Opinion
Case No. 00CV2142K POR
February 27, 2001
ORDER DENYING APPLICATION TO INTERVENE
On January 21, 2001, Stirling Cooke Insurance Services, Inc. ("Stirling") filed an application to intervene in this matter pursuant to Federal Rules of Civil Procedure Rule 24(a)(2). Defendant United States of America opposes. Plaintiff Michael Hess has not filed any papers with the court on this matter. All parties are represented by counsel.
I. Background
The following statements of facts was taken from parties' papers. They do not constitute a finding of fact by the court.
Stirling is an insurance company based in Long Beach, California. Stirling wrote an insurance policy insuring Delphius Engineering against claims under the Longshore and Harbor Workers' Compensation Act (the "Act"), 33 U.S.C. § 901 et seq. Plaintiff Michael Hess was a shoreworker employed by Delphinus Engineering as a pipefitter. Pursuant to a contract with the United States, Delphius was performing certain services on the USS Bonhomme Richard, at that time afloat in San Diego Harbor. On or about October 25, 1999, Plaintiff alleges that in the course of employment for Delphius, he suffered injuries on the Bonhomme Richard. Plaintiff filed a claim with his employer pursuant to the Act. Stirling alleges that as of January 24, 2001, Stirling has paid out $46,477.13 pursuant its obligations under the Act. Pursuant to the Act, Plaintiff filed the instant claim on October 24, 2000 claiming that his injuries were a result of negligence on the part of the United States as owner of the vessel Bonhomme Richard.
II. Discussion
Stirling claims that pursuant to the Act, it is entitled to be recognized as a lienholder, and by right entitled to reimbursement from the proceeds of any payment by the Defendant to the Plaintiff. Stirling argues that because of its status as a lienholder, it should be allowed to intervene in this matter under the terms of FRCP Rule 24(a)(2). The government does not object to the court recognizing Stirling's status as a lienholder pursuant to 33 U.S.C. § 33(b), but does object to Stirling's intervention in this action as an independent party.
A. Legal Standard
FRCP Rule 24(a) provides:
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.
An order granting intervention as of right is appropriate if "1) the applicant's motion is timely; (2) the applicant has asserted an interest relating to the property or transaction which is the subject of the action; (3) the applicant is so situated that without intervention the disposition may, as a practical matter, impair or impede its ability to protect that interest; and (4) the applicant's interest is not adequately represented by the existing parties." U.S. ex rel. McGough v. Covington Technologies, 967 F.2d 1391, 1394 (9th Cir. 1992) (citing County of Orange v. Air California, 799 F.2d 535, 537 (9th Cir. 1986), cert denied, 480 U.S. 946 (1987)).
B. Analysis
While the court agrees that Stirling meets the first two requirements, Stirling has not sufficiently shown that absent intervention, Stirling's ability to protect its interest will be impaired or that Stirling's interests are inadequately represented by the current parties.
Stirling argues that it has a substantial and growing lien in the pending action and that if Stirling is not allowed to intervene, the lien may be jeopardized. In particular, Stirling argues that it "may be bound by the nature and extent of any judgment or settlement obtained by the plaintiff without any opportunity to participate in the litigation or negotiate an appropriate settlement, and its subrogation rights may be impaired if payments are made by the defendant directly to the plaintiff." PA at 4. Stirling further argues that its interests are inadequately represented by the Plaintiff because "plaintiff has an interest in increasing his damages, while at the same time reducing Stirling's potential for lien recovery." Id.
Stirling's conclusory statements, without more, are insufficient. While Stirling has an undisputed interest in this case as a lienholder under the Act, it is unclear why that interest would be impaired if Stirling is not allowed to intervene. Stirling does not explain how the "nature and extent" of a potential judgment might harm its interests, nor does Stirling show how Defendant might circumvent the lien by making payments "directly" to Plaintiff. Simply put, Stirling does not explain why the lien that Stirling has as right under the Act is insufficient to guarantee reimbursal from any potential judgment or settlement between Plaintiff and Defendant.
Stirling also does not explain why Stirling's interest is inadequately represented by Plaintiff. Plaintiff has a motivation to get as large a judgment or settlement as possible from the Defendant, which coincides with Stirling's interest in getting reimbursed for moneys paid out thus far. While Stirling argues that Plaintiff has an interest in "increasing his damages", while "reducing Stirling's potential for lien recovery," Stirling does not explain how Plaintiff might do this, considering the Act explicitly provides for Stirling's right of compensation. See 33 U.S.C. § 933. If Stirling has reason to believe that Plaintiff will inadequately represent his interests, Stirling must state the reasons for its belief explicitly.
III. Conclusion
Considering the foregoing, the court DENIES Stirling's application to intervene.
IT IS SO ORDERED.