Ungar v. Arafat

Citation634 F.3d 46
Decision Date09 February 2011
Docket NumberNo. 10–2145.,10–2145.
PartiesEfrat UNGAR et al., Plaintiffs, Appellees,v.Yasser ARAFAT et al., Defendants, Appellees,The Palestinian Pension Fund for the State Administrative Employees in the Gaza Strip, Movant, Appellant.
CourtU.S. Court of Appeals — First Circuit

OPINION TEXT STARTS HERE

Deanne E. Maynard, with whom Brian R. Matsui, Charles L. Kerr, Mark David McPherson, Morrison & Foerster LLP, Joseph V. Cavanagh, Jr., Joseph V. Cavanagh, III, and Blish & Cavanagh LLP were on brief, for appellant.Robert J. Tolchin, with whom Jaroslawicz & Jaros LLC, David J. Strachman, and McIntyre, Tate & Lynch, LLP were on brief, for plaintiffs-appellees.Before LIPEZ, Circuit Judge, SOUTER,* Associate Justice, and SELYA, Circuit Judge.SELYA, Circuit Judge.

This appeal, brought by a putative intervenor, has its genesis in an injunction issued in a bitter dispute between victims of terrorist violence and governmental entities in the Palestinian territories. The putative intervenor claims that the injunction, which does not refer to it by name, has frozen its assets. The district court rejected this claim and denied the motion to intervene. After careful consideration, we conclude that the putative intervenor has failed to demonstrate that it has a sufficient interest in the underlying action to justify intervention as of right. Accordingly, we affirm.

I. BACKGROUND

The underlying action has narrowed to a dispute between the estate of Yaron Ungar, on the one hand, and the Palestinian Authority (PA) and the Palestine Liberation Organization (PLO), on the other hand. The litigation has been extensively chronicled. See, e.g., Ungar v. PLO ( Ungar II ), 599 F.3d 79 (1st Cir.2010); Ungar v. PLO ( Ungar I ), 402 F.3d 274 (1st Cir.2005). We rehearse here only those facts needed to bring this appeal into perspective. Readers who hunger for more detail should consult our earlier opinions.

While in Israel, Yaron Ungar, a citizen of the United States, and his wife Efrat were ambushed and murdered by terrorists affiliated with the Hamas Islamic Resistance movement. In March of 2000, the personal representative of Ungar's estate (the Estate) brought suit in the United States District Court for the District of Rhode Island against the PA and the PLO under the Anti–Terrorism Act (ATA), 18 U.S.C. §§ 2331–2338.1 The ATA permits, inter alia, recovery for United States nationals injured by acts of international terrorism. Id. § 2333(a).

We fast-forward to July 12, 2004, when the district court entered a default judgment for more than $116,000,000 against the PA and the PLO. We affirmed that order. Ungar I, 402 F.3d at 293–94. Since then, the defendants have engaged in a series of determined efforts to set aside the judgment. Although they have not succeeded thus far, their efforts are still ongoing. See, e.g., Ungar II, 599 F.3d at 87.

To aid in the collection of the judgment, the district court, on the Estate's motion, granted an injunction. The injunction, issued on May 5, 2005, restrained the PA, the PLO, and “their officers, agents, servants, employees, ... fiduciaries, and any natural or legal persons in privity with them and/or acting on their behalf” from selling, transferring, or otherwise alienating any of their property located within the United States. As the defendants had no known assets in Rhode Island, the injunction was intended to allow the Estate to domesticate the judgment in other states—states in which assets could be found. By its terms, the injunction was to remain in place until further order of the court. It contained no bond requirement.

With the injunction in hand, the Estate proceeded to notify a galaxy of financial institutions of the injunction's existence. Pertinently, this roster included Swiss American Securities, Inc. (SASI), a New York-based affiliate of Credit Suisse. SASI held the assets of the Palestinian Pension Fund for the State Administrative Employees in the Gaza Strip (the Fund). Despite the Fund's protestation that it was not affiliated in any way with the PA or the PLO, SASI froze the Fund's assets.

Litigation in a New York state court ensued. On February 14, 2006, the Estate filed both a turnover action and a declaratory judgment action against SASI and the Fund. The state court judge held a hearing and concluded that the Estate had not produced sufficient evidence to warrant a turnover order. Accordingly, she dismissed the turnover action without prejudice.

The declaratory judgment action soldiered on. After a period of pretrial discovery, the Estate and the Fund cross-moved for summary judgment. On June 5, 2008, the state court judge concluded that genuine issues of material fact precluded her from granting either motion.

As the New York case proceeded, the parties began to wrangle over the availability of a jury trial. When the court denied the Fund's motion to strike the Estate's jury trial demand, the Fund moved to stay the action pending resolution of (i) its interlocutory appeal of that ruling, and (ii) the defendants' motion in the Rhode Island federal case to vacate the underlying default judgment. The stay was granted and the declaratory judgment action remains pending.

