Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_14-cv-02597/USCOURTS-caed-2_14-cv-02597-9/pdf.json

Nature of Suit Code: 470
Nature of Suit: Civil (Rico)
Cause of Action: 18:1962 Racketeering (RICO) Act

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UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

DAVID WEINER, individually and on

behalf of other members of the public

similarly situated,

Plaintiff,

v.

OCWEN FINANCIAL CORPORATION, 

a Florida corporation, et al.,

Defendants.

No. 2:14-cv-2597 MCE DB

ORDER

On November 18, 2016, this matter came before the undersigned for hearing of plaintiff’s 

motion to compel. Attorney Mark Pifko appeared on behalf of the plaintiff and attorney Jim

Bowman appeared on behalf of the defendants. Plaintiff’s motion to compel seeks further 

production of documents with respect to four requests for production. (ECF No. 62 at 7.) 

Discovery in this action is currently limited to whether this action should be certified as a 

class action. (ECF No. 50 at 2.) “The class action is ‘an exception to the usual rule that litigation 

is conducted by and on behalf of the individual named parties only.’” Wal-Mart Stores, Inc. v. 

Dukes, 564 U.S. 338, 348 (2011) (quoting Califano v. Yamasaki, 442 U.S. 682, 700-01 (1979)). 

“In order to justify a departure from that rule, ‘a class representative must be part of the class and 

possess the same interest and suffer the same injury as the class members.’” Id. at 348-49

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(quoting E. Tex. Motor Freight Sys., Inc. v. Rodriguez, 431 U.S. 395, 403 (1977)). Class 

certification is governed by Rule 23 of the Federal Rules of Civil Procedure.

“Rule 23(a) ensures that the named plaintiffs are appropriate representatives of the class 

whose claims they wish to litigate. The Rule’s four requirements—numerosity, commonality, 

typicality, and adequate representation—‘effectively limit the class claims to those fairly 

encompassed by the named plaintiff’s claims.’” Dukes, 564 U.S. at 349 (quoting Gen. Tel. Co. of 

Sw. v. Falcon, 457 U.S. 147, 156 (1982)). In this regard, in order for a class to be certified: (1) 

the class must be so numerous that joinder of all members is impracticable, (2) questions of law 

or fact exist that are common to the class, (3) the claims or defenses of the representative parties 

are typical of the claims or defenses of the class, and (4) the representative parties will fairly and 

adequately protect the interests of the class. See Fed. R. Civ. P. 23(a). 

Rule 23(b) also allows for certification of a class if either “final injunctive relief or 

corresponding declaratory relief is appropriate respecting the class as a whole,” or, if “questions 

of law or fact common to class members predominate over any questions affecting only 

individual members, and that a class action is superior to other available methods for fairly and 

efficiently adjudicating the controversy.” Fed. R. Civ. P. 23(b). “Rule 23(b)(3) requires a 

showing that questions common to the class predominate, not that those questions will be 

answered, on the merits, in favor of the class.” Amgen Inc. v. Connecticut Retirement Plans and 

Trust Funds, 133 S.Ct. 1184, 1191 (2013). The plaintiff bears the burden of demonstrating that 

each of the elements under Rule 23(a), along with at least one component of Rule 23(b), has been 

satisfied. Conn. Ret. Plans & Trust Funds v. Amgen Inc., 660 F.3d 1170, 1175 (9th Cir. 2011).

“Rule 23 does not set forth a mere pleading standard”; indeed, the “party seeking class 

certification must affirmatively demonstrate his compliance with the Rule—that is, he must be 

prepared to prove that there are in fact sufficiently numerous parties, common questions of law or 

fact, etc.” Dukes, 564 U.S. at 350. Therefore, when “considering class certification under Rule 

23, district courts are not only at liberty to, but must perform ‘a rigorous analysis [to ensure] that 

the prerequisites of Rule 23(a) have been satisfied.’” Ellis v. Costco Wholesale Corp., 657 F.3d

970, 980 (9th Cir. 2011) (quoting Dukes, 564 U.S. at 350-51). In many cases, this rigorous 

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analysis will “overlap with the merits of the plaintiff’s underlying claim. That cannot be helped.” 

Dukes, 564 U.S. at 351. 

Here, plaintiff’s Requests for Production of Documents numbers 129 and 6 seeks 

defendants’ “internal communications relating to their decision to spin-off third-party Altisource 

Solutions S.A. (‘Altisource’). . . .’” (ECF No. 62 at 7.) Requests for Production of Documents 

numbers 120 and 121 “seek documents produced by Defendants to the New York Department of 

Financial Services (‘NYDFS’) which ultimately led” to a Consent Order between defendants and 

the NYDFS. (Id. at 8.) 

Plaintiff argues that the internal communications discovery is:

... highly relevant to class-certification, because Defendants’ 

motivation for spinning-off Altisource bears directly on their 

classwide intent to fraudulently conceal marked-up default-related 

costs from consumers. In particular, in his motion for class 

certification, Plaintiff intends to demonstrate to the Court that 

classwide evidence exists to support his allegations concerning (1) 

the existence of a RICO enterprise (involving Defendants, 

Altisource, and William Erbey); (2) the RICO enterprise’s 

fraudulent scheme to conceal and profit from marked-up charges 

for default services, and (3) the exact scope of the enterprise’s 

scheme. It cannot reasonably be disputed that Defendants’ internal 

communications regarding the decision to spinoff Altisource have 

the potential to provide this evidence and to reveal whether 

Defendants’ fraudulent practices uniformly applied to Plaintiff and 

all class members, irrespective of the type of loan they had, their 

geographic location, or any other factors that may be unique to a 

particular borrower.

