Maxum Indemnity Company v. Curley et al

MOTION to Dismiss

N.D. Ga.September 15, 2017

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT 011' GEORGIA ATLANTA DIVISION MAXUM INDEMNITY COMPANY, Plaintiff, v. LARSHELL CURLEY, RODNEY McCRAE, THE EST A TE OF EBONY McCRAE-CURLEY, CEDRIS K COOKS, LAFAYETTE GALBREATH, ERIC DWIGHT MURPHY. PATRICK PARTAIN, DA YID SHULA, III, ASHLEY PITTS- WILLIAMS, SHAWN DESHAY WILLIAMS, GRADY MEMORIAL HOSPITAL, and AICA ORTHO SPINT, P.C., Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) CASE NO.: 1: 17-CV-02858-CAP DEFENDANTS LARSHELL CURLEY, AND THE ESTATE OF EBONY McRAE-CURLEY'S MOTION TO DISMISS AMENDED PETITION FOR INTERPLEADER. AND INCORPORATED MEMORANDUM OF LAW Defendants, Larshell Curley ("Curley"), and the Estate of Ebony Mccrae-Curley (the .. Estate"), by and through undersigned counsel, hereby move to dismiss Plaintiff, Maxum Indemnity Company's ("Insurer) Amended Petition for lnterpleader because Insurer fraudulently joined Curley and Rodney McCrae in order to create statutory interpleader jurisdiction, and state: I. On April 15, 2017, Ebony McRae-Curley ("Ebony") went to have dinner at a restaurant. She was killed while she was waiting for the valet to bring her cur to her. The valet failed to put the parking brake on a car before getting out of the car, and when he jumped back into the car negligently hit the gas instead of the brake, causing the cur to speed backwards. The Case 1:17-cv-02858-TCB Document 27 Filed 09/15/17 Page 1 of 9 valet pinned Ms. McCrae-Curley between two cars, killing her. See generally, Petition for Interpleader, para. 18. 2. A probate estate was opened for Ebony. See In re: Estate of Ebony Monette McCrae-Curley. Fulton County Probate Court, Estate No. Pc-2017-001070. Larshell Curley, Ebony's mother, was appointed personal representative of Ebony's estate. This fact may be judicially noticed by this Court, as it is not subject to reasonable dispute in that it is capable of accurate and ready determination by resort to sources whose accuracy cannot be questioned, to wit: the Letters of Administration issued by the Probate Court. See OCGA Section 24-2- 201 (b )(2), and redacted Letters of Administration attached as Exhibit 1. 3. Defendant, Rodney McCrae, is Ebony's father. He is described as an "heir" in the documents submitted to the Probate Court. See OCGA Section 24-2-201 (b )(2). If McCrac is asserting any claim for compensation for his daughter's death, it is being handled through the Estate of McCrae~Curley. 4. The only claim for Ebony's death is being asserted by Curley, as Administrator and Personal Representative of the Estate of McCrae-Curley. See Exhibit B to Petition for Interpleader attaching letter from The Hatchett Firm regarding "our client": "Larshell Curley for the Estate of Ebony McCrae-Curley." 5. The interpleader petition should be dismissed because the Insurer fraudulently joined McCrae and Curley in order to establish interpleader jurisdiction under Tille 28 Section - 1335. Without either McCrae or Curley, Insurer does not have two or more claimants of diverse citizenship lo sustain jurisdiction under the federal interpleader statute, 28 U.S.C. 1335. Insurer needs both McCrae and Curley, as they are the only defendants alleged to be of diverse citizenship from Insurer. 2 Case 1:17-cv-02858-TCB Document 27 Filed 09/15/17 Page 2 of 9 6. In order to establish statutory interpleader jurisdiction, Insurer must allege at least two adverse claimants to the fund it seeks to interplead. Insurer alleges it is a Georgia corporation; Curley and McCrae are alleged to be Massachusetts residents. Insurer needs both Curley and McCrae in order to establish federal diversity interpleader jurisdiction under 28 U.S.C. Section 1335. Both Curley and McCrae were fraudulently joined by Insurer. 