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Lucy, Esq.
Lucy, Esq., Attorney
Category: Business Law
Satisfied Customers: 29985
Experience:  Attorney
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I have a meet and confer teleconference scheduled on Friday.

Customer Question

I have a meet and confer teleconference scheduled on Friday. I e-mailed the group with two issues I'd like to add to the agenda: My motion to sever; and, another motion to disqualify one of the attorneys (who is representing the insured) so that this attorney can testify regarding my case. (If needed, I can provide more details).

At any rate, the Plaintiff's attorney e-mails me back stating he intends to file a summary judgment against me and that severing my claim is "inappropriate" for a federal interpleader. ??? I thought severing has to do with joinder which is what an interpleader is all about, no?
Submitted: 6 years ago.
Category: Business Law
Expert:  Lucy, Esq. replied 6 years ago.

Interpleader is a type of case where one person holds money that he know doesn't belong to him, but he doesn't know who it belongs to legally. So, he goes to court and says, "Look, judge, I have this money, and it belongs to either A, B, C, or D, but I don't know who, and I want you to figure it out, because all I know is that it's not mine."

In that context, I don't really know why they would file for summary judgment against you, unless they're saying that you definitely don't have a claim against the funds in question (in which case, why did they add you as a defendant?).

I don't have all the facts of your case, but I know that you were asking to sever because there were different issues of fact and law in your case than in the other cases. If you are claiming that you're entitled to the same asset that everyone else is fighting over, then the judge probably won't sever your case, even if you have different issues that you also want the judge to hear. If you're not claiming a portion of some an asset that everyone else is fighting over, it may be appropriate to sever your case.

I don't know if it would help if I had more facts. It may also be that the other attorney simply used the term "interpleader" incorrectly - there are a few similar terms, and it can get confusing.
Customer: replied 6 years ago.

Hmm...I have the same understanding of the interpleader action as you do. One policy, one pool of money, all defendants swim in the same pool. Some aren't allowed to swim (disqualified).


Severing - My claim is different from the others. My claim did not occur from the same transaction or occurrance; does not involve the same matters of fact and law; I have a stipulated judgment stemming from a federally mandated arbitration and mediation process (contract law - insurance claim), others don't (tort law - negligence/fraud claims); and, I don't need a jury (my case comes down to insurance contract law which a judge can easily figure out), some of them have requested a jury trial to figure out if they were defrauded or treated unfairly.


Still, only one professional liability policy. $1M per claim; $5M aggregate. Perhaps the way to sever would be to demonstrate the carrier has acted in bad faith. Not only did they deny my claim, they failed to provide a defense to their insured. My arbitration lead to mediation, neither of which they participated in, but were continuously infomed of. The attorney representing the insured has also represented the carrier defending the insured in other related actions. A different attorney (who has also represented the carrier in the past) signed my stipulated judgment binding the carrier. However, now this attorney is representing the insured and the carrier is suing them in this lawsuit. Seems to me like a big shell game!


Anyway, if not possible to sever, how about bifurcate? Since my claim is distinct from the others, it would confuse a jury to have me lumped together with the others. The other defendants have investor complaints involving negligence and fraud (tort law); I have an employment law / failure to supervise case that was "settled" with a stipulated judgement (contract law).


Last, the plaintiff's attorney frequently threatens "summary judgment." He's apparantly driven by emotion, not logic. Anyway, the meet and confer should be about sorting out these issues. Unfortunately, I think plaintiff's counsel will use it to throw up a lot of "monkey dust" (e.g. "summary judgment").


So, if not sever, bifurcate?





Expert:  Lucy, Esq. replied 6 years ago.
Bad faith is a claim between the insured and the insurer. If they failed to defend the insured against you, you wouldn't have the right to claim bad faith. It's up to insured to do that.

At this point, I'm assuming that the total claims exceed the $5 million aggregate limit. If that's true, they need a judge to decide who gets which portion of the money and why. The problem with bifurcation is that, if the jury divides the $5 million pool among all the other defendants, and a judge finds that you are also entitled to $5 million, you're in the same boat you are now - multiple claimants putting claims on the same pool of money. One reason that joinder would be allowed is to avoid inconsistent verdicts that might compromise the rights of the various parties. That can happen in an interpleader case - if it weren't interpleader, you're right, the cases would be severed.

You could ask to bifurcate on the issue of liability only. That way, the jury would decide which, if any, of the other defendants were harmed. The judge would enforce your judgment, and then the judge would decide how to divide the total pool based on the liability determination. I don't know if that would be allowed.

I am also now very confused as to why the attorney would request summary judgment against you, if you already have a stipulated judgment. That would only make sense if he is stating that you can be paid the amount of the judgment without compromising the rights of any of the other defendants. He is right that, if you stipulated to a judgment amount, you don't really need a trial. A trial is to determine the facts, and it sounds like you've already agreed to the facts (or at least agreed that the insurance company is liable).
Lucy, Esq. and 2 other Business Law Specialists are ready to help you
Customer: replied 6 years ago.
It is all very confusing. But I will end this question for now and discuss more with you later. Thank you. You've been a BIG help!
Expert:  Lucy, Esq. replied 6 years ago.
You're welcome, and thank you. I should be available this evening if you have more questions - you're right, it IS very confusing.