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Schneider v. CitiMortgage, Inc.

United States District Court, D. Kansas

June 29, 2017

RANDALL A. and AMY L. SCHNEIDER, Plaintiffs,
CITIMORTGAGE, INC., et al., Defendants.


          K. Gary Sebelius U.S. Magistrate Judge

         This matter comes before the court upon plaintiffs' Motion for Finding of Violation of Rule 30(b)(6)(ECF No. 419). Plaintiffs contend that Primerica, Inc.'s (“Primerica's”) designee as a corporate representative under Fed. R. Civ. 30(b)(6) was unprepared for the deposition that occurred on December 29, 2016. For the following reasons, this motion is granted in part and denied in part.


         Plaintiffs, Randall A. Schneider and Amy L. Schneider, bring claims against defendants, CitiMortgage, Inc. ("CitiMortage"); Citibank, National Association ("Citibank"); Citigroup, Inc. ("Citigroup"); and Primerica Financial Services Home Mortgages, Inc. ("Primerica"), for breach of contract and for violations of the Kansas Consumer Protection Act ("KCPA"). The claims involve defendants' alleged misconduct in handling the Schneiders' residential mortgage loan, and their 2010 loan refinance. The Schneiders allege that they were wrongfully assessed overcharges and fees and they were denied a loan refinance for which they were qualified.

         Discovery in this case has been difficult. Both sides are responsible for the many problems that have occurred. The court has repeatedly attempted to get counsel to work cooperatively, but success has been limited. Rather than recount all of the transgressions, the court shall turn immediately to the facts that underlie the instant motion.

         The parties' efforts to complete the Rule 30(b)(6) depositions have been particularly difficult, to say the least. In August 2014, plaintiffs served their Rule 30(b)(6) notices.[1] The defendants responded with a motion to quash the deposition notices.[2] On September 29, 2014, the court conducted a telephone conference on this motion and other matters in the case. As a result of the telephone conference, plaintiffs agreed to withdraw the Rule 30(b)(6) notices. The court then denied the motion to quash as moot.[3] On March 12, 2015, plaintiffs again filed Rule 30(b)(6) notices.[4] Plaintiffs filed a Motion for Conference to address the disputes concerning the Rule 30(b)(6) topics.[5] Defendants then filed another motion for protective order and/or to quash plaintiffs' deposition notices.[6] Defendants again raised issues of overbreadth, undue burden and relevance.

         On January 28, 2016, the court denied plaintiffs' motion for conference, finding that a telephone conference would not aid the parties.[7] In ruling on that motion, the court noted that “[t]hroughout this litigation the parties have failed to cooperatively resolve disputes.”[8] The court directed the parties to resolve their disputes about plaintiffs' topics with some additional guidance provided in the order. The court ordered plaintiffs to file corrected Rule 30(b)(6) notices that complied with the court's directives by February 22, 2016.[9] The court directed plaintiffs to narrowly tailor their topics to comply with the “reasonable particularity” requirements of Rule 30(b)(6).[10] The court also found that plaintiffs' notice violated the court's prior orders to limit discovery to the claims still at issue in the case.[11] The court noted that if the defendants still sought a protective order after the plaintiffs' renewed notice, the parties were to confer and promptly seek to resolve their dispute. The court stated:

Only after the parties have conducted this second, good-faith discussion will the court consider any additional motion on the issue. If briefing is necessary, the defendants shall list the topics for which they seek a protective order by number. Then for each topic they shall be required to show good cause why the court should issue a protective order under Federal Rule of Civil Procedure 26(c)'s enumerated categories: annoyance, embarrassment, oppression, or undue burden or expense.[12]

         Conferences were held by the parties after the court's order of January 28, 2016. The parties conferred in excess of six hours in conferences on February 22, 2016, and March 2, 2016. After the first conference, plaintiffs provided a revised list, which the parties discussed at the second conference. On March 3, 2016, plaintiffs served another list of topics which included a number of new topics.

