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Tuesday, February 18, 2020

Defendant makes unusual move in class action, embraces more discovery

By Nicholas Gueguen | Feb 16, 2017

Law money 03

CINCINNATI (Legal Newsline) – A defendant in an Ohio class action was successful in an unusual discovery move seeking to identify the scope of a possible class, which will affect its defense strategy, a Carlton Fields attorney says.

An Ohio federal judge on Jan. 17 granted Emery Federal Credit Union's motion to compel discovery from the plaintiffs in Palombaro v. Emery Federal Credit Union.

Emery Federal Credit Union has been sued for allegedly violating the Real Estate Settlement Procedures Act. According to the order, which was filed Jan. 17 on the U.S. District Court for the Southern District of Ohio, Western Division, the plaintiffs alleged that Emery was paid cash and/or marketing services they allege to be a sham for business referrals to Genuine Title LLC, a company that offers title services.

Carlton Fields attorney Thaddeus Ewald, who co-wrote a blog post with D. Matthew Allen about the order, told Legal Newsline that Emery likely submitted both the interrogatories and the motion to compel answers from the plaintiffs so that Emery could prepare for when the plaintiffs would motion to certify the class.

"A complete understanding of the scope of the proposed class influences the defendant’s strategy, resource allocation, and the ultimate arguments it makes against the motion to certify," Ewald said.

Ewald said Emery's move is unusual for defendants in putative class action cases.

"Generally speaking, the plaintiff is much more likely to pursue a motion to compel discovery in a putative class action than the defendant, who is more likely to oppose broad discovery," Ewald said.

According to the order, Emery sent the plaintiffs five interrogatories, asking them to explain how they'll prove that Emery received cash for each referral of each of the putative class members made to Genuine Title LLC.

Through these interrogatories, Emery also asked the plaintiffs to explain how they'll prove that Genuine Title and Emery split an exact amount of money, and along with that, the amount of money paid; the amount of money paid that was split; the date that the money was split and paid; who received the split payment; how the split fee was paid; and how they, their lawyers, the court or the jury will figure out the amount of money the plaintiffs allege was split.

Emery also asked the plaintiffs to explain how they will find out for sure how diligently each putative class member investigated their Real Estate Settlement Procedures Act claim one year after each of their loans with Emery closed and after that one-year period.

According to the order, Emery also sought answers from the plaintiffs about who would be in the putative class and whether it would include individuals who currently know about their rights to prosecute a claim against Emery.

Also requested were individuals who received advertising, solicitation, or communication from the plaintiffs' counsel about the case or proceedings in Maryland, where the putative class action against Emery originated in 2013. Emery also wanted to know whether the plaintiffs planned to include individuals who did not receive referrals to Genuine Title and individuals who were referred to Genuine Title, but the employees who made the referrals were not rewarded with cash or anything else for those referrals.

According to the order, finally, Emery sought to know the plaintiff's plans for trial for issues that would be resolved as common issues for all putative class members and the course of action for resolving those issues, how they plan to resolve class representative claims, including claims limitations that class representatives can litigate, how they plan to resolve claims, including claims limitations, for class members who aren't present, how plaintiffs' cases will go through trial, and jury instructions that the plaintiffs would like to suggest and how those instructions would account for individual damages rulings and affirmative defenses.

Emery sent these interrogatories on Aug. 25.

Ewald said the relevant part of this decision was the discovery order.

"In granting Emery’s motion to compel, the court ordered the plaintiffs to respond to Emery’s interrogatory asking whether certain types of plaintiffs would be included within their proposed class," Ewald said.

"The plaintiffs had stated they planned to provide the class definition at the time they moved for class certification, so this order merely accelerated the timeline under which they would clarify the scope of their putative class."

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