7. As to McCrae, Insurer alleges McCrae "may have a claim" because he is Ebony's father (see Amended Petition para. 21 ), and therefore jumps to the conclusion that McCrae is therefore a claimant under 28 U.S.C. Section 1335. Because McCrae has not actually asserted a claim, he is not a claimant, and therefore cannot be used to establish diversity jurisdiction under 28 U.S.C. Section 1335. Insurer fails to state a claim for statutory interpleader, requiring dismissal of the amended imerpleadcr petition. 8. Also, the Insurer fraudulently joined Curley. There should be no question Curley's claim is being asserted through the Estate. See letter from Curley's counsel to Insurer, attached to the Petition for Interpleader, and auached here as Exhibit 2. There is no separate claim by Curley against Insurer for Ebony's death. Therefore, Curley is not a claimant under 28 U.S.C. Section 1335. Again, Insurer fails to state a claim for statutory interpleader, requiring dismissal of the amended interpleader petition. 9. The Insurer split up the Estate's claim into three claims by the Estate, Curley and McCrae to fraudulently allege Curley and McCrae are of diverse citizenship from Insurer, to manufacture federal court interpleader jurisdiction. That violates the federal interpleader statute, and should not be permitted. 10. Finally, assuming this Court dismisses the statutory interpleader action, Insurer cannot maintain this suit as a Rule 22 interpleader. That would require complete diversity of 3 Case 1:17-cv-02858-TCB Document 27 Filed 09/15/17 Page 3 of 9 citizenship, which does not exist, as a multilude of the defendants are alleged to reside in the State of Georgia. WHEREFORE, Defendants, Larshell Curley ("Curley"), and the Estate of Ebony McCrae-Curley, request that this Court dismiss Plaintiff, Maxum Indemnity Company's Amended Petition for lnlerpleader. MEMORANDUM OF LAW IN SUPPORT OF MOTION TO DISMISS Al\'IENDED PETITION FOR INTERPLEADER Defendants, Larshell Curley ("Curley"), and the Estate of Ebony McCrae-Curley, file this Memorandum of Law in support of their Motion to Dismiss Amended Petition for Interpleader. There are two types of interplcader actions that may be brought in federal court. Statutory interpleader under 28 U.S.C. Section 1335 does not require complete diversity for a federal court to exercise jurisdiction, but does require "two or more adverse claimants of diverse citizenship." Metropolitan Life Ins. Co. v. Price, 501 F.3d 271, 275 (3rd Cir. 2007); Suae Farm Life Ins. Co. v. Jefferso11, etc., CV 116-085 *5 (So. Dist. GA May 18, 2017). 1 The second type of federal interpleader is Rule 22 interpleader, which requires complete diversity of citizenship. Metropolitan Life bis. Co. v. Price, 501 F.3d 271, 275 (3rd Cir. 2007); State Farm Life Ins. Co. v. Jefferson, etc., CV 116-085 *5 (So. Dist. GA May 18, 2017). The United States Supreme Court holds federal court jurisdiction is proper in "only those cases in which a well-pleaded complaint establishes either that federal law creates the cause of action, or that the plaintiffs right to relief necessarily depends on resolution of a substantial federal question." Boatmen's First Nat'! Bank of Kansas City v. McCoy, 861 F.Supp. 846, 849 (W.D. Miss. 1994), citing Fra11cliise Tax Board v. Constmctioll Laborers Vacation Trust, 463 U.S. 1 ( 1983), and granting motion lo remand because court lacked jurisdiction under 1 Since this is an unpublished decision, a copy of the case State Farm 1•. Jefferson, is attached as Exhibit 3. 