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Community Vocational Schools of Pittsburgh, Inc. v. Mildon Bus Lines, Inc.

United States District Court, W.D. Pennsylvania

April 17, 2017

COMMUNITY VOCATIONAL SCHOOLS OF PITTSBURGH, INC., a corporation, individually and as the representative of a class of similarly situated persons, Plaintiff,
v.
MILDON BUS LINES, INC., a Pennsylvania corporation, Defendant/Third Party Plaintiff,
v.
CAROLINE ABRAHAM and JOEL ABRAHAM, Third Party Defendants.

          MEMORANDUM OPINION

          Joy Flowers Conti Chief United States District Judge

         I. Introduction

         In its motion for leave to intervene (ECF No. 64), Erie Insurance Exchange (“Erie”) calls upon the court to allow it to intervene in this case pursuant to Federal Rule of Civil Procedure 24 (“Rule 24”). This punitive class action case seeks to advance claims under the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227. (ECF No. 1.) Community Vocational Schools of Pittsburgh, Inc. (“plaintiff”) represents a class of persons who allegedly received unlawful facsimile messages from Mildon Bus Lines, Inc. (“Mildon Bus” or “defendant”) in January 2006.

         Erie is the insurance provider for Mildon Bus and is currently providing representation to it subject to a reservation of rights. (ECF No. 64 at 2.) Erie seeks to intervene in this case for the limited purpose of submitting special jury interrogatories. Erie's claimed purpose for intervention is to determine whether it has a duty to indemnify defendant against any judgment obtained by plaintiff. (Id. at 7.) Erie states that if the jury enters an award of general damages, Erie will be unable to determine whether it has a duty to indemnify Mildon Bus against the judgment. (Id. at 8.) For the reasons set out in this opinion, the court finds that Erie failed to satisfy the requirements for intervention of right under Rule 24(a), and at this time it is premature for the court to determine whether to allow permissive intervention under Rule 24(b). Erie's motion to intervene, therefore, is denied.

         II. Procedural History

         On November 30, 2009, plaintiff filed a class action complaint against defendant advancing a claim under the TCPA for sending unlawful facsimile messages. (ECF No. 1.) On July 27, 2010, defendant filed for bankruptcy in the United States Bankruptcy Court for the Western District of Pennsylvania. In re Mildon Bus Lines, Ins., Civil Action No. 10-25312. On September 22, 2010, this court issued a stay with respect to this case pending resolution of defendant's bankruptcy proceedings. (ECF Nos. 26, 27.) The bankruptcy court, in light of the insurance coverage, lifted the automatic stay to permit this case to proceed to the extent of the coverage. (Civil Action No. 10-25312, ECF No. 79.) Erie filed a claim against defendant in the Court of Common Pleas of Allegheny County concerning insurance coverage (“coverage action”). Erie Ins. Exch. v. Mildon Bus Lines, Inc. and Community Vocational Sch. of Pittsburgh, Alleg. Cty. Ct. of Common Pleas, Civil Action No. 10-003030. This court continued the stay of this matter pending the resolution of summary judgment motions in Erie's coverage action. (ECF No. 64 at 2.) On November 22, 2016, after being advised that summary judgment was not granted in favor of Erie, this court held a status conference, at which point it reopened the case and ordered fact discovery to be completed on or before February 15, 2017. (ECF No. 49.) On January 30, 2017, this court granted plaintiff's unopposed motion to extend fact discovery, and ordered that discovery be completed on or before May 15, 2017. (ECF No. 62.) On February 2, 2017, Erie filed a motion for leave to intervene pursuant to Federal Rule of Civil Procedure 24 (“Rule 24”), accompanied by a memorandum of law in support of its motion. (ECF No. 64.)

         On February 22, 2017, plaintiff filed a response to Erie's motion for leave to intervene, accompanied by a memorandum of law in support of its response. (ECF Nos. 67, 68.) On March 7, 2017, defendant filed a brief in reply to plaintiff's response in opposition to Erie's motion to intervene. (ECF No. 74.) On March 7, 2017, Erie filed a reply brief in further support of its motion to intervene. (ECF No. 75.) A hearing was held on the motion on March 27, 2017. Having been fully briefed and argued, this motion is now ripe for disposition.

         III. Discussion

         A. Rule 24(a) and Rule 24(b)

         Erie seeks to intervene in the underlying action for the limited purpose of submitting special jury interrogatories. Erie seeks “intervention of right” under Federal Rule of Civil Procedure 24(a) (“Rule 24(a)”). Rule 24(a) states, in relevant part:

(a) Intervention of Right. Upon timely application, anyone shall be permitted to intervene in an action… (2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and the applicant is so situated that the disposition of the action may as a practical matter impair or impede the applicant's ability to protect that interest, unless the applicant's interest is adequately represented by existing parties.

