Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_06-cv-06997/USCOURTS-cand-3_06-cv-06997-2/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 29:1144(a) E.R.I.S.A supersedes state law employee benefits

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

GOLDEN GATE RESTAURANT

ASSOCIATION,

Plaintiff,

 v.

CITY AND COUNTY OF SAN FRANCISCO

and DOES 1-15,

Defendants. /

No. C 06-06997 JSW

ORDER GRANTING MOTION TO

INTERVENE

Now before the Court is the motion to intervene filed by San Francisco Labor Council,

Service Employees International Union (“SEIU”) Local 1021, SEIU United Health Case

Workers-West, and United Here! Local 2 (collectively “the Unions”) pursuant to Federal Rule

of Civil Procedure 24(a) and (b). Plaintiffs oppose the motion to intervene. Defendant City and

County of San Francisco consents to the Unions’ intervention. The Court finds that this matter

is appropriate for disposition without oral argument and the matter is deemed submitted. See

N.D. Civ. L.R. 7-1(b). Accordingly, the hearing set for April 6, 2007 is HEREBY VACATED. 

The Case Management Conference, set for April 6, 2007 at 9:00 a.m. is HEREBY VACATED

and RESET to April 6, 2007 at 1:30 p.m. Having carefully considered the parties’ arguments

and relevant legal authority, the Court hereby GRANTS the Unions’ motion to intervene. 

Case 3:06-cv-06997-JSW Document 24 Filed 04/05/07 Page 1 of 6
United States District Court

For the Northern District of California

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BACKGROUND

This is an action initiated by Golden Gate Restaurant Association (the “Association”), a

non-profit trade association representing restaurants and culinary employers throughout the City

and County of San Francisco. (Complt. ¶ 15.) The Association’s “primary mission is to

promote, extend and protect the interests of the restaurant industry by serving its members in

the San Francisco Bay Area.” (Id.) The Association challenges portions of the San Francisco

Health Care Security Ordinance (the “Ordinance”) which require certain businesses to expend a

minimum dollar amount on health care expenses or to contribute up to the threshold amount to

fund the San Francisco Health Access Program (“HAP”). (Id. ¶ 1.) The Association contends

that portions of the Ordinance directly and indirectly intrude upon the administration of covered

employers’ federally governed employee benefit programs and are there preempted by the

Employee Retirement Income Security Act. (Id. ¶ 2.) 

The Unions request leave to intervene pursuant to Federal Rule of Civil Procedure 24(a)

and (b) as defendants in the action in order to defend the Ordinance.

ANALYSIS

Pursuant to Federal Rule of Civil Procedure 24(a), an applicant seeking to intervene in a

pending lawsuit “as of right” must demonstrate that: “(1) it has a significant protectable interest

relating to the property or transaction that is the subject matter of the action; (2) the disposition

of the action may, as a practical matter, impair or impede the applicant’s ability to protect its

interest; (3) the application is timely; and (4) the existing parties may not adequately represent

the applicant’s interest.” United States v. City of Los Angeles, 288 F.3d 391, 397 (9th Cir.

2002) (internal citations omitted). An applicant must satisfy all four of these requirements. 

Arakaki v. Cayetano, 324 F.3d 1078, 1083 (9th Cir. 2003).

In evaluating these requirements, courts “are guided primarily by practical and equitable

considerations.” Donnelly v. Glickman, 159 F.3d 405, 409 (9th Cir. 1998). Courts generally

construe conflicts in favor of intervention. United States ex rel. McGough v. Covington Techs.

Co., 967 F.2d 1391, 1394 (9th Cir. 1992). “By allowing parties with a practical interest in the

outcome of a particular case to intervene, we often prevent or simplify future litigation

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United States District Court

For the Northern District of California

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involving related issues; at the same time, we allow an additional interested party to express its

views before the court.” Forest Conservation Council v. United States Forest Serv., 66 F.3d

1489, 1496 n.8 (9th Cir. 1995) (citation omitted).

