NELSON v. CAPITAL ONE BANK

EDWARD M. CHEN, United States District Judge.

MOTION FOR LEAVE TO MOVE FOR RECONSIDERATION

Pursuant to Local Rule 7-9(b)(3), defendants respectfully request leave to file a motion for reconsideration. Defendants seek reconsideration of the Court's December 17, 2001, order requiring defendants to produce millions of pages of documents within ten days. Additionally, defendants seek an extension of time in which to comply with the Court's order.

Reconsideration of an interlocutory order is appropriate when the Court fails to consider "material facts or dispositive legal arguments which were presented to the Court before such interlocutory order." Civil L.R. 7-9(b)(3). Reconsideration is appropriate here because the Court failed to consider defendants' evidence of undue burden and the fact that all evidence before the Court demonstrated that plaintiffs could not proceed under an agency theory ofjurisdiction.

I. THE COURT APPARENTLY FAILED TO CONSIDER UNCONTRADICTED AFFIDAVITS SUBMITTED BY CAPITAL ONE BANK, WHICH DEMONSTRATE THAT RESPONDING TO REQUESTS #33 AND 34 WOULD BE UNDULY BURDENSOME.

The Court's December 17 order does not address the specific burden objections raised by Capital One Bank and substantiated by the uncontradicted affidavits of Katherine Thurston and Frank Rotman regarding requests Nos. 33 and 34, which were before the Court at the time of hearing on plaintiffs' motions to compel. The Court indicated at the hearing that due to the volume of materials submitted, it was unable to read all of the parties' papers. Additionally, the Court's order noted that a general statement of undue burden is insufficient." The Court instructed that "[i]n the future, all parties are directed to state and substantiate any objections to discovery requests with specificity." (Order 4:21-25). It thus appears that the Court overlooked certain declarations submitted by Capital One Bank that bore directly upon the burdensome nature of certain document requests.

Katherine Thurston's declaration (attached hereto as Exhibit A) established that Request No. 33, which calls for the production of all solicitations and scripts that reference Capital One Financial Corporation, is unduly burdensome because it calls for all "solicitations by Capital One Bank, which would constitute bilhons of documents." (Thurston Decl. ¶ 6.) Ms. Thurston further attested that responding to the request as drafted would require the production of millions of pages of documents and the sifting through hundreds of millions of pages more. (Id. ¶¶ 7-8.) Plaintiffs adduced no evidence whatsoever to controvert Ms. Thurston's declaration. It appears from the Court's order, which directs defendants to produce these millions of pages of documents within ten days and does not address defendants' burden objections, that the Court failed to consider Ms. Thurston' s declaration.

Frank Rotman's declaration (attached hereto as Exhibit B) established that Request No. 34, which calls for the production of all of Capital One Bank's business plans, budgets and related documents that reference California business, is unduly burdensome because Capital One Bank has many departments and sub-departments, each of which prepares its own budgets and business and marketing plans. (Rotman Decl. ¶ 4.) The Rotman declaration also established that these documents are not maintained in a central location or indexed with regard to geography. (Id.) Thus, the request for California-specific information calls for Capital One Bank to review all of its documents to produce those referencing California business. (Id.) Frank Rotman attested that this would be unduly burdensome. (Id. ¶ 6.) Again, Plaintiffs adduced no evidence whatsoever to controvert Mr. Rotman's declaration. It appears from the Court's order, which calls for Capital One Bank to search through all these many disaggregated files and produce response documents in ten days and does not address defendants' burden objections, that the Court failed to consider Mr. Rotman' s declaration.

Because the Court apparently failed to consider these declarations, which demonstrate the undue burden Capital One Bank would be subject to if compelled to respond to these requests, defendants should be given leave to seek reconsideration.

II. THE COURT FAILED TO CONSIDER DEFENDANTS' UNCONTROVERTED EVIDENCE THAT COF IS A HOLDING COMPANY TO WHICH THE "AGENCY" JURISDICTION ANALYSIS IS INAPPLICABLE.

