible things at a place within 100 miles of where the person resides, is employed, or regularly transacts business in person." Fed.R.Civ.P. 45(c)(2)(A). DCS argues that because Defendants' subpoena required compliance electronically or in Memphis, Tennessee, any disputes regarding the subpoena are proper in "the court where compliance is required, " that is, the United States District Court for the Western District of Tennessee. [DE 63, pg. 3].

         DCS also argues that the requested records are confidential under Tennessee state law, which is controlling in a diversity action, and that DCS has a compelling interest in protecting the confidentiality of its documents. Id. DCS rejects Defendants' proposal to narrow the requests by omitting any "documentation related to any details of reports of harm" from the documents. DCS stated that narrowing the request was a "distinction without a difference, " because the reports would necessarily contain details of reports of harm by the very nature of the reports. [DE 63, pg. 4]. DCS also argues that the specific exception relied upon by Defendants only applies in a court exercising criminal law jurisdiction. [DE 63, pg. 6]. DCS argues that its records are "sacrosanct" and that there is strong public policy protecting the confidentiality of the records of the children in DCS's care. Therefore, Defendants' need for the records to defend themselves in a civil lawsuit does not outweigh DCS's interest in protecting the welfare of the children in its custody. [DE63, pg. 4, 7].

         Defendants filed a Reply [DE 64] on May 14, 2018, in which they argue that this Court has jurisdiction to adjudicate Defendants' Motion to Compel due to the exceptional circumstances in this case, pursuant to Federal Rule of Civil Procedure 45(c). [DE 64, pg. 1]. Defendants argue that they have a "legitimate interest" in the requested records because they have narrowly tailored the request to defend against Plaintiffs claims that she lost custody of her grandchildren due to Defendants' actions. [DE 64, pg. 2].

         II. ANALYSIS

         a. Jurisdiction

         Federal Rule of Civil Procedure 45 requires subpoena-related motions to be filed in the district court where compliance with the subpoena is required. Fed.R.Civ.P. 45(c), (d)(2)(B)(i), and (d)(3)(A); The Dispatch Printing Co. v. Zuckerman, No. 16-CV-80037-Bloom/Valle, 2016 WL 335753, at *2 (S.D. Fla. Jan. 27, 2016) (citing Morrissey v. Subaru of America, Inc., 2015 WL 9583278, at *3 (S.D. Fla. Dec. 31, 2015). However, Rule 45 allows the court to transfer a subpoena-related motion to the issuing court for adjudication "if the court finds exceptional circumstances." Fed.R.Civ.P. 45(c); Zuckerman, WL 335753, at *2. Although Rule 45(f) does not explain what qualifies as an exceptional circumstance, the Advisory Committee Notes to the 2013 amendments provide two examples of situations in which transfer due to exceptional circumstances is appropriate: (1) when the issuing court has already ruled on issues presented by the motion, and (2) when the same discovery issues are likely to arise in many districts. Zuckerman, WL 335753, at *2; See Judicial Watch, Inc. v. Valle Del Sol, Inc., 307 F.R.D. 30, 34 (D.D.C. 2014) ("Specifically, the authority to transfer subpoena-related motions under Rule 45(f) broadly applies to all motions under this rule, including motions for a privilege determination.") (quotation marks omitted).

         When determining whether a motion should be transferred from the compliance court to the issuing court, a court should look to a "variety of factors to determine if the judge from the issuing court is in a better position to rule on the motion due to her familiarity with the full scope of the issues involved as well as any implications the resolution of the motion will have on the underlying litigation." Zuckerman, WL 335753, at *2 (citing In re UBS Financial Services, Inc. Securities Litigation, 2015 WL 4148857, at *1 (D.D.C. July 9, 2015) (quoting Wultz v. Bank of China, Ltd.,304 F.R.D. 38, 47 (D.D.C. 2014) (internal quotations omitted))). "These factors include the complexity, procedural posture, duration of pendency, and the nature of the issues pending before, or already resolved by, the issuing court in the underlying litigation." Id. (citing Judicial Watch, 307 F.R.D. at 34; see XY, LLC v. Trans Ova Genetics, L.C, 2014 WL 4437728, at *l-2 (D.D.C. Sept. 10, 2014) (finding exceptional circumstances where issuing court "has already supervised substantial discovery and begun preparations for trial")); Wultz v. Bank of China, Ltd., 304 F.R.D. 38, 46 n. 6 (D.D.C. May 30, 2014) (transferring subpoena-related motions in "highly complex" litigation where issuing court "is in better position to rule...due to her familiarity with the full scope of issues involved as well as any implications the resolution of the motion will have on the underlying litigation" and to further "the interest in obtaining consistent rulings on the issues presented"). "In addition, the Court should consider whether requiring the local nonparty to ...

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