Vaughn v. Toyota Motor Corporation et al

Filing 37

Memorandum Opinion and Order For the reasons stated in the Order, the Court holds that neither intervention of right nor permissive intervention is here appropriate. Medical Mutual's Motion to Intervene, Doc #: 28 , is DENIED. Signed by Judge Dan Aaron Polster on 2/24/2016. (K,K)

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

NERMINA VAUGHN,

)
)
Plaintiff,
)
)
vs.
)
)
TOYOTA MOTOR CORPORATION, et al., )
)
Defendants.
)

CASE NO. 1:13-cv-01732-DAP
JUDGE DAN AARON POLSTER
OPINION AND ORDER

Before the Court is Medical Mutual of Ohio’s Motion to Intervene (the “Motion”). Doc
#: 28. For the reasons discussed below, the Motion is denied.
I. Background
According to the Complaint, on January 26, 2012, Aida Cemanovic was involved in a car
collision whilst operating a 2004 Toyota Corolla. Compl. ¶¶ 8–10, Doc #: 1. Cemanovic died on
June 3, 2012, according to the Complaint, as a result of injuries sustained during this car
collision. Id. at ¶¶ 20, 22, 25.
The matter was brought before the Cuyahoga County Probate Court on September 14,
2012, whereupon Plaintiff Nermina Vaughn was appointed administrator of Cemanovic’s estate.

Id. at ¶ 24; Entry Appointing Fiduciary, The Estate of Aida Cemanovic, No. 2012EST182360
(Cuyahoga County Prob. Ct. docketed Sept. 17, 2012). On August 9, 2013, Vaughn filed the
instant action, claiming wrongful death and product liability on the part of Defendants Toyota
Motor Corporation and Toyota Motor Sales USA, Inc. [collectively, “Toyota”], in this Court.
Compl. ¶¶ 11–26. Vaughn and Toyota thereafter engaged in litigation and mediation regarding
these matters.
In relevant part, on August 27, 2015, the parties notified the Court that the most recent
mediation had not resulted in a settlement agreement. As a result, shortly thereafter on August
31, the Court set a trial schedule and scheduled a settlement conference to occur on January 11,
2016. On December 23, 2015, however, the Court cancelled the scheduled settlement conference
because the parties notified the Court that they had reached a settlement agreement and had
submitted the matter to the probate court for approval. See Minutes and Order, Doc #: 29.
Meanwhile, proposed Intervener Medical Mutual of Ohio [“Medical Mutual”] began
communicating with Vaughn’s counsel. On September 11, 2015, Medical Mutual sent (through
counsel) to Vaughn’s counsel a “Notice of Lien/Claim” alleging claims related to medical
benefits paid on behalf of Cemanovic. Doc ##: 28-2, 31-1. Vaughn’s counsel requested a copy
of the plan contract, and on October 29, 2015, Medical Mutual sent Vaughn’s counsel a
document entitled “PPO Network Comprehensive Major Medical Heath Care Certificate /
Prescription Drug Rider.” Doc #: 31-2. On December 14, 2015, Vaughn’s counsel sent a letter
to Medical Mutual’s counsel rejecting Medical Mutual’s claim for subrogation/reimbursement.
Doc ##: 28-3, 31-3.
On January 7, 2016, Medical Mutual filed the instant Motion to Intervene “to enforce its
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contractual right of subrogation.” Mot. to Intervene 5, Doc #: 28. The proposed Complaint of
Intervention alleges that Medical Mutual paid benefits to Cemanovic and is accordingly entitled
to a judgment against Toyota. Compl. of Intervening Pl. ¶¶ 4–6, Doc #: 28-4. Both Vaughn and
Toyota filed opposition responses, Doc ##: 31, 32, and Medical Mutual replied, Doc #: 34-1. On
February 22, Toyota filed a sur-reply. Doc #: 36. This Order follows.
II. Legal Standard
Intervention is governed by Federal Rule of Civil Procedure 24, which in pertinent part
states,
(a) Intervention of Right. 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.
(b) Permissive Intervention. (1) In General. On timely motion, the court may
permit anyone to intervene who: . . . (B) has a claim or defense that shares
with the main action a common question of law or fact.
Fed. R. Civ. P. 24. “A motion to intervene as a matter of right must therefore be timely, and the
proposed intervenor must establish (1) that he has an interest which is the subject matter of the
lawsuit, (2) which is likely to be impaired by the disposition of the lawsuit, and (3) that the
existing parties cannot adequately protect that interest.” Bradley v. Milliken, 828 F.2d 1186,
1191 (6th Cir. 1987) (citations omitted). “The proposed intervenor must prove each of the four
factors; failure to meet one of the criteria will require that the motion to intervene be denied.”
Grubbs v. Norris, 870 F.2d 343, 345 (6th Cir. 1989). Permissive intervention allows the district
Court “to permit intervention if the motion is timely, and if the applicant’s claim or defense and
the main action have a question of law or fact in common.” Bradley, 828 F.2d at 1193 (citations
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and internal quotation marks omitted).
III. Discussion
Intervention is here inappropriate because Medical Mutual has failed to establish at least
three of the four Bradley elements.
A. Legal Interest in the Matter and Likelihood of Impairment
1. The Subrogation Claim is Barred by the Statutes of Limitations
In its reply brief, Medical Mutual concedes that its subrogation claim is time-barred.
Medical Mutual cites Ohio Bur. of Workers’ Comp. v. McKinley, 956 N.E.2d 814, 820–21, and
then observes,
Under this analysis, Medical Mutual’s claim for subrogation here arose on
the date of Aida Cemanovic’s wrongful death on June 3, 2012, and the
statute of limitations has likely run on that claim. However, Medical
Mutual seeks to intervene on the basis of its right to reimbursement,
which is set forth in the insurance contract . . . .
Reply 2–3.
The Court agrees. “[A]n action based on a product liability claim and an action for bodily
injury or injuring personal property shall be brought within two years after the cause of action
accrues,” and “a civil action for wrongful death shall be commenced within two years after the
decedent’s death.” Ohio Rev. Code Ann. §§ 2305.10(A), 2125.02(D)(1). Cemanovic died on
June 3, 2012. Consequently, any claims against Toyota expired in June 2014. Medical Mutual,
however, did not act until 2015.
Furthermore, the time-barring of Medical Mutual’s claims against Toyota not only
demonstrates that Medical Mutual lacks “an interest which is the subject matter of the lawsuit,”
but also, by extension, makes it impossible that Medical Mutual has an interest that could
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possibly “be impaired by the disposition of the lawsuit.” Bradley, 828 F.2d at 1191. The
absence of a valid claim strikes at the heart of both mandatory and permissive intervention.
2. Reimbursement is not Presently at Issue
Medical Mutual argues that its reimbursement claim is not barred—as Vaughn and
Toyota argue—by the statute of limitations in Ohio Rev. Code Ann. § 2117.06 (barring claims
against an estate not presented within six months of death), instead being governed as a
contingent claim by § 2117.37 (permitting a contingent claim to be filed within the later of six
months of death or two months from the accrual of the cause of action). However, the arguments
raised by Medical Mutual appear to conflate the right of subrogation with the right of
reimbursement allegedly provided for under the terms of the policy of insurance between
Cemanovic and Medical Mutual.1 Medical Mutual has here moved for intervention on the basis
of subrogation, not reimbursement.
Medical Mutual correctly notes in its Reply that subrogation and reimbursement are
distinguishable. See Provident Life & Acc. Ins. Co. v. Williams, 858 F. Supp. 907, 911 (W.D.
Ark. 1994) (“While subrogation and reimbursement are similar in their effect, they are different
doctrines. With subrogation, the insurer stands in the shoes of the insured. With reimbursement,
the insurer has a direct right of repayment against the insured.”). Put simply, in the insurance
context, a subrogation claim involves the insurer stepping into the shoes of the insured regarding

