United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 96-3915
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Standard Heating and Air *
Conditioning Co.; Quality *
Refrigeration, Inc.; Thermex *
Corporation; Advance Energy *
Services, Inc.; Ray N. Welter *
Heating Co., *
*
Plaintiffs - Appellees, *
*
v. *
* Appeal from the United States
City of Minneapolis; Examination * District Court for the District
Board of Warm Air Heating * of Minnesota
Installers; Examination Board of *
Refrigeration Installers; Board *
of Examiners and Plumbers, *
*
Defendants - Appellees, *
*
Minnesota Mechanical Contractors *
Association; Sheet Metal, Air *
Conditioning & Roofing *
Contractors Association; Metro *
Plumbing-Heating-Cooling *
Contractors Association, *
*
Intervenors Defendants - *
Appellants. *
___________
Submitted: November 21, 1997
Filed: February 25, 1998
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Before BOWMAN and MURPHY, Circuit Judges, and CONMY,1 District Judge.
___________
MURPHY, Circuit Judge.
Three trade associations appeal from the denial of their motion to
intervene in a lawsuit brought against the City of Minneapolis and several
of its trade licensing boards. Standard Heating and Air Conditioning Co.,
Quality Refrigeration, Inc., Thermex Corp., Advance Energy Services, Inc.,
and Ray N. Walter Heating Co. (the companies) sued the city and its
examining boards for air heating installers, refrigeration installers, and
plumbers to challenge certain ordinances and rules governing
apprenticeship, testing, and licensing. We affirm.
Individuals seeking to enter the heating and cooling, refrigeration,
and plumbing and gas trades in Minneapolis are subject to licensing
standards established by city examination boards. Minneapolis Code §§
277.770, 277.790, 277.1010, 277.1030, 277.1170, 277.1190. Board rules
require that individuals wishing to become journeymen in any of these
trades obtain a certificate of competency and show they meet the required
standards. Minneapolis Code §§ 277.730, 277.990, 277.1470. The standards
mandate, among other things, completion of a four year apprenticeship in
the Minnesota State Voluntary Apprenticeship Program established by
Minnesota Statute, Chapter 178, and passage of competency examinations
administered by the boards. State rules declare that pay rates for
apprentices be based on preexisting pay rates and that journeymen
participants in the apprenticeship programs be paid according to any
applicable collective bargaining agreement, the state prevailing wage, or
existing apprenticeship rates. Minnesota Rules Part 5200.0390.
1
The Honorable Patrick Conmy, United States District Judge for the District of
North Dakota, sitting by designation.
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The companies are engaged in the installation, repair, and
maintenance of heating, air conditioning, refrigeration, and ventilation
units and employ individuals subject to the requirements and testing of the
boards. The companies sued to enjoin the city and its boards from
enforcing rules which require participation in a state-approved
apprenticeship program and which govern wages and conditions of employment
in such programs. They seek a declaratory judgment that the state
apprenticeship program and other requirements are preempted by the
Employment Retirement Income Security Act of 1994, 29 U.S.C. §§ 1001, et
seq., and exceed the authority granted to the boards by the city. They
also assert various claims under 42 U.S.C. § 1983 arising from the
administration of the rules for competency exams and examination
applications, as well as equal protection claims and violations of state
and federal antitrust law.
The three trade associations sought to intervene in this action in
order to defend the regulations. Their members are businesses of various
sizes which together employ approximately 9,500 to 11,500 workers, a
substantial number of whom work regularly in Minneapolis. They hire
individuals who have completed the challenged apprenticeship program and
who submit to the testing and licensing procedures. The associations claim
the challenged regulations serve vital safety and economic interests and
help maintain high quality work in the affected trades. They argue that
resolution of the case in their absence may impair their ability to protect
their interests so they are entitled to intervene under Fed. R. Civ. P.
24(a). Otherwise they should be permitted to intervene under Rule 24(b)
because their defenses would present common issues of law and fact with
those already in the case.
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The motion to intervene was denied by the magistrate judge2 who ruled
that the attempted intervenors did not qualify under either Rule 24(a) or
(b). Since plaintiffs did not seek elimination of the apprenticeship
requirement, they did not implicate a legally cognizable interest of the
intervenors. The safety interests asserted by the associations were the
same as those of the public and were therefore adequately represented by
the defendants, and the intervenors did not allege real concerns about the
testing requirements. Intervenors were also denied permissive intervention
because they had failed to identify a claim or defense different from those
already in the case or to show they had a substantial stake in the issues
raised by the plaintiffs. The associations appealed to the district court3
which affirmed.
