The opinion of the court was delivered by: Hon. Thomas J. Whelan United States District Judge
AMENDED ORDER (1) DENYING MOTION TO INTERVENE [DOC. 30], AND (2) RENDERING MOTION FOR SANCTIONS AND CEASE AND DESIST ORDER [DOC. 32] MOOT
This declaratory-relief action was filed in December 2005 by Julianites Against Shakedown Tactics ("JAST") and Californians Against Litigation Predators ("CALP").*fn1 Defendants are attorney Theodore A. Pinnock and two of his clients, Total Equality, Just Judgment and Rights ("TEJJR") and Mantic Ashanti's Cause ("Mantic Ashanti"). Plaintiffs are suing for alleged unlawful and unethical pre-litigation conduct arising from Defendants' pursuit of Americans With Disabilities Act ("ADA") claims.
Pending before the Court is a motion to intervene under Federal Rule of Civil Procedure 24(a)(2) and 24 (b)(2) filed by Santa Ysabel General Store/Antiques, Rong Branch Restaurant, Mom's Pie House, and the Warm Hearth ("Applicants"). Four of the five Applicants are being sued by Defendants in a separate case for alleged ADA violations. Applicants contend that in this case, Plaintiffs' counsel has, among other things, made misrepresentations regarding Applicants' relationship with JAST and CALP that have complicated Applicants' ability to settle with Defendants. Accordingly, Applicants seek to intervene to pursue sanctions and a cease and desist order against Plaintiffs' counsel.
The Court decides the matter on the papers submitted and without oral argument pursuant to Civil Local Rule 7.1(d.1). For the reasons discussed below, the Court DENIES Applicants' motion to intervene. Applicants' motion for sanctions and a cease and desist order is, therefore, moot.*fn2
A. Plaintiffs are Challenging Defendants' Pre-Litigation Conduct
According to Plaintiffs' First Amended Complaint, in November 2005, defendant Pinnock visited the small, mountain community of Julian, California. (FAC at ¶11.) Shortly thereafter, Pinnock sent letters to 67 businesses alleging violations of the ADA and demanding, in total, more than $200,000 for his client, TEJJR. (Id.) Pinnock later distributed a memo to the Julian businesses warning that if his monetary demands were not met, they would begin to increase on a daily basis. (Id. at ¶ 19.) Pinnock then distributed a "series of proposed settlement agreements wherein he made varying financial demands, but which contained the significant requirement that the payment which the Julian business would make would be for an 'investigation fee' payable to TEJJR...." (Id. at ¶20.)
Plaintiffs contend that Pinnock's demands are subject to extraordinarily short deadlines so that the businesses have a difficult time obtaining "appropriate legal advice." (FAC at ¶23.) Plaintiffs also complain that Pinnock refuses to discuss any of the legal issues before filing litigation. For example, Pinnock allegedly conducts "on-site mediations" at the property he is considering suing, during which time if "a business or lawyer desire [sic] to dispute the claims, engage in fact finding or make legal arguments" Pinnock terminates the mediation and files litigation. (Id. at ¶26.)
Aside from the claims against the Julian businesses, Plaintiffs allege that Pinnock has filed more than 2000 ADA/access lawsuits and "has sent hundreds -- if not thousands -- of letters to businesses around Southern California threatening litigation...." (FAC at ¶¶12, 17.) Businesses that refuse to pay the "investigation fee" or hire TEJJR to conduct the access inspection are sued for alleged ADA violations by Pinnock's other client, Mantic Ashanti. Plaintiffs further assert that Pinnock's actions in Julian, which Pinnock has allegedly referred to as "the Julian Experiment", constitute a new approach for pursuing ADA claims. (Id. at ¶25.)
In filing this lawsuit, Plaintiffs are seeking court review of Defendants' pre-litigation practices, which"the Pinnock Group worked very hard to keep away from judicial attention...." (FAC at ¶14, emphasis in original.) The First Amended Complaint, therefore, requests a declaration that Defendants' pre-litigation tactics are unethical and unlawful, and a mandatory injunction requiring Defendants to, in essence, comply with the law and rules of professional conduct.
B. Applicants Seek to Challenge Plaintiffs' Counsel's Pre-Litigation Conduct
Applicants are among the Julian businesses that received a demand letter from Pinnock in November 2005. (Apps.' P & A at 2.) Applicants contend that in approximately December 2005, Plaintiffs' counsel, Lawyers Against Lawsuit Abuse ("LALA"), entered into negotiations with Pinnock on behalf of Applicants. (Id. at 5.) LALA, however, was neither retained nor authorized to represent Applicants, and during the negotiations with Pinnock, LALA allegedly received settlement offers, but failed to timely advise Applicants of the offers. (Id.) Applicants also allege that LALA knowingly and intentionally lied about certain Applicants' position with regard to ADA compliance. (Id.) According to Applicants, these misrepresentations were made so that LALA could buy time in order to file this lawsuit. (Id.)
As a result of LALA's alleged failure to advise Applicants of Pinnock's settlement offers, Applicants contend that they were denied the opportunity to settle the ADA claims, which resulted in Pinnock filing an ADA enforcement action against 4 of the 5 Applicants. Additionally, Applicants assert that as a result of LALA's conduct, Applicants have incurred significant expenses and have encountered "great difficulty 'undoing' the adverse affects of LALA's actions and false representations." (Apps.' P & A at 8.) Accordingly, although Applicants acknowledge that they could pursue a separate action, Applicants seek to intervene to protect their interests and pursue sanctions and a cease and desist order pursuant to Federal Rule of Civil Procedure 11 against LALA.
Rule 24(a)(2) permits anyone to intervene as a matter of right who 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 Ninth Circuit applies a four-prong test, under which the applicant must establish:
(1) the application for intervention is timely;
(2) the applicant has a 'significant protectable' interest relating to the property or transaction that is the subject of the action;
(3) the applicant is so situated that the disposition of the action may, as a practical matter, impair or impede the applicant's ...