UNITED STATES OF AMERICA CONSUMER FINANCIAL …

UNITED STATES OF AMERICA CONSUMER FINANCIAL PROTECTION BUREAU

IN THE MATTER OF CIVIL INVESTIGATIVE DEMAND ISSUED TO ASSURANT, INC.

ASSURANT, INC.'S PETITION TO MODIFY OR SET ASIDE SEPTEMBER 22, 2015 CIVIL INVESTIGATIVE DEMAND

CARLTON FIELDS JORDEN BURT, P.A. Frank G. Burt fburt@ W. Glenn Merten gmerten@ Brian P. Perryman bperryman@ Richard D. Euliss reuliss@ 1025 Thomas Jefferson Street, N.W. Jefferson Court, Suite 400 East Washington, D.C. 20007 (202) 965-8100 Attorneys for Petitioner Assurant, Inc.

TABLE OF CONTENTS

I. PRELIMINARY STATEMENT .........................................................................................1

II. RELEVANT BACKGROUND ...........................................................................................3

A. LPI's Role In Homeownership.................................................................................3

B. Assurant And The Underwriters ..............................................................................5

C. State LPI Regulation ................................................................................................6

D. Prior Civil Litigation And Class Action Settlements...............................................8

E. The Bureau's Investigation And The CID ...............................................................9

III. OBJECTIONS TO THE BUREAU'S ENFORCEMENT AUTHORITY.........................10

A. The Dodd-Frank Act Does Not Confer On The Bureau Enforcement Authority Over Assurant Or The Underwriters................................11

1. The Dodd-Frank Act and the business of insurance ..................................11

2. LPI and Outsourced Services are the business of insurance......................12

B. RESPA Does Not Confer On The Bureau Enforcement Authority Over Assurant Or The Underwriters ......................................................................17

IV. OBJECTIONS TO THE BUREAU'S INVESTIGATION................................................20

A. Applicable Legal Standards ...................................................................................20

B. The CID Should Be Set Aside And Redirected To The Underwriters ..........................................................................................................21

C. The CID Does Not Meaningfully Advise Assurant Of The Nature Of The Conduct Constituting The Alleged Violation Or Applicable Legal Provisions.....................................................................................................24

1. The CID specifies neither the nature of the investigated conduct, the persons engaged in the conduct, nor whether Assurant itself is under investigation .........................................................25

2. The CID does not cite the specific legal provisions allegedly violated .......................................................................................27

D. The CID Should Categorically Exclude LPI Flood, Over Which The Bureau Lacks Investigative Or Enforcement Authority .................................28

i

1. A court will not permit the Bureau to investigate matters outside the jurisdictional boundaries that Congress established ..................................................................................................29

2. RESPA restricts the Bureau's enforcement authority to LPI Hazard, and specifically excludes LPI Flood ............................................31

3. LPI Flood is not offered or provided as a consumer financial product or service, but constitutes the business of insurance ....................................................................................................33

E. The Applicable Time Period Should Be Modified To Commence On September 22, 2012, Not January 1, 2010 .......................................................34

1. The Bureau lacks authority to investigate or enforce alleged violations that exceed the three-year limitations periods applicable to RESPA and the Dodd-Frank Act..........................................34

a. A three-year limitations period governs the RESPA amendments, which only became effective on January 10, 2014 ............................................................................34

b. A three-year limitations period governs both litigation and administrative actions to enforce the Dodd-Frank Act .............................................................................36

2. Fundamental principles of fairness and due process dictate against retroactive application of the Dodd-Frank Act's provisions ...................................................................................................40

3. Documents and information antedating 2013 are irrelevant because LPI and Outsourced Services business practices have been modified since that time............................................................41

F. Interrogatory No. 1 Seeks Protected Attorney Work-Product ...............................42

G. Interrogatory No. 2(c) And (g) Seek Irrelevant And Overbroad Information Relating To Thousands Of Discrete Data Fields ...............................43

H. Request For Documents No. 2 Is Overbroad And Imposes A Burden Assurant Should Not Have To Bear..........................................................44

