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Sandigo v. Ocwen Loan Servicing, LLC

United States District Court, N.D. California, San Jose Division

June 24, 2019


          ORDER RE MOTIONS IN LIMINE [RE: ECF 162, 163, 164, 165, 166, 167, 169, 170, 171]

          BETH LAB SON FREEMAN, United States District Judge.

         In preparation for trial which is set to begin on August 19, 2019, the parties submitted nine motions in limine. The Court held a final pretrial conference on June 21, 2019. With respect to each side's motions in limine (“MILs”), the Court rules as follows, for the reasons set forth below and as stated on the record at the pretrial conference:


         1. Plaintiff's Motion in Limine No. 1 Regarding Undisclosed Witnesses Stephanie Spurlock, Adam Hamburg, and Sonya Miller (ECF 163)

         Plaintiff Phyllis Sandigo moves to preclude under Federal Rule of Civil Procedure (“FRCP”) 37(c)(1) three of Defendant Ocwen Loan Servicing, LLC's (“Ocwen”) witnesses from testifying at trial because Ocwen did not disclose these witnesses to Plaintiff until May 31, 2019, in violation of FRCP 26(a)(1)(A). See ECF 162. The three witnesses are (1) Stephanie Spurlock, a representative of Western Progressive who will testify about the notices of default sent to Plaintiff and the recording and rescission of the notice; (2) Sonya Miller, a representative of Assurant Partners who will testify about insurance policy loss and the processing of Plaintiff's insurance claim; and (3) Adam Hamburg, Ocwen's original defense counsel who will testify about Plaintiff's written discovery and responses to Plaintiff's qualified written requests (“QWR”) under the Real Estate Settlement Procedures Act. See ECF 162 at 2; ECF 179 at 2-5.

         Ocwen counters that these witnesses should be allowed to testify because either Plaintiff knew of them before filing the action, or the witnesses were made known to Plaintiff during the discovery process, or the failure to disclose is harmless. ECF 179 at 2. As to Ms. Spurlock, Ocwen argues that Plaintiff has known about Western Progressive's role since she received its demand letters in January 2017, and she was aware of the notice of default and its rescission because she mentions them in her FAC. Id. at 3. Ocwen's 30(b)(6) witness in his deposition in October 2018 also made clear to Plaintiff's counsel that Western Progressive and Ocwen are separate entities. As to Ms. Miller, Ocwen argues that Plaintiff has known about third-party Assurant since October 2018, when Ocwen's counsel informed Plaintiff's counsel about Assurant's independent role in handling insurance issues for Ocwen. Id. at 4. Finally, as to Mr. Hamburg, Ocwen argues that Plaintiff has known about Mr. Hamburg's role since at least December 2017 when he responded to Plaintiff's QWRs and since he prepared Ocwen's initial responses to Plaintiff's discovery requests. Id. at 5.

         As discussed on the record at the pretrial conference, Plaintiff's MIL No. 1 is GRANTED IN PART AND DENIED IN PART.

         The MIL with respect to Stephanie Spurlock is DENIED on the condition that Ms. Spurlock be made available for deposition (which can be by video) with the costs of the deposition to be covered by Ocwen. Though Ms. Spurlock signed the notice of rescission, she was not otherwise specifically disclosed to Plaintiff, and Plaintiff was never put on notice that Ms. Spurlock might testify as to the notices of default, which were sent well before the rescission was recorded. Because Ocwen neither added Ms. Spurlock to its initial disclosures nor otherwise made her existence or role known to Plaintiff, Ocwen violated FRCP 26(e). This failure to disclose was not substantially justified because, though Plaintiff knew of Western Progressive's role, Ocwen should have determined who would be testifying on Western Progressive's behalf and disclosed that person's identity to Plaintiff. Moreover, it was prejudicial because Ms. Spurlock's testimony about the notices of default will directly pertain to one of Plaintiff's theories of liability under the Rosenthal Act. However, the harsh sanction of exclusion under FRCP 37 is not necessary here because the prejudice to Plaintiff can otherwise be cured. See Alfred E. Mann Found. for Sci. Research v. Cochlear Corp., No. CV 07-8108-FMO, 2014 WL 12586105, at *18 (C.D. Cal. Jan. 3, 2014). Because Ms. Spurlock's testimony will be limited and there are almost two months until trial, there is sufficient time for Plaintiff to take Ms. Spurlock's deposition, with Ocwen covering the costs but not the attorneys' fees.

