Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_06-cv-02905/USCOURTS-caed-2_06-cv-02905-1/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1335 Interpleader Action

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28 This matter was determined to be suitable for decision without *

oral argument. L.R. 78-230(h).

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

CHARLES SCHWAB & CO., INC., a )

corporation, )

) 2:06-cv-2905-GEB-GGH

Plaintiff, )

) ORDER*

v. )

)

JEANNE WAGAMAN, TRACY NELSON, )

SARAH NELSON WACKER, SCOTT NELSON, )

DANIEL CAMACHO, CHAD CAMACHO, )

OPHIR-BEAR MOUNTAIN LODGE # 33, )

JANICE M. HAMMOND, WANDA JOYCE )

TAKARA, and JERRI CURRY, )

 )

Defendants. )

)

)

AND RELATED CLAIMS. )

)

Plaintiff moves to strike Defendant Jerri Curry’s (“Curry”)

amended Answer and counterclaims to Plaintiff’s First Amended Verified

Complaint for Interpleader or, in the alternative, for dismissal of

Curry’s amended counterclaims on the grounds that they are subject to

mandatory arbitration. Curry opposes this motion. 

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On March 30, 2007, Curry filed a “Declaration in Response to 2

Issues Raised in Plaintiff’s Complaint and [the subject] Motion.” (See

Curry Decl. (Doc. No. 39) (hereinafter, “Curry Opp’n to Mot. for

Discharge.”).) Although this document was referenced as a declaration,

it was signed by the purported declarant’s attorney. Accordingly, the

document is not a declaration and the statements contained therein are

treated as arguments in opposition to Plaintiff’s motion. 

The court has jurisdiction pursuant to 28 U.S.C. § 1335. The 3

“stake” that is the subject of the competing claims is under Plaintiff’s

control and is valued at more than $500; Plaintiff has established four

sets of potential conflicting claimants who are both adverse to and

independent of one another, and who may assert competing claims to the

Account; minimal diversity exists between at least two claimants in this

action; and venue is proper. (See generally Compl.)

2

Plaintiff also moves for a court order authorizing deposit

of the assets of the account at issue in the court registry, an order

discharging Plaintiff from liability, and an award of attorney’s fees

and costs. (See generally Pl.’s Mot. for an Order (1) Authorizing

Deposit into Court, (2) Discharging Plaintiff Stakeholder from

Liability, and (3) Awarding Attorney’s Fees and Costs to Plaintiff

(Doc. No. 30) (“Mot. for Discharge”).) Defendants Janice M. Hammond

(“Hammond”) and Curry oppose this motion. 

2

BACKGROUND

Plaintiff currently maintains Account No. 2236-4399 (“the

Account”) in the name of Virginia C. Durrie (“Durrie”). (First Am.

Verified Compl. (Doc. No. 25) (“Compl.”) ¶ 16.) Durrie passed away in

November 2006. (Id. ¶ 17.) As of November 30, 2006, the Account

contained assets with a market value of approximately $650,000,

comprised of both cash and securities. (Id. ¶ 18.) 

Plaintiff filed this interpleader action alleging that there

are at least four potentially conflicting claims to the assets in the

Account. (Id. ¶ 19.) The first of these involves the Designated 3

Beneficiary Plan, a feature that Durrie added to the Account in April

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In her Answer, Curry denies that she is entitled to exercise 4

unilateral control over the assets in the Account but admits that Durrie

named her a joint tenant with a right of survivorship in the Account.

(See Curry’s Am. Answer (Doc. No. 57) ¶ 5.) 

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2005. (Id. ¶ 20.) By its terms, Durrie designated three

beneficiaries (Defendants Curry, Hammond, and Wanda Joyce Takara

(“Takara”)) to whom she intended the assets in the Account to be

distributed in equal parts upon her death. (Id.) 

The second potential conflicting claim to the Account is

Curry’s claim that Durrie named her a joint tenant with a right of

survivorship in the Account and that she is entitled to exercise

unilateral control over the assets of the Account. (Id. ¶ 21.) The 4

third potential conflicting claim to the Account is the “Last Will and

Testament of Virginia C. Durrie” executed by Durrie on February 3,

2005 in which Durrie left her entire estate (with the exception of her

mobile home) to her children, Curry, Hammond, and Takara, in equal

parts. (Id. ¶ 22.) Plaintiff believes that the assets in the Account

may be property Durrie intended to dispose of by will. (Id.)

The fourth and final potential conflicting claim to the

Account is the “Harry M. Durrie and Virginia C. Durrie Revocable

Trust” executed in 1998. (Id. ¶ 23.) Plaintiff argues that stocks

and securities owned by Harry and Virginia Durrie are subject to the

trust and therefore this could include assets in the Account. (Id.) 

