TCPA Plaintiffs’ Lawyers Continue to Get Slapped Around in RICO Conspiracy Case

Better bust out the popcorn—the Navient Solutions, LLC v. Law Offices of Jeffrey Lohman, P.C. case is still as crazy as ever. We’ve been chronicling this drama for several months now, and the court continues to absolutely skewer these TCPA plaintiff-lawyers, who are sitting on the other side of the V for a change.

Navient is alleging the law firm conducted to manufacture TCPA claims and defraud Navient. Here’s the CliffsNotes version of the alleged scheme: After “luring” student borrowers in under the guise of debt relief, the law firm would convince students to stop paying their loans (and start paying other entities instead), give them a script to read that instructed Navient to stop calling them, and tell them not to answer any other calls (which inevitably would come when they defaulted). The firm would then sit back, wait, then tally up the TCPA fines and eventually sue Navient.

Navient eventually caught on and went on the offensive, to say the least. They came out guns blazing, suing Lohman and his employees (among a plethora of other defendants) in the Eastern District of Virginia. The defendants filed a bunch of counterclaims, but the court seems to be knocking them out one at time.

As we’ve been reporting, the EDVA has been pretty ruthless for Lohman so far, and there’s been a flurry of activity in recent months despite the ongoing pandemic. Back in November, the court threw out Lohman counterclaims and denied its motion to strike under California’s anti-SLAPP law back, and then tossed another defendant’s counterclaims in April. Then, the court entered default against an absent debt-relief company alleged to have been involved in the scheme, entering a $6.15 million judgment.

But that’s far from the worst of it for the plaintiffs’ lawyers. As we detailed in March, the magistrate judge held that Lohman’s otherwise privileged communications with his clients were discoverable under the crime-fraud exception, and the district judge agreed. OUCH—there’s no decision on the merits yet, but this certainly spells trouble for Lohman.

Lohman tried to fight back against some of this in May by filing a motion to compel Navient to produce privileged communications. Lohman argued that Navient waived attorney-client privilege by putting its attorneys’ advice regarding causation and damages at issue in the lawsuit, but the magistrate judge found no basis for that argument. Lohman just filed a motion for reconsideration of this decision, but it seems unlikely that he’s going to be able to even the playing field here.

The magistrate judge issued another decision last week in Navient Solutions, LLC v. Law Offices of Jeffrey Lohman, P.C., No. 1:19-cv-461, 2020 U.S. Dist. LEXIS 117260 (E.D. Va. July 1, 2020), and Navient continues its winning streak. This court here denied a motion to compel Navient to supplement several discovery responses, finding it “meritless for several reasons.”

Two former Lohman associates named as defendants in the original suit filed the motion in June. The court first held that they lacked standing to compel responses to discovery that Lohman (not the associates) had propounded. It didn’t matter to the court that the associates—who obtained new counsel in March—had been represented by the same attorneys as Lohman when the discovery was sent.

The associates couldn’t compel responses to their own discovery requests either. They were too late. They had Navient’s responses for over seven months by the time they filed the motion to compel in June, and according to the court, they should have done so during the meet-and-confer process in late 2019, or at least “in the earlier months of 2020 by the latest.” The court reiterated that it had granted prior discovery extensions (a rarity in this court) to accommodate newly added defendants as well as the difficulties associated with conducting discovery during the COVID-19 pandemic. These extensions had nothing to do with the defendants’ various “long-winded complaints,” and the court didn’t extend so that the associates “could procrastinate resolution of discovery disputes.” Pretty brutal introduction to the Rocket Docket.

The fact that the associates “slept on their discovery remedies” was, in and of itself, enough for the court to deny the motion in its entirety, but it still explained why it would deny the motion to compel on the merits anyway: Simply put, Navient’s objections to the “incredibly broad” requests were “valid and [had to] be sustained.”

Notably, the court said that requests regarding Navient’s debt-collection policies had “no bearing on the claims and defenses” in the case, given that the “matter is not an ‘underlying’ TCPA case” and instead involves claims “for racketeering against a group of businesses, law firms, and individuals that allegedly worked together to recruit clients and produce fraudulent lawsuits.” This aspect of the decision in particular is yet another big win for Navient (if it stands after reconsideration/objections, which seems likely), as it could signal that the court’s sole focus will be on the RICO-related conduct, not on any conduct of Navient.

For now, Navient continues its forward attack, and it’s not taking any prisoners. This continues to be the most successful RICO case we’ve seen, and companies and lawyers should closely monitor developments. More to come.



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