         For the same reasons, the MIL with respect to Sonya Miller is DENIED on the condition that Ms. Miller be made available for deposition (which can be by video) with the costs of the deposition to be covered by Ocwen. As with Ms. Spurlock, Ocwen never disclosed Ms. Miller to Plaintiff, and thus violated FRCP 26(e). And Ocwen's failure to do so was neither substantially justified nor harmless. However, given the limited nature of Ms. Miller's testimony and the amount of time before trial, an appropriate sanction under FRCP 37 is to allow Plaintiff's attorney to depose Ms. Miller, with costs covered by Ocwen.

         Finally, the motion with respect to Mr. Hamburg is GRANTED IN PART AND DENIED IN PART. The Court finds that with respect to the QWRs, Mr. Hamburg's involvement was sufficiently disclosed to Plaintiff to satisfy FRCP 26(e) because Mr. Hamburg signed Ocwen's responses to certain QWRs and was the named recipient of at least one, as discussed at the conference. As such, Mr. Hamburg can testify about the QWRs and related events. However, Mr. Hamburg is not permitted to testify with respect to Ocwen's responses to Plaintiff's discovery requests because Plaintiff would have no reason to believe that an attorney would testify about his client's discovery responses at trial, such that Mr. Hamburg was not sufficiently disclosed under FRCP 26. Moreover, this failure to disclose him is neither substantially justified nor harmless because the nature of his testimony on these issues is still unknown to Plaintiff and Ocwen should have made it known to Plaintiff that it intended to have Mr. Hamburg testify about litigation issues much sooner so Plaintiff could prepare to and take Mr. Hamburg's deposition.

         2. Plaintiff's Motion in Limine No. 2 Regarding Undisclosed Witness James T. Broome, Esq. (ECF 164)

         Plaintiff moves to preclude under FRCP 37(c)(1) Ocwen's witness James T. Broome from testifying at trial because Ocwen did not disclose Mr. Broome to Plaintiff before May 31, 2019, in violation of FRCP 26(a)&(e). See ECF 164. Plaintiff describes Mr. Broome as Ocwen's lead attorney in Plaintiff's bankruptcy action, but Ocwen describes him as a former member of Ocwen's bankruptcy department and current paralegal at Ocwen. ECF 189 at 3-4. Plaintiff notes that throughout the litigation, Ocwen has relied on its 30(b)(6) witness Kevin Flannigan to testify about the bankruptcy proceedings, such that Plaintiff was led to believe that only Mr. Flannigan would testify about these issues. She also argues that Mr. Broome should be excluded because he was not disclosed as an expert witness but plans to offer expert opinions and impermissible legal opinions, and his testimony will conflict with this Court's summary judgment ruling on res judicata. See ECF 164 at 3-5.

         Ocwen argues that Mr. Broome should not be excluded because Ocwen disclosed its bankruptcy preclusion theory to Plaintiff in October 2018, and Plaintiff did not attempt to conduct discovery related to this theory by, for example, deposing anyone from Ocwen's bankruptcy department. ECF 189 at 3. Moreover, Ocwen argues that Mr. Broome is not an attorney and will not be offering expert or legal opinions, but instead will provide testimony related to Ocwen's bankruptcy practices. Id. at 3-4, 6. Ocwen admits that it never disclosed Mr. Broome by name to Plaintiff but argues that Plaintiff is not prejudiced because Ocwen disclosed that members of its bankruptcy department (specifically, Mr. Muldoon and Ms. Brophy) would be percipient witnesses. Id. at 4-5. Ocwen then notes that even if it did prejudice Plaintiff, Plaintiff can still depose Mr. Broome, Mr. Broome's testimony will not disrupt trial, and Ocwen did not act in bad faith. Id. at 5-6.

