Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_07-cv-01655/USCOURTS-casd-3_07-cv-01655-2/pdf.json

Nature of Suit Code: 110
Nature of Suit: Insurance
Cause of Action: 28:1335 Interpleader Action

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

CONSECO LIFE INSURANCE

COMPANY,

Plaintiff,

CASE NO. 07cv1655 WQH (NLS)

ORDER

vs.

DONNA GOMEZ, BRENDA AHL,

Defendants.

HAYES, Judge:

The matter before the Court is the “Motion of Plaintiff Stakeholder Conseco Life

Insurance Company to be Discharged from Liability and Dismissed from the Action.” (Doc.

# 13).

Background

On August 21, 2007, Plaintiff-Stakeholder Conseco Life Insurance Company 

(“Conseco”) filed a Complaint for Interpleader, pursuant to 28 U.S.C. § 1335. (Doc. # 1). 

The Complaint alleges that on or about October 4, 2002, Conseco issued a life insurance

policy to Dawn Hawley, which provided a $35,791.00 death benefit that was later increased

to $52,450.00. The named beneficiary was Defendant Brenda Ahl (“Ahl”). Complaint, ¶

6. The Complaint alleges that on or about January 10, 2006, Dawn Hawley executed a

Declaration of Life Insurance trust, which designated Defendant Donna Gomez (“Gomez”)

as the recipient of the proceeds of the policy upon her death. Id. ¶ 7. The Complaint

alleges that Conseco received conflicting claims from Ahl and Gomez, both claiming

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entitlement to the policy benefits. Id. ¶ 8. The Complaint alleges that Conseco decided to

interplead the policy benefits because it is unable to determine the validity of the

conflicting demands made by Ahl and Gomez. Id. ¶¶ 9-11. The Complaint alleges that Ahl

and Gomez are of diverse citizenship. Id. ¶¶ 3-5. The Complaint alleges that Conseco is in

possession of the policy benefits and that “[c]oncurrently with filing this complaint, [it] is

depositing the policy benefits, plus interest with the Clerk of this Court.” Id. ¶¶ 11, 15. 

The Complaint alleges that Conseco “claims no interest in the policy benefits described

above.” Id. ¶ 15. The Complaint alleges that Conseco “has incurred, and is continuing to

incur, and will continue to incur costs and attorneys fees in bringing this action.” Id. ¶ 16. 

On October 29, 2007, Conseco filed the “Motion of Plaintiff Stakeholder Conseco

Life Insurance Company to be Discharged from Liability and Dismissed from the Action”

(“Motion for Discharge”), pursuant to 28 U.S.C. § 1335. Conseco moves the Court to

discharge it from liability for the death benefits under Dawn Hawley’s insurance policy,

dismiss it from this interpleader action, and grant its attorney Marc J. Wodin attorneys’ fees

and costs. In support of the Motion for Discharge, Conseco submitted the Declaration of

its Attorney Marc J. Wodin, who attests that “[o]n August 21, 2007, concurrently with

filing the subject complaint, plaintiff deposited $53,721.74 with the Clerk of the Court

pursuant to 28 USC § 1335 which amount is the total insurance benefits, plus interest,” that

Conseco “claims no interest in the” money deposited with the Court, and that Attorney

Wodin’s “fees, to date, are in the total amount of $2,422.64.” Wodin Declaration, ¶¶ 3, 6. 

Defendant Ahl and Defendant Gomez do not oppose the Motion for Discharge. 

Applicable Law

Pursuant to 28 U.S.C. section 1335,

[t]he district courts shall have original jurisdiction of any civil action of

interpleader or in the nature of interpleader filed by any person, firm, or

corporation, association, or society . . . having issued a note, bond, certificate,

policy of insurance, or other instrument of value or amount of $500 or more 

. . . if

(1) Two or more adverse claimants, of diverse citizenship . . . are claiming or

may claim . . . to be entitled to . . . any one or more of the benefits arising by

virtue of any note, bond, certificate, policy or other instrument, or arising by

virtue of any such obligation; and if

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(2) the plaintiff has . . . paid the amount of or the loan or value of such

instrument or the amount due under such obligation into the registry of the court,

there to abide the judgment of the court. 

When a district court has jurisdiction over an action pursuant to section 1335, the

court “shall hear and determine the case, and may discharge the plaintiff from further

liability, make the injunction permanent, and make all appropriate orders to enforce its

judgment.” 28 U.S.C. § 2361. Once it is determined that an interpleader action is

appropriate, the court is entitled to discharge a plaintiff-stakeholder who has no interest in

the disputed funds. See Mendez v. Teachers Ins. & Annuity Ass’n and College Retirement

Equities Fund, 982 F.2d 783, 787 (2d Cir. 1992) (accord Valley Forge Life Insurance

Company v. Dena Hulse, 2007 U.S. Dist. LEXIS 52061 (N.D. Cal., July 6, 2007)). 

Courts have discretion to award attorney’s fees to a disinterested plaintiffstakeholder in an interpleader action. Schirmer Stevedoring Co., Ltd. v. Seabord

Stevedoring Corp., 306 F.2d 188, 194 (9th Cir. 1962). The reasons for allowing attorney

fees to interpleading plaintiff-stakeholders are “that the plaintiff has benefitted the

claimants by promoting early litigation on ownership of the fund, thus preventing

dissipation, . . . and that the plaintiff should not have to pay attorney fees in order to guard

himself against the harassment of multiple litigation.” Id. at 193. Attorney fees may be

denied to the plaintiff “when he has some interest in the outcome” of the interpleader

action. Id. 

Courts have discretion to award costs to the plaintiff-stakeholder in an interpleader

action. Gelegren v. Republic National Life Insurance Company, 680 F.2d 79, 81 (9th Cir.

1982). Costs “should not be assessed against a stakeholder, at least where the stakeholder

has not been dilatory or otherwise guilty of bad faith.” Id. 

Ruling of the Court

This is an appropriate interpleader action under section 1335 because Defendants

Ahl and Gomez are diverse, the value of the insurance policy issued by Conseco exceeds

$500, and the amount of the insurance policy has been deposited with the Clerk of the

Court. See 28 U.S.C. § 1335. Conseco has also demonstrated that it claims no interest in

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the insurance policy. See Wodin Declaration ¶ 2. The Court concludes that Conseco is

entitled to discharge from liability because this is an appropriate interpleader action and

Conseco is a disinterested stakeholder. See Mendez, 982 F.2d at 787. The Court also

concludes that Conseco, as a disinterested stakeholder, is entitled to attorney’s fees and

costs. See Schirmer Stevedoring Co., Ltd., 306 F.2d at 194. 

IT IS HEREBY ORDERED that the “Motion of Plaintiff Stakeholder Conseco Life

Insurance Company to be Discharged from Liability and Dismissed from the Action” (Doc.

# 13) is GRANTED. Conseco Life Insurance Company is fully discharged from liability

in this action and entitled to attorney’s fees and costs in the amount of $2,422.64, payable

from the funds deposited with the Clerk of the Court. The Court orders the Clerk of the

Court to disburse $2,422.64 from the interest bearing account to Marc. J Wodin at the

following address: 

Marc J. Wodin

Law Offices of Marc J. Wodin

21600 Oxnard Street

Suite 1110

Woodland Hills, CA 91367

DATED: January 15, 2008

WILLIAM Q. HAYES

United States District Judge

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