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Nguyen v. LVNV Funding, LLC

United States District Court, S.D. California

March 10, 2017

TONY NGUYEN, Plaintiff,
v.
LVNV FUNDING, LLC; MICHAEL S. HUNT; JANALIE A. HENRIQUES, Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART MOTION TO COMPEL TESTIMONY AT DEPOSITION AND FOR SANCTIONS [ECF NO. 56] AND GRANTING IN PART REQUEST FOR A PROTECTIVE ORDER [ECF NO. 57]

          Hon. Ruben B. Brooks United States Magistrate Judge

         On October 27, 2016, Plaintiff Tony Nguyen filed a “Motion to Compel Testimony at Deposition and for Sanctions” (the “Motion to Compel”) with a Memorandum of Points and Authorities, a declaration of Stephen G. Recordon, a declaration of Clinton Rooney, and several exhibits [ECF No. 56]. Defendants Michael S. Hunt and Janalie A. Henriques filed a “Memorandum of Points and Authorities in Opposition to Plaintiff's Motion to Compel Deposition Testimony and for Sanctions; Request for a Protective Order” (the “Opposition”) on November 30, 2016, with a declaration of Tomio B. Narita and multiple exhibits [ECF No. 57]. There, the Defendants request a protective order preventing further deposition questions that seek information protected by the attorney-client privilege and the work-product doctrine. (Opp'n 12-13, ECF No. 57.) On December 7, 2016, Nguyen filed a Reply with a declaration of Stephen G. Recordon [ECF No. 58]. For the reasons discussed below, Plaintiff's Motion to Compel [ECF No. 56] is GRANTED in part and DENIED in part, and Defendants' request for a protective order [ECF No. 57] is GRANTED in part.

         I. FACTUAL BACKGROUND

         Nguyen filed his lawsuit against Defendants LVNV Funding, LLC; Michael S. Hunt; and Janalie A. Henriques on April 7, 2015. (Compl. 1, ECF No. 1.)[1] In his First Amended Complaint, Plaintiff asserts claims against the three Defendants for violations of the Fair Debt Collection Practices Act (“FDCPA”) and the Rosenthal Act. (First Am. Compl. 5-6, ECF No. 39.) Nguyen contends that on April 17, 2014, Hunt and Henriques filed a complaint against him in San Diego Superior Court on behalf of LVNV. (Id. at 3.) In the state court action, Hunt and Henriques alleged that LVNV was the assignee of a debt owed by Plaintiff and that LVNV had enforceable claims against Nguyen. (Id. at 4.) Plaintiff maintains that the claims against him were time-barred and unenforceable. (Id.) He seeks actual damages, statutory damages, litigation costs, and attorney's fees. (Id. at 6-7.)

         II. PROCEDURAL BACKGROUND

         Nguyen filed his First Amended Complaint on April 7, 2016 [ECF No. 39]. United States District Court Judge Larry Alan Burns consolidated this case with a related case involving the same parties on April 20, 2016 [ECF No. 43], and the Defendants answered shortly after [ECF Nos. 44, 45, 46]. Defendants Hunt and Henriques were deposed on September 28, 2016. (Mot. Compel 2, ECF No. 56.) Several times during the depositions, defense counsel objected to questions by Plaintiff's counsel and instructed his clients not to answer. (Id. Attach. #1 Mem. P. & A. 7-14.) Subsequent communications between counsel were unsuccessful in resolving these issues, (id. at 14-15), and the Motion to Compel was filed on October 27, 2016 [ECF No. 56].

         III. DISCUSSION

         A. Plaintiff's Motion to Compel

         It is well established that a party may obtain discovery regarding any nonprivileged matter that is relevant to any claim or defense and proportional to the needs of the case. Fed.R.Civ.P. 26(b)(1). Relevant information need not be admissible at trial to be discoverable. Id. Relevance is construed broadly to include any matter that bears on, or reasonably could lead to other matters that could bear on, any issue that may be in the case. See Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 350-51 (1978) (footnote omitted) (discussing relevance to a claim or defense, although decided under 1978 version of Rule 26 that authorized discovery relevant to the subject matter of the action (citing Hickman v. Taylor, 329 U.S. 495, 501 (1947))). Rule 37 of the Federal Rules of Civil Procedure enables the propounding party to bring a motion to compel responses to discovery. Fed.R.Civ.P. 37(a)(3)(B). The party opposing discovery bears the burden of resisting disclosure. Miller v. Pancucci, 141 F.R.D. 292, 299 (C.D. Cal. 1992).

