DECISION & ORDER: INTERVENTION Plaintiff, Father Demetrios Kehagias (“Plaintiff” or “Father Kehagias”), has sued Defendant insurance companies (the “Insurers”) for a declaration that they have a contractual obligation to pay for costs of his defense and indemnify him for potential liability in an underlying state court action (the “State Action”). The plaintiffs in the State Action, two minors acting by and through their parents (the “Movants”), have moved to intervene in the instant action pursuant to Federal Rule of Civil Procedure 24 (“Rule 24″). Movants contend that Father Kehagias, who is bankrupt, will not adequately protect their interest in securing a declaration of coverage in favor of Father Kehagias in the event that Movants obtain a judgment against him in the State Action. As discussed below, the motion to intervene will be denied without prejudice, and Movants will be permitted, as amici curiae, to submit briefing on summary judgment in the event they do not obtain a judgment and intervention before then. Background1 In the State Action, Movants claim that the minor son of Father Kehagias committed sexual battery, and that the persons who should be held liable include Father Kehagias; the church where the incident allegedly took place, Holy Resurrection Greek Orthodox Church of Brookville, New York (the “Church”); and the Greek Orthodox Archdiocese of America (the “Archdiocese”). The Church and the Archdiocese successfully moved for summary judgment on the basis that the alleged incident was not within the scope of Father Kehagias’s employment. A.M. v. Holy Resurrection Greek Orthodox Church of Brookville, 190 A.D.3d 470, 135 N.Y.S.3d 823 (1st Dep’t 2021) (Mermelstein Decl. Ex. B). As a result, Father Kehagias is the lone defendant in the State Action. Movants have not obtained a judgment in the State Action. Jury selection is slated to begin on March 11, 2024. After the State Action had commenced, Father Kehagias filed a petition for Chapter 7 bankruptcy, and a discharge was entered on January 18, 2018. (Mermelstein Decl. Ex. C.) During that proceeding, the bankruptcy court granted Movants relief from the automatic stay so that they could prosecute the State Action to establish liability and damages against Father Kehagias. The court ruled, however, that Movants could collect any settlement or judgment solely from insurance proceeds, not from Father Kehagias personally. (Mermelstein Decl. Ex. D, pp. 1-2.) Following his discharge in bankruptcy and the dismissal of the Church and the Archdiocese from the State Action, Father Kehagias moved for summary judgment in the State Action. He argued that, based on the state court’s finding that the conduct alleged was outside the scope of his employment, he was not entitled to coverage by the Insurers. And because he could not be held personally liable, the argument went, there was no recovery to be had thus warranting dismissal. The state court denied Father Kehagias’s motion, and the appellate court affirmed. A.M. v. Holy Resurrection Greek Orthodox Church of Brookville, 199 A.D. 3d 489, 154 N.Y.S.3d 414 (1st Dep’t 2021) (Mermelstein Decl. Ex. E). The appellate court rejected Father Kehagias’s logic, stating that “[t]he liability in tort of the Church and Archdiocese, on the one hand, and whether their insurance carriers properly disclaimed coverage of Kehagias, on the other, are separate issues.” Id. 154 N.Y.S.3d at 414. The court also noted that “the issue of insurance coverage is not yet ripe, since there has been no judgment entered against Kehagias.” Id. The instant action began as a third-party claim filed by Father Kehagias in the State Action. On August 21, 2023, however, the state court severed Father Kehagias’s claim against the Insurers, and, on August 25, 2023, the action was removed to this Court on the basis of diversity jurisdiction. (Dkt. 1 Ex. U.) On November 7, 2023, the parties reported to the Court that, with much of discovery having taken place in the underlying action, the parties needed only 90 days to conduct focused discovery, to be followed by summary judgment briefing. (Dkt. 18.) Movants filed their motion to intervene on November 22, 2023. (Dkt. 28-30.) In their proposed Intervention Complaint, Movants directly seek relief against the Insurers for a declaration that they are “obligated…to pay any judgment issued or settlement reached in favor of [Movants] resulting from the negligence claims asserted against Father Kehagias in the State Court Action. (See Mermelstein Decl. Ex. A at