1. The Request is overbroad...........................................................................44

2. The Request is unduly burdensome ...........................................................45

I. The CID Should Be Modified To Amend The Production Deadline ....................47

CONCLUSION ..............................................................................................................................47

ii

TABLE OF AUTHORITIES

Cases

Page(s)

Agency Holding Corp. v. Malley-Duff & Associates, Inc., 483 U.S. 143 (1987) ..........................37 Ali v. Wells Fargo Bank, N.A., 2014 WL 345243 (W.D. Okla. Jan. 24, 2014) .......................18, 35 American School of Magnetic Healing v. McAnnulty, 187 U.S. 94 (1902) ...................................21 Board of Education of Evanston Township High School District No. 202 v.

Admiral Heating & Ventilating, Inc., 104 F.R.D. 23 (N.D. Ill. 1984) .................................43 Boardley v. Household Finance Corp. III, 39 F. Supp. 3d 689 (D. Md. 2014) .............................35 Campbell v. Nationstar Mortgage, 611 F. App'x 288 (6th Cir. 2015) ..........................................40 Cannon v. Wells Fargo Bank, N.A., 917 F. Supp. 2d 1025 (N.D. Cal. 2013) ...............................23 Cochran-May v. Wells Fargo Bank, N.A.,

2014 WL 361177 (S.D. Tex. Feb. 3, 2014) ....................................................................23, 24 Curtis v. Cenlar FSB, 2013 WL 5995582 (S.D.N.Y. Nov. 12, 2013) ...........................................19 Davis v. Wells Fargo Bank, N.A., 2015 WL 3555301 (E.D. Pa. June 8, 2015).............................23 Decambaliza v. QBE Holdings, Inc.,

2013 WL 5777294 (W.D. Wis. Oct. 25, 2013) ....................................................................19 DelCostello v. International Brotherhood of Teamsters, 462 U.S. 151 (1983).......................37, 38 Dexter v. Equitable Life Assurance Society of the United States,

527 F.2d 233 (2d Cir. 1975) .................................................................................................14 Eaves-Leanos ex rel. Eaves v. Assurant, Inc.,

2007 WL 2462632 (W.D. Ky. Aug. 28, 2007).....................................................................23 EEOC v. Group Health Plan, 212 F. Supp. 2d 1094 (E.D. Mo. 2002) ...................................29, 30 EEOC v. Karuk Tribe Housing Authority, 260 F.3d 1071 (9th Cir. 2001) ....................................30 EEOC v. Ocean City Police Department, 486 U.S. 1019 (1988) ..................................................34 EEOC v. Ocean City Police Department, 820 F.2d 1378 (4th Cir. 1987).....................................34 FTC v. Carter, 636 F.2d 781 (D.C. Cir. 1980) ..................................................................26, 27, 28 FTC v. Invention Submission Corp., 965 F.2d 1086 (D.C. Cir. 1992) ..........................................26 FTC v. Ken Roberts Co., 276 F.3d 583 (D.C. Cir. 2001) ........................................................29, 30 FTC v. National Casualty Co., 357 U.S. 560 (1958).....................................................................14 FTC v. Shaffner, 626 F.2d 32 (7th Cir. 1980)................................................................................30 Gabelli v. SEC, 133 S. Ct. 1216 (2013) .........................................................................................37

iii

General Finance Corp. v. FTC, 700 F.2d 366 (7th Cir. 1983) ......................................................30 General Insurance Co. of America v. EEOC, 491 F.2d 133 (9th Cir. 1974).................................34 Gilchrist v. State Farm Mutual Automobile Insurance Co.,

390 F.3d 1327 (11th Cir. 2004) ......................................................................................14, 15 In re Gimbel, 77 F.3d 593 (2d Cir. 1996) ......................................................................................22 Gomez v. Nationstar Mortgage, LLC,

2015 WL 966224 (E.D. Cal. Mar. 4, 2015)....................................................................35, 40 Hellenic Lines Ltd. v. Federal Maritime Board, 295 F.2d 138 (D.C. Cir. 1961) ..........................26 Helvering v. Stockholms Enskilda Bank, 293 U.S. 84 (1934)........................................................32 Houston v. U.S. Bank Home Mortgage Wisconsin Servicing,

