Allstate Life Insurance Company v. Ellett et al
Filing
14
OPINION AND ORDER denying without prejudice 6 Motion for Summary Judgment by Ryan Martinez. A copy of this order was sent to all counsel of record on 2/4/15. Signed by District Judge Mark S. Davis and filed on 2/4/15. (tbro)
UNITED
STATES DISTRICT COURT
EASTERN DISTRICT OF VIRGINIA
Norfolk Division
ALLSTATE LIFE
INSURANCE COMPANY
Plaintiff,
Civil Action No: 2:14cv372
v.
CHRISTOPHER ELLETT,
and
RYAN LEE MARTINEZ,
Defendants
OPINION AND
ORDER
This matter is before the Court on a motion for summary judgment
filed by defendant Ryan Lee Martinez ("Martinez") .
is
an
"interpleader"
action
in
The instant case
which plaintiff,
Allstate
Life
Insurance Company ("Allstate") , as issuer of a life insurance policy
for decedent Cindy Jensen-Ellett ("the Insured"), seeks to deposit
death benefit funds with the Court to allow defendants to litigate
their competing claims to such funds.
As discussed below, because
Martinez fails to demonstrate that summary judgment should be entered
in his favor at this time,
the pending motion is DENIED.
I. Factual and Procedural History
On or about July 25, 2013,
the Insured died in her home from
a knife wound to the neck, and her death certificate lists the cause
of death as "homicide."
Compl. 11 11-12, ECF No. 1.
The Insured's
husband died on the same day from a gunshot wound to the head, with
his cause of death likewise identified as "homicide."
Id. 1 13.
At
the time of her death, the Insured had a life insurance policy issued
by Allstate in the amount of $202,882.20 (the "Death Benefits" ) .
Id.
at 11 10, 19; ECF No. 7, at 2.
The
Insured's
life
insurance
policy
identifies
beneficiaries: defendant Christopher Ellett ("Ellett")
defendant Martinez (50%) .
Compl. 1 10.
two
(50%); and
After the Insured's death,
both Ellett and Martinez filed claims with Allstate asserting the
right to policy proceeds.
Id.
11 14-15.
Ellett has already
received his 50% share in the amount of $101,441.10, but as executor
of
the
Insured's estate,
Ellett
seeks
to prevent Martinez
from
obtaining the other 50% based on Martinez's alleged involvement in
the death of the Insured.
Id. 11 18-19.
Allstate, having concerns
about Martinez's apparent involvement in the Insured's death, filed
this interpleader action after learning from the City of Chesapeake
Police Department that Martinez was a suspect.
Id. 11 16-17.
Allstate's complaint seeks permission to deposit the disputed
portion of the Death Benefits into the registry of the Court in order
to permit Martinez and Ellett to litigate their competing claims,
and further seeks dismissal from this suit with an award of attorneys'
fees and costs.
ECF No.
1.
Although Allstate has not yet filed a
motion seeking to deposit the disputed portion of the Death Benefits
with the Court, and discovery has not yet commenced in this case,1
Martinez filed the instant summary judgment motion arguing that he
is legally entitled to 50% of the Death Benefits.
briefs
in
Both Ellett and
Allstate
subsequently
filed
opposition
judgment,
and Martinez
later filed a reply brief.
to
summary
The pending
summary judgment motion is therefore ripe for review.
II.
"Interpleader
is
Standard of Review
a
procedural
device
that
allows
a
disinterested stakeholder to bring a single action joining two or
more adverse claimants to a single fund."
Hartford v. Arcade Textiles,
2002).
Security Ins.
Inc., 40 F. App'x 767,
Co. of
769 (4th Cir.
It is designed "to protect the stakeholder from multiple,
inconsistent
judgments
and
to
relieve
it
of
the
obligation of
determining which claimant is entitled to the fund."
Id.
An interpleader action typically involves two stages.
Paysage Bords De
Seine,
Pierre-Auguste Renoir,
1879 Unsigned Oil
991 F. Supp.
In re
Painting on Linen by
2d 740,
743
(E.D.
Va.
2014)
(citing United States v. High Tech. Prods., Inc., 497 F.3d 637, 641
(6th Cir.
2007)).
First,
the
court
must
determine
whether
the
plaintiff "has properly invoked interpleader, including whether the
1 Ellett has filed an answer to Allstate's complaint in interpleader,
stating that he did not oppose this interpleader action, but does seek a
stay of proceedings "until such time as the criminal liability of Ryan
Martinez for the death of the Insured is established,
and until
[Ellett]
. . . has the opportunity to investigate a potential action under the
Virginia Wrongful Death Statute ."
has not
filed an answer.
Ellett Answer 1 30, ECFNo. 8.
