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Before You File, Review For “Personally Identifiable Information” and Redact: Indiana Overview

Most if not all states, including Indiana, have rules requiring the redaction of so-called “personally identifiable information” (PII) before documents may be filed with a court. (Don’t know what “redaction” means? This article helps explain.) Generally speaking, each document should be prepared according to the court’s respective guidelines and jurisdictional/county rules. Examples of these documents include, but are not limited to, complaints for foreclosure, affidavits, judgments, and bankruptcy filings.

Federal rules. For federal court actions, see Federal Rule of Civil Procedure Rule 5.2 and Federal Rule of Bankruptcy Procedure 9037.

Indiana rules. Indiana’s Rules on Access to Court Records (the “Rules”) govern our state court matters. There are only 12 rules, and Indiana practitioners and their staffs should take a minute to review (or re-review) them. For purposes of today’s post, Rule 5(C)(1) is key:

        (C) Personal Information of Litigants, Witnesses, and Children:

            (1) Unless necessary to the disposition of the case, the following information shall be redacted, and no notice of exclusion from Public Access is required:

                (a) Complete Social Security Numbers of living persons;
                (b) Complete account numbers, personal identification numbers, and passwords.

If the information is necessary to the disposition of the case, the document containing the confidential information shall be filed on green paper (if paper filing) or filed as a confidential document (if e-filed). A separate document with the confidential information redacted shall be filed on white paper (if paper filing) or filed as a public document (if e-filing). A separate ACR Form identifying the information excluded from public access and the Rule 5 grounds for exclusion shall also be filed.

Note that Rule 11 provides that lawyers and/or their clients can be subject to sanctions for failing to comply with the Rules. Again, any PII not required in the filing should be redacted.

Examples of PII. The following is a list of the type of information that should be redacted, but the list is not all inclusive:

• Social Security Number(s)

• Taxpayer Identification Number ("TIN")

• Driver’s License Number(s) or other Government identification number

• Loan Originator/ Loan Application Number(s)

• Servicer Loan Number(s)

• Third Party Loan/File Number(s)

• Bank Account Number (may include copy of imaged check)

• Any Financial Account, credit card numbers, Escrow Account Number(s)

• Customer Reference Number(s)

• Mortgage Identification Number ("MIN")

• Mortgage Electronic Registration Systems Number (“MERS”)

• Birthdates

• Insurance Policy Number(s)

• Any Minor Child Information

• Any Images that may include NPPI

• Telephone Numbers

• Bar Codes on Collateral Documents for any of the above numbers, except as may otherwise be required in documents that are filed as part of the public record.

Other tips.

• All information, including attachments and exhibits, should be reviewed for PII (including handwritten information).

• Even if a previously-recorded document, such as a mortgage, contains PII, redaction still should occur.

• With today’s computer software, redactions can (and should) be accomplished electronically.

• We advise redacting with a clearly visible black box to reflect where PII has been removed. The black box should completely cover the PII.

• Be careful not to redact any original loan documents such as an original promissory note.

Credit. I would like to thank my colleague Edward Boll, who helps lead Dinsmore’s default servicing and consumer bankruptcy practice group in Cincinnati. Ed and his team prepared the majority of today’s content.  Thanks for sharing your presentation, Ed.
I represent parties involved in disputes arising out of loans that are in default. If you need assistance with a similar matter, please call me at 317-639-6151 or email me at [email protected]. Also, don’t forget that you can follow me on Twitter @JohnDWaller or on LinkedIn, or you can subscribe to posts via RSS or email as noted on my home page.

7th Circuit Opinion Captures The Essence Of An Indiana Lis Pendens Notice

The recent Seventh Circuit Court of Appeals case in Nat'l Asset Consultants LLC v. Midwest Holdings-Indianapolis LLC 2022 U.S. App. LEXIS 16689 (7th Cir. June 16 2022) did not litigate a lis pendens issue per se. The opinion did, however, comment on the practical impact of an Indiana lis pendens filing.

The dispute began with the filing of a state court case in which the plaintiffs [Sellers] sought to require the defendant [Purchaser] “to perform what [Sellers] described as a contract for the sale of a parcel of land.” Sellers filed a lis pendens notice in connection with the suit. Purchaser later alleged that Sellers attached an altered exhibit to their state court complaint. In an effort to combat that wrong, Purchaser filed a federal court action against the Sellers for fraud and counterfeiting.

In the federal court case, the district judge granted summary judgment for Sellers on the basis that the alleged fraud/counterfeiting had not caused any damage. Sellers thus convinced the district court that there was an absence of injury arising out of the bogus exhibit. Purchaser appealed.

At the 7th Circuit, Purchaser asserted that it had been injured by the very existence of the state court litigation, which made the subject real estate unmarketable by greatly diminishing the potential selling price. The Court rejected the theory, noting that “one page of one exhibit to a complaint” did not affect the value or marketability of the real estate. Rather:

it is the complaint itself, accompanied—as Indiana law requires—by a lis pendens in the real-estate property records. The lis pendens notifies potential buyers that the interests a seller can convey may be subject to the suit's outcome…. [A] lis pendens would have been filed whether or not the page had been altered, so any injury would have been the same.

The Court stated that Purchaser could have asked the state court judge to withdraw the lis pendens notice, but Purchaser apparently had not done so. Thus, the “altered page did not injure anyone, which knocks out any claim for damages” under the statute at issue.

A couple takeaways: (1) an Indiana lis pendens notice is a powerful tool that effectively renders the subject real estate unmarketable during the pendency of the underlying lawsuit and (2) if an owner has an objection to a lis pendens notice, the owner should seek an order lifting the notice.

For more on lis pendens, I have a separate category devoted to the subject.
Part of my practice involves representing parties in real estate-related disputes. If you need assistance with a similar matter, please call me at 317-639-6151 or email me at [email protected]. Also, don’t forget that you can follow me on Twitter @JohnDWaller or on LinkedIn, or you can subscribe to posts via RSS or email as noted on my home page.