Kusek v. Principal Financial Group

Filing 40

ORDER - that the parties' Stipulation for Entry of Decree of Interpleader (filing 37 ) is denied without prejudice. Ordered by Judge John M. Gerrard. (KLF)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
DAVID KUSEK,
Plaintiff and
Counter-Defendant,
vs.
PRINCIPAL FINANCIAL GROUP, A
CORPORATION,
8:16-CV-275
Defendant,
Counterclaimant,
and Third-Party
Plaintiff,

ORDER

vs.
THE ESTATE OF KARLA KUSEK, et
al.,
Third-Party
Defendants.
This matter is before the Court on the parties' Stipulation for Entry of
Decree of Interpleader (filing 37). The stipulation will be denied without
prejudice. A brief recap of the procedural history of the case will explain why.
The plaintiff, David Kusek, sued the defendant, Principal Life
Insurance Company, asserting a claim for breach of an insurance policy
arising out of failure to pay benefits due as a result of his wife's death. Filing
1-1. The defendant answered and asserted a counterclaim against the
plaintiff, and a third-party claim against several third-party defendants: the
decedent's estate and her children (and alternative heirs). Filing 6. The
plaintiff answered the defendant's counterclaim, but did not assert a claim
against the third-party defendants pursuant to Fed. R. Civ. P. 14(a)(3). Filing
27. Finally, the third-party defendants answered the defendant's third-party
claim, but did not assert a claim against the plaintiff pursuant to Rule
14(a)(2)(D). Filing 32.
So, at this point, three claims are presented by the parties' pleadings:



The plaintiff's claims against the defendant,



The defendant's counterclaim against the plaintiff, and



The defendant's third-party claim against the third-party
defendants.

The parties have stipulated that the defendant should be excused from this
case "and shall be dismissed from this case with prejudice, and the remaining
parties to this case shall litigate their claims." Filing 37 at 3. But what claims
are those? It appears to the Court that Principal Life Insurance Company is
either the sole defendant or sole plaintiff for every pending claim. If Principal
is dismissed with prejudice, the remaining parties would have no claims
pleaded against one another, leaving the Court with nothing to adjudge. See
United States v. Lushbough, 200 F.2d 717, 721 (8th Cir. 1952).1
In short, dismissing the defendant from this case would functionally
dismiss all the claims in this case. And it is evident that is not what the
parties intend. Accordingly, the Court will deny the parties' stipulation
without prejudice to reassertion after the parties have repleaded or realigned
in a manner that would leave a pending claim following the defendant's
dismissal from the action.
IT IS ORDERED that the parties' Stipulation for Entry of Decree
of Interpleader (filing 37) is denied without prejudice.
Dated this 22nd day of February, 2017.
BY THE COURT:

John M. Gerrard
United States District Judge

The Court is aware that according to some courts, a formal amendment of plaintiff's
complaint is not necessary if the parties actually treat each other in an adverse manner.
Practice in Third-Party Actions—Plaintiff's Rights Against the Third-Party Defendant, 6
Fed. Prac. & Proc. Civ. § 1459 (3d ed.). But the Court is uncertain whether that practice
extends to actually dismissing the third-party plaintiff from the case without any actual
assertion of an adverse claim. And in any event, the Eighth Circuit's precedent suggests
otherwise. See Lushbough, 200 F.2d at 721.
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