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Barrett v. Pdp Unlimited, Inc.

United States District Court, N.D. Mississippi, Greenville Division

November 4, 2019

CHERYL BARRETT PLAINTIFF
v.
PDP UNLIMITED, INC.; ROBERT L. NEWBY; and JOHN DOES A, B AND C DEFENDANTS

          ORDER

          DEBRA M. BROWN UNITED STATES DISTRICT JUDGE.

         Before the Court is Campbell DeLong, LLP's motion to intervene. Doc. #91.

         I Procedural History

         On April 4, 2019, this Court closed this case after being notified of a settlement between Cheryl Barrett and the defendants. Doc. #88. On April 16, 2019, Barrett's former law firm in the case, Campbell DeLong, LLP, filed a motion to intervene under Federal Rule of Civil Procedure 24. Doc. #91. Campbell DeLong seeks to align itself as a plaintiff “with a claim against co-Plaintiff Barrett as to the amount of the attorney's fees owed, and a direct claim against Defendants for imposition of a lien over the settlement proceeds.” Doc. #99 at 5. Campbell DeLong's proposed intervenor complaint asserts that “[t]his Court has subject matter jurisdiction over this matter under 28 U.S.C. § 1367 as Campbell DeLong, which aligns itself with the Plaintiff for purposes of intervention, meets the diversity of citizenship and amount in controversy requirements of 28 U.S.C. § 1332(a).” Doc. #91-13 at ¶ 5.

         Rather than rule immediately on the motion to intervene and related motions, [1] the parties and Campbell DeLong were directed to participate in a settlement conference to resolve the outstanding issues. Doc. #111. The settlement conference was held July 31, 2019, with no resolution reached. Doc. #112. Approximately a month later, Barrett and the defendants stipulated to the dismissal of this action. Doc. #113.

         II Impact of Stipulation

         Federal Rule of Civil Procedure 41(a)(1)(A)(ii) allows a plaintiff to stipulate to dismissal of an action so long as the stipulation is signed by all parties who have appeared. Proposed intervenors are not parties within the meaning of Rule 41. In re Irish Bank Resolution Corp. Ltd., No. 13-12159, 2014 WL 1884916, at *3 & n.10 (Bankr. D. Del. May 12, 2014) (collecting cases). Ordinarily a stipulation of dismissal pursuant to Rule 41 moots a pending motion to intervene. Eli Lilly & Co. v. Synthon Labs., Inc., 538 F.Supp.2d 944, 947 (E.D. Va. 2008). However, “[t]here may … be circumstances where an intervenor could and should be treated as a de facto party and the Court might invoke equitable principles to estop the stipulating parties from invoking a rule which would prejudice the rights of a party whose motion to intervene is pending.” Id. at 946 (emphasis in original).

         Equitable relief is appropriate where, as here, a proposed-intervenor agrees to delay disposition of its motion in order to participate in settlement discussions. Fleet Capital Corp. v. Merco Joint Venture, LLC, No. 02-cv-0279, 2002 WL 31528633, at *3 (E.D.N.Y. Sep. 3, 2002). Under such circumstances, it is appropriate to estop the normal immediate effect of a stipulated dismissal, pending resolution of the motion to intervene. Id. Accordingly, the Court will address the merits of Campbell DeLong's motion to intervene.

         III Analysis

         As explained above, Campbell DeLong moves to intervene as of right under Rule 24, and to assert claims under this Court's supplemental jurisdiction. Doc. #91 at ¶ 5. To intervene as of right, a plaintiff “must demonstrate that (1) it timely applied; (2) it has an interest relating to the property or transaction that is the subject of the case; (3) disposition of the case may practically impair or impede its ability to protect its interest; and (4) it is inadequately represented by the existing parties.” Adam Joseph Res. v. CAN Metals Ltd., 919 F.3d 856, 865 (5th Cir. 2019). While Campbell DeLong seeks to assert claims against both Barrett and the defendants, it only addresses the intervention requirements with respect to the claim against Barrett for attorney's fees. See Doc. #92 at 7-8. Accordingly, the Court considers intervention only with respect to this claim.

         28 U.S.C. § 1367, the supplemental jurisdiction statute, provides in relevant part:

(a) Except as provided in subsections (b) and (c) or as expressly provided otherwise by Federal statute, in any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution. Such supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties.
(b) In any civil action of which the district courts have original jurisdiction founded solely on section 1332 of this title, the district courts shall not have supplemental jurisdiction under subsection (a) over claims by plaintiffs against persons made parties under Rule 14, 19, 20, or 24 of the Federal Rules of Civil Procedure, or over claims by persons proposed to be joined as plaintiffs under Rule 19 of such rules, or seeking to intervene as plaintiffs under Rule 24 of such rules, when exercising supplemental jurisdiction over such claims would be inconsistent with the jurisdictional requirements of section 1332.

         Notably, the statute withdraws from supplemental jurisdiction “claims by persons … seeking to intervene as plaintiffs under Rule 24 … when exercising supplemental jurisdiction over such claims would be inconsistent with the ...


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