United States District Court, N.D. Indiana, Hammond Division
OPINION AND ORDER
P. Rodovich United States Magistrate Judge
matter is before the court on the Motion for Interpleader [DE
11] filed by the plaintiff, American United Life Insurance
Company, on August 24, 2018. For the following reasons, the
motion is GRANTED.
matter arises under the Employee Retirement Income Security
Act of 1974, as amended (ERISA), 29 U.S.C. § 1001,
et seq. Further, this is an interpleader action
pursuant to Rule 22 of the Federal Rules of Civil Procedure.
On May 21, 2018 the plaintiff, American United Life Insurance
Company, filed an interpleader complaint.
United has filed the instant motion for interpleader deposit
(28 U.S.C. § 1335). American United has alleged that the
decedent was a former employee of Tender Loving Care
Management, Inc. (TLC) and had basic life insurance coverage
under TLC's plan. TLC informed American United that the
decedent had completed a dependent beneficiary information
form naming her spouse, George Woodward, Sr., as her
beneficiary. However, at the time of her death, George Sr. no
longer was her spouse. The decedent's children contend
that the decedent would not have named her ex-spouse as the
beneficiary, rather she would have intended to name her
children as her beneficiaries.
court held a status conference on October 26, 2018. At the
status conference, the defendants were advised as to the
motion for interpleader deposit. The court gave the
defendants until November 23, 2018 to respond to the motion.
The defendants have not filed a response.
Rule of Civil Procedure 22 permits interpleader, and
states “[p]ersons with claims that may expose a
plaintiff to double or multiple liability may be joined as
defendants and required to interplead.” Interpleader is
meant to allow “a neutral stakeholder, usually an
insurance company or a bank, to shield itself from liability
for paying over the stake to the wrong party. This is done by
forcing all the claimants to litigate their claims in a
single action brought by the stakeholder.” Lutheran
Brotherhood v. Comyne, 216 F.Supp.2d 859, 862 (E.D. Wis.
2002) (quoting Indianapolis Colts v. Mayor and City
Council of Baltimore, 733 F.2d 484, 486 (7th Cir.
United has indicated that it cannot determine whether the
court would find that the dependent beneficiary information,
incorrectly submitted by the decedent naming her spouse as
George Sr. although he was not her spouse at the time of her
death, controls distribution of the Plan Benefits or if the
decedent's children should receive the distribution.
American United asserts that by choosing the beneficiary or
beneficiaries of the Plan Benefits it would exposing itself,
TLC, and the Plan to multiple liabilities. American United
represents that it has no claim to the Plan Benefits.
Therefore, it requests to deposit the disputed funds with the
court and to be dismissed from this action with prejudice.
American United has requested to deduct its attorneys'
fees and costs from the amount deposited with the court. The
determination of whether to allow the deduction of
attorneys' fees and in what amount falls within the
court's broad discretion. Lutheran Brotherhood,
216 F.Supp.2d at 864 (citing Trustees of Directors Guild
of America-Producer Pension Benefits Plans v. Tise, 234
F.3d 415, 426 (9th Cir. 2000)). Generally, courts award fees
from deposited funds when: 1) the party seeking fees is a
disinterested stakeholder; 2) the party conceded liability
for the funds; 3) the party deposited the funds into court;
and 4) the party sought discharge from liability.
Lutheran Brotherhood, 216 F.Supp.2d at 863 (quoting
Septembertide Publ'g v. Stein & Day, Inc.,
884 F.2d 675, 683 (2d Cir. 1989)). The court concludes that
awarding fees and costs to American United is appropriate in
light of these factors. American United is a disinterested
stakeholder, it has conceded liability for the Plan Benefits,
and it seeks to deposit the contested funds and then be
dismissed from the interpleader suit it initiated.
Additionally, the defendants have not opposed the request for
on the foregoing and noting the lack of an objection, the
court hereby GRANTS the Motion for
Interpleader [DE 11] and ORDERS that:
• American United Life Insurance pay to the Clerk of
Court the Plan Benefits, plus any applicable interest and
minus any applicable attorney fees and costs of filing this
• Upon receipt of the Plan Benefits by the Clerk of
Court and upon American United's filing of a Motion to
Dismiss, American United shall be dismissed with prejudice
from this action, and American United, Tender Loving Care
Management, Inc., the Plan, and the Policy are discharged
from any further liability for the Plan Benefits;
• The defendants are required to litigate or settle and
adjust between themselves their claim for the Plan Benefits,
or upon their failure to do so, the court will settle and
adjust their claims and determine to whom the Plan ...