Accordia Life and Annuity Company v. Shyvers, 4:17-cv-01461

Background

Accordia filed a statutory interpleader after competing claims were made to a life insurance policy (the Policy) for which the Grist Mill Trust Welfare Benefit Plan (the Plan) and its Trustee were listed as owner/beneficiary; the Policy was held by Accordia following corporate acquisitions.
The Trustee (Kehoe) requested surrender of the Policy; Shyvers and the Pollack Co. later claimed the Policy’s benefits for Shyvers, prompting Accordia to interplead the proceeds rather than pay.
Plan Defendants moved to dismiss the interpleader (jurisdictional and failure-to-state-a-claim arguments) and to strike portions of Shyvers/Pollack’s amended counterclaims/crossclaims as scandalous/immaterial.
Shyvers and Pollack counterclaimed and crossclaimed against the Plan and Accordia asserting fraud, negligent misrepresentation, negligence, breach of contract, breach of fiduciary duty, unjust enrichment, money had and received, and declaratory relief; they allege an internal practice of allowing participants to receive cash surrender value for a 10% fee and other misrepresentations about the Plan’s legality and tax benefits.
The court denied the motion to dismiss the interpleader (Accordia had a good-faith basis to fear multiple claims and timely filed; deposit was later made), denied the motion to strike, and granted-in-part and denied-in-part the Plan Defendants’ amended motion to dismiss the counterclaims/crossclaims.
The court dismissed unjust enrichment and money-had-and-received claims (quasi-contract remedies barred by existence of an express plan contract) but allowed fraud, negligent misrepresentation, negligence, breach of contract, breach of fiduciary duty, and declaratory relief claims to proceed; Rule 9(b) particularity challenge was rejected as adequate.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether statutory interpleader jurisdiction exists and the interpleader was timely	Accordia: had good-faith belief of adverse claims and timely filed before contractual payment obligation matured	Plan: Accordia failed to deposit funds and waited too long; no colorable competing claims because Plan is owner	Denied motion to dismiss interpleader; jurisdiction and timeliness satisfied (deposit later cured, good-faith multiple claims)
Whether portions of counterclaims should be stricken under Rule 12(f) as immaterial/scandalous	Shyvers/Pollack: allegations about Plan control, IRS probe, seizures are relevant to alleged fraud	Plan: allegations irrelevant, factually wrong, and some from sealed documents	Motion to strike DENIED (allegations have possible relation and are central to scheme)
Whether crossclaims/fraud-based claims plead fraud with required particularity (Rule 9(b))	Shyvers/Pollack: identify who, what, when (prior to adoption), and misrepresentations about Plan legality/tax treatment	Plan: claims lack dates, speakers, were post-transaction, and contradict Plan documents	Rule 9(b) challenge DENIED; fraud pleadings sufficiently identify who/what/when/where given context
Whether various common-law claims survive 12(b)(6)	Shyvers/Pollack: claims arise from misrepresentations, plan practices, and trustee conduct and are plausible	Plan: many claims fail as a matter of law (ownership precludes some claims; ERISA precludes fiduciary claims; express contract bars quasi-contract)	Unjust enrichment and money had and received DISMISSED; negligence, negligent misrepresentation, fraud, breach of contract, breach of fiduciary duty, and declaratory claims survive (fiduciary and contract issues to be explored further)

Key Cases Cited

Rhoades v. Casey, 196 F.3d 592 (5th Cir.) (discusses interpleader procedure and two-stage analysis)
Wausau Ins. Cos. v. Gifford, 954 F.2d 1098 (5th Cir.) (interpleader statutes liberally construed to protect stakeholder)
In re Bohart, 743 F.2d 313 (5th Cir.) (interpleader protects stakeholder from multiple liability and is to be construed liberally)
N.Y. Life Ins. Co. v. Welch, 297 F.2d 787 (D.C. Cir.) (interpleader statute construed to prevent double liability)
Dunbar v. United States, 502 F.2d 506 (5th Cir.) (party seeking interpleader must show it has been or may be subjected to adverse claims)
Evans v. Tubbe, 657 F.2d 661 (5th Cir.) (federal courts lack interpleader jurisdiction only if claims are plainly frivolous)
Duke Power Co. v. Carolina Envtl. Study Grp., 438 U.S. 59 (U.S. Supreme Court) (jurisdictional standards and limits; merits not required for interpleader jurisdiction)
Bell Atl. Corp. v. Twombly, 550 U.S. 544 (U.S. Supreme Court) (pleading must state plausible claim to relief)
Travelers Ins. Co. v. First Nat’l Bank of Shreveport, 675 F.2d 633 (5th Cir.) (ancillary/supplemental jurisdiction extends to crossclaims in interpleader)
Peacock v. Thomas, 516 U.S. 349 (U.S. Supreme Court) (codification of ancillary jurisdiction into §1367)
State Farm Fire & Cas. Co. v. Tashire, 386 U.S. 523 (U.S. Supreme Court) (limits on interpleader as an all-purpose bill of peace)