37 F.4th 717
1st Cir.2022Background
- In 2008 Pinti and Phillips (the Homeowners) executed a $160,000 note secured by a mortgage to Emigrant Mortgage Co. (EMC); Phillips was excepted from personal liability.
- The loan went into default; EMC initiated a nonjudicial foreclosure and sold the property at auction in 2012; a discharge of mortgage was later prepared and recorded by the Homeowners after litigation.
- Multiple assignments among EMC, ESB-MH, FHLBNY, and Emigrant Residential occurred (some unrecorded until 2019); the physical Note remained in district-court custody after earlier litigation.
- The Massachusetts SJC (Pinti I) declared the foreclosure void; later federal litigation (Pinti II) dismissed EMC for lack of standing after discovery and trial on standing issues, and the court acknowledged limited opportunity to examine the physical Note.
- Emigrant Residential recorded 2009/2019 assignments and sued in federal court (Pinti III) to strike the discharge; the district court stayed discovery, denied the Homeowners’ Rule 56(d) request for additional discovery, and granted summary judgment for Emigrant Residential.
- The First Circuit held the district court abused its discretion in denying Rule 56(d) discovery limited to (a) the Note’s authenticity and chain of custody and (b) facts surrounding the 2019 assignments, vacated summary judgment, and remanded for that targeted discovery.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the district court abused its discretion in denying Rule 56(d) discovery | Homeowners: timely sought additional discovery needed to oppose summary judgment (note authenticity/chain of custody; 2019 assignments) | Emigrant Residential: parties had full prior discovery and additional discovery is futile | Abuse of discretion as to the two narrowly identified areas; summary judgment vacated and remanded for limited discovery |
| Whether Homeowners had "good cause"/a full and fair prior opportunity to obtain the requested discovery | Homeowners: Pinti II did not permit Note-examination discovery and 2019 assignments postdated Pinti II | Emigrant Residential: prior proceedings provided adequate opportunities to discover | For most topics no good cause; but good cause exists for the Note-authenticity/chain-of-custody and 2019-assignment issues |
| Whether additional discovery would be futile (utility) | Homeowners: discovery could reveal defects that render assignments void or prove inauthenticity of the Note | Emigrant Residential: any assignment defects would be merely voidable and not challengeable by mortgagor | Futility rejected — discovery might reveal void defects affecting standing, so utility exists |
| Whether summary judgment was appropriate without permitting the requested discovery | Homeowners: SJ was premature because discovery stayed and 56(d) relief denied | Emigrant Residential: SJ appropriate given prior record and legal standards | SJ vacated without prejudice; district court to permit limited discovery then reconsider SJ |
Key Cases Cited
- Rivera-Almodóvar v. Instituto Socioenconómico Comunitario, Inc., 730 F.3d 23 (1st Cir. 2013) (standard of review and purpose of Rule 56(d))
- In re PHC, Inc. S'holder Litig., 762 F.3d 138 (1st Cir. 2014) (denial of detailed Rule 56(d) affidavit can be abuse of discretion)
- Resol. Tr. Corp. v. N. Bridge Assocs., Inc., 22 F.3d 1198 (1st Cir. 1994) (motions invoking Rule 56(d) should be construed generously)
- Vélez v. Awning Windows, Inc., 375 F.3d 35 (1st Cir. 2004) (requirements for Rule 56(d) affidavit)
- Culhane v. Aurora Loan Servs. of Neb., 708 F.3d 282 (1st Cir. 2013) (mortgagor standing to challenge assignments that are invalid or void)
- Paterson-Leitch Co. v. Mass. Mun. Wholesale Elec. Co., 840 F.2d 985 (1st Cir. 1988) (prior opportunity to obtain discovery bears on Rule 56(d) relief)