Securities and Exchange Commission v. American Pension Services, 2:14-cv-00309

Franklin American Mortgage Company moved to intervene in the SEC receivership case to foreclose a deed of trust on real property at 12231 South 1950 East, Draper, Utah (the Draper Property).
The loan is evidenced by a note and deed of trust assigned to Franklin (MERS assigned the beneficial interest to Franklin).
The Receiver previously concluded, after forensic analysis, that the Draper Property had no equity for the receivership (total encumbrances ~$744,000; appraisal ~$630,000).
A receivership freeze order prevents foreclosure or other enforcement absent court action, which Franklin says impairs its mortgage rights.
The SEC and the Receiver did not oppose Franklin’s motion; Defendants (Curtis and Michelle DeYoung) are in default and have interests adverse to Franklin.
The magistrate judge granted intervention of right under Federal Rule of Civil Procedure 24(a)(2).

Issue	Plaintiff's Argument	Defendant's Argument	Held
Timeliness of intervention	Franklin: filed promptly after Receiver's finding there is no equity; no prejudice to parties	Receiver/SEC: no opposition; Defendants not specifically argued	Granted — motion timely given circumstances and no prejudice
Whether applicant has sufficient interest	Franklin: holds note and deed of trust assigned to it; legal interest in property	Opposing parties: receivership focus, Defendants adverse	Granted — Franklin has adequate legal/equitable interest in the Draper Property
Whether disposition of action will impair interest	Franklin: freeze order prevents enforcement; without intervention its mortgage rights may be impaired	Receiver/SEC: no showing they represent Franklin’s interest	Granted — practical impairment likely if intervention denied
Adequacy of existing representation	Franklin: neither SEC nor Receiver represents its mortgage interest; Defendants adverse	SEC/Receiver: focused on misappropriation and receivership administration, not lender enforcement	Granted — existing parties do not adequately represent Franklin

Elliot Indus. Ltd. P’ship v. BP Am. Prod. Co., 407 F.3d 1091 (10th Cir.) (courts apply liberal construction to intervention under Rule 24(a))
Utah Ass’n of Counties v. Clinton, 255 F.3d 1246 (10th Cir.) (timeliness and four-factor Rule 24(a) test)
Rosebud Coal Sales Co. v. Andrus, 644 F.2d 849 (10th Cir.) (apply policy goals to define an applicant’s interest)
Allard v. Frizzell, 536 F.2d 1332 (10th Cir.) (interest must be a specific legal or equitable one)
Grutter v. Bollinger, 188 F.3d 394 (6th Cir.) (impairment element requires possibility that substantial legal interest could be affected)