The Court's December 17 order relies on plaintiffs' agency theory of jurisdiction to require Capital One Bank and Capital One Financial Corporation to produce literally millions of documents in response to Requests Nos. 33, 34, 36, 37, 8, and 19. Personal jurisdiction over a principal may be asserted on the basis of an agent's presence within the state where an operational parent company uses its subsidiaries as a general agent, for such things as marketing products manufactured by the parent, not where the parent is mere holding company. See Modesto City Schools v. Riso Kagaku Corp., 157 F. Supp.2d 1128 (E.D. Cal. 2001) (where foreign parent manufactured products and sold them to domestic subsidiary for resale in U.S., subsidiary can be "general agent" of parent); Wells Fargo Co. v. Wells Fargo Express Company, 556 F.2d 406, 422-23 (9th Cir. 1977) (common law requirements of general agency demand that substantial activities be carried on for benefit of principal before "agent's" in-state presence permits exercise of personal jurisdiction over principal); Doe v. Unocal Corp., 248 F.3d 915, 929 (9th Cir. 2001) (where parent owned subsidiary, but did not transact business with it, subsidiary not "agent" establishing jurisdiction over parent). Although the Court acknowledges that the agency theory ofjurisdiction is unavailable where the parent corporation is a holding company (Order, 3:22-23), the Court stated that "the issue remains as to whether COF is indeed a mere holding company." The uncontroverted evidence before the Court on the motion, though, plainly established that COF is only a holding company. The March 22d 2001 declaration of Michael Barry (attached hereto as Exhibit C), averred that "Capital One Financial Corporation is a holding company for the stock of its subsidiaries. As such, Capital One Financial Corporation has never issued credit cards, made loans, accepted payments, or engaged in any business other than holding stock in its subsidiaries." (Barry Decl., ¶ 3.) A number of documents of public record which are the appropriate subjects of judicial notice also make clear that Capital One Financial Corporation is a holding company. (Capital One Financial Corporation's Request For Judicial Notice In Support of Motion For Leave To File Motion For Reconsideration, Exs. A, B, C, D.) Plaintiffs submitted no probative evidence that raised any issue as to whether, contrary to its filings with the Securities and Exchange Commission, its report to its shareholders and the Barry declaration before the Court, Capital One Financial Corporation was not a holding company. Thus, defendants should be given leave to move the Court to reconsider its conclusion that the holding company status of Capital One Financial Corporation is reasonably in dispute.

The Barry declaration was before the Court as Exhibit F to the November 26, 2001, declaration of Wendy Garbers submitted in opposition to the motions to compel.

III. AT THE VERY LEAST, DEFENDANTS NEED ADDITIONAL TIME TO COMPLY WITH THE COURT'S ORDER.

The Court's December 17 order requires defendants to produce literally millions of pages of documents by 5:00 p.m. on December 28, 2001. Compliance with Court's order is not humanly possible. Furthermore, the scant ten-day period in which defendants are given to perform this feat is substantially consumed by the Christmas holiday, during which a great many of the individuals who would assist defendants with this task are not at work. Thus, defendants request that the deadline for compliance with the Court's order be extended.

Defendants have contacted counsel for plaintiffs in an attempt to negotiate a stipulation for modification of the production date. While it appears from the exchange of voice mail messages that some agreement may be reached, none has been reached as of the time of filing of this motion.

CONCLUSION

For the aforementioned reasons, defendants should be given leave to move the Court to reconsider its order requiring defendants to produce millions of pages of documents and sift through millions of pages more, within ten days. At a minimum, the time in which defendants are required to comply with the Court's order should be extended.

ATTACHMENT

NELSON v. CAPITAL ONE BANK, (N.D.Cal. 2001)

JAUTASSA NELSON, EVA MARTIN, DAWN CIESLIK, and DORIS KOGO on behalf of themselves and all others similarly situated, Plaintiffs v. CAPITAL ONE BANK and CAPITAL ONE 17 FINANCIAL CORPORATION, Defendants. No.C 01-0079 PJH (EMC) United States District Court, N.D. California, San Francisco Division. December 17, 2001

JAMES F. MCCABE (BAR NO. 104686), JAMES R. MCGUIRE (BAR NO. 189275), WENDY M. GARBERS (BAR NO. 213208), MORRISON FOERSTER LLP., San Francisco, California, CAPITAL ONE BANK and CAPITAL ONE FINANCIAL CORPORATION. Attorneys for Defendant.