A. Significant Protectable Interests.

“The requirement of a significantly protectable interest is generally satisfied when the

‘interest is protectable under some law, and ... there is a relationship between the protected

interest and the claims at issue.’” Arakaki, 324 F.3d at 1084 (quoting Sierra Club v. United

States EPA, 995 F.2d 1478, 1484 (9th Cir. 1993)). The “relationship” requirement is generally

satisfied “only if the resolution of the plaintiff’s claims will actually affect the applicant.” Id.

(quoting Donnelly, 159 F.3d at 410). To demonstrate a significant protectable interest, the

proposed intervenor must demonstrate that the “relief sought by the plaintiffs will have direct,

immediate, and harmful effects upon [the proposed-intervenors’] legally protectable interests.” 

Southwest Center for Biological Diversity v. Berg, 268 F.2d 810, 818 (9th Cir. 2001) (quoting

Forest Conservation Council, 66 F.3d at 1494). The requirement of an “interest relating to the

property or transaction” is construed expansively. Cascade Natural Gas Corp. v. El Paso

Natural Gas Co., 386 U.S. 129, 132-36 (1967). There are two factors the Court must consider

to determine whether a party has a sufficient interest relating to the transaction: (1) whether the

asserted interest is “protected under some law” and (2) whether there is a “relationship”

between the legally protected interest and the claims at issue. Green v. United States, 996 F.2d

973, 976 (9th Cir. 1993). 

Here, the Unions contend that they have a protectable interest in the subject transaction

because whether employers’ expenditures are in the form of health care insurance, contribution

to health savings accounts, direct reimbursement, direct delivery of health care services, or

payments to the City’s HAP, they will benefit members of the Unions. (Motion at 6.) 

Additionally, the Unions contend that the Ordinance protects the interests of employees whose

employers do currently make the required minimum payments but compete in the same market

as those employers that do not make the required expenditures. Further, the Unions argue that

there is a relationship between this legally protected interest in securing health care

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United States District Court

For the Northern District of California

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contributions on behalf of the Unions’ members and the claims before this Court because the

resolution of the claims and the injunctive relief sought by Plaintiff will directly affect Union

members. See City of Los Angeles, 288 F.3d at 398. 

In response, Plaintiff contends that the Unions and its members have not demonstrated a

sufficient protectable interest because their interests merely mirror those of San Francisco

employees generally whose interests are already represented by the City and County of San

Francisco, the existing defendant. Where a proposed intervenor’s interests mirror those of a

substantial portion of the population and merely assert “an undifferentiated, generalized interest

in the outcome of an ongoing action,” such an interest is not sufficient. (Opp. Br. at 5-6, citing

Westlands Water District v. United States, 700 F.2d 561, 563 (9th Cir. 1983) and S. Cal. Edison

Co. v. Lynch, 307 F.3d 794, 803 (9th Cir. 2002).) 

Here, the Court finds that the Unions have made a sufficient showing that they possess a

protectable interest in the subject transaction and that there is a relationship between this legally

protected interest in securing health care contributions and the claims before this Court because

the resolution of the claims and the injunctive relief sought by Plaintiff will directly affect

Union members. See Californians for Safe and Competitive Dump Truck Transportation v.

Mendonca, 152 F.3d 1185, 1189-1190 (9th Cir. 1998) (upon de novo review, finding that union

had a right to intervene as a matter of law where its members “had a ‘significant interest’ in

receiving the prevailing wage for their services as opposed to a substandard wage” and if the

challenge the California’s Prevailing Wage Law succeeded, “it would have clearly impaired

[the union’s] members’ right to receive the prevailing wage.”) 

B. The Disposition of this Action May Impair or Impede the Proposed Intervenors’

Ability to Protect Their Interests.

