On June 24, 2016, the United States District Court for the Northern District of Ohio, Eastern Division, determined that “a party cannot simply claim ignorance in order to avoid producing documents that are relevant to an opposing party’s claim or defense”.
Plaintiff FDIC is the receiver of AmTrust while Defendant Ark-La-Tex is engaged in the business of brokering, originating, processing and other activities related to loans. Plaintiff alleges that defendant breached their agreement by submitting false information for the At-Issue loans to AmTrust
Defendant served discovery requests on plaintiff. Defendant found Plaintiff’s response to be deficient and moved the court to compel discovery of electronic loan policies and procedures.
Plaintiff argued that production would be disproportionate to the needs of this case. The party’s e-discovery expert also explained that attempting to identify the documents sought by Defendants would require an “expansive set of ESI search terms, such as ‘loan policy,’ that would yield tens of thousands of documents culled from a universe of over 1.5 billion pages of documents.” Plaintiff also objected that it didn’t know which documents were related to the at-issue loan.
The Court deemed these arguments unpersuasive. It referred to the amended FRCP 26(b)(1) proportionality factors to rejected Plaintiffs objections explaining that “Plaintiff is the party with access to this information, defendant has no other way to obtain it, and a number of defendant’s defenses depend on it. Moreover, plaintiff has offered no alternatives that would enable even some degree of production.”
The court granted the motion to compel much of the discovery, noting that “it does not appear that Plaintiff has attempted to run any searches at all. Plaintiff did not do any good faith effort at searching for the requested documents and has not met its obligation to show that the burden of complying with defendant’s requests outweighs the likely benefit of production”.
FDIC v. Ark-La-Tex Fin. Servs., LLC, 2016 U.S. Dist. LEXIS 82444 (N.D. Ohio June 24, 2016) can be downloaded with subscription at Lexis Nexis Open Pdf
For more information, Francesca Giannoni-Crystal