CapitalPlus Equity, LLC v. Tutor Perini Corporation (TV2)
3:18-cv-00178
E.D. Tenn.May 31, 2019Background
- Plaintiff CapitalPlus sued Tutor Perini Corp. and Tutor Perini Building Corp. alleging Defendants failed to pay amounts owed to The Espinosa Group (TEG), a subcontractor; Plaintiff had a security interest in TEG’s receivables.
- The District Judge partially denied Defendants’ motion to dismiss, compelled arbitration under a confidential settlement agreement and subcontract, and stayed the case pending arbitration.
- Movants (The Espinosa Group, Juan Espinosa, Carol Espinosa, Michael Espinosa, and Jamiju, LLC) filed a second motion to intervene seeking to participate in the arbitration.
- Movants previously sought intervention conditioned on the case continuing in court; that original motion was denied without prejudice and Movants were given leave to refile if the case remained in court.
- Defendants and Plaintiff opposed the second motion, arguing Movants failed to identify a legal basis, failed to satisfy Rule 24(a) or (b), and did not attach a pleading as required by Rule 24(c).
- The Magistrate Judge recommended denial of the motion to intervene because Movants offered only conclusory assertions of indispensability, provided no legal argument or statutory basis for intervening in the arbitration, and did not cure deficiencies from their prior filing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Movants may intervene in the arbitration | Movants assert they are indispensable parties and thus should be permitted to intervene | Movants failed to cite any authority for intervention, failed to meet Rule 24(a) or 24(b) standards, and did not file a required pleading under Rule 24(c) | Denied: Movants’ motion lacks legal/factual support and fails Rule 24 requirements |
| Whether intervention is timely and appropriate after the case was stayed for arbitration | (implied) Movants seek to intervene despite the arbitration order | Defendants note Movants did not seek relief from the stay and offer no argument why intervention is appropriate post-stay | Denied: Court declined to exercise authority to allow intervention on current filings |
| Whether Movants carried their burden to show common questions or claims under Rule 24(b) | Movants asserted common interest with the main action (conclusory) | Parties emphasize Movants did not present a pleading setting out claims or identify common legal/factual issues | Denied: Movants failed to meet burden and did not comply with Rule 24(c) |
| Whether the court must analyze intervention after stay versus district-court collateral jurisdiction | (no developed argument from Movants) | Defendants implicitly argue district court retains only collateral jurisdiction and Movants did not show need to address merits | Denied: Court noted limits on district-court intervention post-arbitration and found Movants’ perfunctory briefing waived arguments |
Key Cases Cited
- ATAC Corp. v. Arthur Treachers, Inc., 280 F.3d 1091 (6th Cir. 2002) (district court retains jurisdiction over collateral matters after stay for arbitration)
- McPherson v. Kelsey, 125 F.3d 989 (6th Cir. 1997) (issues raised perfunctorily and without developed argument are deemed waived)
- Shy v. Navistar Int'l Corp., 291 F.R.D. 128 (S.D. Ohio 2013) (proposed intervenor has burden to show intervention under Rule 24(b))
- Thomas v. Arn, 474 U.S. 140 (1985) (procedural requirements for objections to magistrate judge reports and waivers for failure to timely object)