The Ninth Circuit approaches the “impair or impede” requirement pragmatically: “[i]f

an absentee would be substantially affected in a practical sense by the determination made in an

action, he should, as a general rule, be entitled to intervene.” Berg, 268 F.3d at 822 (quoting

Federal Rule of Civil Procedure 24 advisory committee’s notes). Having found that the Unions

possess a significant protectable interest, it is clear that the outcome of this suit challenging the

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Ordinance may impair the Unions’ ability to protect their members’ interest in ensuring that

their employers make the minimum health care expenditures on their behalf. Should the Court

ultimately find that it must enjoin the enforcement of the Ordinance, the Unions’ members

would lose protections ostensibly granted by passage of the Ordinance. See also Mendonca,

152 F.3d at 1190.

C. The Application is Timely.

In determining timeliness, the Court weighs (1) the stage of the proceeding at which an

applicant seeks to intervene; (2) the prejudice to other parties; and (3) the reason for and length

of any delay. United States v. Oregon, 913 F.2d 576, 588-89 (9th Cir. 1990). The Unions

served their motion to intervene before any discovery commenced and the motion will not delay

the litigation of this action nor prejudice any party. Plaintiff does not contest the timeliness of

the motion to intervene. (Opp. Br. at 3.) The Unions filed the motion timely.

D. The Existing Parties May Not Adequately Represent the Unions’ Interests.

The Ninth Circuit has identified three factors to consider when determining whether

existing parties adequately represent an intervenor applicant’s interest: “(1) whether the interest

of a present party is such that it will undoubtedly make all the intervenor’s arguments; 

(2) whether the present party is capable and willing to make such arguments; and (3) whether

the would-be intervenor would offer any necessary elements to the proceedings that other

parties would neglect.” City of Los Angeles, 288 F.3d at 398 (citations omitted). The

requirement “is satisfied if the applicant shows that representation of his interest ‘may be’

inadequate.” Trbovich v. United Mine Workers, 404 U.S. 528, 538 n.10 (1972). The burden of

making this showing is minimal. Id. 

There is “an assumption of adequacy when a government agency is acting on behalf of a

constituency that it represents.” Arakaki, 324 F.3d at 1087 (citing City of Los Angeles, 288 F.3d

at 401). However, this presumption may be overcome where the prospective intervenor’s

interests may be “more narrow and parochial than the interests of the public at large.” 

Mendonca, 152 F.3d at1190; see also Forest Conservation Council, 66 F.3d at 1499 (citing

Mille Lacs Band of Chippewa Indians v. Minnesota, 989 F.2d 994, 1000-01 (8th Cir. 1993)

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(finding that, because the county’s and landowners’ “local and individual interests” were not

shared by the general state citizenry, the State would not adequately represent those interests).)

In Mendonca, the court noted that the interests of the union members in receiving the

prevailing wage were potentially more narrow than the state’s broader interest in upholding the

prevailing wage law generally, and therefore the union had made a sufficient showing of

inadequacy. Id. As in Mendonca, the Unions’ members here have a personal interest in the

enforcement of the Ordinance that is more narrow than the City’s general interest because they

would be among the employees directly affected by the injunction of the Ordinance. In

addition, the Defendant City and County of San Francisco represents the public generally,

including businesses and employers who may claim to be harmed by the passage of the

Ordinance. Lastly, according to the language in the Ordinance itself as quoted by the Unions,

the City and County maintains an independent institutional interest in the passage of the

Ordinance because it is currently the operator of health care entities that provide emergency

services for uninsured residents without compensation. (See Motion at 10, citing Ordinance §

1.) The City’s interest is therefore distinct from the Unions’ interest in protecting its member

employees.

CONCLUSION

Accordingly, the Court HEREBY GRANTS the Unions’ motion to intervene as of right

pursuant to Federal Rule of Civil Procedure 24(a) and as such will not address permissive

intervention pursuant to Rule 24(b). The Unions shall file their answer within ten days of this

Order.

IT IS SO ORDERED.

Dated: April 5, 2007 

JEFFREY S. WHITE

UNITED STATES DISTRICT JUDGE

Case 3:06-cv-06997-JSW Document 24 Filed 04/05/07 Page 6 of 6