ORDER RE PLAINTIFF'S MOTION TO COMPEL DEFENDANTS TO FURTHER RESPOND TO PLAINTIFFS' FIRST REQUEST FOR PRODUCTION OF DOCUMENTS (No. 115) AND PLAINTIFFS' MOTION TO COMPEL DEFENDANTS TO FURTHER RESPOND TO PLAINTIFFS' SECOND REQUEST FOR PRODUCTION OF DOCUMENTS (No. 109)

Plaintiffs moved to compel defendants Capital One Bank (hereinafter the "Bank") and Capital One Financial Corporation (hereinafter "COF") to produce responsive documents to Plaintiffs' First Request for Production of Documents. In a second motion, Plaintiffs moved to compel the Bank and COF to produce responsive documents to Plaintiffs' Second Request for Production of Documents.

Having considered the briefs and declarations filed in conjunction with these motions, the record of this case and the argument of counsel at hearing on December 12, 2001, the Court declines to adjudicate the dispute as to discovery which goes to the merits of Plaintiffs' claims. Such discovery is premature as the Second Amended Complaint, anticipated by Plaintiffs, has yet to be filed and because the parties have not filed a discovery plan with the Court as required by Federal Rule of Civil Procedure 26(f). As such, this Court will defer argument on the merits discovery to the Court's first Wednesday law and motion calendar which follows twenty (20) days after Plaintiffs' filing of its Second Amended Complaint. Said hearing will occur at 9:30 a.m. Plaintiffs shall re| notice the hearing. The parties are also directed to meet and confer in person after the filing of the Second Amended Complaint and file a joint statement outling merits discovery issues yet to be resolved seven (7) days prior to the aforementioned hearing.

Additionally, the parties will participate in a further discovery status hearing before this Court on January 3, 2001, at 9:30 a.m., to discuss the presentation of a joint discovery plan. The parties will file on or before December 27, 2001, a joint statement describing the joint discovery plan proposed and indicating differences, if any, between the parties. Counsel shall meet and confer in person prior to filing said joint statement.

With respect to the jurisdictional discovery, the Court makes the following findings and determinations:

1. Federal Rule of Civil Procedure 34 requires a party responding to a request to produce documents which "are in the possession, custody or control of the party upon whom the request is served." "Generally, a party is deemed to have control of documents, only if the party has the legal right to obtain the documents requested upon demand." Estate of Young Through Young v. Holmes, 134 F.R.D. 291, 294 (D. Nev. 1991) ("[t]he relationship between the party and the person or entity having actual possession of the document is central in each case"), citing, Searock v. Stripling, 736 F.2d 650, 653 (11th Cir. 1984); see Wright, Miller Marcus, Federal Practice and Procedure: Civil 2d § 2210. In parent-subsidiary situations, while some courts look to a variety of factors concerning "control," the Ninth Circuit has applied a per se test wherein, "[a] corporation must produce documents possessed by a subsidiary that the parent corporation owns or wholly controls." United States v. International Union of Petroleum and Industrial Workers. AFL-CIO, 870 F.2d 1450, 1452 (9th Cir. 1989); see also Gerling International Ins. Co. v. Commissioner of Internal Revenue. 839 F.2d 131, 140 (3rd Cir. 1988). Defendants cite no controlling cases to the contrary.

It is undisputed that the Bank is a wholly owned subsidiary of COF. Therefore, notwithstanding the Bank's and COF's "General Objection No. 16," the Bank and COF must produce documents responsive to Plaintiffs' sustained Rule 34 requests which are in the possession of either the Bank or COF (as to whomever the request is directed) and any subsidiary that is owned or wholly controlled by that responding party. Furthermore, the term "your" as used in specific document requests (e.g., Request Nos. 34 and 36 of Plaintiffs First Request) shall be deemed to mean documents belonging to the responding party only, as indicated below.

