Cohen Cheat Sheet on Interpleader | Brett Johnson | December 05, 2014


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Cohen Cheat Sheet on Interpleader

NB: I will not test you on this material or really cover it in any depth in class but you should read it. It is on the line of "Civ Pro" and "Advanced Civ Pro" (if that course ever exists) and I want you to know about this for your practice.


Imagine I pick up your laptop, and hold on to it. You sue me and say it is yours. Well I want to give it away. But I also know that two other students think it is their laptop and will sue me too . . . what am I to do? Well it is like a “hot potato” – I want to get rid of it, and interpleader is a rare and exotic device meant to do that.

It is designed to deal with complex, multi-party litigation. Paradigmatic case: several parties claiming the right to singular piece of property. For example, several people fighting the Met over the ownership of a Picasso.

There are two different ways interpleader can be invoked: the party holding the property can turn the property over to the court and have the claimants fight it out amongst themselves or the party can turn the property over to the court and become one of the claimants themselves.

There are two different kinds of interpleader.

1.    Statutory Interpleader.

This is more powerful but only applies when there is more than $500 at stake. Found in 28 U.S.C. §§ 1335, 1397, 2361. Why is it more powerful? Because we can get a lot of parties into the claim. Permits venue in any judicial district where claimant resides, and nationwide service of process to reach all claimants. Also nationwide personal jurisdiction, remember FRCP 4(k)(1)(C)! Requires minimal not complete diversity between the claimants; the citizenship of the stakeholder is irrelevant.

2.    Rule Interpleader.

FRCP 22. This is the less powerful cousin, what you’d use if you had something less than $500 on the table. Requires either FQ or Diversity jurisdiction to be fully satisfied, including complete diversity between the stakeholder and the claimants, and AIC if you go that route. Does not authorize nationwide service of process.


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December 05, 2014

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Brett Johnson


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