505 F. App'x 543 (6th Cir. 2012).........................................................................................35 Johnson v. Green Tree Servicing, LLC,

2015 WL 2452680 (N.D. Miss. May 22, 2015) ...................................................................19 Jones v. ABN Amro Mortgage Group, Inc., 606 F.3d 119 (3d Cir. 2010) .....................................19 Kunzelmann v. Wells Fargo Bank, N.A.,

2013 WL 139913 (S.D. Fla. Jan. 10, 2013)....................................................................19, 20 Landgraf v. USI Film Products, 511 U.S. 244 (1994) ...................................................................40 Lauren v. PNC Bank, N.A., 2013 WL 5565511 (W.D. Pa. Oct. 8, 2013)......................................23 Life Partners, Inc. v. Morrison, 484 F.3d 284 (4th Cir. 2007) ......................................................14 Long Island Precast, Inc. v. Department of Labor,

2014 WL 3735943 (E.D.N.Y July 14, 2014) .................................................................44, 45 Louisiana Public Service Commission v. FCC, 476 U.S. 355 (1986) ...........................................29 Melinder v. Texas Farmers Insurance Co.,

2014 WL 8298930 (S.D. Tex. Jan. 15, 2014) ......................................................................23 Miller v. Wells Fargo Bank, N.A., 994 F. Supp. 2d 542 (S.D.N.Y. 2014).....................................19 Montoya v. PNC Bank, N.A., 2014 WL 4248208 (S.D. Fla. Aug. 27, 2014) ................................23 Montship Lines, Ltd. v. Federal Maritime Board, 295 F.2d 147 (D.C. Cir. 1961)........................26 Ocean State Physicians Health Plan, Inc. v. Blue Cross & Blue Shield,

883 F.2d 1101 (1st Cir. 1989) ..............................................................................................14 Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186 (1946)................................................20 Pedraza v. United Guaranty Corp., 2000 WL 36692425 (S.D. Ga. Aug. 14, 2000) ....................15 Peters v. United States, 853 F.2d 692 (9th Cir. 1988) .......................................................20, 44, 45

iv

Reich v. Great Lakes Indian Fish & Wildlife Commission, 4 F.3d 490 (7th Cir. 1993) ..............................................................................................29, 30

Roberts v. Wells Fargo Bank, N.A., 2013 WL 1233268 (S.D. Ga. Mar. 27, 2013).................19, 23 Robinson v. Penner, 2007 WL 2902967 (E.D. Cal. Oct. 2, 2007).................................................42 Rothstein v. GMAC Mortgage, LLC, 2013 WL 5437648 (S.D.N.Y. Sept. 30, 2013)....................18 Rothstein v. Balboa Insurance Co., 794 F.3d 256 (2d Cir. 2015) ...........................................18, 19 Sabo v. Metropolitan Life Insurance Co., 137 F.3d 185 (3d Cir. 1998)..................................14, 15

In re Sealed Case, 42 F.3d 1412 (D.C. Cir. 1994).........................................................................44 SEC v. National Securities, Inc., 393 U.S. 453 (1969) ..................................................................14 See v. City of Seattle, 387 U.S. 541 (1967)..............................................................................20, 21 Singleton v. Wells Fargo Bank, N.A., 2013 WL 5423917 (N.D. Miss. Sept. 26, 2013) ................19 Sorenson v. Secretary of Treasury, 475 U.S. 851 (1986) ..............................................................32 Stevens v. Department of Treasury, 500 U.S. 1 (1991) .................................................................37 Stevens v. Union Planters Corp., 2000 WL 33128256 (E.D. Pa. Aug. 22, 2000) .........................19 Strauss v. Credit Lyonnais, S.A., 242 F.R.D. 199 (E.D.N.Y. 2007) ..............................................42 Trailer Marine Transport Corp. v. Federal Maritime Commission,