         As discussed on the record at the pretrial conference, Plaintiff's MIL No. 2 is GRANTED, but Ocwen is allowed to amend its witness list to include Mr. Muldoon or Ms. Brophy. Mr. Broome was never disclosed to Plaintiff in violation of FRCP 26, and the Court cannot say that this failure was justified or harmless FRCP Rule 37. The testimony of an individual from Ocwen's bankruptcy department is critical to Ocwen's defense and allowing an undisclosed party to testify on such issues would prejudice Plaintiff. Moreover, Ocwen acknowledges that Mr. Muldoon and Ms. Brophy are “one and the same” with Mr. Broome, which implies that there was no justifiable reason not to similarly disclose Mr. Broome.

         That said, the Court finds that Mr. Muldoon and Ms. Brophy were sufficiently disclosed to Plaintiff during Mr. Flannigan's 30(b)(6) deposition. Mr. Flannigan told Plaintiff's attorney that he had spoken to Mr. Muldoon and Ms. Brophy about the bankruptcy's effect on the servicing of Plaintiff's loan. See ECF 189-4 at 16:22-25. Plaintiff's attorney followed up with questions about what Mr. Flannigan discussed with each of these individuals, and Mr. Flannigan described the information that each of these witnesses provided to him about Ocwen's processes. Id. at 18:17-20:12. Thus, these individuals and their areas of knowledge were sufficiently disclosed to Plaintiff during discovery. As such, Ocwen may amend its witness list to include either of these individuals. Plaintiff will not have an opportunity to depose whomever Ocwen selects.

         3. Plaintiff's Motion in Limine No. 3 regarding Medical Records About Jury Service (ECF 165)

         Plaintiff moves to exclude certain medical records from September 2012 and 2015 in which Plaintiff asked her doctor to write a letter excusing her from jury service because she cannot hear or see well. See ECF 165. Plaintiff argues that these records are not relevant under Federal Rules of Evidence (“FRE”) 401 and 402 and that the probative value is substantially outweighed by the potential prejudice under FRE 403 because they are outside the relevant timeframe and the jury may find it unfair that Plaintiff sought to get out of jury duty. The emails are from September 2012 and June 2015; Plaintiff alleges her emotional distress began in December 2015. ECF 165 at 2 and Attachment. Plaintiff also mentions that she will raise relevance objections to most of the 1, 095 pages of medical records that Ocwen seeks to introduce.

         Ocwen argues that these records are relevant to Plaintiff's alleged emotional distress damages because they indicate other potential sources for her alleged stress and anxiety than Ocwen's actions here. ECF 190 at 2-4. Ocwen also argues that the records are not unduly prejudicial under Rule 403.

         As discussed on the record at the pretrial conference, Plaintiff's MIL No. 3 is DENIED. The email evidence is admissible under FRE 401 and 402 because it is relevant to whether Plaintiff's emotional distress may have been caused by other factors than Ocwen's alleged actions. See, e.g., Luna v. Cty. of Los Angeles, No. 07-CV-04715-SJO, 2008 WL 11410093, at *5 (C.D. Cal. Sept. 25, 2008). Moreover, it is admissible under FRE 403 because its probative value is not substantially outweighed by its potential to prejudice Plaintiff. This evidence is directly probative of other causes of Plaintiff's emotional distress besides Ocwen. Moreover, Plaintiff does not argue that the statements are untrue. Introduction of this evidence will not prejudice Plaintiff, as jurors understand that certain individuals need to be excused from jury service due to legitimate limitations.

         To the extent Plaintiff is requesting that the Court exclude some larger portion of the 1, 095 records, the request is DENIED without prejudice to Plaintiff's combing through the records and identifying those that are truly irrelevant or unduly personally invasive. Introduction of such a large number of medical records would not only waste time but would also likely include cumulative evidence. Moreover, to the extent that these documents are not from the relevant time period, they are likely to be less relevant. The parties are directed to meet and confer to narrow the number of documents. Plaintiff also is not precluded from objecting to certain documents as they are introduced at trial. The Court notes that Ocwen represented at the hearing that it only intends to introduce documents from 2015 and after.

         4. Plaintiff's Motion in Limine No. 4 Regarding Legal ...

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