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Carla Montgomery v. United States of America

January 17, 2012

CARLA MONTGOMERY,
PLAINTIFF,
v.
UNITED STATES OF AMERICA,
DEFENDANT.



The opinion of the court was delivered by: Honorable Janis L. Sammartino United States District Judge

ORDER: (1) DENYING TWIN CITIES' MOTION TO INTERVENE; (2) DENYING TWIN CITIES' MOTION TO STAY; AND (3) GRANTING PARTIES' JOINT MOTION TO DISMISS (ECF Nos. 40, 41, 44)

Presently before the Court are motions by Twin Cities Fire Insurance Company ("Twin Cities") to intervene in this action and to stay dismissal of the action until the motion to intervene can be heard. (ECF Nos. 40, 41.) Also before the Court is a joint motion by Plaintiff Carla Montgomery and Defendant United States of America to dismiss the action with prejudice. (ECF No. 44.) Having considered the parties' arguments and the law, the Court DENIES Twin Cities' motion to intervene, DENIES its motion to stay, and GRANTS the parties' joint motion to dismiss.

BACKGROUND

This underlying Federal Tort Claims Act ("FTCA") action arises out of a slip and fall accident that occurred while Plaintiff was employed as a contract nurse at Naval Medical Center San Diego (NMCSD).*fn1 In February 2008, Plaintiff was working as a circulating nurse, employed by TCMP Health Services, LLC. On February 8, 2008, while circulating during a vascular surgery in NMCSD operating room 11, Plaintiff slipped on a puddle of saline and fell, breaking her toe. As a result of her injury, she received workers' compensation benefits.

On July 22, 2009, Plaintiff filed a complaint for negligence against Defendant. (Compl., ECF No. 1.) The complaint alleges that Defendant, as owner and operator of NMCSD, failed to maintain the floor of the operating room in a reasonably safe condition, and that as a result Plaintiff slipped and fell. On February 22, 2011, the Court granted Defendant's motion for summary judgment, and directed Defendant to file a renewed motion for summary judgment regarding its liability under general negligence principles. (Order, ECF No. 30.) Defendant declined to file a renewed motion. (ECF No. 31.) On May 26, 2011, the date set for pretrial conference in this matter, Twin Cities*fn2 filed a notice of lien. (Notice of Lien, ECF No. 36.) This notice claimed "first lien upon the settlement, proceeds of any judgment or the satisfaction of any judgment herein" in favor of Plaintiff Montgomery for amounts paid in workers' compensation and related benefits totaling $30,880.37, pursuant to California Labor Code § 3852 ("California Worker's Compensation Act" or "CWCA").

Before the date set for pretrial conference, counsel for Defendant United States of America informed the Court that the parties had reached a tentative settlement and intended to file a joint motion to dismiss. (See Notice of Hearing on Sua Sponte Dismissal, ECF No. 38.) However, no motion to dismiss was filed and neither party appeared at the pretrial conference. On May 27, 2011, the Court notified the parties that this case would be dismissed on June 30, 2011 pursuant to the Court's inherent authority to dismiss an action sua sponte for want of prosecution. (Id.)

However, on June 17, 2011, Twin Cities filed the instant motion to intervene in this action pursuant to Federal Rules of Civil Procedure 24(a)(2) and 24(b)(1)(B). (Mot. to Intervene, ECF No. 41.) Twin Cities simultaneously filed a motion to stay the Court's dismissal of the action until its motion to intervene could be heard. (Mot. to Stay, ECF No. 40.) Subsequently, the Court vacated the hearing on the sua sponte dismissal set for June 30, 2011 pending the resolution of Twin Cities' motions. (Order Vacating Hearing, ECF No. 42.) On July 14, 2011, while Twin Cities' motions were still pending, Plaintiff and Defendant filed a joint motion to dismiss the action with prejudice pursuant to a stipulated settlement between them. (Joint Motion to Dismiss, ECF No. 44.) Both parties also filed oppositions to Twin Cities' motion to intervene, (Pl.'s Opp'n to Mot. to Intervene, ECF No. 45; Def.'s Opp'n to Mot. to Intervene, ECF No. 43) and Twin Cities replied (Reply ISO Mot. to Intervene, ECF No. 46.) Twin Cities' motions were set for hearing on August 25, 2011, and the Court vacated the hearing and took the matter under submission pursuant to Civil Local Rule 7.1(d)(1). (ECF No. 47.)

LEGAL STANDARD

Federal Rule of Civil Procedure 24(a) provides in relevant part:

On timely motion, the court must permit anyone to intervene who: . . . (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.

