Lawrence Kalbers v. Volkswagen Ag

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
LAWRENCE P. KALBERS, No. 20-56316
Plaintiff-Appellee,
D.C. No.
v. 2:18-cv-08439-
FMO-PJW
UNITED STATES DEPARTMENT OF
JUSTICE,
Defendant, OPINION
v.
VOLKSWAGEN AG, Proposed
Intervenor,
Movant-Appellant.
Appeal from the United States District Court
for the Central District of California
Fernando M. Olguin, District Judge, Presiding
Argued and Submitted October 21, 2021
Pasadena, California
Filed December 28, 2021
Before: Consuelo M. Callahan, John B. Owens, and
Danielle J. Forrest, Circuit Judges.
Opinion by Judge Owens
2 KALBERS V. VOLKSWAGEN AG
SUMMARY *
Intervention / Freedom of Information Act
The panel reversed the district court’s order denying, as
untimely, Volkswagen AG’s motion to intervene in a
Freedom of Information Act (“FOIA”) lawsuit concerning
millions of VW’s documents.
Professor Lawrence Kalbers took an academic interest in
the VW “Dieselgate” emissions scandal and submitted a
FOIA request to the U.S. Department of Justice (“DOJ”).
Kalbers sued DOJ under FOIA to obtain undisclosed
documents. VW moved to intervene.
The panel considered whether VW’s motion to intervene
as of right was timely and applied the timeliness factors.
Applying the first factor, the length of and reason for delay,
the panel held that in a FOIA case delay is measured from
the date the proposed intervenor knew or should have known
the parties would no longer adequately protect its interests.
The government’s obligation to comply with FOIA did not
transform this fact-specific analysis into a bright-line rule
mandating immediate intervention upon learning of the
intervention. Here, the district court’s ruling to the contrary
was an abuse of discretion. The district court used the wrong
inquiry when it focused almost exclusively on the date when
VW learned of the FOIA lawsuit and on VW’s
representations concerning this knowledge. The panel held
that, properly measured, the delay between when VW should
*
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
KALBERS V. VOLKSWAGEN AG 3
have known that its interests might be inadequately protected
by the parties and when VW filed its motion was just a few
weeks, and such a short delay weighed in favor of timeliness.
The panel next considered the factor of prejudice to the
parties. The panel held that prejudice must be connected in
some ways to the timing of the intervention motion, and the
fact that adding another party might make resolution more
difficult did not constitute prejudice. The district court’s
prejudice analysis failed to conform to this rule. Applying
the proper rule, the panel identified no prejudice stemming
from the timing of VW’s motion. The lack of prejudice
weighed heavily in favor of timeliness.
Addressing the stage of the proceeding, the panel held
that the district court failed to explain why a motion to
intervene filed at this stage was unreasonably late. This case
was in its early stages when VW moved to intervene. To the
extent that the age of the case and the formal stage were
relevant, both supported a finding of timeliness. The panel
therefore concluded that VW’s motion to intervene was
timely, and the district court abused its discretion when it
held otherwise.
The panel next considered the other Fed. R. Civ. P. 24(a)
elements for intervention as of right. First, a proposed
intervenor must demonstrate a significant protectable
interest in the action. VW met this element when it asserted
that its interest in the non-disclosure of its documents was
protected under Exemption 4 of FOIA, and there was a
direct, antagonistic relationship between VW’s interest in
confidentiality and Kalbers’ interest in obtaining the
documents at issue. The second element, whether the
disposition of the action may impede VW’s ability to protect
its interest, was met because VW’s interest in keeping its
4 KALBERS V. VOLKSWAGEN AG
documents confidential would obviously be impaired by an
order to disclose. The third element, adequacy of
representation, was met where VW argued that it was
uniquely well-positioned to explain the commercial
significance of the documents at issue.
The panel held that VW met all the requirements to
intervene as of right. The panel ordered the district court on
remand to grant the Rule 24(a) motion and permit the
immediate intervention of VW into these proceedings.
COUNSEL
Robert J. Giuffra, Jr. (argued), Sharon L. Nelles, Suhana S.
Han, and Andrew J. Finn, Sullivan & Cromwell LLP, New
York, New York; Laura Kabler Oswell, Sullivan &
Cromwell LLP, Palo Alto, California; for Movant-
Appellant.
Daniel Jacobs (argued) and Robert A. Rabbat, Enenstein
Pham & Glass, Los Angeles, California, for Plaintiff-
Appellee.