On August 18, 2010, the Fund opened a second front in its campaign against the Estate: it moved in the federal district court for leave to intervene as of right in the original action. Its stated purpose in intervening was to vacate or modify the injunction.2 In the alternative, it sought to have the Estate post a bond to ensure recompense for any losses resulting from the freezing of its assets. The Estate opposed the motion.

The district court heard arguments on September 21, 2010. Ruling ore tenus, the court denied the motion. It noted that the injunction applied only to the PA, the PLO, and those in privity with them. The factual question of whether the Fund fell within the scope of the injunction was being litigated in New York and permitting intervention to thrash out that question would, therefore, result in wasteful duplication of effort.

This timely appeal followed.

II. ANALYSIS

An order denying a motion to intervene as of right is immediately appealable as a collateral order. R & G Mortg. Corp. v. Fed. Home Loan Mortg. Corp., 584 F.3d 1, 7 (1st Cir.2009); Pub. Serv. Co. of N.H. v. Patch, 136 F.3d 197, 204 (1st Cir.1998). Consequently, we have jurisdiction to consider this appeal.

A. The Legal Landscape.

Under the Civil Rules, intervention comes in two flavors: intervention as of right, Fed.R.Civ.P. 24(a), and permissive intervention, Fed.R.Civ.P. 24(b). The Fund has framed its motion as a motion to intervene as of right. We cabin our discussion accordingly.3 Negrón–Almeda v. Santiago, 528 F.3d 15, 21 (1st Cir.2008).

Specifically, the Fund invokes Rule 24(a)(2). In the absence of a triggering federal statute—and none is involved here—Rule 24(a)(2) provides an authoritative recipe that lists the essential ingredients for intervention as of right:

On timely motion, the court must permit anyone to intervene who ... claims an interest relating to the property or transaction that is the subject of the action, and is so situated that disposing of the action may as a practical matter impair or impede the movant's ability to protect its interest, unless existing parties adequately represent that interest.

It follows that a would-be intervenor must demonstrate that: (i) its motion is timely; (ii) it has an interest relating to the property or transaction that forms the foundation of the ongoing action; (iii) the disposition of the action threatens to impair or impede its ability to protect this interest; and (iv) no existing party adequately represents its interest. See R & G Mortg., 584 F.3d at 7; Travelers Indem. Co. v. Dingwell, 884 F.2d 629, 637 (1st Cir.1989). Each of these requirements must be fulfilled; failure to satisfy any one of them defeats intervention as of right. B. Fernández & Hnos., Inc. v. Kellogg USA, Inc., 440 F.3d 541, 545 (1st Cir.2006); Patch, 136 F.3d at 204.

Determining whether the necessary showings have been made requires a series of judgment calls—a balancing of factors that arise in highly idiosyncratic factual settings. See Patch, 136 F.3d at 204; Int'l Paper Co. v. Inhab. of Town of Jay, 887 F.2d 338, 344 (1st Cir.1989). Moreover, the “inherent imprecision of Rule 24(a)(2)'s individual elements” dictates that the rule should be applied with an eye toward the “commonsense view of the overall litigation.” Patch, 136 F.3d at 204 (citing United States v. Hooker Chems. & Plastics Corp., 749 F.2d 968, 983 (2d Cir.1984) (Friendly, J.)).

The grant or denial of a motion to intervene engenders review for abuse of discretion. R & G Mortg., 584 F.3d at 7; Int'l Paper, 887 F.2d at 344. In the context of intervention as of right, “the district court's discretion is somewhat more circumscribed than in the context of intervention generally.” Negrón–Almeda, 528 F.3d at 22; B. Fernández, 440 F.3d at 544; see Int'l Paper, 887 F.2d at 344. If the district court either fails to follow the general recipe provided in Rule 24(a)(2) or reaches a plainly incorrect decision, we will intrude. Patch, 136 F.3d at 204; Int'l Paper, 887 F.2d at 344.

B. The Merits.

With this landscape in place, we turn to the Fund's assignments of error.

The Fund first claims that the district court abused its discretion by failing to cogitate the requirements of Rule 24(a)(2). This claim lacks force.

The district court denied the motion to intervene in a bench decision. It did not subdivide its analysis into discrete silos. Nevertheless, its findings and reasoning can easily be inferred from the record. Thus, we can gauge whether the court applied the Rule 24(a)(2) factors appropriately. No more is exigible.4 See Geiger v. Foley Hoag LLP Ret. Plan, 521 F.3d 60, 64 (1st Cir.2008); Cotter v. Mass. Ass'n of Minority Law Enf. Officers, 219 F.3d 31, 34 (1st Cir.2000).

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