Fed.R.Civ.P. 24(a)(2).

         The Third Circuit Court of Appeals utilizes a four-factor test to determine whether the intervening party has a right to intervene under Rule 24(a). This test requires:

1) a timely application for leave to intervene, 2) a sufficient interest in the underlying litigation, 3) a threat that the interest will be impaired or affected by the disposition of the underlying action, and 4) that the existing parties to the action do not adequately represent the prospective intervenor's interests.

Liberty Mut. Ins. Co. v. Treesdale, Inc., 419 F.3d 216, 220 (3d Cir. 2005) (citing Kleissler v. United States Forest Serv., 157 F.3d 964, 969 (3d Cir. 1998)). Each of the factors must be satisfied for intervention under Rule 24(a) to be granted and the burden is on the party seeking intervention. Mountain Top Condo. Ass'n v. Dave Stabbert Master Builder, Inc., 72 F.3d 361, 366 (3d Cir. 1995).

         If the intervening party does not meet its burden under Rule 24(a) it may still be able to intervene under Rule 24(b). Rule 24(b), which provides for permissive intervention, provides the court with discretion in determining whether intervention is proper. Brody By & Through Sugzdinis v. Spang, 957 F.2d 1108, 1124 (3d Cir. 1992) (“Whether to grant permissive intervention under Rule 24(b), as the doctrine's name suggests, is within the discretion of the district court.”). Rule 24(b) provides, in relevant part:

(b) Permissive intervention. Upon timely application, anyone may be permitted to intervene in an action: . . . (2) when an applicant's claim or defense and the main action have a question of law or fact in common.

Fed.R.Civ.P. 24(b)(2). A district court may exercise its discretion and allow a timely applicant to intervene under Rule 24(b) if the original plaintiff and the intervenor share a “question of law or fact in common.” McKay v. Heyison, 614 F.2d 899, 906 (3d Cir. 1980). “In exercising its discretion the court shall consider whether the intervention will unduly delay or prejudice the adjudication of the rights of the original parties.” Fed.R.Civ.P. 24(b)(3).

         B. Rule 24(c), Notice and Pleading Required

         As a preliminary matter, the court will address plaintiff's argument that Erie's motion should be dismissed for failing to attach a pleading under Federal Rule of Civil Procedure 24(c) (“Rule 24(c)”). Rule 24(c) requires the party seeking intervention to serve a motion to intervene and a proposed pleading on the opposing parties. Fed.R.Civ.P. 24(c) (“motion must state the grounds for intervention and be accompanied by a pleading that sets out the claim or defense for which intervention is sought.”) (emphasis added). Rule 24(c) is “designed to ensure that parties have advance notice of the claims that an intervenor plans to make.” SEC v. Investors Sec. Leasing Corp., 610 F.2d 175, 178 (3d Cir. 1979) (finding that court was without jurisdiction to rule on intervening party's claims because applicant failed to serve a motion to intervene on the other parties, and consequently those parties had absolutely no way to know the claims for intervention).

         Generally, failure to comply with the requirements of Rule 24(c) will result in the denial of a motion to intervene. Meridian Financial Advisors, LTD v. Contract Purchase & Design, Inc., 495 B.R. 274, 280 (Bankr. W.D. Pa. 2013); see Township of S. Fayette v. Allegheny Cty Housing Auth., 183 F.R.D. 451 (W.D. Pa. 1998) (motion to intervene dismissed when movants did not submit the requisite proposed pleading). Nonetheless, “despite the compulsory language of [Rule 24(c)], some federal circuits have held that whether ‘to permit a procedurally defective motion to intervene is within the sound discretion of the district court.'” United States ex rel. Frank M. Sheesley Co. v. St. Paul Fire & Marine Ins. Co., 239 F.R.D. 404, 408 (W.D. Pa. 2006) (quoting Retired Chi. Police Ass'n v. City of Chicago, 7 F.3d 584, 595 (7th Cir. 1993); see Providence Baptist Church v. Hillandale Comm., Ltd., 425 F.3d 309, 313 (6th Cir. 2005); Beckman Indus., Inc., v. Int'l Ins. Co., 966 F.2d 470, 474 (9th Cir. 1992). Although the requirements under Rule 24(c) state that a party seeking intervention must attach “a pleading ...


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