         Under Federal Rule of Civil Procedure 30(a)(1), “[a] party may, by oral questions, depose any person, including a party, without leave of court except as provided in Rule 30(a)(2).” Fed.R.Civ.P. 30(a)(1). Rule 30(c)(2) provides the following guidance regarding objections during a deposition:

An objection at the time of the examination -- whether to evidence, to a party's conduct, to the officer's qualifications, to the manner of taking the deposition, or to any other aspect of the deposition -- must be noted on the record, but the examination still proceeds; the testimony is taken subject to any objection. An objection must be stated concisely in a nonargumentative and nonsuggestive manner.

Id. 30(c)(2). “As a general rule, ‘instructions not to answer questions at a deposition are improper.'” Cohen v. Trump, Civil No. 13-CV-2519-GPC (WVG), 2015 WL 2406094, at *1 (S.D. Cal. May 19, 2015) (quoting Detoy v. City and Cty. of San Francisco, 196 F.R.D. 362, 365 (N.D. Cal. 2000)). “A person may instruct a deponent not to answer only when necessary to preserve a privilege, to enforce a limitation ordered by the court, or to present a motion under Rule 30(d)(3).” Fed.R.Civ.P. 30(c)(2). “If a party believes that a particular question asked of a deponent is improper for any other reason, that party may object; however, the examination still proceeds; the testimony is taken subject to any objection.” Mendez v. R Carriers, Inc., No. CV 11-02478-CW (JSC), 2012 WL 1535756, at *1 (N.D. Cal. Apr. 30, 2012) (citations omitted) (internal quotation marks omitted).

         This is the case even when deposition questions appear to seek irrelevant information. See 7 James Wm. Moore et al., Moore's Federal Practice § 30.43[2], at 30-89 (3d ed. 2016).

If deposing counsel engages in irrelevant or repetitious questioning, the appropriate course for opposing counsel is to enter an objection. The witness may then answer the question. If the answer is offered at trial, opposing counsel may then renew the objection and obtain a ruling from the court. If deposing counsel persists in irrelevant or repetitious questioning after objection, opposing counsel may seek a protective order or sanctions from the court. However, counsel does not have the right to decide the issue unilaterally by instructing the witness not to answer.

Id. (footnote omitted); see Pilates, Inc. v. Georgetown Bodyworks Deep Muscle Massage Centers, Inc., 201 F.R.D. 261, 261 n.1 (D.D.C. 2000) (ordering the deponent to be redeposed after counsel improperly instructed the witness not to answer several questions).

         Nguyen asserts there were three instances during the depositions of Michael Hunt and Janalie Henriques where defense counsel improperly instructed his clients not to answer questions. (Mot. Compel Attach. #1 Mem. P. & A. 7-14, ECF No. 56.) The Court addresses these instances separately.

         1. Questions to Defendant Hunt concerning California Code of Civil Procedure section 395(b)

         Plaintiff first complains about the following exchanges during Hunt's deposition:

         Q Mr. Hunt, if you would go to the second page of Exhibit 4 [Request for Entry of Default and Clerk's Judgment]. Under Paragraph 5 there are three subparagraphs, A, B, and C. On this one, C, you can check a box on whether or not an obligation is “for goods, services, loans, or extensions of credit subject to Code of Civil Procedure 395(b).” Does Hunt & Henriques undertake an inquiry before filing a request for default to make sure that the obligation at issue is subject to Code of Civil Procedure 395(b)?

         MR. NARITA: Well, object to the form. He didn't sign this. He didn't prepare it.

         BY MR. ROONEY:

         Q My question is more generally. When Hunt & Henriques files requests for default, do they perform an inquiry prior to checking that box?

MR. NARITA: Don't answer that.
MR. ROONEY: You're going to instruct him not to answer that?
MR. NARITA: Yes.
MR. ROONEY: Okay. We'll be speaking to Judge Brooks shortly.
MR. NARITA: That's fine. It's not likely to lead to the discovery of admissible evidence in this case.
MR. ROONEY: I'm sure you know --
MR. NARITA: It's being asked solely for the purposes of harassment or annoyance.
MR. ROONEY: I am sure -- (a) I dispute that; (b) I'm sure you know relevance is no basis to refuse to answer. And a sanctionable behavior.
MR. NARITA: So go ahead.

BY MR. ROONEY:

Q Mr. Hunt, are you going to answer that question?
A No.

BY MR. ROONEY:

         Q Mr. Hunt, just to clarify, are you refusing to testify regarding Page 2, Subsection 5, Subparagraph c of this form, Hunt & Henriques's procedures regarding that box?