Martinez
court has jurisdiction over the suit,
whether the stakeholder is
actually threatened with double or multiple liability, and whether
any equitable concerns prevent the use of interpleader. "2
Prods. ,
Inc. ,
497
F.3d
at
641.
Once
a
court
High Tech.
determines
that
interpleader is appropriate, the court "may discharge the plaintiff
from further liability, " and may enter an injunction restraining the
claimants from litigating related actions in state or federal court.
28 U.S.C. § 2361; High Tech. Prods., 497 F.3d at 641; see City Nat.
Bank of Fairmont v. Fidelity Mut. Life Ins. Co.,
(4th Cir.
1953)
206 F.2d 531,
534
(dismissing the interpleader plaintiff from suit
after the "cash value" of the insurance policy was deposited with
the court) .
the
case
In the second stage, "a scheduling order is issued and
continues
respective rights."
between
the
claimants
to
determine
their
Metro. Life Ins. Co. v. Vines, No. WDQ-10-2809,
2011 WL 2133340, at *2 (D. Md. May 25, 2011) ; see High Tech. Prods. ,
4 97 F.3d at 641 (indicating that the second stage proceeds "via normal
litigation processes,
including pleading, discovery, motions, and
trial").
Federal procedure provides two distinct methods of
invoking
interpleader—"statutory" interpleader and "rule" interpleader—and
2 Equitable concerns include whether the plaintiff has acted in bad faith
or delayed unreasonably in bringing the interpleader action.
See Mendez
v. Teachers Ins. & Annuity Ass'n & Coll. Ret. Equities Fund, 982 F.2d 783,
787 (2d Cir. 1992) (bad faith); Matter of Bohart, 743 F.2d 313, 325 (5th
Cir. 1984) (unreasonable delay).
their
jurisdictional
interpleader,
district
requirements
courts
have
vary.
Under
original
statutory
jurisdiction
actions if: (1) the amount in dispute exceeds $500;
over
(2) there are
two or more adverse claimants of diverse citizenship; and (3) the
plaintiff deposits the money or property in dispute into the registry
of the court or posts an adequate bond.
1335
has
been
diversity,'
claimants,
"uniformly
construed
28 U.S.C. § 1335.
to
require
only
Section
'minimal
that is, diversity of citizenship between two or more
without
claimants may be
Tashire, 386 U.S.
regard to
the
co-citizens."
523, 530 (1967) .
circumstance
State
that
Farm Fire
other rival
& Cas.
Co.
v.
By contrast, rule interpleader
pursuant to Federal Rule of Civil Procedure 22 is a procedural device
only, and jurisdiction must therefore be proper under 28 U.S.C.
1331
(federal
question
jurisdiction)
or
§
1332
§
(diversity
jurisdiction).
Because Martinez has filed a summary judgment motion appearing
to argue that
appropriate,
the
record demonstrates
that
interpleader is not
or that even if it is appropriate,
Martinez should
prevail on the merits through summary disposition,
the Court must
apply
Such
the
provides,
familiar
in short,
summary
judgment
standard.
standard
that "summary judgment should be granted if
*there is no genuine dispute as to any material fact and the movant
is entitled to judgment as a matter of law,' based on the 'materials
in the record,'" which must be viewed "in the light most favorable
to the nonmoving party."
Sansotta v. Town of Nags Head,
533, 539 (4th Cir. 2013) (quoting Fed. R. Civ. P. 56).
724 F.3d
On summary
judgment, "[t]he movant initially bears the burden of showing the
absence of any genuine issue of material fact," and it is only when
such burden is effectively carried that the nonmovant is required
"to present facts sufficient to create a triable issue."
Wilson
Works, Inc. v. Great American Ins. Group, 495 F. App'x 378, 380 (4th
Cir. 2012)
718
(citing Temkin v. Frederick Cnty. Comm'rs., 945 F.2d 716,
(4th Cir.
1991)).
III.
Discussion
Prior to filing an answer or other responsive pleading, Martinez
filed the instant summary judgment motion requesting a final ruling
on the merits finding that Martinez is entitled to the portion of
the
Death
Benefits
Although Martinez's
for
which
he
is
a
designated
beneficiary.
summary judgment motion does not
expressly
allege that this Court lacks jurisdiction over this case, it appears
to argue that interpleader is not appropriate because there are not
two legitimate adverse claimants.
A.
Interpleader Stage One
Applying the interpleader standard set forth above, it appears
from the current record that Allstate has met all of the requirements
for invoking interpleader, except for the deposit requirement, which
can be cured by a subsequent motion to deposit.3
in
controversy
jurisdictional
is
$101,441.10,
requirement
which
First, the amount
exceeds
both
the
$500
for statutory interpleader and the
$75,000 diversity jurisdiction threshold that applies to rule
interpleader.
