## Facts

- Southern Farm Bureau Life Insurance Company (Farm Bureau) issued a life insurance policy insuring the life of Mr. Davis with a face value of $95,000.
- The policy named Mr. Davis’s wife, Robyn Davis, as the beneficiary.
- Mr. Davis died, and Ms. Davis was arrested and charged with killing him.
- Under Louisiana law, a beneficiary may be barred from recovering life-insurance proceeds if she is found criminally responsible for the insured’s death or is judicially determined to have participated in an intentional, unjustified killing.
- If the primary beneficiary is disqualified and there is no contingent beneficiary, Louisiana law directs that the proceeds be paid to the insured’s estate (and, in turn, the heirs under succession law).
- Farm Bureau filed an interpleader action against Ms. Davis and Mr. Davis’s estate/heirs to have the court determine the proper recipient of the policy proceeds and to discharge Farm Bureau from multiple liability.
- Ms. Davis moved to dismiss, arguing the federal court lacked subject-matter jurisdiction.

## Issues

1. Whether the federal court had subject-matter jurisdiction over Farm Bureau’s interpleader action when the requirements for statutory interpleader under 28 U.S.C. § 1335 were not established, but the stakeholder alleged complete diversity and an amount in controversy exceeding $75,000 under 28 U.S.C. § 1332 and proceeded under Fed. R. Civ. P. 22.

## Decision

- The court denied Ms. Davis’s motion to dismiss for lack of subject-matter jurisdiction.
- The court held that interpleader may proceed either under statutory interpleader (28 U.S.C. § 1335) or under Rule 22, so long as an independent basis for federal jurisdiction exists (such as 28 U.S.C. § 1332).
- Because Farm Bureau (a Mississippi citizen) was completely diverse from all defendants (Louisiana citizens) and the amount in controversy ($95,000) exceeded $75,000, the court had jurisdiction under § 1332, permitting Rule 22 interpleader even if § 1335 was not satisfied.

## Legal Principles

- A federal court must confirm subject-matter jurisdiction before reaching the merits of a dispute over entitlement to the stake.
- Statutory interpleader under 28 U.S.C. § 1335 is a separate jurisdictional grant with its own requirements, including minimal diversity among adverse claimants and a $500 amount-in-controversy threshold, plus a deposit or bond.
- Rule interpleader under Fed. R. Civ. P. 22 is a procedural device and does not itself create subject-matter jurisdiction.
- A Rule 22 interpleader may proceed in federal court when an independent jurisdictional basis exists, including complete diversity and the jurisdictional amount under 28 U.S.C. § 1332.
- For § 1332 diversity in a Rule 22 interpleader filed by a stakeholder, the diversity inquiry is between the plaintiff-stakeholder and the defendant-claimants (not between claimant-defendants).
- Interpleader protects a disinterested stakeholder facing competing claims by allowing the stakeholder to deposit the funds and seek discharge from further liability while claimants litigate entitlement.

## Conclusion

The court kept the case in federal court, ruling that Farm Bureau could use Rule 22 interpleader because the insurer established ordinary diversity jurisdiction under § 1332 (complete diversity between the insurer and all defendants and an amount in controversy exceeding $75,000), even if the action did not satisfy the separate requirements for statutory interpleader under § 1335.


Southern Farm Bureau Life Ins. Co. v. Davis, 2010 WL 1245024 (2010)