## Facts

- The Indianapolis Colts’ owner considered relocating the NFL franchise from Baltimore to Indianapolis in early 1984.
- Maryland enacted legislation authorizing Baltimore to acquire the franchise by eminent domain.
- On March 28, 1984, the Colts moved their operations to Indianapolis and entered a 20-year stadium lease with the Capital Improvement Board of Managers of Marion County, Indiana (CIB) to play home games in the Hoosier Dome.
- The lease included (1) an “eminent domain escape clause” allowing the Colts to terminate lease obligations at their option if the franchise were acquired by eminent domain, and (2) a limited CIB right to locate a purchaser if the owner decided to sell.
- On March 30, 1984, Baltimore filed a Maryland state condemnation action seeking to take ownership of the Colts’ franchise.
- The Colts then filed a federal statutory interpleader action in the Southern District of Indiana under 28 U.S.C. § 1335, asserting Baltimore and the CIB had conflicting claims concerning the franchise and related obligations.
- The district court accepted interpleader jurisdiction and enjoined Baltimore from pursuing the Maryland condemnation action and certain related actions against the NFL.

## Issues

1. Whether 28 U.S.C. § 1335 interpleader jurisdiction existed because Baltimore and the CIB asserted adverse claims to the same stake.
2. Whether the Colts showed a real and reasonable fear of double liability or vexatious, conflicting claims sufficient to invoke statutory interpleader.
3. Whether, absent § 1335 jurisdiction, the district court lacked power to issue injunctions restraining Baltimore’s condemnation action and related proceedings.

## Decision

- The Seventh Circuit vacated the district court’s injunctions and remanded with instructions to dismiss for lack of subject-matter jurisdiction.
- The court held § 1335 interpleader requirements were not met because Baltimore and the CIB did not assert adverse claims to a single stake.
- The court further held the Colts lacked a real and reasonable fear of double liability because the lease’s eminent domain escape clause made any alleged conflict too remote and contingent.

## Legal Principles

- Statutory interpleader under 28 U.S.C. § 1335 requires adverse claimants competing for the same property, fund, or obligation (a single stake) such that resolution among claimants can discharge the stakeholder.
- Interpleader is improper where one claimant seeks ownership of property while the other asserts only distinct contractual rights not amounting to a competing claim to the same stake.
- A stakeholder must demonstrate a real and reasonable fear of double liability or conflicting claims; speculative or contractually avoided exposure does not satisfy § 1335.
- If statutory interpleader jurisdiction is absent, a federal court lacks authority to maintain injunctions issued in aid of the interpleader action.

## Conclusion

The Seventh Circuit concluded the Colts could not use § 1335 interpleader to consolidate Baltimore’s condemnation effort and the CIB’s lease rights because the claims did not compete for a single stake and the lease’s eminent domain termination provision eliminated any reasonable risk of double liability, requiring dismissal and vacatur of the injunctions.


Indianapolis Colts v. Mayor & City Council of Balt., 741 F.2d 954 (7th Cir. 1984)