KALBERS V. VOLKSWAGEN AG 5
OPINION
OWENS, Circuit Judge:
Proposed Intervenor-Appellant Volkswagen AG
(“VW”) appeals from the district court’s order denying its
motion to intervene in this Freedom of Information Act
(“FOIA”) lawsuit concerning millions of VW’s documents.
We reverse and remand.
I. BACKGROUND
A. The Emissions Scandal and Investigation
This case has its roots in the so-called “Dieselgate”
emissions scandal. Back in 2015, the federal government
announced an investigation into VW’s “defeat device”
software, which enabled certain diesel vehicles to
fraudulently pass emissions tests. Through its outside
criminal defense counsel, VW met with Department of
Justice (“DOJ”) prosecutors and provided millions of
documents in response to a grand jury subpoena.
VW eventually pled guilty to federal criminal charges.
See Plea Agreement, United States v. Volkswagen, No. 2:16-
cr-20394-SFC-APP (E.D. Mich. Mar. 10, 2017), ECF. No.
68. An independent monitor (“Monitor”) was appointed to
oversee VW’s compliance with its plea agreement and to
prepare reports for DOJ. See id. at 33–35, Ex. 3–1–14. As
the plea agreement acknowledged, these reports could
contain “proprietary, financial, confidential, and competitive
business information.” Id. at Ex. 3–14.
Not surprisingly, in addition to the criminal case,
hundreds of civil lawsuits commenced against VW. These
were consolidated in a multi-district litigation in the
6 KALBERS V. VOLKSWAGEN AG
Northern District of California. See Transfer Order, In re
Volkswagen “Clean Diesel” Mktg., Sales Pracs., & Prod.
Liab. Litig., No. 3:15-md-02672-CRB (N.D. Cal. Dec. 8,
2015), ECF. No. 1.
B. Kalbers’ FOIA Request and Lawsuit
Professor Lawrence Kalbers, of Loyola Marymount
University, took an academic interest in the “Dieselgate”
scandal. To further his research, he submitted a FOIA
request to DOJ in June 2018. He sought, in relevant part:
(1) A copy of all reports submitted to the
Justice Department by the Monitor under the
Plea Agreement in United States v.
Volkswagen, No. 16-CR-20394 (E.D. Mich.)
. . . and
(2) A copy of all “factual evidence” presented
by [VW’s outside criminal counsel] to the
Justice Department as the term in [sic] used
on p. 295 of Volkswagen’s 2017 Annual
Report.
But his request was unsuccessful. DOJ responded that the
documents were “protected from disclosure pursuant to
Exemption 7(A) of FOIA, which protects ‘records
or information compiled for law enforcement purposes’ that
‘could reasonably be expected to interfere with enforcement
proceedings.’” See 5 U.S.C. § 552(b)(7)(A). Shortly
thereafter, on August 22, 2018, DOJ emailed VW’s outside
civil counsel, notifying them of Kalbers’ request and DOJ’s
response.
On October 1, 2018, Kalbers sued DOJ under FOIA to
obtain the undisclosed documents. Sixteen days later—on
KALBERS V. VOLKSWAGEN AG 7
October 17, 2018—DOJ emailed VW’s civil counsel a copy
of Kalbers’ complaint.
For the next eleven months, the case inched forward.
DOJ filed its answer; the parties litigated a preliminary
discovery dispute, filed a Joint Rule 26(f) Report, and
participated in an unsuccessful settlement conference; and
the district court stayed the proceedings for a month when
government appropriations lapsed. No documents were
disclosed.
C. VW’s Motion to Intervene
Things began to change in September 2019. On
September 4, DOJ sent a letter to VW’s counsel to “formally
advise” them about Kalbers’ suit, as well as a similar suit
filed by the New York Times. The letter cited 28 C.F.R.
§ 16.7(h), which requires DOJ to notify a “submitter”—
anyone who has provided DOJ with confidential commercial
information that may fall within FOIA’s Exemption 4—of
lawsuits seeking that information. See 28 C.F.R. § 16.7(a),
(h); see also 5 U.S.C. § 552(b)(4) (exempting from
disclosure “trade secrets and commercial or financial
information obtained from a person and privileged or
confidential”). DOJ explained, though, that it did “not plan
to release any records” and that if its position changed, VW
would “be notified and given an opportunity to object to
disclosure.”
