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Title v. Warren

United States District Court, District of Columbia

July 14, 2017

DISTRICT TITLE, Plaintiff,
v.
ANITA K. WARREN, et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          AMY BERMAN JACKSON United States District Judge.

         Plaintiff District Title, a real estate settlement company, was handling the sale of a property formerly owned by defendant Anita K. Warren when it erroneously transferred $293, 514.44 to Warren instead of to the mortgage lender, non-party Wells Fargo Bank, N.A. Am. Compl. [Dkt. # 5] ¶ 15. Warren promptly transferred the funds to her son Timothy Day, and the two refused to give the money back. See District Title v. Warren, No. 14-1808, 2015 WL 7180200, at *1 (D.D.C. Nov. 13, 2015). On November 13, 2015, the Court granted summary judgment to plaintiff on a breach of contract count brought against Warren and an unjust enrichment count brought against Day. See Id. The Court entered judgment in favor of plaintiff in the amount of $293, 514.44, plus pre-and-post judgment interest and attorneys' fees and costs, and it also entered a permanent injunction to enjoin defendants from dissipating their assets until the judgment was satisfied. Order (Nov. 13, 2015) [Dkt. # 79]; see also Order (Aug. 3, 2016) [Dkt. # 100] (amending the November 13, 2015 order to correct a clerical error). The D.C. Circuit summarily affirmed the Court's judgment. District Title v. Warren, No. 15-7157, 2016 WL 3049558 (D.C. Cir. May 4, 2016).

         On March 22, 2016, plaintiff filed a motion to conduct post-judgment discovery related to its efforts to collect on the judgment; it sought to depose Day, [1] and it sought court permission to serve subpoenas on three individuals, including counsel for defendants, Matthew LeFande. See Mem. of P. & A. in Supp. of Pl.'s Mot. for Oral Examination of J. Debtor Timothy Day & Third Parties, & for Leave to Serve Subpoenas [Dkt. # 88-1]. Plaintiff asserted that it sought to issue a subpoena on LeFande because he “may have information concerning assets held or transferred by Timothy Day.” Id. at 5.

         The Court referred the motion to a Magistrate Judge pursuant to Local Civil Rule 72.2(a). Order (Apr. 5, 2016) [Dkt. # 90]. Thereafter, the Court referred another post-judgment discovery matter to the same Magistrate Judge. See Order (June 29, 2016) [Dkt. # 95] (referring plaintiff's motion for the issuance of Letters Rogatory to the Auckland High Court in Auckland, New Zealand); Mem. Op. & Order [Dkt. # 104] (granting the motion for the issuance of Letters Rogatory).

         On April 21, 2017, plaintiff moved for an order to show cause as to why LeFande should not be held in contempt, and it renewed its request for leave to issue a subpoena to LeFande. Pl.'s Mot. to Show Cause Why Timothy Day's Counsel Should Not be Held in Contempt & Renewed Request for Issuance of Subpoena to Matthew LeFande [Dkt. # 107] (“Pl.'s Mot.'). In support of its motion, plaintiff pointed to testimony in a related proceeding in a Maryland state court that LeFande was complicit in the concealment of defendant Day's assets. Pl.'s Mem. of P. & A. in Supp. of Pl.'s Mot. [Dkt. # 107-1] (“Pl.'s Mem.”) at 3. Plaintiff proffers that Day transferred over $80, 000 in profits received from a November 2014 sale of property in St. Mary's County, Maryland to an account in New Zealand. Id. At a trial related to the St. Mary's County transaction, a witness testified that it was Day's attorney, Matthew LeFande, who instructed the settlement company to transfer the funds to the New Zealand account. Id.

         LeFande opposed the motion and sought a protective order. Opp. to Pl.'s Mot. & Request for Protective Order [Dkt. # 108] (“LeFande's Opp.”). In his opposition, LeFande asserted his Fifth Amendment right against self-incrimination, and he also asserted that any testimony would be covered by the attorney-client privilege. Id.

         In an opinion dated June 2, 2017, the Magistrate Judge granted plaintiff's motion for the issuance of a subpoena, denied LeFande's motion for a protective order, and stayed the request for a show cause order. Mem. Op. & Order [Dkt. # 110] (“Magistrate Judge's Opinion”). The Magistrate Judge concluded that LeFande's assertions of privilege were premature because LeFande would be required to assert the attorney-client and fifth-amendment privileges on a question-by-question basis. Id. at 8-9. On June 16, 2017, LeFande filed objections to the Magistrate Judge's order, and he renewed his request for a protective order. Obj. to Magistrate Judge's Op. & Request for Protective Order [Dkt. # 111] (“LeFande's Obj.”). In that opposition, LeFande also contends that plaintiff violated D.C. Rule of Professional Conduct 8.4 by “seek[ing] or threaten[ing] to seek criminal charges or disciplinary charges solely to obtain an advantage in a civil matter.” Id. at 11-12.[2] Plaintiff responded to the objections, Reply in Obj. to LeFande's Obj. [Dkt. # 112] (“Pl.'s Resp.”), and LeFande did not file a reply. Because LeFande has not pointed to any clear error, and because the Magistrate Judge's opinion is not contrary to law, LeFande's objections will be overruled.

         STANDARD OF REVIEW

         Local Civil Rule 72.2(a) permits a district court to refer “any pretrial motion or matter, ” with the exception of certain motions and petitions set forth in Local Civil Rule 72.3, to a Magistrate Judge. Baylor v. Mitchell Rubenstein & Assocs., P.C., 857 F.3d 939, 945 (D.C. Cir. 2017), quoting LCvR 72.2(a).[3] If any party files written objections to a Magistrate Judge's ruling on such a matter, the District Court “may modify or set aside any portion of [the] order . . . found to be clearly erroneous or contrary to law.” LCvR 72.2(c). “A court should make such a finding when the court ‘is left with the definite and firm conviction that a mistake has been committed.'” New Life Evangelistic Ctr., Inc. v. Sebelius, 847 F.Supp.2d 50, 53 (D.D.C. 2012), quoting Am. Soc'y for Prevention of Cruelty to Animals v. Feld Entm't, Inc., 659 F.3d 13, 21 (D.C. Cir. 2011).

         ANALYSIS

         LeFande challenges the Magistrate Judge's ruling on two grounds: first, he argues that any testimony that would be sought from him would be protected by the Fifth Amendment privilege against self-incrimination, and second, he contends that any testimony would be protected by attorney-client privilege. Because LeFande cannot assert these privileges to bar all questioning, the Court will overrule the objections.

         I. LeFande must assert the self-incrimination privilege on a question-by-question basis.

         LeFande argued before the Magistrate Judge that he would refuse to answer any questions about the St. Mary's County transaction, and he cited his Fifth Amendment privilege against self-incrimination. LeFande's Opp. at 7. The Magistrate Judge concluded that LeFande's blanket assertion of the self-incrimination privilege was premature. The Magistrate Judge held:

[N]o authority supports the proposition that the threat by a witness to claim such privileges is a basis upon which to preclude the issuance of a subpoena. Rather, the applicable authorities require that claims of such privileges be made in response to a specific question or ...

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