Camenisch v. Umpqua Bank

Background

This was a discovery order concerning requests by the plaintiffs in litigation involving PFI and a Ponzi scheme. The order addressed docket numbers 68 and 74. The court considered whether the likely benefit of requested information outweighed the burden and expense of producing it.

Actimize alerts

Umpqua had 152 Actimize alerts concerning PFI. The court ordered Umpqua to produce the associated account numbers and transaction details because that information would help put each alert in context and was relevant to the case. Although Umpqua reported that Actimize did not have an export function, the court found that the bank could manually extract the information and that the benefit outweighed the burden.

The court did not require Umpqua to produce the analyst notes accompanying the alerts. It relied on its earlier conclusion that those notes were protected by the suspicious-activity-report privilege. The court also did not require Umpqua to allow the plaintiffs to inspect the Actimize system because it contained privileged information that would be difficult to protect.

Account and wire-transfer records

Umpqua did not dispute that monthly statements for PFI’s bank accounts often failed to identify the people or entities sending or receiving funds. Because those names would help track the flow of money, the court ordered Umpqua to produce deposit slips, check images, and documents identifying the senders and recipients of PFI’s wire transfers. The court found that the plaintiffs had timely requested the documents and that Umpqua had not shown that the burden or expense would outweigh the likely benefit.

Internal reports

The court ruled that Umpqua did not need to produce additional internal reports sought in response to requests for production 17 through 20. The plaintiffs argued that the reports could show that Umpqua significantly benefited from PFI’s business and therefore had a motive to aid PFI’s scheme. The court noted that motive is not an element of aiding-and-abetting fraud and that the reports would be cumulative because Umpqua had already produced emails showing that PFI was the Novato branch’s number-one business client.

Email search

Umpqua had previously agreed to search six custodians’ emails for references to PFI, PISF, or Professional Financial Investors. The plaintiffs sought the same search for 19 additional custodians, whose emails included about 4,400 unproduced messages mentioning one or more of those terms. The court recognized that these individuals were more removed from PFI’s accounts than the original six custodians, but found that they had some involvement with PFI and that 4,400 emails was a modest number to search among 19 custodians. The court ordered Umpqua to search for and produce the requested emails.

Deadline and disposition

The court ordered Umpqua to comply and produce the required documents by March 2, 2022. It explained that the order did not authorize new discovery requested on the eve of the February 2 fact-discovery cutoff; instead, it required Umpqua to supplement responses to timely discovery requests and timely requests to compel production. The court also found that the plaintiffs had not delayed their requests. Each side was ordered to bear its own fees and costs.