Keech v. Sanimax USA, LLC

Background

Patricia Keech and David Newfield brought a proposed class action against Sanimax USA, LLC. They alleged that noxious odors from Sanimax’s rendering and waste-oil processing facility physically invaded their properties. Their complaint asserted nuisance and negligence claims.

The court had previously denied Sanimax’s motion to strike the class allegations, finding that it was too early to decide whether the claims could be proven on a class-wide basis. The parties later reached an agreement in principle and sought preliminary approval of a class settlement. After a hearing, the court found the proposed settlement fair, reasonable, and adequate and granted preliminary approval.

The City of Newport then filed a motion to intervene. Sanimax supported the motion, and the plaintiffs opposed it. The City’s filing did not include a separate pleading setting out the claim for which it sought intervention, but the court did not deny the motion on that ground.

Timeliness

Federal Rule of Civil Procedure 24 permits intervention as of right and permissive intervention, but both require a timely motion. The court considered the progress of the litigation, the City’s knowledge of the case, its reason for waiting, and the prejudice that intervention would cause.

The court found the motion untimely. The City filed it after the court had preliminarily approved the proposed class settlement, even though the City had shown interest in the case before the approval hearing. The court also found that the City appeared to have known about the litigation from its beginning. The City’s explanation that it became concerned only after learning the settlement terms did not justify the delay.

The court concluded that allowing intervention at that stage would prejudice the parties because they had already spent substantial time negotiating the proposed settlement. The court stated that the settlement process might have to be set aside and restarted if the City were allowed to intervene.

Intervention as of Right

The court also ruled that the City would not qualify for intervention as of right even if its motion had been timely. This form of intervention requires a recognized interest in the subject of the litigation, a possibility that the interest would be impaired by the case’s disposition, and inadequate protection of that interest by the existing parties.

The City did not provide evidence showing that it had a recognized interest that could be impaired. The settlement applied only to owners of residential property and concerned a private-nuisance action. The court reasoned that any public-nuisance claims the City might have would not be affected by the settlement. The court also rejected the City’s argument based on its ownership of commercial property because the settlement did not cover commercial property.

The court distinguished precedent allowing intervention where the litigation directly targeted a utility’s interests. Here, the settlement would not require the City to do anything or give up any right. The City and its interests were not the ultimate target of the litigation.

Permissive Intervention and Disposition

Permissive intervention allows a court to permit a party with a claim or defense sharing a common question of law or fact with the main action to join the case. The court has discretion to deny it when intervention would cause undue delay or prejudice.

The court denied permissive intervention because the City’s last-minute request would prejudice the parties, who had already negotiated a proposed settlement that the court had allowed to proceed.

The court ordered that the City of Newport’s Motion to Intervene, Docket No. 72, was DENIED. The order did not state that the motion was denied with or without prejudice.