The Ninth Circuit has established a four-part test to determine whether intervention as of right is appropriate: "(1) the motion must be timely; (2) the applicant must assert a 'significantly protectable' interest relating to property or a transaction that is the subject matter of litigation; (3) the applicant must be situated so that disposition of action may as a practical matter impair or impede the interest; and (4) the applicant's interest must be inadequately represented by the parties." Kootenai Tribe of Idaho v. Veneman, 313 F.3d 1094, 1107--08 (9th Cir. 2002) (citing Wetlands Action Network v. U.S. Army Corps of Eng'rs, 222 F.3d 1105, 1113--14 (9th Cir. 2000) and Sierra Club v. E.P.A., 995 F.2d 1478, 1481 (9th Cir. 1993)). The requirements for intervention as of right are interpreted liberally in favor of intervention. Prete v. Bradbury, 438 F.3d 949, 954 (9th Cir. 2006). In determining whether intervention is appropriate, well-pleaded nonconclusory allegations in the motion to intervene and the declarations in support of the motion must be taken as true, and a court may take notice of uncontroverted facts in pleadings and affidavits opposing intervention. Sw. Ctr. for Biological Diversity v. Berg, 268 F.3d 810, 819--20 (9th Cir. 2001). This determination should be primarily guided by practical and equitable considerations. Donnelly v. Glickman, 159 F.3d 405, 409 (9th Cir. 1998).

Further, Federal Rule of Civil Procedure 24(b)(1)(B) permits a court to allow anyone to intervene on a timely motion who "has a claim or defense that shares with the main action a common question of law or fact." A party seeking permissive intervention must show that "(1) it shares a common question of law or fact with the main action; (2) its motion is timely; and (3) the court has an independent basis for jurisdiction over the applicant's claims." Donnelly, 159 F.3d at 412 (citing Nw. Forest Res. Council, 82 F.3d at 839). While permissive intervention is left to the broad discretion of the district court, the court "must consider whether intervention will unduly delay the main action or will unfairly prejudice the existing parties." See Donnelly, 159 F.3d at 412; Fed. R. Civ. P. 24(b)(2).

ANALYSIS

Twin Cities seeks to enter this action as a plaintiff-in-intervention in order to obtain reimbursement of any workers' compensation amounts already paid to Plaintiff which are attributable to negligence on the part of Defendant. (Mot. to Intervene 3.) According to Twin Cities, it was never served formal notice of this action by Plaintiff as required by California Labor Code § 3853. Further, Twin Cities asserts that the CWCA allows an employer or insurance carrier acting as employer to intervene in an employee's action against a third party to recover payments it has made to the employee injured by the third party. For these reasons, Twin Cities argues that it may intervene in this action as of right, and that the interests of justice would not be served by the Court's dismissal of the action, precluding Twin Cities from obtaining full recovery of the benefits it has paid to Plaintiff. In the alternative, Twin Cities states that its intervention is at least permissible under Federal Rule of Civil Procedure 24(b)(1)(B).

Defendant objects to the intervention, stating that Twin Cities' interests are sufficiently protected by the lien it asserted in this case on May 26, 2011 pursuant to California Labor Code § 3856(b). (Def.'s Opp'n to Mot. to Intervene 1; see also Notice of Lien, ECF No. 36.) Defendant states that it transferred funds to Plaintiff's counsel's trust account on July 13, 2011, as provided by the May 23 settlement between those two parties, and argues that "Twin Cities is entitled to recover from plaintiff's settlement, after reasonable attorney's fees are paid out, its expenses." (Id. at 2.) Further, Defendant asserts that Twin Cities has not established intervention serves the interests of justice because Twin Cities may file suit directly against Plaintiff to enforce its lien, and intervention at this time would prejudice both Defendant and Plaintiff, who have settled the present action and seek to dismiss it voluntarily with prejudice. (Id. at 3.)

Plaintiff also objects to the intervention, adding that Twin Cities' insistence on recovering 100% of its lien is improper, as its recovery should at least be reduced by the amount of Plaintiff's expenses under the equitable common fund doctrine, as outlined in California Labor Code ยง 3856. (Pl.'s Opp'n 3, 5.) Plaintiff states it has negotiated with Twin Cities to resolve the lien, offering as much as $17,105.35, but that all of its attempts were rejected. (Id. at 6.) According to Plaintiff's calculations, a 45% attorney fee should be applied for Plaintiff's counsel's efforts in recovering the lein, and after costs of $1,956 are also subtracted, Plaintiff's offer to pay $17,105.35 "represents a 50% recovery which is much more than customary." (Id.) Plaintiff ...


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