Meanwhile, proceedings before the district court were
ramping up. On September 6, the district court ordered the
parties to file a joint summary judgment motion by
November 7 and any supplemental memoranda by
November 22. Then, on September 16, the district court
8 KALBERS V. VOLKSWAGEN AG
ordered DOJ to produce a Vaughn index. 1 In practical terms,
this order meant that DOJ could not categorically rely on
Exemption 7(A) to justify non-disclosure; it would have to
provide a document-by-document index listing and
justifying all applicable FOIA exemptions, including
Exemption 4.
This combination of circumstances—the September 4
letter, the summary judgment schedule, and the Vaughn
index order—sparked VW’s decision to intervene, according
to its attorneys. 2 Thus, on September 27, VW moved to
intervene as a matter of right or, in the alternative, for
permissive intervention. See Fed. R. Civ. P. 24(a)–(b). In
its motion, VW argued that its interests were distinct from
DOJ’s and that it was “in the best position to effectively
explain why its confidential information shared with the
DOJ . . . warrants protection from disclosure.” However,
VW devoted just two paragraphs to the timeliness of its
motion, explaining that it “was formally notified of this
action” by the September 4 letter. It made no mention of the
August 22, 2018 and October 17, 2018 notice emails from
DOJ.
Kalbers opposed VW’s motion on timeliness grounds.
Suspecting that VW had learned of the lawsuit before
1
A Vaughn index is “a government affidavit identifying the
documents withheld, the FOIA exemptions claimed, and a particularized
explanation of why each document falls within the claimed exemption.”
Aguirre v. U.S. Nuclear Regul. Comm’n, 11 F.4th 719, 728 (9th Cir.
2021) (internal quotation marks and citation omitted); see also Vaughn
v. Rosen, 484 F.2d 820, 827-28 (D.C. Cir. 1973).
2
VW also asserts that, on September 23, 2019, it learned that DOJ
was considering releasing a portion of the Monitor’s report, which
“further supported [its] decision to move to intervene.”
KALBERS V. VOLKSWAGEN AG 9
September 4, he asked DOJ to disclose the date when it first
notified VW. In response, DOJ revealed the existence of the
August 22, 2018 and October 17, 2018 notice emails. At
Kalbers’ insistence, VW filed copies of these emails with the
district court—but VW maintained that the emails “in no
way suggest[ed] that there was any need for Volkswagen to
intervene before it sought to do so on September 27, 2019.”
D. The District Court’s Ruling
Nearly a year passed. Then, on October 9, 2020, without
ever holding oral argument, the district court denied VW’s
motion to intervene as untimely.
The district court first concluded that the case had
“significantly progressed” before VW’s motion to intervene,
citing the Vaughn index order and the unsuccessful
settlement conference. The court then determined that VW’s
intervention would “raise complicating issues beyond those
raised in this relatively straightforward FOIA action,” which
“would inevitably and unduly delay this action further by
requiring a new briefing schedule and time for the court—in
the midst of a pandemic and significant judicial shortage—
to consider the motion.”
The heart of the district court’s order, though, concerned
the length of and reasons for VW’s delay in moving to
intervene. The court emphasized that VW “became aware
of this litigation a mere 16 days after it was filed.” It
characterized the “formal” September 4 notice letter as “a
red-herring that not only strains credulity, but is
disingenuous as well.” According to the district court, “VW
could never have reasonably believed that its ‘unique
interests’ would be adequately protected by the DOJ at any
stage of the proceedings in this case. In other words, if VW
wanted to protect against the disclosure of documents in the
10 KALBERS V. VOLKSWAGEN AG
DOJ’s possession, it should’ve sought to intervene as soon
as it learned of the lawsuit.”
The district court thus denied the motion to intervene as
of right as untimely, based on VW’s “failure to provide any
reasons or otherwise justify its delay,” as well as its alleged
“misrepresentation of the record.” The court also denied
permissive intervention on those grounds.
In the same order, the district court also rejected DOJ’s
motion for summary judgment. Specifically, the court
concluded that DOJ’s interpretation of Kalbers’ request for
“factual evidence” was “highly technical and unfair,” and it
demanded a much broader interpretation. Thus, in the same
breath, the district court denied VW’s request to intervene
and expanded the universe of VW’s documents at issue from
around 300 to nearly 6 million.