On appeal to this court the trade associations raise the same points
again. The companies challenge their standing as well as their right to
intervene. Article III standing is a prerequisite for intervention in a
federal lawsuit, Mausolf v. Babbitt, 85 F.3d 1295, 1300-01 (8th Cir. 1996),
and we review the denial of mandatory intervention de novo, United States
v. Union Elec. Co., 64 F.3d 1152, 1158 (8th Cir. 1995). If a party can
establish standing, it is entitled to intervene when it has made a timely
application and it
claims an interest relating to the property or transaction
which is the subject of the action and the applicant is so
situated that the disposition of the action may as a practical
matter impair or impede the applicant’s ability to protect that
interest, unless the applicant’s interest is adequately
represented by existing parties.
Fed. R. Civ. P. 24(a). As a practical matter, this means that a party
seeking
2
The Honorable Jonathan Lebedoff, United States Magistrate Judge for the
District of Minnesota.
3
The Honorable David S. Doty, United States District Judge for the District of
Minnesota.
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mandatory intervention must establish that it:
(1) ha[s] a recognized interest in the subject matter of the
litigation that (2) might be impaired by the disposition of the
case and that (3) will not be adequately protected by the
existing parties.
Mausolf, 85 F.3d at 1299.
Appellants claim that they have established the injury and causal
connection necessary for Article III standing and the interests required
for Rule 24(a) intervention since they have an economic interest in the
subject matter of the litigation. If participation in apprentice programs
were voluntary, employers like them who hire participating workers would
have an economic disadvantage because employers could pay lower wages to
hire non-participants. Appellants also say their members have invested in
the existing education system which is dependent on the regulations, and
elimination of the regulations would present safety risks on their members’
job sites. Lastly, they claim that the interests they assert may conflict
with those of the city and that they therefore should be able to
participate in settlement negotiations.4
The city and the other defendants have not taken any position on
intervention, but the plaintiff companies contend that in addition to lack
of standing the trade associations have mischaracterized the complaint by
saying it seeks elimination of the apprenticeship requirement and the
testing and licensing regulations. Plaintiffs say they only seek to
prevent participation in a “State Approved Voluntary Apprentice Program”
from being a precondition to take a licensing test for the construction
trades. The companies claim that the associations have identified no
protectable interest in the operation of a mandatory apprentice program,
and that the asserted interests in safe and
4
Counsel indicated at oral argument that the trade associations have been
participating in ongoing settlement negotiations despite their lack of intervenor status.
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competent work are no different from those of the public, and that the
defendants adequately represent any articulated interest.
The interests asserted by the associations concerning the
apprenticeship requirement are too speculative to be “direct, substantial
and legally protectable” interests as required by Rule 24(a)(2). Union
Elec. Co., 64 F.3d at 1161 (quoting Alameda Water & Sanitation Dist. v.
Browner, 9 F.3d 88, 90 (10th Cir. 1993)). “An interest that is remote from
the subject matter of the proceeding, or that is contingent upon the
occurrence of a sequence of events before it becomes colorable, will not
satisfy the rule.” Washington Elec. v. Massachusetts Mun. Wholesale Elec.,
922 F.2d 92, 97 (2d Cir. 1990).
A sequence of events would have to occur for the interests of the
associations to be impacted by a successful challenge to the rules, and the
associations have not made an adequate showing that these events are
likely. Entities accepting bids may be wary of hiring companies with
workers who have not gone through the state apprenticeship program, and a
successful challenge to the rules could cause the city to enact new rules
that would affect labor costs similarly to the current regulations.
Moreover, the associations have presented no evidence of how much the
companies could save by using cheaper labor and by how much they would be
able to underbid association members. These facts are critical to
evaluating the likelihood that the associations’ interests will be
implicated. Although association members may fear the loss of business or
difficulties in recruiting qualified applicants, they have not submitted
evidence to support their fears other than the speculative beliefs of
several association officers. Their general reliance on economic forces
is insufficient to constitute a legally protectable claim.
The asserted interest in safety on job sites also is insufficient
because the suit does not threaten to eliminate the apprenticeship
requirement completely, and the associations will still remain free to
defend their safety interest by hiring only those
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who have completed a state approved apprenticeship program. The
associations may also appeal to the government for more stringent safety
regulations. See Wade v. Goldschmidt, 673 F.2d 182, 186 (7th Cir. 1982)
(applicants should present economic, safety, and environmental interests
to the government bodies since they and “not the courts, are required by
statute to evaluate and make decisions as to the priority of the various
considerations”).
The associations also contend that the challenge to the
administration of the competency examinations implicates their interest in
not undercutting the effort of members’ employees who will have
unnecessarily complied with the testing requirements, and other interests
not yet apparent due to the vague complaint. The associations, however,
have not presented any affidavits or other evidence of employees it claims
would be adversely affected by changes in test procedures, and this
asserted interest is therefore speculative. Cf. United States v. City of
Chicago, 870 F.2d 1256, 1260 (7th Cir. 1989) (qualified applicants entitled
to intervene in suit involving racially altered test results). Moreover,
the companies’ challenge is only to the administration of the examinations
and not to the defendants’ power to test applicants, and the associations
have not explained how their interests would be impaired by any changes in
administration alone. The associations therefore have failed to identify
any interest in the challenge to test administration.
