Intervention, Standing Draw Supreme Court Attention

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By Bernie Pazanowski

Third parties who want to take part in a lawsuit already filed in federal court may get some guidance from the U.S. Supreme Court after oral argument today ( Town of Chester v. Laroe Estates Inc., U.S., No. 16-605 , argued 4/17/17 ).

The justices focused on whether intervenors under Federal Rule of Civil Procedure 24(a)(2) must also meet the requirements for standing under Article III of the U.S. Constitution. The circuit courts are split over whether independent standing is required, and the Supreme Court has dodged the issue in the past.

During the argument, several of the justices asked if Article III standing should be required in Rule 24(a)(2) cases only when the intervenor asks for relief distinct from the plaintiff’s request.

Neal K. Katyal, Hogan Lovells US LLP, Washington, representing petitioner Town of Chester, N.Y., argued that Article III standing should always be required because the intervenors under Rule 24(a)(2) are “full-blown parties.”

Respondent Laroe Estates Inc.'s attorney, Shay Dvoretzky of Jones Day, Washington, suggested that no inquiry into Article III standing is needed here because the intervenor didn’t seek “a separate claim or separate relief” from the original plaintiff.

Assistant to the Solicitor General Sarah E. Harrington argued that Rule 24(a)(2) requires an intervenor to demonstrate that it has Article III standing by showing that he has a cognizable interest that can be impaired by the disposition of the pending lawsuit.

No Questions for You

This was Justice Neil M. Gorsuch’s first day on the job, but there was some question whether he would recuse himself from this argument because Katyal introduced him at his Senate confirmation hearings.

Gorsuch didn’t recuse himself, but he also didn’t ask Katyal any questions. He did, however, participate fully while the other two attorneys presented their arguments.

Under Rule 24(a)(2), third parties must be allowed to intervene if their request is timely, they have a legitimate interest in the dispute that may be impaired and the parties won’t adequately represent that interest.

Standing under Article III requires a party to show an actual case or controversy exists, that they have been injured by the defendant and that the court can redress their grievance.

Justice Ruth Bader Ginsburg asked Katyal if Congress can enact a statute that provides for intervention of right for someone who doesn’t have standing. Katyal said that “if a statute provides for full-blown party status for someone who lacks the components of Article III standing, that ... is unconstitutional.”

The was also some discussion about defendant standing and if the rules are different.

Justice Stephen G. Breyer asked Dvoretzky this: “How does a defendant have standing? How does that work?”

But that’s not an Article III standing inquiry, Dvoretzky replied.

Takings Claim Sets Stage

Here, the estate of a real estate developer alleged that the town passed regulations that prevented the developer from using the property without compensating him for the loss of use. Another developer claimed interest in the property and filed a motion to intervene under Rule 24. The district court ruled that it lacked standing.

Reversing, the U.S. Court of Appeals for the Second Circuit said that because there was a real case or controversy between the parities to the original takings suit, the district court should have focused on the requirements of Rule 24, which were met in this case.

In its Supreme Court brief, Chester argued that both Article III and Rule 24 require intervenors to have independent standing. Courts can’t award relief unless the party requesting it has standing, it said.

In an amicus brief, the government argued that Rule 24 incorporates the requirements of Article III.

The developer’s brief countered that once the original plaintiff establishes its standing, third parties can intervene under Rule 24 provided they assert the same claim and seek the same relief.

To contact the reporter on this story: Bernie Pazanowski in Washington at bpazanowski@bna.com

To contact the editor responsible for this story: Jessie Kokrda Kamens at jkamens@bna.com

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