VW timely appealed the district court’s order. 3
3
During the pendency of the appeal and after oral argument, the
district court sua sponte filed an “Order re Indicative Ruling.” The court
advised that, on remand, it would deny the motion to intervene as moot
because the case below had been consolidated with another case in which
VW was a party. We ordered supplemental briefing on the issue of
mootness and further ordered the parties to file a joint motion to dismiss
if they agreed on the appropriate course of action. The parties (who
never previously asserted that the appeal was moot) were unable to
agree. We therefore conclude that the issue presented on appeal remains
live, and that the district court’s “order” announcing its hypothetical
future ruling does not deprive us of jurisdiction to review its earlier
decision.
KALBERS V. VOLKSWAGEN AG 11
II. DISCUSSION
A. Jurisdiction and Standard of Review
We have jurisdiction under 28 U.S.C. § 1291 to review
the denial of a motion to intervene as of right. League of
United Latin Am. Citizens v. Wilson, 131 F.3d 1297, 1302
(9th Cir. 1997).
“A lower court’s denial of a motion to intervene is
reviewed de novo, except that its timeliness determination is
reviewed for abuse of discretion.” Smith v. L.A. Unified Sch.
Dist., 830 F.3d 843, 853 (9th Cir. 2016). “A court abuses its
discretion if it fails to apply the correct legal rule or
standard” or if its “application of that rule was (1) illogical,
(2) implausible, or (3) without support in inferences that may
be drawn from the facts in the record.” Id. at 853–54
(internal quotation marks and citation omitted). We have
“repeatedly instructed that ‘the requirements for intervention
are [to be] broadly interpreted in favor of intervention.’” Id.
at 853 (alteration in original) (quoting United States v. Alisal
Water Corp., 370 F.3d 915, 919 (9th Cir. 2004)).
B. Intervention as of Right
Rule 24(a)(2) requires a prospective intervenor to show
that: (1) its “motion is ‘timely’”; (2) it “has ‘a significantly
protectable interest relating to . . . the subject of the action’”;
(3) it “is ‘so situated that the disposition of the action may as
a practical matter impair or impede [its] ability to protect that
interest’”; and (4) its “interest is ‘inadequately represented
by the parties to the action.’” Id. (ellipses in original)
(quoting Freedom from Religion Found., Inc. v. Geithner,
644 F.3d 836, 841 (9th Cir. 2011)).
12 KALBERS V. VOLKSWAGEN AG
1. Timeliness
The first element, timeliness, “is the threshold
requirement for intervention.” United States v. Oregon, 913
F.2d 576, 588 (9th Cir. 1990) [hereinafter Oregon II].
Timeliness hinges on “three primary factors: ‘(1) the stage
of the proceeding at which an applicant seeks to intervene;
(2) the prejudice to other parties; and (3) the reason for and
length of the delay.’” Smith, 830 F.3d at 854 (quoting Alisal
Water, 370 F.3d at 921).
We assess each of these factors by reference to the
“crucial date” when “proposed intervenors should have been
aware that their interests would not be adequately protected
by the existing parties.” Id. (quoting Smith v. Marsh, 194
F.3d 1045, 1052 (9th Cir. 1999)); accord League, 131 F.3d
at 1304; Legal Aid Soc’y of Alameda Cnty. v. Dunlop, 618
F.2d 48, 50 (9th Cir. 1980) (per curiam); see also Oregon II,
913 F.2d at 589 (“A party seeking to intervene must act as
soon as he ‘knows or has reason to know that his interests
might be adversely affected by the outcome of the
litigation.’” (quoting United States v. City of Chicago, 870
F.2d 1256, 1263 (7th Cir. 1989))). Determining this crucial
date is necessarily a fact-specific inquiry, as timeliness is
“determined by the totality of the circumstances.” Smith,
830 F.3d at 854.
In analyzing timeliness, we are also mindful of the
balance of policies underlying intervention. On the one
hand, we “discourage premature intervention” that
unnecessarily “squander[s] scarce judicial resources and
increase[s] litigation costs.” John Doe No. 1 v. Glickman,
256 F.3d 371, 376–77 (5th Cir. 2001). On the other hand,
we favor intervention because it “serves both efficient
resolution of issues and broadened access to the courts.”
Wilderness Soc’y v. U.S. Forest Serv., 630 F.3d 1173, 1179
KALBERS V. VOLKSWAGEN AG 13
(9th Cir. 2011) (en banc) (citation omitted). Accordingly,
while we construe the intervention motions that we receive
liberally, id., we do not require hasty intervention. See also
John Doe No. 1, 256 F.3d at 375 (“[T]imeliness is not a tool
of retribution to punish the tardy would-be intervener, but
rather a guard against prejudicing the original parties by the
failure to apply sooner.” (quoting Sierra Club v. Espy, 18
F.3d 1202, 1205 (5th Cir. 1994))); Utah Ass’n of Cntys. v.
