Opinion
Civil Action 01-2401, Section "T"(5)
January 8, 2002
Before the Court are two motions, a Motion for Summary Judgment filed on behalf of two of the Defendants, Southern Farm Bureau Casualty Insurance Company and Mississippi Farm Bureau Insurance Company (Document No. 6), and a Motion for Summary Judgment filed ob behalf of the Plaintiff, the United States of America (Document No. 7). The parties waived oral argument and the matter was taken under submission on November 7, 2001. The Court, having considered the arguments of the parties, the Court record, the law and applicable jurisprudence, and the fact that the defendant, Marvel Alexander, did not file a response, is fully advised in the premises and ready to rule.
ORDER AND REASONS
I. BACKGROUND:
On September 18, 2000, the Auto theft Task Force, Federal Bureau of Investigation, New Orleans Division, seized a 1989 Toyota 4Runner, VIN No. JT3VN66W4K0037730, from defendant Marvel Alexander because it had been reported as stolen on October 16, 1998, to the Baton Rouge Police Department by the previous owner, James Matheny. Although Ms. Alexander had a bill of sale. she did not have a title to the vehicle.
Following the theft. James Matheny filed a claim with defendant Mississippi Farm Bureau insurance Company. Mississippi Farm Bureau Company paid the claim. Mississippi Farm Bureau Insurance Company is a subsidiary of Southern Farm Bureau Casualty Insurance Company. Title to the 1989 Toyota 4Runner. VIN No. JT3VN66W4K0037730, was issued to Southern Farm Bureau Casualty Insurance Company on May 7, 1999 ( See Exhibit A to Motion for Summary Judgment Document No. 6, Certificate of Title).
Since its seizure, the Toyota 4Runner has been maintained by the Auto theft Task Force, Federal Bureau of Investigation, New Orleans Division. The Toyota 4Runner has a value of more than $500.
II. LEGAL ANALYSIS:
A. Law on Interpleader
In its Motion for Summary Judgment, the United States argues the interpleader is proper in this case. Statutory Interpleader is proper when money or property (the "stake") valued at $500 or more is deposited in the court and is subject to claims by "[t]wo or more adverse claimants, of diverse citizenship. Statutory Interpleader requires "minimal diversity" between two or more adverse claimants, regardless of the stakeholder's citizenship. State Farm Fire Casualty Co. v. Tashire, 386 U.S. 523, 530-31, 87 S.Ct. 1199, 1203-204 (1967). "To satisfy the adversity requirement for an interpleader action, the interpleader claims must be adverse to the fund and adverse to each other." Industrial Bank of Washington v. Techmatics Technologies. Inc., 763 F. Supp. 629, 634 (D.D.C. 1991), aff'd 955 F.2d 764 (D.C. Cir. 1992). The stakeholder must also deposit the stake with the court or post an appropriate bond. 28 U.S.C. § 1335. However, when the stakeholder is the United States, it need not post any bond or deposit the stake with the court, as is required of ordinary plaintiffs. United States v. Herce, 334 F. Supp. 111, 112 (D.N.Y. 1971).
An interpleader action under 28 U.S.C. § 1335 typically takes place in two stages. Amy Holding Company v. Dasyure. Ltd., 1999 WL401660 (E.D.La. June 19, 1999). The two stages may be consolidated and the entire action disposed of at one time. New York Life Ins. Co. v. Connecticut Development Authority. 700 F.2d 91, 95 (2d Cir. 1983).
During the first stage, the court must determine whether or not the requirements of the statute have been met and whether the stakeholder may be relieved from liability. Mid-American Indemnity Co. v. McMahon, 666 F. Supp. 926, 928 (S.D.Miss. 1987). The stakeholder must demonstrate that the requisites for interpleader have been met. Id. Although there is no set procedure for conducting the first stage of interpleader, it may be accomplished by a motion for summary judgment. Charles Alan Wright, Arthur R. Miller Mary Kay Kane, Federal Practice Procedure vol. 7, § 1714 (3d ed. 2001).
In the second stage, which proceeds like any other action, the adverse claims are adjudicated and the proceeds disbursed. Id. The second stage may be adjudicated on a motion for summary judgment and a default judgment may be entered against a claimant who fails to appear or otherwise defend the action. id.
