GOVERNMENT AGENCY SANCTIONED!: Five Defendants Pursued by CFPB in Debt Collection Call Case Set Free After Agency’s Deposition Misconduct

Most civil litigators really do not understand how important discovery is. And how effective a tool it can be to get a case thrown out.

And I am not just talking about gathering facts to support a position.

Little known fact, before the Czar became the Czar–i.e. a famous federal court complex litigator–I was just a regular state court trial lawyer.

In those early years of my career, however, I seemingly won more cases in discovery than I actually did at trial. The reason–litigators just really do not know how to follow rules very well. And despite all of my various proclivities toward disruption I am actually an incredibly good little rule follower–or, perhaps better and more accurately stated, an incredibly good rule applier. 

While that capability is particularly valuable at trial–no one leverages evidentiary objections like the Czar–it is also critically important in discovery. This is true because when one party breaks the rules in discovery the other party can take great advantage by seeking sanctions–and sanctions orders can create tremendous leverage to obtaining a settlement, or even having a case thrown out.

Most of the time the sanction a party is seeking is money–and the Czar has racked up tens of thousands in sanctions against litigation opponents over the years while having never been sanctioned himself–but in a particularly egregious case of discovery abuse an entire claim may be tossed out as a sanction.

And that is precisely what happened to the CFPB recently. And it is an amazing little tale.

So the CFPB was pursuing a few debt collectors who were–allegedly–pursuing phantom debt and defrauding folks using outbound phone calls. Not good conduct.

But they did hire good lawyers. (Not me BTW.)

And those lawyers went after the CFPB and demanded a deposition–i.e. demanded that the CFPB put somebody in a chair and respond to questions under oath.

The CFPB-a government agency and consumer protection outfit–scoffed at the notion that it would be subject to a deposition. It is, after all, the primary regulator of consumer lenders in this nation. Surely it was exempt from the pedestrian rules of civil discovery that bind only “the rest of us.”


The lower court held the CFPB had to be deposed, and the the agency twice showed up with antics and shenanigans galore the lower court sanctioned the agency by throwing out its claims against the deposing defendants.

To be sure this was a stunning result–for a government agency to see a case against allegedly fraudulent actors thrown out due to a failure to follow the federal rules of civil procedure, eesh. That has got to sting.

The CFPB appealed the order and, well, the sting just got worse.

In CFPB v. Brown, No. 21-14468 (11th Cir. 2023) the Eleventh Circuit court of Appeals determined that the CFPB’s conduct in the case was sanction worthy–and in a published opinion, no less.

The Eleventh Circuit panel found the CFPB’s assertion of work product objections to avoid identifying witnesses or facts supporting claims against the Defendants to be egregious. But the worst conduct was the CFPB’s use of “memory aides”–lengthy documents (some spanning over 90 pages) that the witness would read off of in response to questions.

This conduct made taking a deposition of the agency impossible. As such the district court acted within its discretion to throw out the case held the Appellate Court:

The CFPB was determined to avoid 30(b)(6) depositions. To realize its goal, the CFPB employed tactics that the district court repeatedly forbade. As such, the CFPB clearly violated Rule 37(b) and severe sanctions were warranted. We therefore hold that the district court’s sanctions order dismissing the CFPB’s claims against the five appellees was not an abuse of discretion.

*slow clap initiated*

Just great litigation prowess by the Defendants’ lawyers here. And while Troutman Amin, LLP does not represent scumbags and does not rejoice at their being dismissed from a case–not saying these defendants were scumbags but they might have been if the CFPB was telling the truth–what I hate even more than scumbags are government agencies (and politicians for that matter) who think the rules do not apply to them.

It has been said that it is better that a hundred guilty men go free than one innocent man go to prison. Perhaps. But it is certainly better that five guilty scumbags go free–if that’s what they were–than one government agency think it can abuse the rules of civil litigation and act as if it is above the law in cases against the rest of us.

Indeed, this is an example of a case that helps keep America “free”–whatever that means these days. The rules work for the little guys and the biggest guys the same way.

Nice work to the Eleventh Circuit and its clerks on this one–and to the brave district court judge who wouldn’t be pushed around to begin with. Very nice to see.


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