Clinton, 255 F.3d 1246, 1250 (10th Cir. 2001) (same); City
of Chicago, 870 F.2d at 1263 (“The purpose of the
requirement is to prevent a tardy intervenor from derailing a
lawsuit within sight of the terminal.” (citation omitted)).
With these considerations in mind, we analyze the
timeliness factors, taking them in order of importance to this
case.
i. Length of and Reason for Delay
To decide whether the length of the delay weighs in favor
of or against timeliness, we must first determine what
constitutes the relevant period of delay. Fortunately, this
rule is clear: “Delay is measured from the date the proposed
intervenor should have been aware that its interests would
no longer be protected adequately by the parties, not the date
it learned of the litigation.” United States v. Washington, 86
F.3d 1499, 1503 (9th Cir. 1996) (emphasis added); accord
Officers for Just. v. Civ. Serv. Comm’n of City & Cnty. of
S.F., 934 F.2d 1092, 1095 (9th Cir. 1991); see also Smith,
830 F.3d at 859 (“[T]he district court erred to the extent it
measured the length of Appellants’ delay by reference to
events pre-dating the time at which Proposed Intervenors
were reasonably on notice that their interests were not being
adequately represented[.]”).
14 KALBERS V. VOLKSWAGEN AG
This rule does not disappear in FOIA litigation, as the
district court held—it applies with even greater force. FOIA
does not mandate that the government turn over all relevant
documents immediately upon the submission of a request or
the filing of a complaint. Instead, nine exemptions from
disclosure (or fourteen, if one counts each subpart of
Exemption 7 separately) are embedded into FOIA’s
statutory text. See 5 U.S.C. § 552(b). Upon receiving a
FOIA request, the government must determine whether the
document falls within an exemption, withhold the qualifying
document, and, if necessary, justify its nondisclosure to an
examining court. Cf. Citizens Comm’n on Human Rights v.
FDA, 45 F.3d 1325, 1328 (9th Cir. 1995) (explaining that the
government agency bears the burden to justify
nondisclosure). In such a case, the interests of the
government (compliance with FOIA) and those of a third-
party submitter (non-disclosure of confidential commercial
information) are aligned by operation of law. See 5 U.S.C.
§ 552(b)(4).
On top of the statutory requirement, a regulatory scheme
takes effect when the requested documents might contain a
third party’s confidential commercial information. See 28
C.F.R. § 16.7. Whenever the government receives a FOIA
request for such information, it must “promptly provide
written notice to a submitter,” unless an exception applies.
Id. § 16.7(c)–(d). Whenever anyone “files a lawsuit seeking
to compel the disclosure of confidential commercial
information,” the government must, once again, “promptly
notify the submitter.” Id. § 16.7(h). And whenever the
government is considering voluntary disclosure, it must
provide the submitter with “a reasonable time period” in
which to provide written objections. Id. § 16.7(e)(1).
Therefore, if the government’s interests begin to diverge
KALBERS V. VOLKSWAGEN AG 15
with those of a submitter, the submitter may learn about it
from the government itself. 4
Other courts considering FOIA cases also have
recognized the importance of a fact-intensive assessment of
the parties’ and proposed intervenor’s interests. Dow Jones
& Co. v. U.S. Dep’t of Just., 161 F.R.D. 247 (S.D.N.Y. 1995)
(Sotomayor, J.), is particularly persuasive on this issue.
There, a third party moved to intervene after the district court
granted summary judgment. Id. at 250. Opposing
intervention, the plaintiffs argued that the third party should
have known that her interest could diverge from the
government’s some eight months earlier, when the
government “decided that Exemption 7(A) did not apply.”
Id. at 252. Like the district court in this case, the plaintiffs
in Dow Jones further asserted that, “in FOIA cases, the
government’s interest is always different from a private
citizen’s interest because the government has the duty to
disclose information to the public.” Id. Then-Judge
Sotomayor disagreed, finding that the proposed intervenor
had a basis for believing the government would protect her
interests in litigating the other contested FOIA exemptions.
Id. at 253. She therefore allowed intervention. Id. at 254;
see also 100Reporters LLC v. U.S. Dep’t of Just., 307 F.R.D.