2. Although Judge Hamilton's September 28, 2001 Order effectively precludes Plaintiffs' theory that this Court possesses general jurisdiction over COF as the alter ego of the Bank, Plaintiffs attempt to establish personal jurisdiction under the separate and distinct theory of agency. Under the agency theory ofjurisdiction, Plaintiffs may demonstrate that the Bank functions as COF's representative "in that it performs services that are sufficiently important to [COF] that if it did not have a representative to perform them, [COF]'s own officials would undertake to perform substantially similar services." Modesto City Schools v. Riso Kagaku Corp., 157 F. Supp.2d 1128, 1132 (E.D. Cal. 2001), quoting, Doe v. Unocal, 248 F.3d 915, 928 (9th Cir. 2001) (internal quotations omitted). Stated slightly differently, the issue is whether "the [subsidiary's] presence substitutes for the presence of the parent." Id. Relevant to this inquiry is, inter alia: COF's level of control over the Bank; the swapping of personnel between COF and the Bank; overlapping directors, officers and employees; percentages of COF's profit moved through the Bank; the importance of the Bank's position in COF's organizational hierarchy; the Bank's marketing of COF's products and services; the extent to which COF was informed of activities undertaken by the Bank; and the relationship between this case alleged to the Bank's activities on behalf of COF. See id. at 1134-35. Because its function is to determine whether the subsidiary's contacts may be attributable to the parent, the agency theory may be used to establish either general or specific jurisdiction. See id. at 1132.

As noted at the December 12, 2001 hearing, Judge Hamilton's analysis as to alter ego for purposes of Plaintiffs' Truth in Lending Act Claims is indistinguishable from the alter ego analysis as it relates to personal jurisdiction. Absent a contrary indication from Judge Hamilton, this Court must conclude the alter ego theory ofjurisdiction is precluded.

While the agency theory does not apply where the holding company's subsidiaries are not agents, but mere investments of the parent see Doe, 248 F.3d at 929, the issue remains as to whether COF is indeed a mere holding company. Plaintiffs are entitled to discovery which is relevant to the nature of the relationship between COF and the Bank.

Accordingly, discovery which could lead to admissible evidence relevant to the agency theory must be permitted.

3. At the December 12, 2001 hearing, Plaintiffs indicated to the Court that in regards to jurisdictional discovery, Plaintiffs sought compliance with eight specific requests for documents. At the close of the hearing, the Court requested Plaintiffs to submit to the Court previous offers made by Plaintiffs to narrow said requests. On December 13, 2001, Plaintiffs submitted a letter narrowing the eight outstanding document requests as discussed, but also included a narrowing of four additional requests, stating that the requests "relate to both jurisdiction and class/merits issues." (Letter from Kelly Dermody of 12/13/01, at 2.) In view of Plaintiffs' representation at the hearing and submission of the matter at the hearing's conclusion, these four additional requests are deemed untimely as to the jurisdictional matter now before the Court. The Court will address only the requests Plaintiffs indicated at the hearing to be at issue: Plaintiffs' First Request for Production of Documents (Request Nos. 33, 34, 36 and 37) and Plaintiffs' Second Request for Production of Documents (Request Nos. 8, 16, 19 and 21).

At the outset, as noted by the Court at the hearing, the Bank and COF, in response to these requests, offered a number of generalized objections. Generally, the burden is on the party advancing objections "to show that discovery should not be allowed . . . [by] clarifying, explaining and supporting its objections." Cable Computer Technology. Inc. v. Lockheed Saunders. Inc.. 175 F.R.D. 646, 650 (C.D. Cal. 1997) (citation omitted). "Boilerplate, generalized objections are inadequate and tantamount to not making any objection at all." Walker v. Lakewood Condominium Owners Assoc., 186 F.R.D. 584, 587 (C.D. Cal. 1999). A general statement of undue burden is insufficient. The responding party must explain with specificity the nature and extent of the burden imposed by each discovery request to which it is objecting. See Jackson v. Montgomery Ward Co Inc 173 F.R.D. 524, 528-29 (D. Nev. 1997). In the future, all parties are directed to state and substantiate any objections to discovery requests with specificity.

REQUEST NO. 33 (as to the Bank only) — All SOLICITATIONS and SCRIPTS that reference [COF].

