15-2054 Mazzei v. Money Store



### UNITED STATES COURT OF APPEALS **FOR THE SECOND CIRCUIT**



## SUMMARY ORDER

**R ULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT**  **. C**  **ITATION TO A SUMMARY ORDER FILED**
**ON OR AFTER J** **ANUARY 1,**  **2007, IS PERMITTED AND IS GOVERNED BY**  **F EDERAL**  **R ULE OF**  **A PPELLATE**  **P ROCEDURE**  **32.1 AND THIS COURT**  **’ S**  **L OCAL**  **R ULE**  **32.1.1. W**  **HEN CITING A SUMMARY ORDER IN A**
**DOCUMENT FILED WITH THIS COURT ,**  **A PARTY MUST CITE EITHER THE F**  **EDERAL A** **PPENDIX OR AN**
**ELECTRONIC DATABASE (**  **WITH THE NOTATION “**  **SUMMARY ORDER ”).**  **A PARTY CITING A SUMMARY ORDER MUST** 
**SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL .** 
**At a stated term of the United States Court of Appeals** 1 **for the Second Circuit, held at the Thurgood Marshall United** 2 **States Courthouse, 40 Foley Square, in the City of New York,** 3 **on the 15 th** **day of July, two thousand sixteen.** 4 5 **PRESENT: AMALYA L. KEARSE,** 6 **RALPH K. WINTER,** 7 **DENNIS JACOBS,** 8 **Circuit Judges**

**.** 9 10
- - - - - - - - - - - - - - - - - - - -X 11 **JOSEPH MAZZEI, on behalf of himself** 12 **and all others similarly situated,** 13 **Plaintiff-Appellant ,**  14 15 **-v.- 15-2054** 16 17 **THE MONEY STORE, TMS MORTGAGE, INC.,** 18 **HOMEQ SERVICING CORP.,** 19 **Defendants-Appellees**

**.** * 20
- - - - - - - - - - - - - - - - - - - -X 21 22

* The Clerk of Court is directed to amend the official caption in this case to conform to the listing of the parties above.

1**FOR PLAINTIFF-APPELLANT:** PAUL S. GROBMAN (Neal DeYoung, 1 Sharma & DeYoung, on the brief ), 2 New York, New York. 3 4 **FOR DEFENDANTS-APPELLEES:** DANIEL A. POLLACK (Edward T. 5 McDermott, Anthony Zaccaria, 6 Minji Kim, on the brief ), 7 McCarter & English, LLP, New 8 York, New York. 9 10 Appeal from a judgment of the United States District 11 Court for the Southern District of New York (Koeltl, J. ). 12 13 **UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED** 14
**AND DECREED**that the judgment of the district court be 15
**AFFIRMED**

. 16 17 Joseph Mazzei appeals from the judgment of the United 18 States District Court for the Southern District of New York 19 (Koeltl, J. ) and two post-trial rulings. At trial, Mazzei 20 sought to prove two breach-of-contract theories on behalf of 21 himself and two nationwide classes. The jury found in favor 22 of defendants and against Mazzei and the “Fee-Splitting 23 Class” as to the “fee-splitting claim,” and in favor of 24 Mazzei and the “Late Fee Class” as to the “late fee claim.” 25 Subsequently, the district court (1) denied Mazzei’s motion 26 for a new trial on the fee-splitting claim and (2) granted 27 defendants-appellees’ post-trial motion to decertify the 28 Late Fee Class. 29 30 In the accompanying opinion, we affirm the grant of 31 defendants’ motion for decertification of the Late Fee 32 Class. In this summary order, we affirm the denial of 33 Mazzei’s motion for a new trial, and the judgment of the 34 district court. We assume the parties’ familiarity with the 35 underlying facts, the procedural history, and the issues 36 presented for review. 37 38 Mazzei’s principal argument in support of his motion 39 for a new trial was that the district court had abused 40 discretion in declining to grant an adverse inference 41 instruction on the fee-splitting claim. The court did not 42 abuse discretion in refusing to impose additional sanctions 43 in the form of an adverse inference instruction, and it did 44 not abuse discretion in denying the Rule 59 motion made on 45 the same premise. 46 47

