RHN Incorporated v. CNA National Warranty Corporation ( 2020 )

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 RHN Incorporated, No. CV-19-02960-PHX-GMS 9 LEAD CASE Plaintiff/Counter-Defendant, 10 No. CV-19-4516-PHX-GMS v. 11 ORDER CNA National Warranty Corporation, et al., 12 Defendants/Counter- 13 Claimants. 14 CNA National Warranty Corporation, 15 Plaintiff, 16 v. 17 RHN Incorporated, et al., 18 Defendants. 19 20 21 Pending before the court are Glaser Weil Fink Howard Avchen & Shapiro 22 LLP’s (“Glaser Weil”) Motion to Intervene as a matter of right (Doc. 129) and the parties’ 23 Stipulation to Allow Glaser Weil to Intervene Pursuant to Rule 24(B). (Doc. 128.) For the 24 following reasons, Glaser Weil’s Motion to Intervene is granted, and the parties’ 25 Stipulation is denied as moot. 26 BACKGROUND 27 On September 14, 2020 the Court granted Glaser Weil’s Ex Parte Application to 28 Withdraw as Counsel for the RHN Parties. (Doc. 94); (Doc. 104). Subsequently, on 1 September 21, 2020, CNA brought a Motion for Sanctions against RHN and its counsel for 2 failure to comply with the discovery obligations of the Mandatory Initial Discovery Pilot 3 Program. (Doc. 117.) Because CNA seeks sanctions against Glaser Weil and it is no longer 4 counsel of record for RHN, Glaser Weil now moves to intervene for the limited purpose of 5 responding to CNA’s Motion. Plaintiff CNA National Warranty Corporation (“CNA”); 6 Plaintiff/Counter-Defendant RHN, Inc. (“RHN”); Counter-Defendants RHH Automotive, 7 Inc.; RHC Automotive, Inc.; NBA Automotive, Inc.; R & H Automotive Group, Inc.; 8 Hooman Nissani; and Melody Nissani; and Defendants Kip Prop., LLC; 737 N. La Brea, 9 LLC; 3170 Cherry Avenue Property, LLC; and Redondo Prop., LLC filed Notices of Non- 10 Opposition to allow Glaser Weil to intervene as a matter of right. (Doc. 130); (Doc. 132). 11 The parties also filed a Stipulation agreeing that Glaser Weil would be permitted to 12 intervene pursuant to Rule 24(b) for permissive intervention. (Doc. 128.) 13 DISCUSSION 14 Under Rule 24(a)(2), “[a]n applicant seeking intervention as of right must show that: 15 (1) it has a “significant protectable interest” relating to the property or transaction that is 16 the subject of the action; (2) the disposition of the action may, as a practical matter, impair 17 or impede the applicant’s ability to protect its interest; (3) the application is timely; and 18 (4) the existing parties may not adequately represent the applicant’s interest.” Donnelly v. 19 Glickman, 159 F.3d 405, 409 (9th Cir. 1998). 20 The Ninth Circuit has held that district courts are to interpret the requirements of 21 Rule 24(a)(2) broadly in favor of intervention. See Prete v. Bradbury, 438 F.3d 949, 954 22 (9th Cir. 2006); Donnelly, 159 F.3d at 409. To determine whether intervention is 23 appropriate, courts are guided primarily by practical and equitable considerations, see 24 Donnelly, 159 F.3d at 409, and are required to accept as true the non-conclusory allegations 25 made in support of intervention, see Sw. Ctr. for Biological Diversity v. Berg, 268 F.3d 26 810, 819 (9th Cir. 2001). 27 Glaser Weil has a significant protectable interest in the litigation. In its Motion, 28 1 CNA seeks sanctions against RHN Inc., Counter-defendants RHH Automotive, Inc., RHC 2 Automotive, Inc., NBA Automotive, Inc., R & H Automotive Group, Inc., Hooman 3 Nissani, and Melody Nissani (collectively “Defendants”), as well as their counsel Glaser 4 Weil. (Doc. 117.) As Glaser Weil is no longer counsel of record for Defendants, its ability 5 to protect its financial interest will be impaired unless it is permitted to respond. Moreover, 6 the existing parties cannot adequately represent Glaser Weil’s interests—the Motion seeks 7 sanctions against Glaser Weil independently of the Defendants, so no other party has an 8 incentive to oppose the penalty as it applies to Glaser Weil. 9 Glaser Weil’s request is also timely. In assessing timeliness, courts in the Ninth 10 Circuit consider: (1) the current stage of the proceedings; (2) whether the existing parties 11 would be prejudiced; and (3) the reason for any delay in moving to intervene. League of 12 United Latin Am. Citizens v. Wilson, 131 F.3d 1297, 1302 (9th Cir. 1997). In this case, 13 discovery has not yet been completed, the dispositive motions deadline has not passed, and 14 a trial date has not yet been set. (Doc. 148.) The current stage of the proceedings weighs in 15 favor of finding Glaser Weil’s motion timely. Further, there is no indication the parties will 16 be prejudiced by the intervention; in fact, the parties filed notices of non-opposition to 17 Glaser Weil’s Motion. (Doc. 130); (Doc. 132). Glaser Weil may therefore intervene 18 pursuant to Rule 24(a). 19 CONCLUSION 20 21 Accordingly, Glaser Weil is permitted to intervene and respond to CNA’s Motion 22 for Sanctions. 23 IT IS THEREFORE ORDERED that Glaser Weil’s Motion to Intervene (Doc. 24 129) is GRANTED. Glaser Weil may intervene for the limited purpose of responding to 25 CNA’s Motion for Sanctions (Doc. 117) on its own behalf. 26 IT IS FURTHER ORDERED that Glaser Weil shall file a response to CNA’s 27 Motion for Sanctions (Doc. 117) within 14 days of the date of filing of this Order. 28 IT IS FURTHER ORDERED that the parties’ Stipulation to Allow Glaser Weil 1 || to Intervene Pursuant to Rule 24(B) (Doc. 128) is DENIED as MOOT. 2 Dated this 29th day of December, 2020. Wars ) 4 A Whacrsay Sooo) 5 Chief United states District Judge 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -4-