Second, diversity is satisfied under both the relaxed
statutory interpleader
"minimal diversity"
requirement
and the
traditional "complete diversity" requirement of § 1332 that applies
to rule interpleader.4
Third, it appears that Allstate legitimately fears the risk of
multiple lawsuits from competing claimants as both Martinez,
and
Ellett (acting as executor), claim entitlement to over $100,000 in
Death
Benefits
still
in Allstate's
possession.
Specifically,
Ellett contends that Martinez is barred from collecting his portion
of the Death Benefits because of Virginia's "slayer statute" and/or
Virginia common law.
ECF No. 9, at 3-6.
Notwithstanding Martinez's
limited evidence advanced in support of his assertion that he was
3 Although there does not appear to be any required procedure for conducting
the first stage of an interpleader action, the "issues typically are
formulated by motion."
7 Charles Alan Wright, Arthur R. Miller & Mary Kay
Kane,
Federal Practice and Procedure § 1714
(3d ed. 2001).
In a similar
interpleader action currently pending before this Court involving both
Ellett and Martinez, the plaintiff insurance company filed both a "Motion
to Deposit Funds" and a "Motion for Discharge."
Unum v. Ellett, Civil
Action No. 2:14cv218.
On the same date the instant Order is entered, this
Court entered an Order granting both of the insurance company's motions
in 2:14cv218.
4 According to Allstate's complaint, it appears that there is complete
diversity as Ellett is a citizen of Florida,
Virginia,
Martinez is a citizen of
and Allstate is a citizen of Illinois.
Compl. 11 1-5.
not
involved
in
the
murder
of
the
Insured,
the
circumstantial
evidence associated with the Insured's death, as well as the absence
of evidence detailing events preceding her stabbing, is sufficient
to demonstrate that Allstate is in a position where it legitimately
fears
not
colorable,
just
potential
conflicting
conflicting claims.
claims,
See Overstreet v.
Life Ins. Co. , 950 F.2d 931, 940 (4th Cir. 1991)
with potential
but
actual,
and
Kentucky Cent.
("An insurer faced
conflicting claims by a possible
slayer and the
insured's estate may absolve itself of excess liability by paying
the proceeds into the registry of the court and filing an action in
interpleader to determine the proper recipient.") (emphasis added);
7 Charles Alan Wright,
Arthur R. Miller & Mary Kay Kane,
Practice and Procedure § 1704 (3d ed. 2001)
Federal
("The primary test for
determining the propriety of interpleading the adverse claimants and
discharging
the
stakeholder
(the
so-called
*first
stage'
of
interpleader) is whether the stakeholder legitimately fears multiple
vexation directed against a single fund.")
(emphasis added).
To the extent that Martinez argues that this Court should, at
this preliminary stage, analyze the merits of the two competing
claims in order to conclusively determine if they are both "valid"
competing claims, such assertion is rejected by this Court.
Wright, supra,
See 7
§ 1704 (explaining that competing claims must only
"meet a minimal threshold level of substantiality" and that because
the
propriety
of
interpleader
turns
on
"the
possibility
of
multiplicity [of adverse claims], a determination of the respective
merits of the adverse claims is inappropriate at the initial stage"
of
an
interpleader action)
(emphasis
added);
28
U.S.C.
§ 1335
(indicating that statutory interpleader requires that " [t] wo or more
adverse claimants . . . are claiming or may claim to be entitled to
such money or property") (emphasis added).
from Martinez,
Having received a claim
as well as a claim from Ellett (as executor of the
Insured' s estate) in the form of a letter from Ellett' s lawyers citing
the Virginia slayer statute and requesting that Martinez's share of
the insurance proceeds be "delayed pending his prosecution," ECF No.
1-7, and having performed some additional investigation into the
pending criminal case, Allstate appropriately attempted to absolve
itself of the risk of paying the wrong party by filing the instant
interpleader action.
Overstreet, 950 F.2d at 94 0.
Although this
Court can envision a hypothetical case where the record plainly
demonstrates that one of the purportedly competing claims is so
clearly unsupported in fact or law that the interpleader action
should fail at stage one, the record in this case does not warrant
such outcome.
Rather,
both Ellet and Martinez have advanced a
colorable claim to the disputed funds, and both claims find some
support in the (currently undeveloped) record.
Moreover, there does not appear to be any equitable concerns
weighing
against
Allstate,
as
it
appears
that
Allstate
is
a
disinterested stakeholder that does not dispute the amount owed under
the relevant insurance policy,
faith,
and is timely asserting,
in good
that it is unable to determine which claimant is legally
entitled to such funds.
It therefore appears that interpleader is
appropriate on this record as
there
is
a legitimate dispute by
competing claimants, with diverse citizenship, with respect to more
than
$100,000
in
judgment motion
life
is
insurance
proceeds.
therefore denied to
Martinez's
the
extent
it
summary
seeks
to
challenge the threshold "stage one" determination as to whether
interpleader is appropriate.
