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Fausz v. NPAS, Inc.

United States District Court, W.D. Kentucky, Louisville

March 31, 2017

ELLA J. FAUSZ, individually, and on behalf of a class of similarly situated persons PLAINTIFFS
v.
NPAS, INC. DEFENDANT

          MEMORANDUM OPINION

          Charles R. Simpson III, Senior Judge United States District Court

         I. Introduction

         This matter is before the Court on the partial objection of Defendant NPAS, Inc. (NPAS) to the order of Magistrate Judge Dave Whalin that was dated January 11, 2017 (“the January 2017 order”), ECF No. 62. Plaintiff Ella J. Fausz responded, ECF No. 74. NPAS did not reply. For the reasons discussed below, the Court will overrule NPAS's partial objection.

         II. Background

         Fausz filed suit against NPAS in February 2015. Compl. 1, ECF No. 1. Fausz asserts that NPAS violated the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692, et seq. by failing to provide required information in correspondence that it sent to her.[1] Id. ¶¶ 23-26.

         As explained by the magistrate judge in the January 2017 order, Fausz served interrogatories and requests for production on NPAS in April 2015. Order 1/13/2017 2, ECF No. 59. Two months later, NPAS responded. Id. NPAS objected to seven of Fausz's interrogatories and sixteen of her requests for production of documents on the basis of relevance. Id. NPAS objected to five of Fausz's interrogatories and ten of her requests for production of documents on the basis of privacy, confidentiality, and/or trade secret protection. Id.

         Counsel for both parties sought to resolve this discovery dispute without the Court's intervention. Id. As a result of counsels' discussions, NPAS agreed to provide supplemental discovery responses. Id. But despite NPAS's providing supplemental discovery responses, Fausz maintained that the responses were still deficient. Id. at 2-3. She thus filed a motion to compel. Id. at 3.

         The magistrate judge addressed Fausz's motion to compel in January 2016. Id. The magistrate judge determined that Fausz was entitled to the majority of her requested discovery, with some limitations. Id. The magistrate judge accordingly ordered NPAS to produce (1) “FDCPA compliance proceedings, manuals and policies, ” (2) “any insurance agreement that might provide coverage to NPAS should it be held liable for violation of the FDCPA, ” and (3) “the account records of the putative class members . . . with the names of the members redacted from the documents.” Order 1/5/2016 10, 14-16, 19, ECF No. 19. Neither party filed an objection to the magistrate judge's order addressing Fausz's motion to compel. Order 1/13/2017 5, ECF No. 59. The magistrate judge presumed that the discovery matter had been fully resolved. Id.

         Over the next several months, however, the parties filed a series of motions to extend the deadlines to complete discovery. Id. They disagreed regarding which documents NPAS was required to produce. Id. at 5-7. As a result of this ongoing discovery dispute, Fausz filed a motion for sanctions, and NPAS filed a motion for a protective order. Id. at 7.

         Relevant to NPAS's partial objection is the portion of the January 2017 order addressing Fausz's motion for sanctions under Federal Rule of Civil Procedure 37(b)(2)(A). The magistrate judge explained that sanctions are imposed under Rule 37(b)(2)(A) to penalize parties for conduct warranting a sanction and to deter those parties who would be tempted to engage in such conduct in the absence of a detriment. Id. at 20 (citing Roadway Express Inc. v. Piper, 447 U.S. 752, 763-64 (1980)). The magistrate judge noted that a district court, when considering whether sanctions are appropriate, must “take into consideration how the absence of the unproduced evidence allegedly impaired the moving party's ability to establish its case.” Id. at 21 (citing Wilson v. Volkswagen of America, Inc., 561 F.3d 494, 504-05 (4th Cir. 1977)).

         The magistrate judge then determined that “it appear[ed] that NPAS knowingly chose to construe the Court's [January 2016] Order in such a fashion as to thwart the efforts of [Fausz] to obtain information and documents clearly relevant to her FDCPA claims.” Id. at 21. Notably, NPAS repeatedly asked Fausz's counsel to explain which data items that she wanted, a task that was impossible until it had acknowledged that there were 1, 118 types of such data. Id. The magistrate judge continued:

This unfortunate scenario suggests to the Court that sanctions are required. Its discovery production in the face of the Court's Order was both belated and incomplete. Only by adopting a strained and overly narrow interpretation of the Order has NPAS been able to attempt to justify its disclosure practices in the present case. The imposition of sanctions under the circumstances is fully warranted.

Id. at 22. The magistrate judge accordingly (1) ordered NPAS to pay the reasonable and necessary costs and attorney fees incurred by Fausz in bringing her motion for sanctions, (2) reopened discovery for ninety days to allow Fausz to obtain complete discovery from NPAS, (3) required NPAS to bear the cost of producing several types of data, and (4) ordered NPAS to bear the cost of re-deposing any witness that had been deposed by Fausz ...


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