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Los Alamos National Bank, N.A. v. Fidelity Bank

United States District Court, D. New Mexico

May 29, 2019




         THIS MATTER comes before the Court on Fidelity Bank's Motion to Extend Expert Disclosure Deadline. [Doc. 58]. The Court, having considered the parties' submissions, the relevant law, and being otherwise fully advised in the premises finds that the Motion is well taken and should be granted.


         This case arises out of alleged breaches of a Mortgage Loan Servicing Rights Purchase Agreement (Agreement) by which LANB sold Fidelity the servicing rights to approximately 4, 500 mortgage loans on real property in northern New Mexico. [Doc. 30-1]. The Agreement provides Fidelity several options in the event of a “defect” with any of the mortgages whose servicing rights Fidelity purchased. [Doc. 30-1, p. 31]. According to Fidelity, claims by the Pueblos of Nambe, Pojoaque, San Ildefonso, and Tesuque that certain county roads built by the County of Santa Fe trespass on tribal land impact the access roads to approximately 240 real properties subject to mortgages now serviced by Fidelity by virtue of the Agreement with LANB. [Doc. 4, pp. 9-11]. Fidelity further contends that the disputed access roads cloud title to the mortgaged properties. [Id., p. 10].

         On April 11, 2018, Fidelity wrote to LANB asserting that the Pueblos' Access Claims clouded title to approximately 240 mortgaged properties, rendering those mortgage loans “defective” within the meaning of the Agreement. [Doc. 30-2]. Fidelity demanded that LANB repurchase the defective loans. [Id.]. LANB refused and filed this declaratory judgment action, seeking a declaration that LANB did not cause a defect in the mortgage loans or servicing rights, has no obligation to repurchase the mortgage loans or servicing rights, and did not breach the Agreement. [Doc. 1]. Fidelity brought contractual and tort counterclaims against LANB, specifically, breach of contract, breach of the implied covenant of good faith and fair dealing, intentional misrepresentation, fraud by silence, and negligent misrepresentation. [Doc. 4, pp. 4-17].

         The Court entered a Scheduling Order on September 19, 2018, which provided that LANB was to disclose its experts by January 25, 2019, Fidelity was to disclose its experts by February 25, 2019, and the termination of discovery was to be April 25, 2019. [Doc. 24, p. 2');">p. 2');">p. 2');">p. 2]. On January 4, 2019, LANB filed an Unopposed Motion to Modify the Pretrial Deadlines, which the Court granted January 7, 2019. [Doc. 40; Doc. 41]. The Order modifying the pretrial deadlines set the parties' expert disclosure deadline for affirmative experts for April 25, 2019, the parties' deadline to disclose rebuttal experts as May 27, 2019, and the termination of discovery for July 24, 2019. [Doc. 41, p. 1]. On March 29, 2019, LANB filed a Stipulation to Modify the Pretrial Deadlines to set Fidelity's expert disclosure deadline for April 25, 2019, LANB's expert disclosure deadline for July 24, 2019, and the termination of discovery for October 4, 2019. [Doc. 53, p. 1]. The Court entered an Amended Scheduling Order adopting the parties' stipulated modification of the pretrial deadlines on April 1, 2019.[1" name= "FN1" id="FN1">1] [Doc. 54].

         On April 19, 2019, Fidelity moved for an extension of its April 25, 2019 expert disclosure deadline, seeking an additional 30 days to disclose its damages experts. [Doc. 58]. Fidelity disclosed a Geographical Information Systems (GIS) expert on the deadline, but claims that its experts on damages will rely on the GIS experts' 225-page report and it seeks an addition 30 days for them to review the GIS report and generate reports of their own. [Doc. 70, p. 2');">p. 2');">p. 2');">p. 2].


         Rule 16(b)(4) provides that a scheduling order “may be modified only for good cause and with the judge's consent.” Fed.R.Civ.P. 16(b)(4). “In practice, this standard requires the movant to show the scheduling deadlines cannot be met despite [the movant's] diligent efforts.” Gorsuch, Ltd., B.C. v. Wells Fargo Nat. Bank Ass'n, 1 F.3d 1230');">771 F.3d 1230, 1240 (10th Cir. 2014) (alteration in original) (internal quotation marks and citation omitted).

         III. ANALYSIS

         The Tenth Circuit has identified several factors to use in determining if good cause to modify a scheduling order exists, including:

1) whether trial is imminent, 2) whether the request is opposed, 3) whether the non-moving party would be prejudiced, 4) whether the moving party was diligent in obtaining discovery within the guidelines established by the court, 5) the foreseeability of the need for additional discovery in light of the time allowed for discovery by the district court, and 6) the likelihood that the discovery will lead to relevant evidence.

Smith v. United States, 166');">834 F.2d 166, 169 (10th Cir. 1987); Derrick v. Standard Nutrition Co., No. 17-CV-1245 RB/SMV, 2018 WL 5635113, at *3 (D.N.M. Oct. 31, 2018) (applying the Smith factors in the context of a request to modify the scheduling order to extend the expert witness disclosure deadline). The movant's diligence is the touchstone of the above factors. See Gorsuch, Ltd., B.C. v. Wells Fargo Nat'l Bank Ass'n, 771 F.3d 1230, 1240 (10th Cir. 2014). Balancing the Smith factors, the Court finds that Fidelity has established good cause to amend the Scheduling Order.

         With respect to the first Smith factor, there is currently no trial setting. Accordingly, this factor weighs in Fidelity's favor. Cf. Summers v. Mo. Pac. R.R. Sys., 132 F.3d 599');">132 F.3d 599, 605 (10th Cir. 1997) (finding that trial was not imminent when the ...

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