United States District Court, S.D. West Virginia, Charleston
MEMORANDUM OPINION AND ORDER
T. Copenhaver, Jr. United States District Judge.
is a motion to intervene, filed by third-party movant, United
Bank, successor-by-merger to United Bank, Inc., on December
action was brought by Vandalia Capital II, LLC
(“Vandalia”) against defendants The Woods
Development, LLC (“Woods”), formerly known as IB
Development, LLC; Base Group Investments, Inc. (“Base
Group”); and Michael L. Sealy on April 14, 2017.
Defendant Sealy filed for personal bankruptcy, and an
automatic stay was issued for all matters related to him
pursuant to 11 U.S.C. § 362(a). See Notice of Bankruptcy
by Michael L. Sealy, filed June 8, 2017, ECF No. 19. Count I
of the First Amended Complaint applied only to defendants
Woods and Base Group, while counts II and III applied only to
defendant Sealy. See First Amended Complaint at pp. 9, 15,
August 25, 2017, the Clerk entered default against defendants
Woods and Base Group as to Count I of the First Amended
Complaint pursuant to Federal Rule of Civil Procedure 55(a).
See ECF No. 29. Vandalia moved for default judgment on
September 29, 2017, and the court subsequently held five
hearings on the matter. See ECF Nos. 35, 38, 39, 40, 43, 44.
At the first of these hearings, held October 13, 2017, Julia
A. Chinchek appeared for United Bank and stated the
bank's interest in what was then a proposed agreed order.
After being provided a copy of the proposed agreed order, Ms.
Chinchek, by hand delivery to the court, stated that United
Bank “does not see anything on the face of the
[proposed agreed order] (excluding the incorporated
complaint) that characterizes or otherwise pertains to The
Woods Development's or the underlying guarantors'
obligations to it. Therefore, United Bank . . . does not have
an opinion about the [proposed agreed order].”
the parties could not agree upon the terms of the proposed
agreed order, and Vandalia prepared and tendered the default
judgment order that was entered by the court on November 17,
2017. See Judgment and Order, ECF No. 45. Accordingly, the
case was closed that same day. Id. The judgment and
order that was entered was substantially different from the
proposed agreed order that Ms. Chinchek had reviewed and to
which she saw no problem with respect to United Bank.
“[W]ithout any record, Vandalia submitted a proposed
default judgment order that contained dozens of findings of
fact and conclusions of law” many of which “were
irrelevant to the substantive claims in Vandalia's
complaint and to the relief Vandalia sought from this
court.” Reply at 3. United Bank had no notice of
Vandalia's proposed order and was given no opportunity to
seek review of the document prior to its entry.
United Bank now “seeks to intervene in this action for
the limited purpose of protecting its interests with respect
to its loan, related instruments, and collateral, ”
which, it asserts, is implicated in the judgment and order
entered November 17, 2017. Mot. Intervene at 1. United Bank,
Inc. made a loan to Woods in the original principal amount of
$28, 212, 594.00. Mem. Supp. Mot. Intervene at 2. If
permitted to intervene, United Bank wishes to file a motion
to reconsider, asking the court to vacate the previously
entered judgment and order and enter an amended version
proposed by United Bank. Id. at 1-2. Vandalia filed
a response in opposition to the motion to intervene on
December 29, 2017.
is governed by Federal Rule of Civil Procedure 24, which
allows for intervention as of right. It provides, in
(a) Intervention of Right. On timely motion, the court must
permit anyone to intervene who: . . .
(2) 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
Fed. R. Civ. P. 24(a)(2). To intervene as a matter of right
under Rule 24(a), a movant must satisfy all four of the
following requirements: (1) the application must be timely,
(2) the movant must have an interest in the subject matter
sufficient to merit intervention, (3) the denial of
intervention would impair or impede the applicant's
ability to protect its interest, and (4) the movant's
interest is not adequately represented by the existing
parties to the litigation. See Fed.R.Civ.P. 24(a);
Houston General Ins. Co. v. Moore, 193 F.3d 838, 839
(4th Cir. 1999).
is of special consideration in granting or denying a motion
to intervene, and wide discretion is given to the district
court in determining what qualifies as a Rule 24
“timely motion.” Gould v. Alleco, Inc.,883 F.2d 281, 286 (4th Cir. 1989) (citing NAACP v. New
York,413 U.S. 345, 365-66 (1973); Brink v. DaLesio,
F.2d 420, 428 (4th Cir. 1981)). In determining
timeliness, “[a] reviewing court should look at how far
the suit has progressed, the prejudice which delay might
cause other parties, and the reason for the tardiness in