(Id. at 8.) With respect to the documents defendants produced to the NYDFS, plaintiff argues that 

these discovery requests “bear directly on the uniformity of Defendants’ practices, . . . fraudulent 

intent, classwide evidence of the RICO enterprise, as well as” establishing the scope of the 

fraudulent practices at issue and the precise timeframe. (Id. at 9.)

It is apparent that the discovery plaintiff seeks goes to the merits of his claims — a point 

plaintiff essentially concedes. (Id. at 9.) In this regard, plaintiff has alleged that the defendants 

“engaged in a pattern and practice of unlawfully charging marked up prices on broker price 

opinions (‘BPOs’) and titles searches to borrowers in default,” and “engaged in a scheme to 

disguise hidden, marked-up fees assessed to homeowners in default on their mortgages.” (Id. at 

12.) Specifically, plaintiff alleges that “[i]n furtherance of this scheme, Defendants funnel 

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default-related services, including BPOs and title searches through their affiliated businesses and 

mark up the cost of those services.” (Id.) “Thus, when Defendants charge homeowners for such 

services, Defendants are not merely being ‘paid back’ by borrowers or collecting ‘amounts 

disbursed.’ Rather, Defendants have turned the BPO and title search charges into an unlawful 

profit center.” (Id.) 

As noted above, “a court’s class-certification analysis must be ‘rigorous’ and may ‘entail 

some overlap with the merits of the plaintiff’s underlying claim.’” Amgen, 133 S.Ct. at 1194 

(quoting Dukes, 564 U.S. at 351). Plaintiff asserts that the discovery at issue has such a 

“significant bearing on issues such as predominance and commonality,” that the “fact that this 

information simultaneously concerns the merits . . . is insignificant” and provides defendant no 

basis to refuse to respond. (ECF No. 62 at 21.) Plaintiff, however, does not articulate how the 

discovery at issue bears on predominance or commonality, aside from speculative and conclusory 

statements such as “if the requested communications reveal a common practice applied uniformly 

to Plaintiff and all class members, it strongly supports class certification.” (Id.) 

Moreover, in support of this argument, plaintiff quotes Lindell v. Synthes USA, No. 1:11-

cv-2053 LJO BAM, 2013 WL 3146806, at *6 (E.D. Cal. June 18, 2013). (ECF No. 62 at 21.) 

The discovery at issue in Lindell, however, was interrogatories and requests for production of 

documents seeking specific, targeted, information related to “expense reimbursement and wage 

deductions for the entire class.” Lindell, 2013 WL 3146806 at *5. Here, plaintiff is not seeking 

specific, targeted information about the potential class. Plaintiff is seeking defendants’ internal 

communications concerning its business decision and all documents produced to the NYDFS in 

another action. 

Plaintiff also cites Bias v. Wells Fargo & Co., 312 F.R.D. 528, 535 (N.D. Cal. 2015), in 

support of the argument that the “timeframe for the scheme, the geographic and substantive 

scope, and the nature of the borrowers impacted all factor into the formulation of the class 

definition.” (ECF No. 62 at 21.) First, plaintiff has done little to explain precisely how he thinks 

the discovery at issue will establish a timeframe for the scheme, its geographic and substantive 

scope, or the nature of the borrowers impacted. 

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Second, Bias is instructive in a different respect. Bias involved allegations similar to the 

ones present here, specifically that the defendant “added a mark-up to the BPO cost . . . which it 

then charged borrowers.” 312 F.R.D. at 532. Plaintiffs in Bias alleged a civil RICO claim and 

sought to certify a “Paid Class” consisting of “all residents of the United States . . . who paid for 

one or more” BPOs charged by defendant from January 1, 2002 through July 1, 2010. (Id. at 532-

33.) The court in Bias analyzed plaintiff’s motion for class certification pursuant to Rule 23, 

including the civil RICO claim, and granted plaintiff’s motion to certify a “Paid Class”, in part. 

Id. at 533-44. Specifically, the court certified all residents of the United States who had a 

mortgage serviced by the defendant and who paid for a BPO for an amount greater than the 

amount the defendant paid for the corresponding BPO from February 11, 2008 through July 1, 

2010. Id. at 544. 

In analyzing the plaintiff’s motion for class certification in Bias, the court did not 

reference any discovery similar to that plaintiff seeks here. Instead, the Bias court focused on the 

evidence that seems, to the undersigned, plainly relevant to class certification. Specifically, 

“common evidence, applicable classwide . . . that Defendants charged borrowers a uniform cost 

for BPOs without regard to the actual amount it paid a third party for the service.” Id. at 536.

Accordingly, upon consideration of the arguments on file and at the hearing, and for the 

reasons set forth above and on the record at the hearing, IT IS HEREBY ORDERED that 

plaintiff’s October 20, 2016 motion to compel, (ECF No. 61), is denied. 

Dated: November 22, 2016

DLB:6

DB\orders\orders.civil\weiner2597.oah.111816

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