4 Case 1:17-cv-02858-TCB Document 27 Filed 09/15/17 Page 4 of 9 interpleader statute. It is well-settled the federal law element must appear on the face of plaintiffs well-pleaded complaint, and not on speculation as to a defense to plaintiffs claim. Id. The interpleader statute is .!1Q1 to be used for forum shopping, and an interpleader action that is brought in bad faith must be dismissed. American Family Mur. Ins. Co. v. Roche, 830 F.Supp. 1241, 1245 (E.D. Wis. 1993). Based on the Insurer's failure to make allegations as to McCcrae to support its interpleader petition, it appears the Insurer is forum shopping. This Court should dismiss the interpleader petition. I. Insurer's Petition for Interpleader Should Be Dismissed Because Insurer Has Not Alleged Defendant, Rodney McCrae, to be a "Claimant," as Required to Sustain Statutory Interpleader Action Brought Under 28 U.S.C. Section 1335 One of the required elements Insurer must allege to maintain a statutory interpleader action is that each defendant named in its Petition for Interpleader are "claimants" under 28 U.S.C. Section 1335. Statutory interpleader requires "two or more adverse claimants of diverse citizenship." Insurer named McCrae as a defendant, only on the allegation he may claim insurance proceeds because he is Ebony's father. Insurer has received no actual claim from McCrae or Insurer would have advised the Court. Because McCrae has not made a claim, McCrae is not a "claimant" under 28 U.S.C. Section 1335. To determine if McCrae is a .. clairnanl," this Court must decide "whether the stakeholder [Insurer] legitimately fears multiple vexation directed against a single fond." American Family Mut. Ins. Co. v. Roelle, 830 F.Supp. 1241, 1245 (E.D. Wis. 1993). The stakeholder needs to have a "bonajide fear of adverse claims." JP Morgan Chase Bank, N.A. v. Neu, No. 17-3475 *7 (D. N.J. May 24, 2017).2 The "obligation [to pay a claim asserted against a common fund] accrues only upon the adjudication of conflicting claims, and that adjudication cannot occur absent a timely and formal assertion of a claim against the proceeds on deposit." General 2 As this is an unpublished decision, JP Morgan Chase v. Neu is attached as Exhibit 4. 5 Case 1:17-cv-02858-TCB Document 27 Filed 09/15/17 Page 5 of 9 Accidellf Group v. Gagliardi, 593 F.Supp. 1080, 1089 (D. Conn. 1984) (emphasis added). Therefore, to be a claimant, there must be a "timely and formal assertion of a claim against the proceeds on deposit." Id. Where a person has not made a claim to the disputed funds, it cannot be considered a "claimant" under 28 U.S.C. 1335. Boatmen's First Nat'[ Bank of Kansas City v. McCoy, 861 F.Supp. 846, 848 (W.D. Miss. 1994) ("Diversity cannot be established under the interpleader statute by the presence of the non-Arkansas plaintiff since it claims no interest in the disputed funds.") (emphasis added); see contra American United Life Ins. Co. & the State Life /11s. Co. v. Mays, No. 2:17cv99 (E.D. VA July 31, 2017)3 *to ("Plaintiffs legitimately fear •not just potential conflicting claims, but actual, and colorable, conflicting claims.' The Plaintiffs have received letters staking claim to all or some of the benefits from at least two defendant in this case [where all defendants are diverse from the plaintiffs]."); Minnesota Life Ins. Co. v. Creasy, etc., No. 1:14-cv-l l *2 (M.D. GA. 2014)4 (" ... Boughner and Jones made competing claims for benefits."). Because Insurer has not alleged McCrae has made a claim against Insurer's policy limits, or any part of them, McCrae is not a "claimant" under 28 U.S.C. 1335. McCrae is only one of two defendants Insurer alleged to be of diverse citizenship in its amended interpleader petition. Because McCrae is not a "claimant" under the interpleader statute, Insurer should not have joined him as a defendant in this case. Without Mccrae, there are not "two or more adverse claimants of diverse citizenship," requiring dismissal of the amended interpleader petition. 3 As this is an unpublished decision, Boatman's v. McCoy is attached as Exhibit 5. 4 As this is an unreported decision, Mi1111esota v. Creasy is attached as Exhibit 6. 