1

It is unclear what the single-page document attached to Medical Mutual’s Motion
as Exhibit A actually is. The Motion refers to the document as a page from the
“Plan document.” Mot. to Intervene 2. The Reply refers to the document as either
the “policy” and the “insurance contract.” Reply 1–2, 3. Vaughn claims it is a
page from a “Health Care Certificate.” Pl. Opp. 2. Alone, it does not establish
Medical Mutual right to an interest in Cemanovic’s estate.
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a claim against some other defendant—here, Toyota. In contrast, a reimbursement claim is
brought by the insurer against the insured (with whom there is a contract)—here, Cemanovic’s
estate.
While Medical Mutual’s proposed complaint makes reference to an alleged
reimbursement right, Motion 2; Compl. of Intervening Pl. ¶ 5, the plain language of Medical
Mutual’s Motion and, particularly, proposed Complaint of Intervention makes inescapable the
conclusion that Medical Mutual has alleged only a claim against Toyota and not the estate. E.g.
Compl. of Intervening Pl. ¶¶ 4, 6 (“Accordingly, Medical Mutual of Ohio is entitled to judgment
against Defendant Defendants [sic] for the amounts paid to the Plaintiffs.”). Therefore, Medical
Mutual’s alleged reimbursement rights are presently inapposite.
3. Subject Matter Jurisdiction
Medical Mutual may or may not have a claim for reimbursement,2 but that matter is not
presently before this Court, and it is unclear it could be brought before this Court.3 At issue is
whether the instant matter is barred by the probate exception to federal jurisdiction.
Under the so-called probate exception, even when the requirements of
diversity jurisdiction have been met, the parties are diverse and the amount
in controversy exceeds the jurisdictional threshold, a federal court
nonetheless lacks jurisdiction over cases involving probate matters.
The standard for determining whether federal jurisdiction may be exercised

2

Though evaluation of the contract is not before this Court (in fact, the full text of
the contract is not even before this Court), the Court expresses concern about
enforcement of certain apparently severe terms (particularly regarding litigation
costs) against an unsophisticated party contained in a plan document Medical
Mutual describes as “too voluminous to attach to this motion.” Motion 2 n.1.

