## Facts

- The United States sued private defendants to stop and remedy construction of caissons and other structures on several offshore coral reefs, alleging unauthorized building and trespass on federal property.
- Atlantis Development Corporation, Ltd., a Bahamian corporation, claimed ownership and development rights in the reefs (the “Atlantis Group”) and asserted the government’s trespass theory depended on rejecting Atlantis’s ownership claim.
- Atlantis alleged it had explored and surveyed the reefs, planned commercial development, and notified U.S. authorities of its asserted ownership and alleged third-party intrusions.
- Atlantis moved to intervene under Federal Rule of Civil Procedure 24 in the government’s action.
- The district court denied intervention (as of right and permissive), concluding Atlantis lacked a sufficient interest.
- Atlantis appealed; the underlying action was stayed pending the appeal.

## Issues

1. Whether Atlantis was entitled to intervene as of right under Federal Rule of Civil Procedure 24(a)(2) by claiming an interest in the property at issue and showing that disposition might, as a practical matter, impair its ability to protect that interest.
2. Whether the district court abused its discretion in denying permissive intervention under Rule 24(b).

## Decision

- The Fifth Circuit reversed the denial of intervention.
- Atlantis was entitled to intervene as of right under Rule 24(a)(2).
- The court did not decide the merits of ownership, sovereignty, or whether the reefs were subject to federal control; it addressed only intervention.

## Legal Principles

- Under Rule 24(a)(2), intervention of right requires: (1) a claimed interest relating to the property or transaction that is the subject of the action; (2) a showing that disposition may, as a practical matter, impair or impede protection of that interest; and (3) inadequate representation by existing parties.
- “As a practical matter” broadens impairment beyond strict res judicata; likely adverse effects from precedent and factual/legal determinations (including stare decisis effects) can satisfy the impairment requirement.
- A claimed ownership interest in the very property the government seeks to protect through a trespass action is a qualifying interest for Rule 24(a)(2).
- Courts should weigh whether adding the intervenor will materially burden the case; where the intervenor’s interest is direct and closely tied to the subject property, resolving related disputes in a single action is favored.

## Conclusion

The Fifth Circuit required the district court to allow Atlantis to intervene as of right because Atlantis claimed an ownership interest in the reefs at issue and an adverse judgment in the government’s trespass action could, in practical effect, impair Atlantis’s ability to protect that claim in later litigation.


Atlantis Dev. Corp. v. United States, 379 F.2d 818 (5th Cir. 1967)