Buyers and Renters United to Save Harlem et al v. Pinnacle Group Corp. et al, No. 1:2007cv06316 - Document 112 (S.D.N.Y. 2010)

Court Description: MEMORANDUM OPINION AND ORDER: The Coalition does not meet the requirements for a motion to intervene set out in Fed. R. Civ. P. 24. The motion to intervene is therefore DENIED. (Signed by Magistrate Judge Ronald L. Ellis on 12/22/10) Copies Sent By Chambers. (mro)
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USDCSDNY ,DOCUMENT Buyers and Renters United to Save Harlem et al v. Pinnacle Group Corp. et al UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK 1\ Doc. FILED 112 1 })dc #: 1 DATE FIL::-'E=n::-:-,--,.-,-""2".-2.---,'0-. .... MARJORIE CHARRON, et aI., Plaintiffs, MEMORANDUM OPINION AND ORDER - against07 Civ. 6316 (CM)(RLE) PINNACLE GROUP NY LLC, et aI., Defendants. RONALD L. ELLIS, United States Magistrate Judge: I. INTRODUCTION District Judge Colleen McMahon referred this case to the undersigned for settlement on July 27,2010. Before the Court is a motion dated November 29,2010, in which third party United Co-op Housing Shareholders Coalition ("the Coalition") requests "the right to intervene and to participate in the settlement negotiations." The Court is unaware of any prior instances where a third party has been granted the right to intervene in a case for the limited purpose of participating in settlement proceedings, but will evaluate the Coalition's motion under the standard used for a typical motion to intervene. For the reason's state below, the Coalition's motion is DENIED. II. BACKGROUND A. The Lawsuit Plaintiffs, rent-regulated tenants in apartments owned by Defendants, filed the instant lawsuit on July 11, 2007, alleging violations of New York rent stabilization and consumer protection laws, as well as the Federal Racketeer Influenced and Corrupt Organizations Act ("RICO"), (Compl. 16.) On September 5, 2008, Judge McMahon, in large part, denied Defendants' motion to dismiss (Doc. 32), and on April 27, 2010, she certified two plaintiff Dockets.Justia.com classes, an injunctive class consisting of all persons who, as of that date, were tenants in rentregulated apartments owned by Defendants, and a liability class consisting of all persons who were tenants between July 11, 2004, and April 27, 2010, in rent-regulated apartments owned by Defendants. (Doc. 96.) Throughout the process of the lawsuit, Plaintiffs' attorneys, Jenner and Block LLP ("Jenner"), have organized a number of large meetings with the tenants who make up the plaintiff class, in order to keep them apprised of the progress of the suit. (See, e.g., Mot. to Intervene, Ex. 1.) B. The Instant Motion The Coalition is a group of residents, primarily cooperative shareholders, in four properties owned by Defendants. (ld. at 14.) Throughout the progress of the lawsuit, the coalition, through its President, Abram Gin, and its attorney, David Reich, has lobbied Jenner for inclusion as a plaintiff in the suit. (See, e.g., id., Ex. 1.) Jenner maintains that they have repeatedly told the Coalition that they do not represent the Coalition or any of its members who do not fall into the plaintiff classes certified by Judge McMahon. (Resp. to Mot. to Intervene 3.) The Coalition, however, insists that Jenner has taken on a responsibility to represent all residents in buildings owned by Defendants, and that they have not been clear about the limitation of their representation to rent-regulated tenants. (Mot. to Intervene 18.) The Coalition argues that they must be allowed to intervene in the settlement proceedings in order to prevent collusion between Jenner and Defendants. (Jd. at 15.) III. DISCUSSION A. Legal Standard The right to intervene in a case in the federal courts is governed by Fed. R. Civ. P. 24, which allows intervention as of right for anyone who: "(1) is given an unconditional right to 2 _ _ _ _ _ _I ' : ! r W - - - - - -....... . intervene by a federal statute; or (2) claims an interest relating to the property or transaction that is the subject of the action, and is so situated that disposing of the action may as a practical matter impair or impede the movant's ability to protect its interest, unless existing parties adequately represent that interest." Rule 24 also allows permissive intervention when a party "(A) is given a conditional right to intervene by a federal statute; or (8) has a claim or defense that shares with the main action a common question oflaw or fact." A party seeking to intervene as of right must "(1) timely file an application, (2) show an interest in the action, (3) demonstrate that the interest may be impaired by the disposition of the action, and (4) show that the interest is not protected adequately by the parties to the action." New York Nel/y's, Inc. v. Kheel, 972 F.2d. 482, 485 (2d Cir. 1992). "The burden of proving that the existing parties to the action cannot adequately represent the rights of the proposed intervenor lies with that party." lvfadison Stock Transfer, Inc. v. Netco Investments, Inc., No. 06CV-3926, 2007 WL 2902960 at * I (E.D.N.Y. 2007) (citing United States Postal Servo V. Brennan, 579 F .2d 188, 191 (2d Cir. 1978)). When considering applications for permissive intervention, a court considers such factors as the adequacy of representation by existing parties, whether intervention will cause delay, and whether intervention will contribute to full factual development and just adjudication oflegal questions. Id. at *2 (citing Brennan, 579 F .2d at 19192). The determination of these matters lies fully within the discretion of the district court. B. The Merits of the Coalition's Motion The Coalition has not established that it is entitled to intervene as of right, or that it should be permitted to intervene under the permissive intervention statute. It cites no federal statute that would grant it a conditional or unconditional right to intervene. The Coalition's members who are not tenants in rent-regulated apartments do not have an interest in the action, 3 which only alleges violations in the Defendants' treatment of rent-regulated tenants. To the extent that some members of the Coalition are rent-regulated tenants, the Coalition has not met its burden of showing that these members' interests will not be adequately represented by Jenner and the named Plaintiffs. The Coalition also has not shown that it has a claim that shares a common question of law or fact with the main action in this case. There is also no indication that participation by the Coalition would contribute to a more full development of the facts of this suit or a more just adjudication of the legal issues. III. CONCLUSION The Coalition does not meet the requirements for a motion to intervene set out in Fed R. Civ. P. 24. The motion to intervene is therefore DENIED. SO ORDERED this 22nd day of December 2010 New York, New York The Honorable Ronald L. Ellis United States Magistrate .Judge Copies of this Order were sent to: Representative for the Coalition: Abram Gin 99-40 63rd Road, Apartment 3Z Rego Park, NY 11374 Attorney for Defendants: Mitchell Karlan Gibson, Dunn & Krucher LLP 200 Park Avenue, 48th Floor New York, NY 10166 Attorney for Plaintiffs: Richard F. Levy Jenner & Block LLP 919 Third Avenue, 13th Floor New York, NY 10022 4