3

Both Toyota and Vaughn briefed subject matter jurisdiction prominently in their
oppositions; Medical Mutual declined to address the matter in its Reply.
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is whether under state law the dispute would be cognizable only by the
probate court.
Lepard v. NBD Bank, a Div. of Bank One, 384 F.3d 232, 237 (6th Cir. 2004) (internal citations
and quotation marks omitted). “[U]nder Ohio law, exclusive jurisdiction of probate matters,
including breach of fiduciary duty, is vested in the Probate Court.” Id.; accord Ohio Rev. Code
Ann. § 2101.24(A)(1).
The instant action before this Court involves Toyota’s alleged liability related to
Cemanovic’s injury and death. Insofar as Medical Mutual moved to intervene on the basis of
subrogation, stepping in for Cemanovic’s estate in prosecution of these wrongful death and
product liability claims against Toyota, the matter is properly decided by this Court. However,
this Court lacks the jurisdiction “[t]o direct and control the conduct and settle the accounts of
executors and administrators and order the distribution of estates.” Ohio Rev. Code Ann. §
2101.24(A)(1)(c). Therefore, insofar as Medical Mutual wishes to seek reimbursement against
Cemanovic’s estate or heirs, the matter is beyond this Court’s jurisdiction, and interested parties
must present the matter to the probate court, only. Accordingly, this Court will not—and
cannot—rule on whether Medical Mutual has other rights or remedies related to reimbursement.
B. Medical Mutual’s Legal Interest would be Protected
Assuming arguendo that Medical Mutual has established it has a legal right which is
likely to be impaired, Medical Mutual has failed to establish that Vaughn will not adequately
protect that interest.
“[T]he applicant for intervention bears the burden of demonstrating inadequate
representation.” Meyer Goldberg, Inc. of Lorain v. Goldberg, 717 F.2d 290, 293 (6th Cir. 1983).

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This requires overcom[ing] the presumption of adequacy of representation
that arises when the proposed intervenor and a party to the suit . . . have
the same ultimate objective. An applicant for intervention fails to meet his
burden of demonstrating inadequate representation when no collusion is
shown between the representatives and an opposing party, when the
representative does not have or represent an interest adverse to the
proposed intervenor, and when the representative has not failed in its
fulfillment of his duty. A mere disagreement over litigation strategy or
individual aspects of a remediation plan does not, in and of itself, establish
inadequacy of representation.
Bradley, 828 F.2d at 1192 (alterations in original) (internal citations and quotation marks
omitted).
Here, Medical Mutual offers only a cursory argument for overcoming this presumption of
adequacy of representation: “While Medical Mutual, like Plaintiff, has an interest in recovering
damages from a tortfeasor, in this case, however, the refusal by Plaintiff’s counsel in Exhibit C to
acknowledge Medical Mutual’s contractual right of subrogation indicates that these rights will
not be protected without intervention in this case.” Motion 7. The Court is not convinced.
Medical Mutual has not demonstrated collusion between Vaughn and Toyota and has in
fact admitted that Medical Mutual and Vaughn share an interest in recovering damages from
Toyota. Though it is not stated as such, Vaughn and Medical Mutual share an interest in
maximizing the extent to which Toyota is found liable for the injuries resulting from the car
collision, and Vaughn’s interest in doing so must exceed Medical Mutual’s interest to the extent
Cemanovic’s estate is bound by a reimbursement contract clause. Medical Mutual also fails to
demonstrate that Vaughn has failed in fulfillment of her duty to represent the interests of
Cemanovic’s estate or insurer.
Rather, Medical Mutual demonstrates only that Vaughn’s counsel rejected Medical

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Mutual’s Notice of Lien/Claim. Assuming, again, for the sake of argument, that Medical Mutual
provided a contract that properly demonstrated its legal interests in Cemanovic’s estate and had
timely pursued all its claims, this letter only establishes a conflict regarding the distribution of
any settlement or litigation proceeds paid by Toyota. The letter in no way suggests Medical
Mutual’s interest vis-à-vis Toyota are not properly represented. As discussed above, the matter
of distribution Cemanovic’s estate is not before this Court. Should the matter of distribution be
contested in probate court, it is almost certain that Vaughn’s and Medical Mutual’s interests will
before that court be adverse. Regarding the matter before this Court, however, all available
evidence suggests Medical Mutual’s interest is fairly protected by Vaughn’s representation.
C. Timeliness
Although Vaughn, Toyota, and Medical Mutual have extensively briefed the matter,
because the Court has held that the other three Bradley elements do not support intervention, the
Court declines to evaluate this final remaining element.
IV. Conclusion
Accordingly, the Court holds that neither intervention of right nor permissive intervention
is here appropriate. Medical Mutual’s Motion to Intervene, Doc #: 28, is DENIED.
IT IS SO ORDERED.
/s/ Dan A. Polster Feb. 24, 2016
DAN AARON POLSTER
UNITED STATES DISTRICT JUDGE

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