Iglesias De Castro v. Castro

Background

The plaintiffs are Maria Luisa Iglesias De Castro, Maria Irene Castro Iglesias, Maria de la Concepcion Castro Iglesias, and Maria Luisa Castro Iglesias. They allege claims for civil theft, conversion, and unjust enrichment based on allegations that family members misappropriated money belonging to Maria Luisa and her daughters. The defendants are Maria Regina Castro and Pedro Jose Caraballo, who deny the allegations.

The dispute addressed in this order concerned confidentiality designations in discovery. The defendants had designated financial records as “Attorneys’ Eyes Only” (AEO), a designation that generally prevents the opposing party from viewing the information before trial. In an April 22, 2019 order, the court denied the plaintiffs’ request to remove all AEO designations but directed the defendants to review each document and determine whether it was actually entitled to AEO protection. The court later required the defendants to reproduce documents completely and place the correct designation on each page.

At an October 9, 2019 hearing, the defendants identified documents such as a receipt for breakfast cereal and a record concerning payment for a daughter’s college apartment as examples of documents designated AEO. The defendants also said they had designated some documents AEO because they considered them unrelated to the lawsuit or believed plaintiffs had no reason to see them. On October 10, the court granted in part the plaintiffs’ request to change the designation of financial documents to “Confidential,” subject to restrictions on disclosure and use.

Defendants’ request

The defendants asked for permission to file a motion to reconsider paragraph 3 of the October 10 order. They argued that the April 22 order allowed them to designate bank statements, electronic transfer and withdrawal records, canceled checks, and other financial documents as AEO when they had a good-faith basis to do so. They stated that they had understood bank statements and other financial records would be designated AEO and had not expected the issue to be reconsidered at the October 9 hearing.

Under District of Minnesota Local Rule 7.1(j), permission to file a reconsideration motion requires compelling circumstances. The court explained that reconsideration is limited to extraordinary circumstances, such as correcting a clear legal or factual error or considering newly discovered evidence. The court also reviewed the standards for protective orders under Federal Rule of Civil Procedure 26(c). The party seeking protection must show good cause, and broad or conclusory claims of harm are insufficient. The court stated that AEO treatment should be reserved for a party’s most secret information rather than used routinely.

Court’s analysis

The court rejected the defendants’ arguments. It found that the defendants knew the AEO designations would be discussed because they addressed the issue in their October 7 letter. The April 22 order did not eliminate the defendants’ duty to show that documents designated AEO actually qualified for that protection. Nor did the October 10 order change the April 22 order; instead, the court determined that the defendants had not complied with the earlier order’s requirement that they evaluate whether the documents were truly entitled to AEO status.

The court also found that the defendants had not identified any specific document containing sensitive information that would cause them harm if designated Confidential rather than AEO. Their concerns about identity theft and their description of the plaintiffs as “foreign nationals with a vendetta” were largely conclusory. The October 10 order addressed those concerns by allowing redactions of account numbers, personal identification numbers, and other identifiers; limiting access to one plaintiff; requiring that plaintiff to sign a declaration and accept the court’s continuing authority over compliance; and making plaintiffs’ counsel responsible for compliance. The defendants did not explain why those restrictions were inadequate.

Disposition

The court concluded that the defendants had not shown the extraordinary circumstances necessary for reconsideration. It therefore ordered that the defendants’ letter request for permission to file a motion to reconsider paragraph 3 of the October 10, 2019 Informal Dispute Resolution order was DENIED.