6 Case 1:17-cv-02858-TCB Document 27 Filed 09/15/17 Page 6 of 9 II. Even if Defendant, Rodney McCrae, is Considered a "Claimant" under 28 U.S.C. Section 1335, Insurer Has Not Alleged Mccrae to be "adverse" to Defendants, Larshell Curley, or to the Estate of Ebony McRae-Curley, requiring dismissal of Interpleader Action The requirement that claimants be "adverse" to each other "is satisfied when the defendants in an interpleader action dispute who control the funds as issue." JP Morgan Chase Bank v. Neu, at 6 (emphasis added). Another court has phrased the question as "whether there are two or more claimants to the policy benefits or proceeds who are both adverse and diverse to each other." American Family Mut. Ins. Co. v. Roche, 830 F.Supp. 124 l, 1245 (E.D. Wis. 1993). It strains credulity as to how McCrae could be "adverse" to Curley or to the Estate of McRae-Curley, (I) where Curley is acting as Administrator and Personal Representative of the Estate of McCrae-Curley based on agreement from McCrae, and (2) where McCrae is an heir identified in the probate papers, making him a beneficiary of the Estate of McCrae-Curley. Simply put, Insurer has not alleged McCrue to be adverse, nor can it. Therefore, Insurer cannot state a cause of action, or establish diversity of citizenship by at least two or more adverse claimants, for statutory interpleader. It is improper for Insurer to split the Estate's claim into three claims in order to manufacture diversity interpleader jurisdiction. III. Curley Is Not A Claimant Separate And Apart From Estate, and Should Therefore Be Dismissed From This Statutory Interpleader Action, Destroying Diversity, and Requiring Entire Statutory Interpleader Action To be Dismissed In Curley's counsel's July 14, 2017 letter to Gary Lovell, Jr., attorney for Sunshine Parking, LLC, the named insured on Maxum Indemnity's insurance policy, counsel plainly states her client to be "Larshell Curley for the Estate of Ebony McCrue-Curley." See Glenda Hatchett's letter, attached to Petition for lnterpleader, towards the middle of the letter, just after identifying "your insured." Simply put, Curley is not a claimant; the Estate is the claimant. 7 Case 1:17-cv-02858-TCB Document 27 Filed 09/15/17 Page 7 of 9 Curley is an heir of the Estate, and claims an imerest through the Estate. Because Curley is not a "claimant" as that term is used in 28 U.S.C. 1335, Curley must be dismissed from the Petition for Interpleader. Another reason why Curley must be dismissed is because she is not "adverse" to all other claimants. There should be no doubt Curley is not adverse to the Estate. The Insurer fraudulently joined Curley solely based on the allegation she resides in Massachusetts, and is therefore diverse from Insurer, a Georgia corporation. WHEREFORE, Defendants, Larshell Curley, and the Estate of Ebony McRae-Curley, request that this Court dismiss Plaintiff, Maxum Indemnity Company's Amended Petition for Interpleader. Respectfully submitted this the 15•h day of September, 2017 The Hatchett Firm, P.C. 191 Peachtree Street, NE Suite 2600 Atlanta, GA 30303 8 THE HATCHETT FIRM, P.C. IS/ Glenda A. Hatchett Glenda A. Hatchett Georgia Bar No.: 337550 Attorney for Plaintiff Case 1:17-cv-02858-TCB Document 27 Filed 09/15/17 Page 8 of 9 CERTIFICATE OF SERVICE I HEREBY CERTIFY that I electronically filed the foregoing with the Clerk of Court using CM/ECF system which will automatically send e-mail notification of such filing to the following attorney of record: on this l 51h day of September, 2017. The Hatchett Firm, P.C. 191 Peachtree Street, NE Suite 2600 Atlanta, GA 30303 Kenan G. Loomis Cozen O'Connor Suite 400 The Promenade 1230 Peachtree Street NE Atlanta, GA 30309 9 THE HATCHETI FIRM, P.C. /SI Glenda A. Hatchett Glenda A. Hatchett Georgia Bar No.: 337550 Attorney for Plaintiff Case 1:17-cv-02858-TCB Document 27 Filed 09/15/17 Page 9 of 9