269, 281 (D.D.C. 2014) (acknowledging that the
government’s interests and those of an intervenor “may
indeed overlap at times”).
We thus affirm that the general rule for measuring delay
applies in a FOIA case: Delay is measured from the date the
proposed intervenor knew or should have known that the
4
We do not hold, however, that the presence or absence of notice
under 28 C.F.R. § 16.7 will always be dispositive of the timeliness of an
application for intervention in a FOIA case.
16 KALBERS V. VOLKSWAGEN AG
parties would no longer adequately protect its interests. The
government’s obligation to comply with FOIA does not
transform this fact-specific analysis into a bright-line rule
mandating immediate intervention upon learning of the
litigation.
Here, the district court’s ruling to the contrary was an
abuse of discretion. Its order focused almost exclusively on
the date when VW learned of Kalbers’ lawsuit and on VW’s
representations concerning this knowledge. But this was the
wrong inquiry. See Washington, 86 F.3d at 1503 (explaining
that delay is not measured from “the date [the proposed
intervenor] learned of the litigation”). The district court’s
reliance on FOIA to conclude that VW should have moved
to intervene “as soon as it learned of the lawsuit,” turned the
applicable rule on its head. 5
Applying the correct rule to the facts makes clear that
VW did not need to intervene before September 2019. Since
receiving the complaint, DOJ repeatedly and consistently
argued that the requested documents were exempt from
disclosure, thereby protecting VW’s interests. In so arguing,
DOJ relied almost exclusively on Exemption 7(A), a law
enforcement exemption. VW would have had no new
information to contribute to this argument, and requiring it
to intervene anyway would have “squander[ed] scarce
judicial resources,” John Doe No. 1, 256 F.3d at 377. In
5
Based in part on its mistaken view that the date of the initial notice
of the litigation controlled, the district court severely criticized VW’s
counsel for a “misrepresentation of the record” and a “lack of candor”
regarding that date. To be clear, VW’s motion to intervene should have
disclosed the initial 2018 notice and argued for its irrelevance from the
get-go. However, the record does not support the district court’s
overheated accusations of unethical conduct directed towards VW’s
counsel.
KALBERS V. VOLKSWAGEN AG 17
September, though, circumstances changed. The district
court’s order for the Vaughn index revealed that Exemption
4, and not just Exemption 7(A), could be dispositive. VW’s
knowledge about the confidentiality and commercial nature
of its records was now important. VW’s subsequent motion
to intervene to litigate “the scope and application of
Exemption 4 . . . on summary judgment,” reflected its
realization that DOJ could no longer fully protect its
interests. 6
Properly measured, the delay between when VW should
have known that its interests might be inadequately protected
by the parties (early- to mid-September 2019) and when VW
filed its motion (September 27, 2019) was just a few weeks.
We have little trouble concluding that such a short delay
weighs in favor of timeliness, rather than against it.
ii. Prejudice to the Parties
As with our delay analysis, one key principle guides our
prejudice analysis: The “only ‘prejudice’ that is
relevant . . . is that which flows from a prospective
intervenor’s failure to intervene after he knew, or reasonably
should have known, that his interests were not being
adequately represented.” Smith, 830 F.3d at 857. That is,
prejudice must be connected in some way to the timing of
the intervention motion—and “the fact that including
another party in the case might make resolution more
‘difficult[ ]’” does not constitute prejudice. Id. (alteration in
6
In addition to the Vaughn index order and the summary judgment
schedule, VW pinned much of its argument on the September 4, 2019
notice letter. We find this argument distinctly unpersuasive, as no new
information appears on the face of the letter, and nothing in the record
indicates how the letter altered the circumstances.
18 KALBERS V. VOLKSWAGEN AG
original) (quoting United States v. Oregon, 745 F.2d 550,
552–53 (9th Cir. 1984) [hereinafter Oregon I]).
The district court’s prejudice analysis failed to conform
to this rule. The court focused on the fact that permitting
intervention would raise “additional complicating issues”
that would “unduly delay this action.” Yet every motion to
intervene will complicate or delay a case to some degree—
three parties are more than two. That is not a sufficient
reason to deny intervention. See Smith, 830 F.3d at 857;
League, 131 F.3d at 1304 (“[D]elay is not alone decisive
(otherwise every intervention motion would be denied out of
hand because it carried with it, almost be [sic] definition, the
prospect of prolonging the litigation).”).