The Court finds that solicitations and scripts used by the Bank during the class period that reference COF are relevant to Plaintiffs' agency theory and COF's own contacts with California and shall be produced.

REQUEST NO. 34 (as to the Bank only) — All of YOUR business plans, budgets and related DOCUMENTS that reference potential or actual California business.

Plaintiffs have offered to narrow the request to documents that refer to COF or its officers, directors or offices. Moreover, the request is interpreted to mean the Bank's business plans, etc. As narrowed, the request is reasonable and seeks information relevant to agency. The Bank shall produce documents responsive to this request as so limited.

REQUEST NO. 36 (as to the Bank and COF) — All of YOUR Board of Director minutes, resolutions and related DOCUMENTS that reference or refer to business conducted in California.

Plaintiffs have proposed to narrow this request to documents that refer to COF or its officers, directors or offices. Moreover, the request shall be construed to mean the Bank's and COF's Board minutes, etc. As narrowed, the request is reasonable and seeks information relevant to agency and COF's own contacts with California. The Bank shall produce documents responsive to this request assolimited.

REQUEST NO. 37 (as to the Bank only) — All DOCUMENTS concerning engagement of outside professionals located in California.

Plaintiffs have proposed to narrow this request to documents that refer to COF or its officers, directors or offices. As narrowed, the request is reasonable and seeks information relevant to agency. The Bank shall produce documents responsive to this request as so limited.

REQUEST NO. 8 (as to COF only) — All DOCUMENTS referencing, indicating, or relating to the percentage of [COF's] revenues that are generate by [the Bank].

The Court finds that the documents sought in this request are relevant to Plaintiffs' theory of agency.

REQUEST NO. 16 (as to the Bank and COF) — All DOCUMENTS referencing, referring or pertaining to the identity and/or location of in-house counsel for [the Bank] and [COF].

Plaintiffs have withdrawn this request and will propound interrogatories instead.

REQUEST NO. 19 (as to COF only) — all minutes, reports, agendas and/or DOCUMENTS of the meetings of the Board of Directors of [COF], and/or any subcommittees thereof, referring, evidencing, reflecting, or pertaining to California businesses, California actual or potential customers, [the Bank's] credit cards, and/or business conducted by [the Bank].

The Court finds the above request to be relevant to Plaintiffs' agency theory and COF's own contacts with California. COF shall produce the above-described documents.

REQUEST NO. 21 (as to COF and the Bank) — All DOCUMENTS referencing, referring or pertaining to efforts by [the Bank] and [COF] to comply with paragraph 14 of the attached "Standing Order for Civil Practice in cases Assigned for All Purposes to Magistrate Judge Edward M. Chen (5/21/01)."

Absent some indication of an immediate need for the documents requested in connection with jurisdictional discovery, the Court will defer ruling on this request along with the merits discovery.

CONCLUSION

GOOD CAUSE APPEARING IT IS HEREBY ORDERED THAT Plaintiffs' Motion to Compel, as to Plaintiffs' First Request for Production of Documents (Docket No. 115), is GRANTED IN PART, DENIED IN PART and DEFERRED IN PART.

Plaintiffs' Motion to Compel, as to Plaintiffs' Second Request for Production of Documents (Docket No. 109), is GRANTED IN PART, DENIED IN PART and DEFERRED IN PART.

The Bank and COF shall provide responsive documents pursuant to this Order to Plaintiffs by 5:00 p.m., December 28, 2001.

IT IS FURTHER ORDERED THAT the parties shall provide joint statements regarding outstanding discovery and a discovery plan on the dates

EXHIBIT A

NELSON v. CAPITAL ONE BANK, (N.D.Cal. 2001)

JAUTASSA NELSON, EVA MARTIN, DAWN CIESLIK, and DORIS KOGO on behalf of themselves and all others similarly situated, Plaintiffs v. CAPITAL ONE BANK and CAPITAL ONE 17 FINANCIAL CORPORATION, Defendants. No.C 01-0079 PJH (EMC) United States District Court, N.D. California, San Francisco Division. December 12, 2001

JAMES F. MCCABE (BAR NO. 104686), JAMES R. MCGUIRE (BAR NO. 189275), WENDY M. GARBERS (BAR NO. 213208), MORRISON FOERSTER LLP., San Francisco, California, CAPITAL ONE BANK and CAPITAL ONE FINANCIAL CORPORATION. Attorneys for Defendant.

