Long Island Trucking, Inc. v. Brooks Pharmacy

219 F.R.D. 53, 2003 U.S. Dist. LEXIS 22009, 2003 WL 22888998
District Court, E.D. New York·Decided December 9, 2003·No. No. CV-02-2302(ADS)(MLO)·Published·Cited by 4 cases

Opinion

MEMORANDUM OF DECISION AND ORDER

SPATT, District Judge.

On April 10, 2002, Long Island Trucking, Inc. and Supersonic Transport, LLC d/b/a Super Transport (“L.I. Trucking” or the “plaintiff’) commenced this action against Brooks Pharmacy (“Brooks” or the “defendant”) alleging that the defendant is hable to the plaintiff for services rendered in the [54] amount of $666,735.10 in invoices, plus interest and costs. Presently before the Court is a motion by Transportation Factoring, Inc. (“Transfac” or the “intervenor”) to intervene in this case pursuant to Rule 24(a)(2) of the Federal Rules of Civil Procedure (“Fed. R. Civ.P”), or in the alternative, to be granted permissive intervention pursuant to Rule 24(b)(2). Brooks does not oppose Transfac’s motion to intervene provided that Brooks’ ability to conduct and complete discovery is not jeopardized. In particular, Brooks requests that if Transfae’s motion is granted, the Court should extend the discovery cut-off date so that it can obtain discovery with respect to Transfac.

I. BACKGROUND

L.I. Trucking is engaged in the business of moving freight. Sometime prior to April 10, 2002, Brooks retained the services of L.I. Trucking for the purposes of moving freight. The complaint alleges that the L.I. Trucking moved the freight from steamship lines to a location specified by the defendant. L.I. Trucking further alleges that Brooks failed to pick up the freight after being notified of the delivery thereby causing L.I. Trucking to place the freight in storage. L.I. Trucking alleges that due to the defendant’s failure to pick up its freight, the defendant is liable to the plaintiffs for not only the cost of transporting and storing the freight, but also for the “detention expense,” “drop charge fee,” “fuel sure charge,” pallets/skids that were removed and not replaced, and “bridge checkpoint sure charge.” In sum, the plaintiff alleges that the defendant is liable for unpaid invoices for services rendered in the amount of $666,735.10, plus interest and costs.

On or about March 7, 2000 and October 2000, the plaintiff entered into two factoring agreements (collectively, the “Factoring Agreements”) with Transfac for the purpose of having its accounts receivable factored by Transfac. By the terms of the Factoring Agreements, Transfac would purchase bills and invoices from the plaintiff. In return, the plaintiff granted to Transfac a security interest in, among other things, all accounts, bills, general intangibles and most, if not all, of its assets.

On or about May 5, 2003, Transfac sued the plaintiff in the United States District Court, District of Oregon to recover in excess of $5.2 million for a breach of the Factoring Agreements. See Transfac’s Mem. In Sup. of Mot. For Intervention at 3; see also Ansell Aff. Ex. 2. According to Transfac’s Memorandum in Support of its Motion for Intervention, the plaintiff is in default to Transfac in the amount of $5.2 million. See Transfac’s Mem. in Sup. of Mot. for Intervention at 4.

Transfac contends that as either the “outright owner” or the “holder of a security interest” of all of the plaintiffs claims against the defendant, it should be permitted to intervene in this ease pursuant to Rule 24(a)(2), or in the alternative, to be granted permissive intervention to Rule 24(b)(2). Brooks does not oppose Transfac’s motion to intervene provided that Brooks’ ability to conduct and complete discovery is not jeopardized. In particular, Brooks requests that if Transfac’s motion is granted, the Court should extend the discovery cut-off date so that it can obtain discovery with respect to the intervention of Transfac.

II. DISCUSSION

Transfac seeks to intervene as of right, or in the alternative, to intervene permissively under Rule 24. Rule 24(a)(2) provides:

(a) Intervention of Right. Upon timely application anyone shall be permitted to intervene in an action: ... (2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and he is so situated that the disposition of the action may as a practical matter impair or impede his ability to protect that interest, unless the applicant’s interest is adequately represented by existing parties.

In order to intervene as of right under Rule 24(a)(2), an applicant must (1) file timely, (2) demonstrate an interest in the action, (3) show an impairment of that interest arising from an unfavorable disposition, and (4) have an interest not otherwise protected. United States v. State of New York, [55] 820 F.2d 554, 556 (2d Cir.1987); see also Brennan v. New York City Bd. of Educ., 260 F.3d 123, 128-129 (2d Cir.2001). Failure to satisfy any one of these requirements is sufficient grounds to deny the application. See United States v. State of New York, 820 F.2d at 556. The test is flexible and courts generally look at all of the factors rather than focusing narrowly on any one of the criteria. See Tachiona v. Mugabe, 186 F.Supp.2d 383, 394 (S.D.N.Y.2002). However, failure to satisfy any one of these requirements is sufficient grounds to deny the application. See Butler, Fitzgerald & Potter v. Sequa Corp., 250 F.3d 171, 176 (2d Cir.2001).

As set forth below, all four factors favor intervention by Transfac in this action.

1. Timeliness

Among the factors to be taken into account to determine whether a motion to intervene is timely are:

(a) the length of time the applicant knew or should have known of his interest before making the motion; (b) prejudice to existing parties resulting from the applicant’s delay; (c) prejudice to applicant if the motion is denied; and (d) presence of unusual circumstances militating for or against a finding of timeliness.

See Buxbaum v. Deutsche Bank AG, 216 F.R.D. 72, 76 (S.D.N.Y.2003).

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Long Island Trucking, Inc. v. Brooks Pharmacy, 219 F.R.D. 53, 2003 U.S. Dist. LEXIS 22009, 2003 WL 22888998 (E.D.N.Y. 2003).

219 F.R.D. 53 (Long Island Trucking, Inc. v. Brooks Pharmacy) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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