2The New Invoice System was a web-based, electronic 1 billing database owned by Fidelity National Foreclosure 2 Solutions (“Fidelity”), a nonlawyer entity to which 3 defendants outsourced certain legal services. Fidelity and 4 vendors, including law firms, used the New Invoice System to 5 submit invoices to defendants. The data in that system 6 (records of the invoices from Fidelity and vendors) were not 7 maintained in their original, accessible form. Affirming 8 the magistrate judge, the district court ruled that, 9 although the database was in the possession of Fidelity (and 10 its successor) rather than defendants, defendants had the 11 legal and practical ability to obtain access, and should 12 have caused the data to be preserved in the previously 13 accessible form. The district court affirmed the limited 14 sanctions awarded by the magistrate judge: the costs of 15 determining the current accessibility of the data, and 16 attorney’s fees and costs for the sanctions motion. 17 18 The district court declined to grant additional relief 19 in the form of an adverse inference charge because the court 20 found that the New Invoice System contained only “tangential 21 information” as to the fee-splitting claim: It did not 22 record payment of invoices by defendants, it did not record 23 fees that were charged to members of the class, and it did 24 not contain bills by Fidelity to law firms or payments by 25 law firms to Fidelity. Mazzei v. Money Store , 308 F.R.D. 26 92, 102 (S.D.N.Y. 2015). It also found that Mazzei failed 27 to diligently seek discovery of fee-splitting evidence from 28 other obvious sources--sources more likely to evidence what 29 payments were exchanged between Fidelity and the law firms. 30 These findings were not clearly erroneous and supported 31 denial of the motion for an adverse inference. See Chin v. 32 Port Auth. of N.Y. & N.J. , 685 F.3d 135, 162 (2d Cir. 2012) 33 (“[A] district court may, at its discretion, grant an 34 adverse inference jury instruction insofar as such a 35 sanction would ‘serve the threefold purpose of (1) deterring 36 parties from destroying evidence; (2) placing the risk of an 37 erroneous evaluation of the content of the destroyed 38 evidence on the party responsible for its destruction; and 39 (3) restoring the party harmed by the loss of evidence 40 helpful to its case to where the party would have been in 41 the absence of spoliation.’” (quoting Byrnie v. Town of 42 Cromwell , 243 F.3d 93, 107 (2d Cir. 2001)) (brackets 43 omitted)), superseded in part byFed. R. Civ. P. 37(e) 44 (2015). 45 46

3Under the current Rule 37(e)(2), which took effect 1 after the post-trial motions were decided, an adverse 2 inference instruction may be given for failure to preserve 3 electronically stored information “only upon finding that 4 the party acted with the intent to deprive another party of 5 the information’s use in the litigation.” Fed. R. Civ. P. 6 37(e)(2)(B). The district court specifically found that 7 defendants did not act with such intent. 8 9 As the district court further explained: “[A]ny 10 additional evidence from the New Invoice System would not 11 have made any difference in this trial. The plaintiff 12 obtained the records from the New Invoice System relating to 13 Mazzei and introduced them at trial. . . . Even with the 14 evidence from the New Invoice System, Mazzei could not prove 15 his individual claim. There is thus no basis to believe 16 that evidence from the New Invoice System would have proved 17 any claim with respect to the class.” Mazzei , 308 F.R.D. at 18 100. “Absent a showing of prejudice [resulting from the 19 missing evidence], the jury’s verdict should not be 20 disturbed.” Chin , 685 F.3d at 162 (quoting Residential 21 Funding Corp. v. DeGeorge Fin. Corp. , 306 F.3d 99, 112 (2d 22 Cir. 2002)) (brackets omitted). 23 24 Mazzei’s remaining arguments are unpersuasive. 25 Defendants’ questions and argument at trial regarding the 26 lack of evidence that Fidelity made payments to law firms or 27 lawyers did not violate the district court’s pretrial 28 orders. The court’s refusal to admit into evidence the 29 Buechner Affidavit was not an abuse of discretion: Mazzei 30 has never articulated the relevance of the information 31 (aside from making spoliation arguments); and Mazzei still 32 does not explain how the information contained in the 33 affidavit likely would have affected the jury’s verdict. 34 Furthermore, Mazzei failed to articulate in the district 35 court a hearsay exception or exclusion pursuant to which 36 admission of the affidavit would have been proper. Finally, 37 denial of a motion for a new trial on weight-of-the-evidence 38 grounds is not subject to appellate review. Stonewall Ins. 39 Co. v. Asbestos Claims Mgmt. Corp. , 73 F.3d 1178, 1199 (2d 40 Cir. 1995), modified on other grounds , 85 F.3d 49 (2d Cir. 41 1996). 42 43

4We have considered Mazzei’s remaining arguments and 1 find them to be without merit. For the reasons stated 2 herein and in the accompanying opinion, the judgment of the 3 district court is **AFFIRMED**

. 4 5 FOR THE COURT: 6 CATHERINE O’HAGAN WOLFE, CLERK 7 8

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