The district court’s reliance on the pandemic and a
judicial shortage further misses the mark. VW filed its
motion to intervene more than five months before COVID-
19 changed the world. As for the judicial shortage in the
Central District of California, that problem long predates
VW’s motion. 7 It was wrong for the district court to blame
these delays on VW and its counsel.
7
See, e.g., Letter from Virginia A. Phillips, Chief United States
District Judge, Central District of California, to Pat Cipollone, White
House Counsel, et al. (Oct. 29, 2019), https://src.bna.com/MNg
(describing need to fill judicial vacancies in C.D. Cal.); Report of the
Proceedings of the Judicial Conference of the United States 26-27
(March 12, 2019), https://www.uscourts.gov/sites/default/files/2019-
03_proceedings_0.pdf (recommending additional judgeships in C.D.
Cal.); Report of the Proceedings of the Judicial Conference of the United
States 16 (March 14, 2017), https://www.uscourts.gov/sites/default/
files/2017-03_0.pdf (same); Report of the Proceedings of the Judicial
Conference of the United States 18-19 (March 10, 2015),
https://www.uscourts.gov/sites/default/files/2015-03.pdf (same).
KALBERS V. VOLKSWAGEN AG 19
Applying the proper rule, we have identified no
prejudice stemming from the timing of VW’s motion. In
fact, there need not have been any delay from VW’s
intervention, as VW offered to comply with the existing
summary judgment briefing schedule. This lack of prejudice
weighs heavily in favor of timeliness. See Oregon I, 745
F.2d at 552 (describing prejudice as “the most important
consideration in deciding whether a motion for intervention
is untimely” (citation omitted)).
iii. Stage of the Litigation
The “stage of proceeding” factor uses a “nuanced,
pragmatic approach” to examine whether “the district court
has substantively—and substantially—engaged the issues in
[the] case.” League, 131 F.3d at 1303. In this inquiry,
substance prevails over form: Neither the formal “stage” of
the litigation (e.g., the “pretrial stage[]”), id., nor the “length
of time that has passed since a suit was filed” is dispositive,
Oregon II, 913 F.2d at 588.
Here, the district court failed to adequately explain why
a motion to intervene filed at this stage was unreasonably
late. It cited only two prior events—one order and one
settlement conference—to demonstrate significant
engagement with the case. That analysis stretches both the
facts and the law beyond their breaking point.
This case was in its early stages when VW moved to
intervene. In stark contrast to League, the parties and the
district court here had covered scarcely any legal ground
together. Cf. 131 F.3d at 1303 (finding that the stage of the
proceeding “weigh[ed] heavily against allowing
intervention” where the case up to that point had involved a
temporary restraining order, a preliminary injunction, an
appeal, provisional class certification, four prior
20 KALBERS V. VOLKSWAGEN AG
interventions, a motion to dismiss, a motion for summary
judgment, and nine months of discovery). And what little
ground they had covered did not meaningfully advance the
case: The two-page minute order for a Vaughn index did not
substantially examine dispositive issues, and the
unsuccessful settlement conference demonstrated only a
lack of progress. In other words, far from “derailing a
lawsuit within sight of the terminal,” City of Chicago, 870
F.2d at 1263, VW sought to intervene just as this case began
gathering speed.
Further, to the extent that the age of the case and the
formal stage of litigation are relevant, cf., e.g., Alisal Water,
370 F.3d at 922 (intervention at the remedies stage “merely
to attack or thwart a remedy” is disfavored), both support a
finding of timeliness. As a survey of our prior cases reveals,
we have allowed intervention after much longer delays and,
on occasion, all the way into the remedial phase of litigation.
See, e.g., Smith, 830 F.3d at 848–53 (describing the litigation
from its inception in 1993 through the original consent
decree in 1996 and the modified consent decree in 2003 to
the intervention motion in 2013); Oregon I, 745 F.2d at 551–
52 (describing the litigation from its inception in 1968
through the adoption of a comprehensive plan in 1977 to the
intervention motion in 1983). This is especially true where,
as here, “a change of circumstances occurs, and that change
is the major reason for the motion to intervene.” Smith, 830
F.3d at 854 (internal quotation marks omitted); see also
Oregon I, 745 F.2d at 552 (“[A] change of circumstance,
which suggests that the litigation is entering a new stage,
indicates that the stage of the proceeding and reason for
delay are factors which militate in favor of granting the
application [to intervene].”).