Parties who are able to assert an interest in the subject matter of
the litigation still may not intervene if the existing parties adequately
represent their interests. Fed. R. Civ. P. 24(a). Where the interests
asserted fall within the realm of “sovereign interests,” and the government
is a party, a presumption that the government adequately represents the
interests of its citizens arises. See Mausolf, 85 F.3d at 1303;
Environmental Defense Fund, Inc. v. Higginson, 631 F.2d 738, 740 (D.C. Cir.
1979). This presumption will be overcome, however, where the state must
balance the applicants’ “narrower and more parochial interests” that are
“not shared by the general citizenry” against the broad public interest,
and the balance may compromise the
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applicants’ interests. Mille Lacs Band of Chippewa Indians v. Minnesota,
989 F.2d 994, 1001 (8th Cir. 1993); see also Dimond v. District of
Columbia, 792 F.2d 179, 193 (D.C. Cir. 1986). The city shares the
appellants’ interests in safety on job sites and in a regulatory system
that guarantees quality work in the trades. These sovereign interests
raise the presumption of adequate representation and prevent intervention
unless the associations can demonstrate that they have an interest which
cannot be subsumed within the general interest of the citizenry. See id.
The associations claim that if the action results in a termination
of the training and testing requirements they will incur increased costs
from injuries on job sites and that these costs are different from the
costs to the general public and that the presumption of adequate
representation therefore should not apply. These potential costs are
insufficient to overcome presumption that the city adequately represents
the appellants’ interests, however, because costs arising from on the job
injury are the type of costs the government seeks to reduce with its
regulatory system. Furthermore, these increased costs to the associations
present “no possibl[ility of] divergence between their position” and that
of the city because both take the same position in the litigation.
Environmental Defense Fund, 631 F.2d at 740.
The appellants assert that their interest in participating in
potential settlement negotiations concerning the administration of testing
requirements overcomes the presumption of adequate representation. In
order to prevail on these grounds the associations must show that their
position in the negotiations is not the same as that of the defendants, or
that they would represent the asserted interests differently than the city.
See Mille Lacs, 989 F.2d at 1001. Testing administration does not force
the government to reconcile two opposing sets of interests during
settlement. Settlement may result in changes in the way tests are
conducted, but the associations and the city share any interest in fair
testing procedures that ensure competent workers in the trades. Cf.
Mausolf, 85 F.3d 1303-04 (intervenors’ interests were inadequately
represented
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because the government faced the possibility of having to reconcile
competing demands on the use of public land).
The associations assert that they can overcome the presumption of
adequate representation because the city has not been a very active party
in this case. See Mausolf, 85 F.3d at 1303 (citing 7C Charles A. Wright,
Arthur R. Miller, & Mary Kay Kane, Federal Practice and Procedure § 1909
(2d ed. 1986)). They argue the city has not pursued discovery or attempted
to clarify the plaintiffs’ claims or the relief sought. The city has
responded to the complaint and is actively participating in settlement
negotiations, however, and the associations offered no example of the type
of discovery they might conduct or why it would be superior to the city’s
representation. Furthermore, there is no indication that a failure to take
discovery has rendered the defendants at a disadvantage in the litigation.
This record is not like the situation in Mausolf. See id. at 1303.
The associations assert in the alternative that they should have been
granted permissive intervention under Rule 24(b)(2) because their claims
raise common questions of law and fact to the defenses of the boards and
the city. The standard of review for denial of permissive intervention is
abuse of discretion. Arrow v. Gambler’s Supply, Inc., 55 F.3d 407, 410
(8th Cir. 1989). A party may be allowed to intervene in an action where
“an applicant’s claim or defense and the main action have a question of law
or fact in common.” Fed. R. Civ. P. 24(b)(2). The magistrate judge
concluded that the economic impact of the regulatory scheme was not at
issue and that the appellants’ proposed answer to the complaint did not
raise any claim or defense that was different from those of the existing
parties. The magistrate judge concluded therefore that the additional
parties would only be a source of repetition and delay. Both the orders
of the magistrate and the district court were based on an accurate
assessment of the law and the facts at issue, and it was not an abuse of
discretion to deny the motion for permissive intervention.
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For the reasons discussed, the interests asserted by the associations
are insufficient to require intervention as of right, and the district
court did not abuse its discretion in denying the motion for permissive
intervention. The order of the district court is affirmed.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
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