Opinion ID: 174432
Heading Depth: 2
Heading Rank: 2

Heading: The Government's Intervention

Text: The government argues that the district court abused its discretion in denying the government's motion to intervene. According to the government, the court should have granted its motion to intervene as of right under Rule 24(a)(1) or (a)(2), or alternatively the government should have been permitted to intervene under Rule 24(b)(1)(B). Rule 24(a)(2) requires the court to allow 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. With regard to that subpart, the government specifically argues that it has an interest in seeing the patent statute enforced, in preventing the distribution of falsely marked items, and in receiving half the statutory damages. Without intervention, according to the government, the disposition of this action might prejudice the government's ability to protect its interests, which have not been adequately represented by Stauffer. Brooks Brothers responds that Rule 24(a)(2) does not apply because the district court's decision would not prevent the United States from bringing its own action. We review the district court's denial of intervention under Rule 24 under regional circuit law, in this case that of the Second Circuit. Ericsson Inc. v. InterDigital Commc'ns. Corp., 418 F.3d 1217, 1220-21 (Fed.Cir.2005). The Second Circuit reviews denials of motions to intervene under Rule 24 for an abuse of discretion. MasterCard Int'l, Inc. v. Visa Int'l Serv. Ass'n, 471 F.3d 377, 389 (2d Cir. 2006). However, a court by definition abuses its discretion when it makes an error of law. Cordes & Co. Fin. Servs. v. A.G. Edwards & Sons, Inc., 502 F.3d 91, 98 (2d Cir.2007). We agree with the government that the district court made an error of law in denying the government's motion to intervene under Rule 24(a)(2). Because we decide the issue on that basis, we need not address the government's arguments with respect to subparts (a)(1) and (b)(1)(B). Contrary to Brooks Brothers' position, the government has an interest in enforcement of its laws and in one half the fine that Stauffer claims, disposing of the action would as a practical matter impair or impede the [government's] ability to protect its interest, and Stauffer may not adequately represent that interest. Rule 24(a)(2). As an initial matter, Brooks Brothers does not contest the government's assertion that Stauffer does not adequately represent the United States' interest in this case. Furthermore, the government would not be able to recover a fine from Brooks Brothers if Stauffer loses, as res judicata would attach to claims against Brooks Brothers for the particular markings at issue. See United States ex rel. Mergent Servs. v. Flaherty, 540 F.3d 89, 94 (2d Cir.2008) ([T]he United States might become bound by res judicata or collateral estoppel as a result of the actions of a pro se in bringing and losing a qui tam action.) (citing Stoner v. Santa Clara County Office of Educ., 502 F.3d 1116, 1126-27 (9th Cir.2007) ( [Q]ui tam relators are not prosecuting only their `own case' but also representing the United States and binding it to any adverse judgment the relators may obtain.)). Thus, even though, as the district court noted, the issue of the government's ability to bring an action pursuant to section 292 in general was not presented, Intervention Op., 2009 WL 1675397, -4, 2009 U.S. Dist. Lexis 51166, at , the United States' ability to protect its interest in this particular case would be impaired by disposing of this action without the government's intervention. We therefore reverse the district court's decision denying the government's motion to intervene.