United States District Court, D. Nevada
PHARMACEUTICAL RESEARCH AND MANUFACTURERS OF AMERICA, et al., Plaintiffs,
BRIAN SANDOVAL, et al., Defendants.
Hoffman, Jr. United States Magistrate Judge
before the Court is non-party Culinary Health Fund's
motion to intervene (ECF No. 48), filed on October 6, 2017.
Plaintiffs filed a response (ECF No. 56) on October 10, 2017,
and Culinary Health Fund (“CHF”) filed a reply
(ECF No. 58) on October 11, 2017.
case was brought by the Pharmaceutical Research and
Manufacturers of America, and the Biotechnology Innovation
Organization, two trade groups representing pharmaceutical
and biotechnology companies. (Compl. (ECF No. 1).)
Plaintiffs' complaint named Brian Sandoval, the Governor
of the State of Nevada, and Richard Whitley, the Director of
the Nevada Department of Health and Human Services, as
defendants. (Id.) The Court subsequently granted the
Nevada Legislature's unopposed motion to intervene as a
defendant. (Order (ECF No. 43).) CHF, a multi-employer
healthcare-plan provider for hotel and hospitality workers in
Las Vegas, now moves to intervene in this case as a defendant
claim that a recently passed law, Nevada Senate Bill No. 539
(“SB 539”), conflicts with federal trade-secret
law, violates the Commerce Clause, would constitute a
regulatory taking, and interferes with Congress'
authority to set national patent policy. SB 539 seeks to
control the cost of certain essential diabetes drugs, such as
insulin, by requiring companies that manufacture them to
provide the State of Nevada with an annual report detailing
the costs of production and marketing of these drugs. The
State of Nevada is required to analyze and then publish a
report on the data provided, explaining the reasons for, and
effects of, any increases in spending on prescription drugs
moves to intervene in this case as a matter of right under
Federal Rule of Civil Procedure 24(a), or alternatively, with
the Court's permission under 24(b). CHF argues that the
fund has a protectable interest in this lawsuit that would be
impaired if Plaintiffs claims were to succeed, and that its
interests are not adequately represented by the current
Defendants. Plaintiffs oppose intervention as a matter of
right, arguing that CHF's interest are adequately
protected by the current Defendants, and are not materially
different than the interests of any Nevada citizen.
Plaintiffs further oppose permissive intervention, arguing
that allowing CHF to join this case would create unnecessary
complexity and delay. Plaintiffs suggest granting amicus
curiae status in lieu of granting intervention, which
would be an inadequate remedy, according to CHF.
Intervention under Fed.R.Civ.P. 24(a)
movant is entitled to intervention of right upon a timely
application, when it “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.” Fed.R.Civ.P.
24(a). Courts in this Circuit construe motions to intervene
under Rule 24(a) in favor of proposed intervenors, and
“are guided primarily by practical
considerations.” United States ex. rel. McGough v.
Covington Techs. Co., 967 F.2d 1391, 1394 (9th Cir.
1992) (internal citation and quotation marks omitted).
prospective intervenor bears the burden of showing
“that (1) the interest asserted is protectable under
some law, and (2) there is a relationship between the legally
protected interest and the claims at issue.” Nw.
Forest Res. Council v. Glickman, 82 F.3d 825, 837 (9th
Cir. 1996) (punctuation and citation omitted). The interest
must be “direct, non-contingent, substantial and
legally protectable, and one not adequately represented by
existing parties.” Dilks v. Aloha Airlines,
642 F.2d 1155, 1157 (9th Cir. 1981) (citation omitted).
“[A]n undifferentiated, generalized interest in the
outcome of an ongoing action is too porous a foundation on
which to premise intervention as of right.” S. Cal.
Edison Co. v. Lynch, 307 F.3d 794, 803 (9th Cir. 2002)
(quotation marks and citation omitted).
intervenors normally face a heavy burden when seeking to
intervene on the same side as a state. “In the absence
of a ‘very compelling showing to the contrary, ' it
will be presumed that a state adequately represents its
citizens when the applicant [for intervention] shares the
same interest.” Arakaki v. Cayetano, 324 F.3d
1078, 1086 (9th Cir. 2003) (quotation marks and citations
omitted). Intervention in such cases depends on establishing
that existing parties will not pursue the same objectives as
a proposed intervenor. See Id. “Where the
parties share the same ultimate objective, differences in
litigation strategy do not normally justify
the parties appear to concede that CHF has a legally
protected interest in the outcome of this litigation. The
parties do not agree, however, as to whether CHF's
interests are distinct from those of the existing parties, or
whether those parties adequately represent CHF's
interests. CHF argues that it has a narrower interest in
defending against Plaintiffs' claims than either the
Governor or the Legislature, in that it is primarily
motivated in preserving the right of public access to drug
manufacturer's pricing information. According to CHF,
this narrow interest is related to its role as a healthcare
benefit provider, retail pharmacy and medical provider, and
is not shared by the other Defendants in this case. CHF
further argues that the current Defendants have indicated
they are willing to make serious concessions to Plaintiffs
regarding SB 539's requirements to publicize drug costs.
In support of this argument, CHF points out that the
Governor's response to Plaintiffs' motion for
preliminary injunction was less than six pages long and did
not address every argument made by Plaintiffs. CHF also finds
fault with the Legislature's response, in that it did not
meaningfully engage with the Plaintiffs' constitutional
arguments against SB 539. According to CHF, the existing
Defendants would concede important issues regarding
publication of drug costs and thereby seriously compromise SB
CHF's reliance on the responses by the Legislature and
the Governor to Plaintiffs' motion for preliminary
injunction is inadequate to make the “very compelling
showing” that is required to allow an intervenor to
join an action along with a state party. CHF may be correct
that not every argument presented by Plaintiffs has been
vigorously disputed at this point, but the failure to make a
particular argument in a response to a motion for preliminary
injunction does not prove that the argument has been conceded
for the entire case. Further, it is not clear at this point
that CHF and the State of Nevada have differing objectives in
this legislation. It appears that the State of Nevada is
willing and prepared to defend the law, including the
portions CHF focuses on. The Court cannot at this point make
a meaningful inference regarding the Governor or the
Legislature's strategy, or whether they might concede any
issues to Plaintiffs. It would therefore be premature to
conclude that the State of Nevada is not adequately
representing CHF's, or any other party's, interests.
The Court will therefore deny CHF's motion to intervene
as a matter of right.
Intervention under ...