DISCOVERY MATTER

DECLARATION OF KATHERINE THURSTON IN SUPPORT OF CAPITAL ONE BANK'S OPPOSITION TO PLAINTIFFS' MOTION TO COMPEL FURTHER RESPONSE AND PRODUCTION OF DOCUMENTS PURSUANT TO PLAINTIFF JAUTASSA NELSON'S FIRST REQUEST FOR PRODUCTION OF DOCUMENTS

Date: Dec. 12, 2001 Time: 1:30p.m. Court: Hon. Edward M. Chen

I, Katherine Thurston, hereby declare and state as follows:

1. I am a Production Clerical Assistant of Capital One Services, Inc. ("Capital One Services"), the entity which provides credit card servicing operations to Capital One Bank. I make this declaration based upon my own personal knowledge of the facts set forth below and, if called as a witness, could and would competently testify thereto.

2. As a Production Clerical Assistant with Capital One Services, I perform record keeping, including maintaining the files of all samples and seeds of solicitation. I file all solicitations and ultimately archive them in a warehouse.

3. I have reviewed the relevant portions of Plaintiff Jautassa Nelson's Request for Production of Documents to Capital One Bank, and Capital One Bank's-responses thereto.

4. Document request Number 3 seeks all "solicitations used by [Capital One] in the sale and/or marketing of credit cards or fee-based services." The results of a compilation of all solicitation material would be extraordinarily voluminous and burdensome. Plaintiffs seek all documents related to solicitations by Capital One Bank, which would constitute bilhons of documents.

5. Document request Number 5 seeks "[a]ll solicitations and scripts used by you to promote or market fee-based services. The results of a compilation of all of the requested documents would be impossibly voluminous. Plaintiffs seek all documents related to Capital One Bank's marketing and solicitation materials, which would constitute bilhons of documents.

6. Document request Number 33 seeks "[a]ll solicitations and scripts that reference Capital One Financial Corporation." The results of a compilation of all solicitation material would be extraordinarily voluminous and burdensome. Plaintiffs seek all virtually documents related to solicitations by Capital One Bank, which would constitute bilhons of documents.

7. My department alone sent out approximately 2,000,000,000 mail solicitations last year. Capital One Services does not keep records related to these solicitations, and solicitations from years past, in one central location. The production department of Capital One Services currently keeps 879 boxes in a warehouse full of archived solicitation materials. Each box contains 10 binders with 500 pages per binder. The contents of the boxes containing the archived solicitation materials alone totals 4,395,000 pages (879 boxes x 5,000 pages). The warehouse is not the only source of solicitation documents. Such documents are also stored on site in file cabinets. My department has 10 cabinets, each with 10 drawers and 500 samples per drawer. tn addition to the samples, my department stores 6,000 solicitations, Each solicitation has several product cells. Each cell h-as S pages front and back. I estimate that my department has over 25,000 pages of current solicitation documents on site. If I were to include solicitation documents to media organizations, including radio, television, and newspapers, account management partnerships, and coupons, another 5,000 pages would be added to the 25,000 total. Searching for such materials would require a separate warehouse and a fulltime staff to search through the files manuafly to locate the solicitation materials.

8. In addition to their solicitation materials, Capital One Bank has approximately 38,000,000 customers, the vast majority of whom receive monthly statements containing solicitation-related materials. These documents alone would total 456,000,000 pates, assuming that the solicitation was limited to one page in each monthly statement. Although the scope of the request is so vast Cnat it is discult even to estimate precisely how many documents are called for, in my opinion, requiring Capital One Bank to produce solicitations would cost millions of dollars. These efforts would seriously impinge on Capital One Bank's regular course of business, as producing these documents would require the location, review, and assembly of billions of pages.

I declare wider penalty of perjuxy that the foregoing is true and correct.

Executed this 26th day of November 2001, at Glen Allen, Virginia.