Further, Plaintiff alleges that the trust provides that if Durrie does

not effectively distribute the trust assets by will, then those assets

will become part of a “Disclaimer Trust.” (Id.) The beneficiaries of

the Disclaimer Trust are Defendants Curry, Hammond, Takara, Jeanne

Wagaman (“Wagaman”), Tracy Nelson, Sarah Nelson Wacker, Scott Nelson,

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Daniel Camacho, Chad Camacho, and Ophir-Bear Mountain Lodge # 33

(“Ophir”). (Id.) 

Plaintiff contends that it cannot resolve the potential

conflicting claims outlined above and therefore cannot determine how

and to whom the Account assets should be distributed. (Id. ¶ 25.) 

Plaintiff claims no interest in the proceeds of the Account. (Id.

¶ 26.) Plaintiff has already deposited with the registry of this

Court $500 from the cash portion of the assets in this Account. (Id.

¶ 27.) 

I. Motion to Strike or Dismiss Curry’s Counterclaims

Plaintiff seeks dismissal of Curry’s counterclaims on the

grounds that they are subject to mandatory arbitration. (Pl.’s Mot.

to Strike Am. Answer or, Alternatively, to Dismiss (Doc. No. 62) at

6.) Curry concedes that some of her counterclaims are subject to

arbitration but requests that the court stay Plaintiff’s motion

pending arbitration of those counterclaims. (Curry Opp’n (Doc. No.

75) at 3.) Specifically, Curry argues that “[t]he contract under

which arbitration is required [does not] include resolution of [the

following counterclaims:] fraud [], elder abuse [,] and punitive

damage[s].” (Id.) Plaintiff counters “[n]othing in [the language of

the parties’ arbitration agreement] can be read to exempt [claims of]

fraud [], elder abuse [], or [those] for which punitive damages are a

permissible remedy.” (Reply to Curry Opp’n (Doc. No. 82) at 8.) 

Curry has not shown that her counterclaims are exempt from

arbitration. The parties’ arbitration agreement provides that they

“agree to settle by arbitration any controversy between [them], or in

any way arising from [their] relationship . . . , including any

controversy over the arbitrability of a dispute.” (Curry’s Am.

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28 Because of this ruling, Plaintiff’s motion to strike need not 5

be reached. 

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Answer, Ex. 1 at 5 (emphasis added)). The broad wording of the

agreement does not exclude any claims arising from the parties’

relationship. Further, the agreement also provides that “arbitration

is final and binding on the parties” and that the parties waive “their

right to seek remedies in court.” (Id.)

Accordingly, Plaintiff’s motion to dismiss Curry’s

counterclaims is granted since they are subject to mandatory

arbitration. See Thinket Ink Info. Res., Inc. v. Sun Microsystems, 5

Inc., 368 F.3d 1053, 1060 (9th Cir. 2004) (affirming the district

court’s decision to dismiss “plaintiffs’ claims that were subject to

arbitration pursuant to Fed. R. Civ. P. 12(b)(6).”). 

II. Interpleader

Plaintiff moves for a determination of the correct

disposition of the assets in the Account and for an order granting

Plaintiff permission to deposit the assets of the Account with the

court registry; enjoining Defendants from instituting other actions

affecting the assets of the Account; dismissing Plaintiff from this

case; and an award of attorney’s fees. 

A. Deposit in Court 

Pursuant to 28 U.S.C. § 1335, Plaintiff is required to

“deposit[] such money or property [to which the adverse claimants may

claim entitlement] into the registry of the court, there to abide the

judgment of the court.” Curry opposes Plaintiff’s request to make

such a deposit, arguing that the liquidation of the Account may result

in potential loss to its value. (Curry Opp’n to Mot. for Discharge

¶ 2(x).) Plaintiff counters that “[a]s a matter of statute, and as a

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matter of contract, [it] has no obligation to maintain the Account

indefinitely as the various claimants attempt to resolve their

differences in this action.” (Reply to Curry Opp’n to Mot. for

Discharge at 3.) Curry has not shown why or how her preference to

maintain the Account in the market supersedes Plaintiff’s statutory

right to deposit the assets into the court registry. (See 28 U.S.C. §

1335.) Accordingly, Plaintiff’s request “for an order authorizing

Plaintiff to liquidate the securities in [the Account], and

subsequently, deposit all of the account assets into the court

registry” is granted. (Mot. for Discharge at 8.) Plaintiff has until

4:00 p.m. on September 7, 2007 to make this deposit with the court

registry. 

