On Monday, the Eleventh Circuit affirmed sanctions levied by the United States District Court for the Northern District of Georgia against the Consumer Financial Protection Bureau due to its conduct during discovery. The CFPB initiated the lawsuit in Consumer Financial Protection Bureau v. Brown, --- F.4th ---, 2023 WL 3939432 (11th Cir. June 12, 2023) against eighteen different defendants for allegedly engaging in or substantially assisting a fraudulent debt collection scheme. Thirteen of the defendants are alleged to have directly participated, while five of the defendants were alleged to have assisted the scheme by providing services to the direct participants.
At the discovery phase, the five defendants alleged to have assisted the scheme sought to depose a 30(b)(6) representative of the CFPB, which the CFPB vehemently opposed. The trial court ultimately ordered the CFPB to present a 30(b)(6) witness, but limited the scope of the depositions to questions of fact, including “exculpatory facts,” while excluding questions regarding trial strategy or other work product issues. During the depositions, however, the CFPB evaded even fact-based questions by objecting on the basis of work product or having the witness respond by reading directly from memory aids in what the Eleventh Circuit referred to as a “filibuster-style reading.” After the first of such depositions, the trial court admonished the CFPB and provided further instructions regarding the scope of their depositions, but the “obstructionist conduct” continued in subsequent depositions. The district court therefore determined that sanctions were warranted and dismissed the CFPB’s claims against those five defendants with prejudice.
On appeal, the Eleventh Circuit had no trouble affirming the district court’s dismissal, recognizing that such “severe sanctions were warranted” after the CFPB “employed tactics that the district court repeatedly forbade.” This opinion serves as a cautionary tale against evasive discovery tactics, which could lead to significant consequences.
PartnerAlan is a partner and practices in the firm’s Financial Services section. Prior to law school, he was employed at a large financial corporation in its commercial lending division. Directly after law school, Alan spent two years as ...
AssociateCollaborative, analytical, and thorough are the qualities that define Ryli’s legal approach. She is skilled in crafting arguments and embracing challenges while working with other attorneys in financial litigation matters ...