B. Law on Summary Judgment
The Federal Rules of Civil Procedure provide that summary judgment should be granted only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED. R. Civ. P. 56(c). The party moving for summary judgment bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the record which it believes demonstrate the absence of a genuine issue of material fact. Stults v. Conoco. Inc., 76 F.3d 651, 655-56 (5th Cir. 1996) (citing Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 912-13 (5th Cir.) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)), cert. denied, 506 U.S. 832 (1992)). When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts. The non moving party must come forward with "specific facts showing that there is a genuine issue for trial" Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (emphasis supplied); Tubacex. Inc. v. M/V RISAN, 45 F.3d 951, 954 (5th Cir. 1995).
Thus, where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no "genuine issue for trial." Matsushita Elec. Indus. Co., 475 U.S. at 588. Finally, the Court notes that substantive law' determines the materiality of facts and only "facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
C. First Stage of Interpleader is Proper
The requisites for interpleader have been met. The FBI has possession of the Toyota 4Runner, which has a value of more than $500. The requisite minimal diversity is present. Marvel Alexander is a resident of Louisiana. Southern Casualty Farm Bureau is a Mississippi corporation with its principal place of business in Mississippi. In addition, each defendant-claimant has an interest in the Toyota 4Runner that is adverse to the other. If the United States is not allowed to interplead in this case, it may be subject to lawsuits brought by both sides. "The mere threat of multiple litigation justifies interpleader." Amy Holding Company, 1999 WL 301660 at *2.
D. Summary Judgment in Favor of the United States is Proper
There is no genuine issue as to material fact in this matter. Both Motions filed, one by the United States and one by the insurance companies, state the same facts. The non-movant in this matter has not shown any genuine issue for trial. When the non-movant fails to show any genuine issue for trial, summary judgment must be granted. Stults, 76 F.3d at 656.
E. Second Stage of Interpleader
Southern Farm Bureau Casualty Insurance Company and Mississippi Farm Bureau insurance Company have filed a Motion for Summary Judgment (Document No. 6) that, if granted, would designate the insurance companies as the rightful owners of the Toyota 4Runner. In the second stage of interpleader, which proceeds like any other action, the adverse claims are adjudicated and the proceeds disbursed. Charles Alan Wright, Arthur R. Miller Mary Kay Kane, Federal Practice Procedure vol. 7, § 1714 (3d ed. 2001). The second stage may be adjudicated on a motion for summary judgment and a default judgment may be entered against a claimant who fails to appear or otherwise defend the action. Id.
In its Motion for Summary Judgment, the insurance companies cite Pierce Enterprises of La., Inc. v. Mamoulides, 337 So.2d 621. In that case, a plaintiff, who had purchased a stolen vehicle, attempted to obtain the vehicle from an insurer who had the title to the vehicle, having paid its insured for said vehicle. The Court ruled in favor of the insurer, designating it as the rightful owner.
In addition, Louisiana Civil Code Article 2452 provides that the sale of a thing belonging to another cannot and does not convey ownership. An innocent purchaser of stolen property" . . . obtains no title thereto. and must return it to the rightful owner . . ." See 151 So.2d 526 (La.App. 4Cir. 1963). Additionally, the Court notes Marvel Alexander's failure to appear or otherwise defend the action.
III. CONCLUSION:
The requisites for interpleader have been met. There is no genuine issue as to material fact in this matter. Therefore, summary judgment is proper as to the interpleader issue.
In addition, summary judgment is proper as to the underlying ownership issue. There are no genuine issues of material fact. One of the claimants, Marvel Alexander, did not appear or defend the action A default judgment may be entered against a claimant who fails to appear or otherwise defend the action.
Accordingly,
IT IS ORDERED that the Motion for Summary Judgment declaring that this interpleader action is properly before the Court. filed on behalf of Plaintiff, the United States of America, be and the same is hereby GRANTED.
IT IS FURTHER ORDERED that the United States is discharged from all liability to the defendant — claimants relating to the Toyota 4Runner at issue.
IT IS FURTHER ORDERED that the Motion for Summary Judgment filed on behalf of the Defendants, Southern Farm Bureau Casualty Insurance Company and Mississippi Farm Bureau Insurance Company (Document No. 6), adjudging them as the rightful owners of the Toyota 4Runner at issue, be and the same is hereby GRANTED.