         On April 7, 2016, plaintiff filed a notice to take the Fed.R.Civ.P. 30(b)(6) deposition of Primerica's corporate designee on May 10, 2016.[13] The notice listed 23 topics for examination.[14]On May 6, 2016, Primerica filed a motion for protective order and a motion to quash.[15]Primerica sought protection from and to quash certain topics in plaintiffs' notice.[16] On May 9, 2016, the court stayed the case after the parties sought mediation.[17] Mediation occurred on June 23, 2016. On July 6, 2016, the court was advised that the mediation was unsuccessful.[18]

         On October 31, 2016, the court granted Primerica's motion in part and denied it in part.[19]The court quashed 13 of the topics designated in plaintiffs' notice. The court denied Primerica's motion concerning the following topics: 13ii, 48, 49, 49yy and 50. The court directed the parties to complete the Rule 30(b)(6) deposition by December 31, 2016.[20] The deposition was subsequently scheduled for December 29, 2016.

         Primerica produced Michael Turnage, a 30-year employee. Currently, he is in charge of field education. This position involves preparing new recruits for “life pre-licensing training.” He has been in this position for three years. Prior to that, he was involved in marketing securities.

         The deposition ultimately proceeded on the following twelve topics:

9. Whether any marketing agreements existed, and if so, the roles assigned to each or between each the defendants (CitiGroup, CitiMortgage, CitiBank, Primerica) or CitiAssurance (the PWP administrator or the a.k.a. American Health and Life Insurance Company) for the products (or features, referred to as the "PWP" waiver, $MART Equity Builder) on the Schneider 2007 loan or the 2010 refinance application.
10. The role and relationship of Primerica to CitiGroup, Inc. as it relates to the Schneider's 2007 loan or 2010 refinance.
13ii. All sources of indirect and direct revenue and total amount of revenue anticipated to be received by Primerica as a result from the Schneiders' initial loan application to Citibank (or Primerica) in or around May 2010, if the application had been approved.
41. Identify, describe and explain the terms, "Smart Loan Center", "Smart Solutions", "Citi-Quick", E-ZPay, and Timely Rewards as these applied to the Schneiders loan.
47ww. During May 2010 (the timeframe of the Schneiders' 2010 loan refinance application to Citibank submitted through Primerica), describe whether there were two application processes and the disclosures, or lack of disclosures, involved in each.
47zz. The corporate structure as between Primerica and Citibank, CitiMortgage, and CitiGroup in 2007 and 2010.
48. Explain and identify all sources of income received by Ms.Cobb, by Primerica related to the Schneiders 2007 mortgage loan, the Schneiders investments with Ms. Cobb, the Schneiders' insurance policies with Ms. Cobb, and the anticipated revenue for the Schneiders' 2010 refinance.
48xx.The timing of disclosures if disclosures were required in connection with a loan refinance application submitted through Primerica to Citibank during May 2010 (the timeframe of the Schneiders' 2010 loan refinance application to Citibank).
49. Explain and identify Primerica structure by divisions and associates by job category that make up the Primerica entity that dealt with Randal and Amy Schneider in the 2007 loan and 2010 refinance if any structural changes.
49yy. All direct and indirect sources of revenue and total amount of revenue anticipated by Primerica to be received by Primerica or Kerry Cobb in connection with the Schneiders ' initial refinance loan application to Citibank in or around May 2010, had the application been approved.
50. Identify and describe the Primerica compensation as it relates to the percentage in accordance with the organizational chart. (Divisions and for associates, employees, vice presidents, or other representatives that make up the Primerica entity including Ms. Cobb as the only identified individual).
62. Explain the features of the 2007 loan Primerica arranged for the Schneiders through Kerry Cobb including the $.M.A.R.T. Equity Builder, $.M.A.R.T. loan, the Payment Waiver Protection Program and any other names used to describe these programs.


         In their motion, plaintiffs raise a variety of arguments. Plaintiffs suggest that Mr. Turnage was not adequately prepared because he had no knowledge of home loans. Plaintiffs point out that Mr. Turnage's experience was in the area of life insurance, securities and human resources. Plaintiffs also suggest that Mr. Turnage did not adequately review the relevant documents. Plaintiffs specifically point to Mr. Turnage's failure to consider a 2006 marketing agreement. ...

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