EXHIBIT B

NELSON v. CAPITAL ONE BANK, (N.D.Cal. 2001)

JAUTASSA NELSON, EVA MARTIN, DAWN CIESLIK, and DORIS KOGO on behalf of themselves and all others similarly situated, Plaintiffs v. CAPITAL ONE BANK and CAPITAL ONE 17 FINANCIAL CORPORATION, Defendants. No.C 01-0079 PJH (EMC) United States District Court, N.D. California, San Francisco Division. December 12, 2001

JAMES F. MCCABE (BAR NO. 104686), JAMES R. MCGUIRE (BAR NO. 189275), WENDY M. GARBERS (BAR NO. 213208), MORRISON FOERSTER LLP., San Francisco, California, CAPITAL ONE BANK and CAPITAL ONE FINANCIAL CORPORATION. Attorneys for Defendant.

DISCOVERY MATTER

DECLARATION OF FRANK ROTMAN IN SUPPORT OF CAPITAL ONE BANK'S OPPOSITION TO PLAINTIFFS' MOTION TO COMPEL FURTHER RESPONSE AND PRODUCTION OF DOCUMENTS PURSUANT TO PLAINTIFF JAUTASSA NELSON'S FIRST REQUEST FOR PRODUCTION OF DOCUMENTS

Date: Dec. 12, 2001 Time: 1:30p.m. Court: Hon. Edward M. Chen

I, Frank Rotman, hereby declare and state as follows:

1. I am a Vice President of Capital One Services, Inc.("Capital One Services"), the entity which provides certain credit card servicing operations to Capital One Bank. I make this declaration based upon my own personal knowledge of the facts set forth below and, if called as a witness, could and would competently testify thereto.

2. I have been with Capital One Services since 1993. Over the past several years, I have been responsible for aspects of account management, building certain risk models, overseeing aspects of risk operations, and developing and managing aspects of certain lines of business within Capital One Bank.

3. I have reviewed the relevant portions of Plaintiff Jautassa Nelson's Request for Production of Documents to Capital One Bank, and Capital One Bank's responses thereto.

4. Capital One Bank is very large and disaggregated, and has many departments and sub| departments, involved with many different lines of business. Most departments prepare their own budget and business and marketing plans. Each department and sub-department typically maintain separate records and/or files, which are not maintained in one central location. In addition, files relating to all of these matters generally are not indexed or maintained by geographic location. The requests seeking California-specific information would force Capital One Services essentially to review all of its documents in order to produce those referring to California business. This onerous task would have to be performed in each separate department and sub-group within the company.

5. As described in greater detail below, request numbers 26, 30, 31, and 32 each seek information related to Capital One Bank's "Information Based Strategy." The information-based strategy pervades virtually everything Capital One Bank does. The information-based strategy is proprietary and highly confidential, and is the single most critical aspect of Capital One Bank's business. Capital One Bank derives independent economic value, both actual and potential, from the fact that this information is not generally known to the public or to other persons who can obtain economic value from its disclosure or use. The information is the subject of intense security and significant efforts, reasonable under the circumstances, are employed to maintain its secrecy. The disclosure of the information to the general public would be financially disastrous.

6. For the foregoing reasons, it would be extremely burdensome to respond to the following requests, and/or the following requests call for highly proprietary and confidential information:

No. 11 ("[a]ll internal memoranda, reports, summaries, and/or accounting work papers concerning any following: late payment fees; over credit limit fees; charges related to any fee-based service; the cancellation, including any request for cancellation, of any services and/or products; payment processing procedures and/or processing; and or the wiring or electronic transfer of funds for payment.")

No. 14 ("[a]ll documents reflecting, referring, or relating to marketing demographics in connection with any of the following: the sale and/or marketing of credit cards and/or fee-based services; late or over limit fees; and/or retention of cardholders and/or sales of fee-based services to cardholders.")

No. 26 ("[a]ll documents describing, referring or relating to defendants' risk modeling system for offering or selling credit cards and/or fee-based services.")

No. 30 ("[a]ll documents from the information-based system that contain information about both potential and current cardholders who reside in California.")

No. 31 ("[a]ll documents that reflect, concern or relate to tests performed by you of data from the information-based system about California residents.")

