The Cities of Buena Park, Hawthorne, Hermosa Beach, Huntington Park, Paramount, Redondo Beach, Seal Beach, South Gate, Torrance, Lynwood, Lawndale and Long Beach (the Cities) appealed the district court's denial of their motion to intervene in a consent decree proceeding. The Cities also appealed the district court's approval of the consent decree. The Ninth Circuit affirmed the district court's denial of the Cities' motion to intervene and dismissed the remainder of the appeal for lack of jurisdiction.

Between 1959 and 1965, a rubbish disposal facility operated as a landfill in Carson, California. In 1982, the California Department of Toxic Substances Control (DTSC) found hazardous waste at the site. In 1995, the DTSC issued a Final Remedial Action Plan (Plan) which allocated eighty percent of the aggregate liability for the soil and upper groundwater contamination to the generators of the hazardous waste disposed of at the site. The plan also indicated that the Atlantic Richfield Co., Chevron U.S.A., Inc., Exxon Mobil Corp., Phillips Petroleum Co., Shell Chemical Co., Shell Oil Co., Southern California Gas Co., Texaco, Inc., Union Oil Co. of California, and Unocal Corp. were potentially responsible parties (PRPs) under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA).[1] The Plan did not identify the Cities as PRPs. However, the Plan was not binding and imposed no limits to CERCLA's strict joint and several liability.

In December 1995, DTSC sought recovery of response costs under CERCLA and state law from the owners of the site. DTSC also proposed a consent decree, which would have capped the landowner's liability at $26 million. In July 1996, the oil companies moved to intervene in opposition of the landowner consent decree. The oil companies' motion to intervene was denied by the district court, and the oil companies subsequently appealed. In August 1997, the landowners sought contribution claims under CERCLA from the oil companies. In 1998, the oil companies' appeal was stayed so settlement discussions could occur between DTSC, the oil companies, and Long Beach Oil Development Co. In 1999, the oil companies invited all of the PRPs to participate in settlement negotiations with DTSC. In September 1999, the oil companies provided evidence tying the Cities and other PRPs to the landfill. Within the same month, the oil companies proposed a second settlement meeting that required the Cities to enter into confidentiality agreements to participate. "[M]ost if not all of the Cities refused to execute the confidentiality agreement and were not permitted to attend the meeting."[2] Thereafter, in November 1999, the oil companies and DTSC provided a settlement offer to the Cities in exchange for full release and contribution protection. The Cities rejected the offer. In January 2000, the oil companies and DTSC again asked the Cities to participate in settlement discussions; again most of the Cities refused.

In February 2000, Shell Oil. Co., Union Oil Co. of California, and Unocal Corp. sought contribution from the Cities. In May 2000, the Cities were once again asked to attend settlement negotiations with the oil companies, landowners, and DTSC. In September 2000, the same request was made to the Cities. In October 2000, DTSC sought judicial approval of a consent decree between DTSC, the landowners, the oil companies, and others and provided notice of the consent decree to interested parties. In November 2000, the Cities challenged the proposed consent decree by submitting comments to DTSC, which moved for judicial approval of the consent decree on January 5, 2001. The same day the Cities, for the first time, moved to intervene. The district court denied the Cities' motion to intervene and entered the consent decree, and the Cities appealed.

The Cities moved to intervene as of right under section 113(i) of CERCLA[3] and Federal Rule of Civil Procedure 24(a).[4] They also moved for permissive intervention.[5] The Cities' motions were denied by the district court because: "(1) the motions were untimely, and failed to establish a legally protectable interest that was impaired; (2) the DTSC adequately protected [the] Cities' interests; and (3) [the] Cities' interests were more appropriately addressed through amici curiae status."[6] The Ninth Circuit reviewed the district court's denial of the Cities' motion to intervene as of right de novo and reviewed the district court's determination concerning whether the motions were timely for an abuse of discretion. The court relied on United States v. Washington,[7] which held that a "court must grant a motion to intervene [as of right] 'if four criteria are met: timeliness, an interest relating to the subject of the litigation, practical impairment of an interest of the party seeking intervention if intervention is not granted, and inadequate representation by the parties to the action.'"[8]

The Ninth Circuit focused on three factors to determine whether the motion to intervene was timely. The court considered "the stage of the proceeding," the potential "prejudice to other parties," and "the reason for and length of the delay."[9] The Ninth Circuit determined that the Cities' motion to intervene was entered late in the proceedings and the fact that the parties had settled, the litigation had begun six years earlier, and the Cities moved to intervene "on the same day DTSC moved for judicial approval of the consent decree" [10] weighed against the Cities. In addition, the Ninth Circuit concluded that the district court did not abuse its discretion in finding that the other parties would be prejudiced by the Cities' late intervention. Furthermore, the Ninth Circuit explained that because the first two factors weighed against the Cities, the Cities would have to clearly explain the reason for their delay. The court concluded that the Cities "had reason to know that negotiations might produce a settlement decree to their detriment."[11] In support of this finding, the court cited the Cities' notification of many settlement discussions and the evidence that the oil companies warned the Cities that they might be linked to the landfill. Therefore, the Ninth Circuit held that the district court's denial of the Cities' motions to intervene because of untimeliness was not an abuse of discretion.[12] Because the Ninth Circuit found that the Cities' motion to intervene was untimely, it did not consider the other factors set forth in United States v. Washington.[13]

Regarding the Cities' appeal of the district court's approval of the consent decree, the Ninth Circuit held that the Cities could not appeal the district court's approval of the consent decree because the "Cities [were] not parties to this litigation and [did] not assert any extraordinary circumstances . . . ."[14] The Ninth Circuit held that the divestment rule prevented it from considering the Cities' appeal of the district court's jurisdiction to approve the consent decree.[15] Thus, the Ninth Circuit held that the Cities' motion to intervene was appropriately denied by the district court and the Cities could not appeal the court's approval of the consent decree.