Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_09-md-02015/USCOURTS-cand-3_09-md-02015-60/pdf.json

Nature of Suit Code: 371
Nature of Suit: Truth in Lending
Cause of Action: 15:1601 Truth in Lending

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

IN RE: WACHOVIA CORP. “PICK-APAYMENT” MORTGAGE MARKETING 

AND SALES PRACTICES LITIGATION, 

et al.,

Plaintiffs,

v.

WORLD SAVINGS BANK, FSB, et al.,

Defendants.

Case No. 09-md-02015-RS (KAW)

ORDER REGARDING 12/15/14 JOINT 

DISCOVERY LETTERS CONCERNING 

CLASSIFICATION OF SETTLEMENT 

CLASS A

Re: Dkt. Nos. 661 & 662

On December 15, 2014, the parties submitted two joint discovery letter briefs concerning 

Defendant Wells Fargo Bank, N.A.’s refusal to respond to Class Representative’s discovery, 

namely a single request for production and two interrogatories. Specifically, the first letter 

addressed Request for Production No. 1, which seeks documents regarding an identified sample of 

114 dual-notice Class Members to ensure that over 66,000 dual-notice members were properly 

classified as members of Settlement Class A (borrowers who no longer have Pick-a-Payment 

loans). (12/15/14 Joint Letter regarding Request for Production No. 1, “JL #1,” Dkt. No. 661 at 2.) 

The second letter addressed two complementary interrogatories seeking the identification of which 

of the 114 dual-notice Class Members Wells Fargo believed were members of Settlement Class A, 

and the factual basis for that contention. (12/14/14 Joint Letter Regarding Interrogatories, “JL #2,” 

Dkt. No. 662, Ex. A.)

I. BACKGROUND

On December 10, 2010, the parties executed a settlement agreement to resolve claims 

arising out of the origination of “Pick-a-Payment” (“PAP”) mortgage loans. The agreement was 

approved on May 17, 2011 and became effective on September 1, 2011. As part of the settlement, 

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United States District Court

Northern District of California

Wells Fargo agreed to pay $50 million to the settlement class and $25 million to class counsel, and 

agreed to make two loan modification programs available to qualifying settlement class members 

who still had their PAP loans.

The settlement class was divided into three groups: Current and former borrowers who 

obtained a PAP mortgage loan between August 1, 2003 and December 31, 2008, but who no 

longer had such a loan at the time of the settlement (Class A); borrowers who still had such a loan 

at the time of the settlement and who were not then in default (Class B); and borrowers who still 

had such a loan at the time of the settlement and who were already in default (Class C). Members 

of all three classes were entitled to payment from the settlement fund. Only certain class members, 

however, were eligible for a loan modification review: those who were already in payment default 

(Class C members), and those members of Class B who were current but in “imminent default” or 

who later defaulted. However, more than 66,000 settlement class members were mistakenly sent 

dual notices indicating that they were members of multiple classes. Plaintiffs previously argued 

that those dual-notice members were entitled to be considered for a loan modification, which was 

rejected by the district court on the grounds that “[t]he dual-notice script simply cannot be read to 

vest additional rights in those class members who received dual notice above and beyond the 

rights to which they are entitled as members of either class B or C.” (Dkt. No. 634 at 11.)

On December 15, 2014, the parties filed two joint letters concerning Defendant Wells 

Fargo Bank, N.A.’s refusal to respond to discovery requests seeking to confirm whether an 

identified sample of 114 dual-notice class members were properly classified as members of 

Settlement Class A. (JL #1, Dkt. No. 661; JL #2, Dkt. No. 662.)

II. DISCUSSION

The Class Representative seeks to confirm that Well Fargo properly classified the 66,000

dual-notice class members as members of Settlement Class A. Instead of requesting discovery on 

all 66,000 members, the Class Representative has requested documents and a factual basis 

regarding a sample of 114 dual-notice class members. The Class Representative contends that this 

discovery is necessary because many of the dual-notice class members appear in data that Wells 

Fargo has stated only covers Settlement Class B and C Members, who are eligible for loan 

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United States District Court

Northern District of California

modifications under the settlement agreement. (JL #1 at 3.) In response, Wells Fargo served

objections and refused to answer. 

As an initial matter, in both letters Wells Fargo claims that the presiding judge has twice 

rejected Class Representative’s attempts to obtain the discovery at issue. (JL #1 at 5; JL #2 at 5.) 

Wells Fargo cites to two orders (Dkt. Nos. 644 and 653) in support, but, upon review of those 

orders, the presiding judge did not address the dispute at issue. In those instances, the Class 

Representative sought loan modification consideration for all dual-notice class members, which 

was denied. Now she seeks to confirm whether 66,000 class members, based on a sample of only 

114, were correctly placed in Settlement Class A.

Moreover, Wells Fargo contends that the requests are speculative, because “Class 

Representative has not presented the Court with a single example of a ‘dual notice’ class member 

she claims was ‘improperly treated as a Settlement Class A Member,” thereby rendering the

requests improper. (JL #1 at 7-8.) This argument is unavailing, as Wells Fargo presumably 

possesses the information necessary to classify class members who were not class representatives. 

For example, Wells Fargo has access to loan documents and terms, and so can determine whether 

the class member still has a loan, and, if so, whether that loan is a PAP loan. Additionally, given 

Wells Fargo’s previous prescreening process, which the presiding judge found to violate the 

settlement agreement, the undersigned does not fault the Class Representative for wanting to 

confirm that the class members were correctly classified. (See Dkt. No. 634 at 10.) Assuming that 

the Class Representative is not misrepresenting the fact that some Class A members appear in data 

that only covers Class B and C Members, a contention that Wells Fargo does not refute, the 

confirmation request is not based on mere speculation.

Based on the information provided, the Court cannot determine whether the instant 

document request and interrogatories seeking information regarding 114 class members is unduly

burdensome. The Class Representative, however, has indicated that she is willing to obtain 

information on fewer than 114 class members, so the parties are ordered to meet and confer to 

determine how many class members are necessary to conclude whether Wells Fargo correctly 

classified the 66,000 dual-notice members who were assigned to Settlement Class A. In so doing, 

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United States District Court

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the parties should narrow the two complementary interrogatories to only seek information 

regarding those agreed upon class members.

Should the parties be unable to resolve this dispute informally, they shall file another joint 

letter.

IT IS SO ORDERED.

Dated: January 30, 2015 _______________________________

KANDIS A. WESTMORE

United States Magistrate Judge

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