Metro. Life Ins. Co. v. Hill
| Decision Date | 25 March 2013 |
| Docket Number | Case No: 6:11-cv-2043-Orl-36TBS |
| Parties | METROPOLITAN LIFE INSURANCE COMPANY, Plaintiff, v. CANDICE D. HILL and ESTATE OF MARSHA L. MCEACHERN, Defendants. |
| Court | U.S. District Court — Middle District of Florida |
This cause comes before the Court upon Plaintiff Metropolitan Life Insurance Company's ("Plaintiff") Motion for miscellaneous relief, specifically Interpleader and Dismissal from Action with prejudice ("Plaintiff's Motion"). Doc. 29. On December 5, 2012, Magistrate Judge Thomas B. Smith submitted a Report and Recommendation, recommending that the Court grant in part and deny in part Plaintiff's Motion, order Plaintiff to deposit the remaining plan benefits into the Court's registry and then dismiss Plaintiff with prejudice from this action. Doc. 36, p. 6.
After an independent de novo review of the record, including Plaintiff's Objection (Doc. 37), the Court agrees with the findings of fact and conclusions of law in the Report and Recommendation.
This is an interpleader action to determine the distribution of life insurance benefits arising from the death of Ralph Kimmel ("Decedent"). Doc. 36, p. 1.1 The Decedent was a participant in the Allegheny Technologies Health and Welfare Plan ("Plan"), an ERISA-regulated welfare benefit plan sponsored by Allegheny Technologies, Inc. and funded by a group life insurance policy issued by Plaintiff. Id. at 2. The Decedent died on June 2, 2010, and at that time, he was covered in the amount of $13,380 ("Plan Benefits"). Id. The Plan provides that if a participant fails to name a beneficiary by the time of death the amount will be paid to one or more persons in the following order: (1) spouse; (2) child; (3) parent; (4) brother and sister. The Decedent's last beneficiary designation was his wife, who predeceased him. Id.
On April 25, 2011, Defendant Candice D. Hill ("Hill") submitted a claim to Plaintiff for the Plan Benefits, as the Decedent's daughter. Id. On May 13, 2011, Defendant Marsha L. McEachern ("McEachern") submitted a claim to Plaintiff for Plan Benefits. Plaintiff determined that McEachern is Decedent's daughter, and paid 50% of the Plan Benefits to her. Id.
The remaining 50% of the Plan Benefits, $6,690, is payable to the proper beneficiaries, but Plaintiff cannot determine whether a court would find that Hill is the Decedent's daughter without risking exposure to liability. Id.
On December 27, 2011, Plaintiff filed the Complaint in this action, naming Hill and McEachern as Defendants. See Doc. 1. On June 21, 2012, McEachern died and the Court substituted McEachern's estate as the party in this case. Docs. 20, 21. Defendants have notanswered Plaintiff's Complaint or responded to the Court's Interested Persons Order, and have failed to comply with two of this Court's Orders to Show Cause. Docs. 14, 17, 19.
In its Motion, Plaintiff seeks to deposit the remaining Plan Benefits with the Court and be dismissed from this action. Doc. 29. Plaintiff argues that it is a disinterested stakeholder and should be allowed to withdraw from the proceedings and avoid multiple liability. Id. Also, Plaintiff seeks to enjoin Defendants from instituting any action or proceeding in any state or United States court against Plaintiff, Allegheny Technologies Health and Welfare Plan, or Allegheny Technologies, Inc., for the recovery of the Plan Benefits. Id. at 7. Finally, Plaintiff agrees to waive all rights it would otherwise have to recover attorneys' fees for this action. Id. at ¶ 21.
Federal Rule of Civil Procedure 72(b)(2), in pertinent part, provides that "a party may serve and file specific written objections to the proposed findings and recommendations" of a magistrate judge. When a party makes a timely and specific objection to a finding of fact in a Report and Recommendation, the district judge "shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made." 28 U.S.C. § 636(b)(1)(C); Jeffrey S. v. State Board of Education of State of Georgia, 896 F.2d 507, 512 (11th Cir. 1990). The district judge may accept, reject, or modify in whole or in part, the Report and Recommendation of the magistrate judge. Fed. R. Civ. P. 72(b)(3). The district judge may also receive further evidence or recommit the matter to the magistrate judge with further instructions. Id.
