CWCapital Cobalt Vr Ltd. v. Fed. Home Loan Mortg. Corp., 18-2483

Cobalt (proposed intervenor) holds junior CMBS certificates tied to the 2006 financing of Stuyvesant Town–Peter Cooper Village; Appaloosa holds other junior certificates; Freddie Mac and Fannie Mae (the GSEs) hold senior certificates; CWCAM is the special servicer.
Dispute concerns allocation of >$600 million from the 2015 sale: CWCAM and the GSEs claim most as "penalty interest" and yield-maintenance; Appaloosa and Cobalt claim some/all as "gain-on-sale."
Trustee-initiated proceedings followed the sale; certificateholders received notice in 2015. Cross-motions for judgment on the pleadings were fully briefed and decided by the district court on March 9, 2018.
Cobalt moved to intervene as of right under Fed. R. Civ. P. 24(a)(2) on March 30, 2018; the district court denied the motion (oral May 23, 2018; written thereafter); Cobalt appealed.
District Court found Cobalt’s motion untimely and that Appaloosa adequately represented Cobalt’s interests; the Second Circuit reviewed for abuse of discretion and affirmed.

Issue	Cobalt's Argument	Appellees' Argument	Held
Timeliness of intervention under Rule 24(a)(2)	Delay excused by alleged prior control by CWCAM affiliate and investigation; had notice but later sought to intervene	Cobalt knew of suit in 2015/2017; long silence while parties litigated narrowed issues; intervention in 2018 would prejudice progress	Affirmed denial: delay from mid‑2017 to Mar‑2018 was unreasonable; district reasonably found prejudice to existing parties and thus untimely
Adequacy of representation by Appaloosa	Appaloosa may not press certain arguments Cobalt would; interests diverge unless >$400M declared gain-on-sale	Appaloosa and Cobalt share the same ‘‘best‑case’’ goal; Appaloosa had raised key arguments and would adequately protect Cobalt’s interests	Affirmed denial: Appaloosa adequately represents Cobalt now; any limited divergence was considered and not enough to require intervention

Floyd v. City of New York, 770 F.3d 1051 (2d Cir. 2014) (timeliness is a flexible, fact‑specific balancing test with listed factors)
MasterCard Int’l Inc. v. Visa Int’l Serv. Ass’n, 471 F.3d 377 (2d Cir. 2006) (elements required for intervention as of right under Rule 24(a)(2))
Bridgeport Guardians, Inc. v. Delmonte, 602 F.3d 469 (2d Cir. 2010) (denial of motion to intervene is a final, appealable order)
Butler, Fitzgerald & Potter v. Sequa Corp., 250 F.3d 171 (2d Cir. 2001) (prior affirmances denying intervention after delays of eight to eighteen months)
United States v. Pitney Bowes, Inc., 25 F.3d 66 (2d Cir. 1994) (district court’s proximity to case confers advantage in intervention decisions)
Catanzano by Catanzano v. Wing, 103 F.3d 223 (2d Cir. 1996) (abuse‑of‑discretion review of intervention decisions)