B. Injunction and Discharge

Pursuant to 28 U.S.C. § 2361, “[i]n any civil action of

interpleader . . . under [§] 1335 [], a district court may [] enter

[an] order restraining [Defendants] from instituting or prosecuting

any proceeding in any State or United States court affecting the

property, instrument or obligation involved in the interpleader action

until further order of the court [] and may discharge the [P]laintiff

from further liability.” See Life Ins. Co. of N. Am. v. Thorngren,

2003 WL 22227881, at *2 (N.D. Cal. Sept. 22, 2003) (“‘If an

interpleading [P]laintiff has no interest in the stake he should be

dismissed.’”) (internal citations omitted). Accordingly, Defendants

are permanently enjoined from instituting other actions regarding

entitlement to the Account assets until further order of the court and

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Curry argues that Plaintiff’s entire interpleader action “was 6

unnecessary in light of the fact that [P]laintiff was aware of the

pending state court petition to determine who should administer the

[Account] assets” and “requests that the court dismiss the federal

action so the state court may properly adjudicate the issues raised in

plaintiff’s complaint.” (Curry Opp’n to Mot. for Discharge ¶¶ 2(w), 3.)

However, Curry’s argument is moot since she subsequently declared that

“[n]o proceeding is now pending in California for administration of

Virginia C. Durrie’s estate.” (See Curry’s Decl. as Successor in

Interest Pursuant to C.C.P. § 377.32 (Doc. No. 58) ¶ 4.); 

see also In re: Harry M. Durrie and Virginia C. Durrie Revocable Trust,

No. PR77787 (Cal. Super. Ct., San Joaquin County), available at

http://www.stocktoncourt.org/stkcrtwwwV5web/SCRegAct1 (stating that the

petition was withdrawn).) 

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since Plaintiff is a disinterested stakeholder with no interest in the

Account assets, it is dismissed. 

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C. Attorney’s Fees

Plaintiff also seeks an award of attorney’s fees and costs

in the amount of $14,998, which represent the fees and costs incurred

in filing the complaint for interpleader and bringing this motion. 

(See Am. Decl. of Kenneth C. Mennemeier in Supp. of Mot. for Discharge

(Doc. No. 31) (“Mennemeier Decl.”) ¶¶ 5-6.) Hammond and Curry oppose

Plaintiff’s motion for attorney’s fees and costs. 

Hammond argues that “to the extent that fees and costs are

sought . . . on a contractual theory arising from the Designated

Beneficiary Plan [] any liability that may arise out of [this plan]

was due to [P]laintiff’s inept handling of decedent’s estate.” 

(Hammond Opp’n at 3.) Hammond further contends that “[t]o the extent

that fees and costs are sought on an equitable theory, [this] action

was unnecessary and [] the fees and costs are outrageous and therefore

inequitable.” (Id.)

Hammond’s conclusory statements are insufficient to defeat

Plaintiff’s motion for attorney’s fees and costs. Plaintiff is

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entitled to fees and costs since Mrs. Durrie agreed to such terms in

her application to add the Designated Beneficiary Plan feature to the

Account. (See Ex. A to Compl at 4.) Further, courts have discretion

to award attorney’s fees and costs to a disinterested stakeholder in

an interpleader action. Abex Corp. v. Ski’s Enters., Inc., 748 F.2d

513, 516 (9th Cir. 1984); Gelfgren v. Republic Nat’l Life Ins. Co.,

680 F.2d 79, 81 (9th Cir. 1982). Hammond has not shown how Plaintiff

mishandled Durrie’s estates nor how this interpleader action was

unnecessary given the multiple and potential conflicting claims to the

assets of the Account. Finally, Hammond has not shown which fees and

costs submitted by Plaintiff are “outrageous” in light of the detailed

declaration Plaintiff’s counsel submitted setting forth the specific

costs and fees he incurred in relation to this motion. (See

Mennemeier Decl. ¶¶ 5-6.)

In Curry’s opposition, she argues that Plaintiff was

responsible for creating the current competing claims to the assets of

the Account. (See Curry Opp’n to Mot. for Discharge ¶ 2.) If a

stakeholder in an interpleader action has been dilatory or acted in

bad faith, attorney’s fees and costs should not be awarded in its

favor. Gelfgren, 680 F.2d at 81. However, Curry’s arguments

concerning attorney’s fees are unsupported by a sworn factual showing. 

Accordingly, the court grants Plaintiff’s request for an award of

attorney’s fees and costs in the amount of $14,998. 

CONCLUSION 

For the reasons stated, Plaintiff’s motion to dismiss

Curry’s counterclaims and its motion to authorize deposit of the

Account’s assets into the court registry, discharge Plaintiff from

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liability, and award Plaintiff attorney’s fees and costs, are both

granted. 

IT IS SO ORDERED.

Dated: August 31, 2007

 

GARLAND E. BURRELL, JR.

United States District Judge

 

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