In his Report and Recommendation, Magistrate Judge Smith found that Plaintiff is a disinterested stakeholder and is entitled to be dismissed from this action once it deposits the disputed funds into the Court's Registry. Doc. 36, p. 4 (). However, the Magistrate Judge recommended denying Plaintiff's request to enjoin Defendants from instituting any action or proceeding in any state or United States court against Plaintiff for the recovery of Plan Benefits. Doc. 36, pp. 4-5.
In its Objection, Plaintiff argues that its action is not brought only pursuant to Federal Rule of Civil Procedure 22, but is also a statutory interpleader action under 28 U.S.C. § 1335. Doc. 37, p. 3; see Doc. 1, ¶ 4. Plaintiff maintains that an injunction is permissible for this interpleader action pursuant to 28 U.S.C. § 2361. Id. ). In Orseck, the district court determined that the case qualified as a statutory interpleader under 28 U.S.C. § 1335, and then found, within its discretion, that an injunction was warranted pursuant to 28 U.S.C. § 2361. 699 F. Supp. 2d at 1351.2 Plaintiff concedes that the Court has discretion with regard to the issuance and scope of an injunction pursuant to 28 U.S.C. § 2361. Id. Although Plaintiff does not object to the Magistrate Judge's explicit finding that an injunction pursuant to 28 U.S.C. § 2361 is not available as a basis for an injunction in a Rule 22 and ERISA interpleader, it argues that becausethis case is not a "pure Rule 22 action" and is also a statutory interpleader action under 28 U.S.C. § 1335, the Court should use its discretion to issue the requested injunction. Doc. 37, pp. 3-5.
In his Report and Recommendation, the Magistrate Judge found that the injunctive relief contemplated by 28 U.S.C. § 2361, restraining claimants from instituting proceedings "affecting the property, instrument or obligation involved in the interpleader action until further order of the court," is not the injunctive relief Plaintiff is seeking and is not available in a Rule 22 and ERISA case. Doc. 36, p. 5 (citing Harris Corp. v. Dunn, 2006 WL 3691541 (M.D. Fla. 2006)). The Court agrees, as Plaintiff notes, that Dunn is distinguishable because the parties were not of diverse citizenship, and thus could not qualify for a statutory interpleader action pursuant to 28 U.S.C. § 1335; see Case No. 6:05-cv-1388, Doc. 1, ¶¶ 12-14. However, the Court agrees with the Magistrate Judge that an injunction pursuant to 28 U.S.C. § 2361 is not available in a Rule 22 interpleader action. See 7 Charles Wright, Miller & Kane, Federal Practice & Procedure § 1717 (3d ed. 2012) (). Moreover, apart from claiming it is not a "pure Rule 22 interpleader action", Plaintiff provides no support for the position that an injunction pursuant to 28 U.S.C. § 2361 is appropriate in an action that qualifies as both a statutory interpleader and a Rule 22 interpleader. See Doc. 37. Indeed, "Section 2361 only authorizes injunctions against other judicial proceedings in statutory-interpleader actions; it does not apply to rule interpleader." Am. Gen Life Ins. Co. v. Jones, 2008 WL 4949847, *2 (S.D. Ala. 2008).
Furthermore, even if the law permitted an injunction, the Court agrees with the Magistrate Judge that Plaintiff has made no factual assertion as to why its interests would not be protected by res judicata or collateral estoppel after the Court enters its judgment. Doc. 36, pp.5-6 (). It is evident that Defendants will be estopped from future actions against Plaintiff seeking the Plan Benefits.
Finally, Plaintiff requests an injunction to protect the interests of Allegheny Technologies Health and Welfare Plan and Allegheny Technologies, Inc.—two entities that are not parties to this action. Doc. 29, p. 7. The Court agrees with the Magistrate Judge that Plaintiff has not provided any legal authority for why an injunction protecting these entities' interests is appropriate. Doc. 36, p. 4. Plaintiff's explanation that "these would be the other likely parties that the Defendants may sue for recovery of the life insurance funds" is insufficient. Doc. 37, p. 5.
Therefore, after careful consideration of the Report and Recommendation of the Magistrate Judge, in conjunction with an independent examination of the court file, the Court is of the opinion that the Magistrate Judge's Report and Recommendation should be adopted, confirmed, and approved in all respects.
Accordingly, it is now ORDERED and ADJUDGED:
To continue reading
Request your trial