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In re Efron

United States Court of Appeals, First Circuit

March 21, 2014

IN RE DAVID EFRON, Movant, Appellant. MADELEINE CANDELARIO-DEL-MORAL, Plaintiff, Appellee,

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David Efron, Pro se.

Judith Berkan, with whom Mary Jo Méndez and Berkan/Méndez were on brief, for plaintiff-appellee.

Enrique G. Figueroa-Llinás, with whom Christopher N. Manning, Ashley W. Hardin, and Williams and Connolly LLP were on brief, for defendant-appellee.

Before Howard, Selya and Lipez, Circuit Judges.


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SELYA, Circuit Judge.

For over four centuries, persons learned in the law have known that, when litigation is in prospect, vigilance is good and somnolence is bad. Commentators and courts have phrased this sentiment in different ways. See, e.g., In re Wood, [1883] 23 Ch.D. 644 at 653 (Eng.) (" It is a reasonable presumption that a man who sleeps upon his rights has not got much right." ); Edmund Wingate, Maxims of Reason (1658) (" Laws come to the assistance of the vigilant, not of the sleepy." ). The lesson to be derived is that " [t]he law ministers to the vigilant not to those who sleep upon perceptible rights." Puleio v. Vose, 830 F.2d 1197, 1203 (1st Cir. 1987). This appeal illustrates the wisdom of that statement.


This appeal has its genesis in the district court's denial of a motion to intervene.

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We touch upon the rudiments of the underlying dispute only so far as necessary to put the appeal into a workable perspective. Where, as here, a putative intervenor neglects to submit a proposed pleading with his motion to intervene, see Fed.R.Civ.P. 24(c), we rely on facts made manifest in the record as a whole, see B. Fernández & Hnos., Inc. v. Kellogg USA, Inc., 440 F.3d 541, 543 (1st Cir. 2006). The reader who thirsts for more exegetic detail may consult the litany of prior opinions in this case. See, e.g., Candelario-Del-Moral v. UBS Fin. Servs. Inc. (Candelario II), 699 F.3d 93, 95-99 (1st Cir. 2012); Candelario-Del-Moral v. UBS Fin. Servs. Inc. (Candelario III), 290 F.R.D. 336, 338-39 (D.P.R. 2013); Candelario-Del-Moral v. UBS Fin. Servs. Inc. (Candelario I), 691 F.Supp.2d 291, 294-300 (D.P.R. 2010).

The putative intervenor, David Efron, and his former wife, Madeleine Candelario-Del-Moral, have been engaged in acrimonious and long-running litigation related to their high-stakes divorce. At one time, Efron had more than $11,000,000 in accounts at UBS Financial Services Inc. (UBS). In October of 2006, a Puerto Rico court in which the divorce proceedings were pending issued an order effectively attaching the funds held in Efron's UBS accounts. Soon thereafter, the court made a ruling that may or may not have sufficed to vacate the attachment. See Candelario II, 699 F.3d at 101-04 (describing reasons for uncertainty about the effect of the ruling). UBS, at Efron's urging, treated the attachment as void and dispersed the bulk of the funds. By the time the matter was clarified, there were insufficient funds remaining to satisfy Candelario's demands.

Candelario took umbrage. She repaired to the federal district court, invoked diversity jurisdiction, see 28 U.S.C. § 1332(a), and sued UBS for negligently releasing the attached funds. After considerable skirmishing, the district court, ruling on cross-motions for summary judgment, awarded Candelario nearly $4,000,000. Candelario I, 691 F.Supp.2d at 304. Both parties appealed. We held that summary judgment was premature and remanded the case for further proceedings. Candelario II, 699 F.3d at 105-06, 107.

We digress for a moment. The suit brought by Candelario against UBS was only one of several cases touching upon the couple's tangled affairs. Pertinently, Efron filed for bankruptcy protection in March of 2011. The bankruptcy proceeding is relevant here because, on July 28, 2011, UBS filed a contingent proof of claim seeking indemnification for any sums paid to Candelario by way of judgment or settlement in her tort case against UBS. This right of indemnification, UBS asserted, flowed from the provisions of its account agreement with Efron (an agreement that dated back to 2002).

We return now to the tort case. Following our remand, Candelario and UBS, at the district court's suggestion, opted to undertake mediation. On March 4, 2013, UBS sent Efron an electronic letter informing him that it had scheduled the first mediation session for the next day and reiterating that it would seek indemnification if a settlement was achieved. One week later, Efron -- a veteran trial lawyer, proceeding pro se -- moved to intervene as of right in the Candelario-UBS litigation. Candelario opposed Efron's motion.[1]

The district court noted that Efron's motion to intervene failed to comply with mandatory procedural requirements in

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that it was not accompanied by a proposed pleading. See Candelario III, 290 F.R.D. at 340 n.3 (citing Fed.R.Civ.P. 24(c)). Although the court acknowledged that it could deny the motion on this procedural ground alone, it nonetheless elected to go further, see id.; see also Pub. Citizen v. Liggett Grp., Inc., 858 F.2d 775, 783-84 (1st Cir. 1988) (noting that a district court may elect to entertain a procedurally deficient motion ...

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