602 F.2d 379 (D.C. Cir. 1979) .............................................................................................26 United States v. Bestfoods, 524 U.S. 51 (1998) .............................................................................13 United States Department of Treasury v. Fabe, 508 U.S. 491 (1993)...........................................14 United States v. Morton Salt Co., 338 U.S. 632 (1950)...........................................................20, 44 United States v. Security State Bank & Trust, 473 F.2d 638 (5th Cir. 1973) ................................26 United States v. Transocean Deepwater Drilling, Inc.,

767 F.3d 485 (5th Cir. 2014) ................................................................................................29 United States v. Transocean Deepwater Drilling Inc.,

936 F. Supp. 2d 818 (S.D. Tex. 2013)..................................................................................29 Weiss v. National Westminster Bank, PLC, 242 F.R.D. 33 (E.D.N.Y. 2007)................................42 Yerger v. Liberty Mutual Group, Inc.,

2012 WL 4424017 (E.D.N.C. Sept. 24, 2012) .....................................................................42

v

Statutes 12 U.S.C. ? 2601............................................................................................................................17 12 U.S.C. ? 2602............................................................................................................................17 12 U.S.C. ? 2605.................................................................................................................... passim 12 U.S.C. ? 2607............................................................................................................................35 12 U.S.C. ? 2608............................................................................................................................35 12 U.S.C. ? 2614............................................................................................................................35 12 U.S.C. ? 5481..........................................................................................................11, 12, 27, 33 12 U.S.C. ? 5491............................................................................................................................33 12 U.S.C. ? 5517................................................................................................................12, 13, 18 12 U.S.C. ? 5531.................................................................................................................... passim 12 U.S.C. ? 5536.................................................................................................................... passim 12 U.S.C. ? 5553............................................................................................................................40 12 U.S.C. ? 5561......................................................................................................................21, 31 12 U.S.C. ? 5562.................................................................................................................... passim 12 U.S.C. ? 5564................................................................................................................36, 38, 39 12 U.S.C. ? 5582............................................................................................................................36 15 U.S.C. ? 45................................................................................................................................27 15 U.S.C. ? 1012............................................................................................................................14 15 U.S.C. ? 1639d..........................................................................................................................32 42 U.S.C. ? 4012a ..........................................................................................................................31 Dodd-Frank Wall Street Reform and Consumer Protection Act,

Pub. L. No. 111-203, ? 1400, 124 Stat. 1376 (2010) ...........................................................35 Dodd-Frank Wall Street Reform and Consumer Protection Act,

Pub. L. No. 111-203, ? 1461, 124 Stat. 1376 (2010) ...........................................................32 Dodd-Frank Wall Street Reform and Consumer Protection Act,

Pub. L. No. 111-203, ? 1463, 124 Stat. 1376 (2010) ...........................................................32

vi

Rules and Regulations 12 C.F.R. ? 22.2 .............................................................................................................................31 12 C.F.R. ? 22.3 .............................................................................................................................31 12 C.F.R. ? 22.7 .............................................................................................................................31 12 C.F.R. ? 1024.2 ...................................................................................................................18, 35 12 C.F.R. ? 1024.37 ...........................................................................................................18, 19, 31 12 C.F.R. ? 1080.5 ...............................................................................................................9, 21, 24 12 C.F.R. ? 1080.6 .........................................................................................................................47 Mortgage Servicing Rules under the Real Estate Settlement Procedures Act

(Regulation X), 78 Fed. Reg. 10,696-01 (Feb. 14, 2013) ....................................................35 2012 Real Estate Settlement Procedures Act (Regulation X) Mortgage

Servicing Proposal, 77 Fed. Reg. 57,200-01 (Sept. 17, 2012) .............................................39 Designated Transfer Date, 75 Fed. Reg. 57,252-02 (Sept. 20, 2010) ............................................36 Fed. R. Civ. P. 26 ...........................................................................................................................43 Fed. R. Civ. P. 81 ...........................................................................................................................43 N.M. Code R. ? 13.18.3.13 ............................................................................................................16

vii

 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download