The Prudential Insurance Company of America v. Payne, 2:20-cv-03683

Prudential issued a group life policy covering Wolfgang Bollman; after his death his wife Gisselle Bollman placed the death benefit into a Prudential Alliance Account and was named account owner.
Gisselle executed multiple beneficiary designation forms; the last (May 16, 2016) named Sabine Assmus and Jessica Payne as co-primary beneficiaries (50% each).
Gisselle died April 18, 2018; the Alliance Account balance was $72,149.41 (as of March 2, 2021) and payable to a beneficiary or beneficiaries.
Edica (Erufadica) Kema (Gisselle’s sister) contested the May 2016 designation, alleging fraud/undue influence and dementia, and commenced a Surrogate’s Court proceeding; Sabine Assmus and Jessica Payne asserted competing claims to the funds.
Prudential, as a disinterested stakeholder, brought an interpleader action under Fed. R. Civ. P. 22 and 67 and 28 U.S.C. § 1335 and sought to deposit the funds with the Court, be discharged from liability, and obtain a permanent injunction preventing other suits.
The parties jointly moved for interpleader relief; the magistrate judge ordered Prudential to deposit $72,149.41 plus accrued interest into the Court registry within 20 days, discharged Prudential, and enjoined the defendants from instituting other actions affecting the disputed funds.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether §1335 jurisdiction is satisfied (amount and diversity)	Amount exceeds $500 and there are two or more adverse claimants of diverse domiciles (minimal diversity)	Defendants assert competing entitlement/fraud claims but do not dispute jurisdiction	Court: §1335 satisfied (amount and minimal diversity met)
Whether Prudential may interplead and deposit the funds	Prudential faces real and reasonable fear of double liability and should be allowed to deposit funds and withdraw	Claimants seek the funds or challenge the beneficiary designation (fraud/undue influence); no serious charge of stakeholder bad faith	Court: interpleader appropriate; Prudential may deposit funds and be discharged as a neutral stakeholder
Whether Prudential should be discharged from further liability	As a disinterested stakeholder that met §1335, Prudential should be discharged and released after deposit	Claimants did not allege Prudential independently liable or bad faith	Court: Prudential discharged upon deposit and submission of proposed discharge order
Whether the Court should issue a permanent injunction barring other suits	Injunction necessary to protect Prudential from overlapping lawsuits and to make interpleader effective	Claimants not opposing injunction as to Prudential; their substantive claims preserved against each other	Court: permanent injunction granted under 28 U.S.C. § 2361 and § 1335

Bank of New York v. First Millennium, Inc., 607 F.3d 905 (2d Cir.) (interpleader protects stakeholders from double liability and conflicting claims)
Washington Elec. Coop., Inc. v. Paterson, Walke & Pratt, P.C., 985 F.2d 677 (2d Cir.) (interpleader shields stakeholder from adjudicating competing claims' merits)
John Hancock Mutual Life Insurance Co. v. Kraft, 200 F.2d 952 (2d Cir.) (stakeholder need not evaluate competing claim merits to invoke interpleader)
New York Life Insurance Co. v. Apostolidis, 841 F. Supp. 2d 711 (E.D.N.Y.) (procedures for discharge and deposit in interpleader under § 1335)
Metropolitan Life Insurance Co. v. Mitchell, 966 F. Supp. 2d 97 (E.D.N.Y.) (interpleader jurisdictional and injunctive relief considerations)
Mendez v. Teachers Insurance & Annuity Ass'n, 982 F.2d 783 (2d Cir.) (district court may discharge stakeholder under § 2361)
New York Life Ins. Co. v. Connecticut Dev. Auth., 700 F.2d 91 (2d Cir.) (discharge of a disinterested stakeholder ordinarily appropriate absent bad-faith allegations)
Fidelity Brokerage Servs., LLC v. Bank of China, 192 F. Supp. 2d 173 (S.D.N.Y.) (interpleader relieves stakeholder from assessing competing claims)
Sotheby's, Inc. v. Garcia, 802 F. Supp. 1058 (S.D.N.Y.) (§ 2361 allows injunctions to protect interpleader effectiveness)