Justice Doris Ling-Cohan
Investors sought to intervene in this rehabilitation action, and conduct limited discovery. The proceeding was brought under Insurance Law Article 74 in which rehabilitator, Financial Guaranty Insurance, was appointed without objection and proposed a rehabilitation plan. Objections to the plan were either settled or withdrawn before a hearing date on the plan, and the court approved same without objection. Financial sought the court's approval of a tentative settlement agreement negotiated in a bankruptcy case. Three objections to the settlement were received, and the investors sought to intervene. The court declined the investors' order to show cause to intervene stating that nowhere in Article 74, which governed special proceedings, did it allow intervention. Also, it stated investors did not need to seek intervention to voice their objections as they were filed, received and would be considered. Further, investors conceded there was no automatic right to discovery in special proceedings, and the court stated they failed to detail the discovery sought, or provide copies of any document demands, hence it was unable to decide if such discovery was material and necessary.