No. 32 ("[a]ll documents that reflect, concern or relate to tests performed by you of data from the information-based system about fee-based services.")

No. 34 ("[a]ll of your business plans, budgets and related documents that reference potential or actual California business.")

No. 38 ("[a]ll documents concerning demographics of cardholders residing in California, including number of cardholders, revenues based on fee-based services, billing inquiries and complaints, and routing system for application of payments received from cardholders.")

I declare under penalty of perjury that the foregoing is true and correct.

Executed this 26th day of November 2001, at Glen Allen, Virginia.

EXHIBIT C

NELSON v. CAPITAL ONE BANK, (N.D.Cal. 2001)

JAUTASSA NELSON, EVA MARTIN, DAWN CIESLIK, and DORIS KOGO on behalf of themselves and all others similarly situated, Plaintiffs v. CAPITAL ONE BANK and CAPITAL ONE 17 FINANCIAL CORPORATION, Defendants. No.C 01-0079 PJH (EMC) United States District Court, N.D. California, San Francisco Division. May 2, 2001

JAMES F. MCCABE (BAR NO. 104686), JAMES R. MCGUIRE (BAR NO. 189275), WENDY M. GARBERS (BAR NO. 213208), MORRISON FOERSTER LLP., San Francisco, California, CAPITAL ONE BANK and CAPITAL ONE FINANCIAL CORPORATION. Attorneys for Defendant.

DECLARATION OF MICHAEL F.BARRY IN SUPPORT OF CAPITAL ONE FINANCIAL CORPORATION'S MOTION TO DISMISS THE COMPLAINT

Date: May 2, 2001 Time: 9:00 a.m. Court: The Honorable Phyllis J. Hamilton

I, MICHAEL F. BARRY, declare:

1. I am Assistant General Counsel of Capital One Financial Corporation. I make this declaration based upon my own personal knowledge of the facts set forth below and, if called as a witness, could and would competently testify thereto.

2. Capital One Financial Corporation is a corporation organized and existing under and by virtue of the laws of the State of Delaware, with its principal place of business in Falls Church. Virginia.

3. Capital One Financial Corporation is a holding company for the stock of its subsidiaries. As such, Capital One Financial Corporation has never issued credit cards, made loans, accepted payments, or engaged in any business other than holding stock in its subsidiaries. Capital One Financial Corporation does not enter into contracts with California consumers, either through a website or otherwise. Capital One Financial Corporation does not own any banks or other subsidiaries in California.

4. Capital One Financial Corporation has never consented to the exercise of general jurisdiction in the State of California.

5. Capital One Financial Corporation has never authorized an agent to accept service of process in California.

6. Capital One Financial Corporation has never operated or managed any business in California.

7. Capital One Financial Corporation has never been licensed or authorized to do business in California.

8. Capital One Financial Corporation has never had an office, place of business, employees. agents, or representatives in California.

9. Capital One Financial Corporation has never maintained any books or records in California.

10. Capital One Financial Corporation has never used, owned, rented, or possessed any real or personal property in California.

11. Capital One Financial Corporation has never advertised or solicited business in California.

12. Capital One Financial Corporation has never had a telephone number in California.

13. At all relevant times, Capital One Financial Corporation and each of its subsidiaries are and were distinct and separate corporate entities. Capital One Financial Corporation and each subsidiary have their own officers and Board of Directors, each holding its own Board of Directors' meetings and maintaining its own corporate minutes and books. All corporate formalities maintaining the separateness of Capital One Financial Corporation and its subsidiaries are and were strictly observed.

14. Capital One Financial Corporation owns the service mark "Capital One" and licenses it to various subsidiaries. Any account or customer relationships using the service mark "Capital One" are entered into by wholly-owned subsidiaries of Capital One Financial Corporation, such as Capital One Bank.

15. Capital One Financial Corporation does not issue press releases on behalf of Capital One Bank.

16. Capital One Financial Corporation does not place solicitations in Capital One Bank's cardholders' monthly statements.

EXECUTED at Glen Allen, Virginia this 22nd of March, 2Q01.

I declare under the penalty of perjury that the foregoing is true and correct to knowledge and belief.