Williams v. Lycoming et al

Filing 37

ORDER GRANTING 33 motion for leave to file complaint-in-intervention. FIC is ordered to file its complaint-in-intervention within two days of the date of this order. Order signed by Magistrate Judge Sheila K. Oberto on 5/25/2011. (Timken, A)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA
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DONALD WILLIAMS,

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CASE NO. 1:10-cv-02358-AWI-SKO

Plaintiff,

ORDER GRANTING MOTION FOR
LEAVE TO FILE COMPLAINT-ININTERVENTION

v.
LYCOMING, A TEXTRON CO., et al.,

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(Docket No. 33)
Defendants.

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I. INTRODUCTION

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On April 22, 2011, Federal Insurance Company (“FIC”) filed this motion, seeking leave to

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file a complaint-in-intervention.1 (Doc. 33.) Defendant AVCO Corporation (“AVCO”) filed a

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statement of non-opposition (Doc. 35) on May 19, 2011, and no party filed an opposition.

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Accordingly, the hearing set for June 1, 2011, is VACATED and the matter is hereby decided on the

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moving papers.

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II. FACTUAL BACKGROUND

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This action arises out of damage sustained by Plaintiff Donald Williams (“Plaintiff”) to his

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1968 Piper Arrow aircraft, which experienced “catastrophic” engine failure on July 14, 2010, while

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This motion was originally noticed before Chief Judge Anthony Ishii, who on April 26, 2011, ordered that
the motion be reset and heard by Magistrate Judge Sheila K. Oberto.

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he was flying near Madera City Airport. (Doc. 1-1, p. 5.) Plaintiff contends that the aircraft engine

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was manufactured by Defendant AVCO and its Lycoming Engines Division, and was improperly

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re-manufactured by Defendant Elite Air Service (“Elite”) using an incorrect part. (Doc. 1-1, p. 5.)

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Plaintiff alleges that AVCO and Elite were aware that Elite’s use of the improper part could result

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in engine failure but failed to notify anyone of the problem. (Doc. 1-1, p. 5.)

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FIC claims that Plaintiff was covered by its insurance policy and that FIC issued insurance

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payments under that policy in the amount of $29,822.61 to repair damage to the aircraft engine.

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(Doc. 33, 3:3-13.) FIC seeks to file a complaint-in-intervention for purposes of subrogation.

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III.

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DISCUSSION

Federal Rule of Civil Procedure 24 provides for two types of intervention – intervention of
right and permissive intervention. FIC seeks to intervene as a matter of right.

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Fed. R. Civ. P. 24(a) addresses intervention of right and provides in pertinent part:

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

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...

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(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.

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There are “four requirements for intervention as of right: timeliness, an interest relating to
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the subject of the action, practical impairment of the party's ability to protect that interest and
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inadequate representation by the parties to the action. The rule is construed broadly in favor of
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applicants for intervention.” Greene v. United States, 996 F.2d 973, 976 (9th Cir. 1993), aff’d,
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64 F.3d 1266 (9th Cir. 1995).
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A.

FIC’s Motion is Timely

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FIC’s motion is timely. Three factors are used to determine timeliness: the stage of the
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proceedings, the prejudice to the parties, and the reason for and length of the delay. United States
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v. Oregon, 913 F.2d 576, 588 (9th Cir. 1990). This action has only been pending in this court since
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December 16, 2010, when the Notice of Removal was filed, and the Scheduling Order was issued
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on March 22, 2011. (Docs. 1, 30.) As such, this action is still in the early stages of the proceeding.
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There is no apparent prejudice to the parties, especially in light of the fact that no party has filed an

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opposition. Further, FIC only recently determined the amount it seeks in its claim, as FIC made its

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final insurance payment on April 13, 2011, eleven days before this motion was filed. (Doc. 33,

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Amador Decl., ¶¶ 3, 6, Exh. A.) As such, FIC’s delay in filing was reasonable.

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B.

FIC’s Interest Relates to the Subject of the Action

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FIC presents evidence that it has compensated Plaintiff in the amount of $29,822.61 for

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damages incurred to the aircraft engine, the subject of the instant action. (Doc. 33, Amador Decl.,

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¶ 3, Exhs. A, B; see also Doc. 1-1, p. 5.) FIC has an interest in seeking subrogation to ensure that

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these damages are compensated by the liable party. “Subrogation is the insurer’s right to be put in

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the position of the insured, in order to recover from third parties who are legally responsible to the

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insured for a loss paid by the insurer.” Barnes v. Indep. Auto. Dealers Ass’n of Cal. Health &

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Welfare Benefit Plan, 64 F.3d 1389, 1392 (9th Cir. 1995). Subrogation “‘is designed to compel

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discharge of the obligation by the one who in equity should bear the loss.’” Id. (citation omitted).

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Here, intervention is appropriate to allow FIC the right to protect its subrogation interest and to

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ensure reimbursement.

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C.

FIC Has a Protectable Interest Which May be Impaired

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The party seeking intervention must demonstrate a “significantly protectable interest” in the

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litigation to merit intervention. Nw. Forest Res. Council v. Glickman, 82 F.3d 825, 837 (9th Cir.

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1996). “Whether an applicant for intervention as of right demonstrates sufficient interest in an action

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is a practical, threshold inquiry. No specific legal or equitable interest need be established.” Greene,

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996 F.2d at 976; Nw. Forest Res. Council, 82 F.3d at 837. Here, FIC demonstrates that it has a

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protectable interest based on subrogration for the damages it paid to Plaintiff. FIC asserts that the

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disposition of this action may impair or impede its ability to protect its interest in subrogation.

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D.

Plaintiff’s Representation of FIC’s Interest May be Inadequate

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FIC further asserts that its interest may be impaired or inadequately represented by Plaintiff.

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No party has opposed this motion. As such, FIC has demonstrated that it is an interested party and

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should be permitted to intervene as a matter of right.

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IV. CONCLUSION AND ORDER

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Accordingly, IT IS HEREBY ORDERED THAT:

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1. FIC’s motion for leave to file complaint-in-intervention is GRANTED.

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2. FIC is ordered to file its complaint-in-intervention within two days of the date of this order.

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IT IS SO ORDERED.

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Dated:
ie14hj

May 25, 2011

/s/ Sheila K. Oberto
UNITED STATES MAGISTRATE JUDGE

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