loanDepot.com, LLC v. CrossCountry Mortgage, LLC

Background

CrossCountry Mortgage, LLC (CCM) objected to Judge Cave’s May 31, 2024 discovery order. CCM had asserted a counterclaim under the Lanham Act, a federal trademark statute, alleging that loanDepot.com, LLC sent mass marketing emails advertising loanDepot’s services from the loanDepot email addresses of former employees after those employees began working for CCM.

CCM sought broad discovery about the alleged email blasts. Judge Cave ordered loanDepot to provide additional discovery on that subject, but did not require loanDepot to search for all potential emails that might have been sent from the email address of every former loanDepot employee.

Court’s Review

Under Federal Rule of Civil Procedure 72(a), the court could change or set aside Judge Cave’s order only if it was clearly erroneous or contrary to law. A clearly erroneous order is one that leaves the reviewing court firmly convinced that a mistake was made. An order is contrary to law when it fails to apply, or misapplies, relevant law or procedural rules.

CCM argued that Judge Cave had not determined whether its requests were relevant and proportional. Judge Subramanian rejected that argument after reviewing the discovery-hearing transcript. The court found that Judge Cave had recognized CCM already had received relevant discovery on the subject, which had produced little information. Judge Cave also considered loanDepot’s representation that investigating the additional requests could take hundreds of hours and considered the parties’ agreed discovery schedule. The court concluded that Judge Cave had properly considered relevance and proportionality.

CCM also argued that Judge Cave improperly considered the merits of its Lanham Act claim by questioning how CCM could prove causation. The court found that Judge Cave’s questions were asked to understand what discovery CCM sought and why it was relevant, not to decide the claim’s merits. The court held that CCM had not met its heavy burden to obtain a change to the discovery order and therefore declined to modify or set it aside.

Other Orders and Deadlines

The court stated that expert discovery was scheduled to close on November 8, 2024. It set December 13, 2024, as the deadline for dispositive motions, January 6, 2025, for opposition briefs, and January 17, 2025, for reply briefs. The court advised that it was unlikely to extend those deadlines. The Clerk was directed to terminate the motions at Dockets 498 and 500.