KALBERS V. VOLKSWAGEN AG 21
Therefore, the “stage of the proceeding” factor—like the
“delay” and “prejudice” factors—weighs in favor of
timeliness. Given that all three factors favor timeliness (and,
conversely, that nothing weighs against a finding of
timeliness), we hold that VW’s motion to intervene was
timely. When the district court held otherwise, it abused its
discretion.
2. Other Rule 24 Requirements
In the ordinary case, we would end our analysis here, as
we do not normally reach issues not passed upon by the
district court. But this case is unique. The requirements for
intervention as of right were adequately briefed, here and
before the district court. Kalbers had a wealth of opportunity
to respond to all of VW’s arguments, yet he chose to focus
almost exclusively on timeliness. (His sole mention of Rule
24’s other requirements—that it is “not at all a foregone
conclusion” that VW “maintains a legally-protectable
interest” in its documents—is both too little and too late.)
The merits of VW’s motion are clear, 8 and the district court’s
failure to reach them is immaterial, as we would have
reviewed its analysis de novo. See Smith, 830 F.3d at 853.
Seeing little utility in delaying this case further, we address
the remaining requirements for intervention and hold that
they are satisfied.
Aside from timeliness, a proposed intervenor must
demonstrate three elements: (1) “that the would-be
intervenor has a significantly protectable interest relating to
8
Indeed, the district court in the similar New York Times case, which
involves only a subset of the documents at issue here, took just a day to
grant VW’s motion to intervene. See Order Granting Mot. Intervene,
The New York Times Co. v. U.S. Dep’t of Just., No. 1:19-cv-01424-KPF
(S.D.N.Y. Sept. 25, 2019), ECF No. 25.
22 KALBERS V. VOLKSWAGEN AG
. . . the subject of the action,” (2) “that the intervenor is so
situated that the disposition of the action may as a practical
matter impair or impede [the intervenor’s] ability to protect
that interest,” and (3) “that such interest is inadequately
represented by the parties to the action.” Id. (alterations and
ellipses in original) (internal quotation marks and citation
omitted).
For the first element, a proposed intervenor “has a
significant protectable interest in an action if (1) it asserts an
interest that is protected under some law, and (2) there is a
relationship between its legally protected interest and the
plaintiff’s claims.” Donnelly v. Glickman, 159 F.3d 405, 409
(9th Cir. 1998) (internal quotation marks and citation
omitted). Notwithstanding Kalbers’ single-sentence
argument to the contrary, this element is straightforward. As
we have already discussed, VW has asserted that its interest
in the non-disclosure of its documents is protected under
Exemption 4 of FOIA. See 5 U.S.C. § 552(b)(4). And there
is a direct, antagonistic relationship between VW’s interest
in confidentiality and Kalbers’ interest in obtaining the
documents at issue.
The second element—whether “the disposition of the
action may, as a practical matter, impair or impede [VW’s]
ability to protect its interest,” Alisal Water, 370 F.3d at 919(citation omitted)—is even more clear-cut. VW’s interest in
keeping its documents confidential would obviously be
impaired by an order to disclose.
The third element, adequacy of representation, “is
satisfied if the applicant shows that representation of his
interest may be inadequate”—a “minimal” burden. Dunlop,
618 F.2d at 50 (emphasis added) (internal quotation marks
and citation omitted). Particularly relevant factors here
include “whether the present party is capable and willing to
KALBERS V. VOLKSWAGEN AG 23
make [the intervenor’s] arguments” and “whether a
proposed intervenor would offer any necessary elements to
the proceeding that other parties would neglect.” Citizens
for Balanced Use v. Mont. Wilderness Ass’n, 647 F.3d 893,
898 (9th Cir. 2011) (citation omitted). As VW aptly argued
to this court and the district court, it is uniquely well-
positioned to explain the commercial significance of the
documents at issue here. Lacking this information, the
existing parties may not represent VW’s interests
adequately. Nothing more is required.
We therefore hold that VW has met all the requirements
to intervene as of right. We order the district court on
remand to grant the Rule 24(a) motion and permit the
immediate intervention of VW into these proceedings. 9
REVERSED and REMANDED. 10
9
Because we hold that VW is entitled to intervene under Federal
Rule of Civil Procedure 24(a), we do not reach the merits of the Rule
24(b) motion.
10
VW’s motion to take judicial notice, Dkt. No. 28, is GRANTED.