MR. NARITA: You haven't asked him a question. Don't answer that. Do you have a question? There's no question pending.
MR. ROONEY: That is a question.

         BY MR. ROONEY:

         Q Are you refusing to testify regarding this issue, Hunt & Henriques's policies and procedures regarding that box? Hunt & Henriques determines whether or not an account is subject to Code of Civil Procedure, Section 395(b)?

MR. NARITA: We're not going to have him --
MR. ROONEY: I'm not asking you.
MR. NARITA: The answer is, yes, he's not going to testify to that.
MR. ROONEY: He can answer that.

BY MR. ROONEY:

Q Are you going to testify to that?
A No.

         Q Okay. Does Hunt & Henriques provide any training to its attorneys on how to ascertain whether a debt is subject to Code of Civil Procedure 395(b)?

MR. MOHANDESI: Vague as to time.
MR. ROONEY: Now.
MR. NARITA: Don't answer that. Has nothing to do with your case.
THE WITNESS: I'm not going to answer it.

         BY MR. ROONEY:

Q You're not going to answer it. Okay.

(Id. Attach. #3 Ex. C, at 12-14, 21.)

         Nguyen indicates that after these exchanges and subsequent objections, counsel for Hunt “attempted to instruct Plaintiff's counsel to only ask questions regarding acts that took place prior to the filing of the state court complaints at issue.” (Id. Attach. #1 Mem. P. & A. 9.) Nguyen asserts that Hunt, an experienced attorney, refused to testify on this topic. (Id.) Contending that questions regarding compliance with section 395(b) are relevant, Plaintiff states, “As Defendants routinely file Requests for Default in California, Defendants routinely state under penalty of perjury that the debts they file suit to collect are subject to California Code of Civil Procedure §395(b).” (Id. at 19.) “This means that Defendants routinely tells [sic] the California Court system that they have made an inquiry into whether or not the debt at issue was incurred for ‘personal, family or household use' and have sufficient information to make a conclusion in that regard.” (Id.) Nguyen asserts that in their operative answers, Defendants denied that they could tell whether Plaintiff's debt was incurred for household, family, or personal purposes, “despite the fact that Defendants filed two Requests for Default in the state court actions at issue, claiming the opposite.” (Id.) Nguyen explains that one of the elements of his FDCPA claim is that the underlying debt arose from a personal, family, or household purpose, which is similar to the language in section 395(b). (Id.) He argues that this makes questions regarding compliance with this section relevant.

Mr. Narita drafted answers in this action denying that Defendants were capable of ascertaining whether the debts at issue were incurred for a “personal, family or household purpose.” Plaintiff is entitled in inquire as to how, precisely, Defendants made the opposite claim, under penalty of perjury, to the state court. It is clear why Mr. Narita wants to limit Plaintiff's inquiry into this area: it is not because the claim is relevant, but precisely because this inquiry is not only relevant to Plaintiff's claim, but exposes the lies in Defendants' answers.

(Id. at 19-20.)

         Defendants respond that “Evidence Regarding The Policies And Procedures Used By The Hunt & Henriques Law Firm When Filing Requests For Entry Of Default Has No Bearing On The Claims Asserted By Nguyen And Questioning On The Topic May Be Designed To Invade The Attorney Client Privilege Or To Obtain Work Product[.]” (Opp'n 6, ECF No. 57.) Defendant Hunt did not sign the requests for default against Plaintiff, (id. (citation omitted)), and he asserts that Nguyen's arguments regarding relevance lack merit, (id.). The Defendant maintains that only Plaintiff would know whether the debt was incurred for a personal, family, or household purpose. (Id.) He then makes six arguments why further deposition testimony on this topic should not be ordered. (Id. at 6-9.)

         Defendant Hunt first contends that because the alleged violations of the FDCPA occurred when the state lawsuits against Nguyen were filed, information regarding how the law firm of Hunt & Henriques subsequently prepared and filed requests for default in those lawsuits is not relevant. (Id. at 6-7.) Second, the Defendant argues that because Nguyen has not asserted claims against Hunt and Henriques's law firm, he is not entitled to ask questions regarding the policies and procedures of the firm. (Id. at 7.) “As such, Nguyen's line of questioning directed at Mr. Hunt regarding the Hunt & Henriques law firm's policies and procedures was intended to harass, annoy, burden and inconvenience Mr. Hunt.” (Id.) Third, Hunt states that if Plaintiff is trying to prove that the ...


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