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Wells Fargo Bank, National Association v. Iny

United States District Court, D. Nevada

June 9, 2014

YOEL INY, et al. Defendant(s)


NANCY J. KOPPE, Magistrate Judge.

Pending before the Court are Defendants' Motion for Clarification Regarding the Magistrate Judge's Order [Doc. 76] and Motion to Enter Protective Order Regarding Confidentiality. Docket Nos. 78, 79. The Court finds this matter is properly resolved without oral argument. See Local Rule 78-2. The Court has considered the Motions, Response, and Reply. Docket Nos. 78, 79, 81, 82. The Motions are hereby DENIED.


This case involves various fraudulent conveyance causes of action brought by Plaintiff Wells Fargo. Plaintiff alleges that Defendants Yoel and Tikva Iny, the Y&T Iny Family Trust, Noam and Rachel Schwartz, and the Noam Schwartz Trust (collectively, "Guarantors") are the guarantors of two loans from Plaintiff which have matured and not been repaid. See Docket No. 1. Plaintiff maintains that the Guarantors initiated fraudulent transfers to the other named Defendants in this case. See Docket No. 55, at 2. Plaintiff brings claims for fraudulent conveyance of property, fraudulent conveyance of cash and securities, and fraudulent transfer of property. Docket No. 1, at 6-13. Plaintiff seeks to recover damages, including attorneys' fees and costs, and seeks to void and set aside certain stock transfers. Id.

The pending motions before the Court relate to Plaintiff's subpoenas served on several banks and financial institutions seeking financial records. Defendants objected to those subpoenas. Defendants filed an initial motion for protective order only a few days prior to the deadline for the banks to respond to the subpoenas. Docket No. 58. On April 9, 2014, the Court denied without prejudice this initial motion for protective order on the ground that the parties did not make a showing of adequate meet and confer efforts as required by Federal Rule of Civil Procedure 26(c)(1). Docket No. 61. The parties subsequently met and conferred in a manner sufficient to satisfy the requirements of Fed.R.Civ.P. 26(c)(1). Docket No. 63, at 6; Docket No. 63-1, at 6.

The parties were still unable to resolve their differences with respect to the subpoenas, however, and Defendants filed an additional Motion for Protective Order on April 10, 2014. Docket No. 63, at 6-7. Plaintiff filed its Response to the Motion for Protective Order on April 22, 2014. Docket No. 69. On April 23, 2014, the Court denied without prejudice Defendants' motion for protective order, Docket No. 71, and found that the parties were capable of crafting an appropriate protective order without Court involvement. The parties again failed to reach an agreement regarding a protective order, however, and Defendants filed their Reply in Support of their Motion for Protective Order on April 28, 2014. Docket No.72.

On May 6, 2014, the Court issued two Orders. First, the Court denied Defendants' Motion to Quash Subpoenas (Docket No. 62), on the grounds that the information sought in the subpoenas was both relevant and discoverable. Docket No. 75. Second, the Court granted in part and denied in part Defendants' Motion for Protective Order (Docket No. 63), restricting the time period encompassed by the subpoenas to the year 2009, and ordering the parties to file a joint stipulated protective order "that limits the use of Defendants' financial documents and the people with access to them[.]" Docket No 76, at 5.

Defendants subsequently circulated a proposed stipulated protective order to Plaintiff, which sought: (a) to shift the burden of proof with respect to the designation of a given document as "confidential" from the designating party to the objecting party (Docket No. 79, at 6); (b) to designate all documents produced in response to the subpoenas as "Highly Confidential - Attorneys' Eyes Only" ( id., at 3-4, 6-7); and (c) to require that the subpoenaed documents be delivered to Defendants' counsel first, despite the fact that Plaintiff's counsel issued the subpoenas ( id., at 3-4).[1]

Plaintiff objected to the above provisions in Defendants' proposed stipulated protective order, and offered a series of revisions which included, inter alia, removal of the designation "highly confidential" from any stipulated protective order.[2] Docket 81, at. Plaintiff also insisted that the subpoenaed documents be initially produced to Plaintiff's office, duplicated, and then served on Defendants' office. Id., at 32. Following receipt by Defendants, Plaintiff would then treat the subpoenaed documents as attorneys' eyes only ("AEO") for a period of five business days, in order to allow Defendants the opportunity to designate any subpoenaed documents as AEO. Id. Defendants rejected Plaintiff's proposal, as well as Plaintiff's proffered revisions to the stipulated protective order ( id., at 33-34, 36), and filed the instant motions on May 12, 2014. Docket Nos. 78, 79.


A. The Designating Party Bears the Burden of Establishing Confidentiality.

"In granting a stipulated protective order, the court delegates to the litigants significant discretion to decide what shall be treated as confidential." Google, Inc. v. Am. Blind & Wallpaper Factory, Inc., 2006 WL 5349265, at *2 (N.D. Cal. Feb. 8, 2006) ( citing In re Coordinated Pretrial Proceedings in Petroleum Prods. Antitrust Litig., 101 F.R.D. 34, 41 (C.D. Cal. 1984)). Here, the parties' competing protective orders differ in numerous respects, but most obviously with respect to which party bears the burden of proof with respect to a document designated as confidential. Plaintiff's version is as follows:

If at any time any Party objects to the designation of any material as "CONFIDENTIAL" o [ sic ] or to a restriction on the use of such Confidential Material, the objecting party shall notify in writing the Party that made the designation. Within five (5) business dyas of the receipt of such notification, the counsel for the designating Party and the objecting Party shall meet and confer in an effort to resolve any disagreement. If the objection is not resolved, the party designating the material as Confidential Material shall, within ten (10) days of the conference, file and serve a noticed motion to resolve the dispute over the designation of the material and shall bear the burden of proof on the issue. If no such motion is filed within the state time period, the material will cease to be designated as Confidential Material and cease to be subject to the ...

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