B.
Interpleader Stage Two
To the extent that Martinez argues that even if the Court
proceeds to stage two of the interpleader inquiry, summary judgment
should be entered in his favor,
such claim is denied at this time.
Martinez argues that summary judgment is appropriate on the record
before the Court because he has not been formally charged with the
death of the Insured, and because, according to Martinez,
not involved in the death of
opposition
to
Martinez's
the insured."
summary
judgment
ECF No.
motion,
7,
"he was
at 6.
In
Ellett
and
Allstate both argue that summary judgment is improper because there
10
are genuine disputes as to material facts regarding the circumstances
surrounding the death of the Insured.
As noted above, the second stage of an interpleader action is
similar to a typical civil case in that the respective rights of the
claimants
are
resolved
through
the
adversarial
process.
Accordingly, here, as in other civil cases, the filing of a summary
judgment motion in advance of any discovery appears premature.
See
McCray v. Md. Dep't of Transp., Md. Transit Auth. , 741 F.3d 480, 483
(4th Cir. 2014)
(indicating that "[i]n general,
summary judgment
should only be granted 'after adequate time for discovery' " as filing
such a motion before discovery "forces the non-moving party into a
fencing match without a sword or mask" (quoting Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986) )) ; see also 7 Wright, supra, § 1704
(explaining that " [e]xtended inquiry at a preliminary stage into the
stakeholder's motives usually will prove fruitless and the court
should not allow itself to be detoured into a premature speculation
about the merits") (emphasis added).
However, notwithstanding the
premature nature of such motion, the non-movants have not filed a
Rule 56(d) affidavit seeking additional time for discovery, and the
Court therefore proceeds to address whether summary judgment is
warranted on the limited record.
Although non-movants do acknowledge that Martinez's girlfriend
was the only person charged with the murder of the Insured, their
11
briefs
highlight
statute."
the
expansive
reach
of
the
Virginia
"slayer
Such statute bars a "slayer" from acquiring any property
as a result of the death of the decedent, defining "slayer" to include
"any
person
(i)
manslaughter
of
conviction,
who
the
is
convicted
decedent
who is determined,
or,
of
the
(ii)
in
murder
the
or
voluntary
absence
of
such
whether before or after his death,
by a court of appropriate jurisdiction by a preponderance of the
evidence to have committed one of the offenses listed in clause (i)
resulting in the death of the decedent."
(emphasis added) .
Va. Code § 64.2-2500 (2012)
Although Martinez has not been criminally charged
with the death of the Insured,
such fact does not resolve whether
the second prong of the slayer statute is applicable, nor does it
resolve whether Virginia common law,
preclude Martinez
from receiving life
Hartford Life and Ace.
5472036,
at *1, *8
Ins.
(W.D. Va.
Co.
v.
2012)
as
discussed below,
insurance proceeds.
King,
No.
7:llcv411/
would
See
2012 WL
(denying the alleged slayer's
summary judgment motion as premature, and recognizing that even in
the
absence
of
criminal
charges,
the
slayer
statute
could bar
claimant from recovering life insurance proceeds).
Although the current record is largely undeveloped,5 it appears
undisputed that Martinez was not only present when the Insured was
5 Curiously, neither Allstate nor Ellett provided any affidavits or other
evidence to counter the evidence that was advanced by Martinez in support
of his summary judgment motion.
However, at this early stage in the
12
killed,
but that Martinez's girlfriend killed the Insured with a
knife during the course of an argument between Martinez and the
Insured,
and
that
subsequent
to
the
Insured's
death,
Martinez
unlawfully transported both the Insured's body and the body of her
husband, who was apparently shot in the head by Martinez on the same
day, and in the same house, in which the Insured was killed.
in the current record sheds
Nothing
light on either Martinez's actions
immediately preceding the killing of the Insured, or how (or when)
the shooting of the Insured's husband occurred.
It is well-established under Virginia law that " [e] very person
who is present at
the commission of a trespass,
encouraging or
inciting the same by words, gestures, looks or signs, or who in any
way, or by any means, countenances or approves the same, is, in law,
assumed to be an aider and abettor, and is liable as [a] principal."
Spradlinv. Commonwealth, 195 Va. 523, 526 (1954) (internal quotation
marks
and citations
omitted).
Stated differently,
while
"mere
presence" when a crime is committed is insufficient "to render one
guilty as an aider or abettor," when a statute criminalizes an act,
"it imposes on all persons who are present purposely giving aid and
comfort to the actual wrongdoer criminal responsibility equal to that
of
the
wrongdoer."
proceedings,
Id.
at
527
(internal
quotation
marks
and
and taking the evidence before the Court in a light most
favorable to the nonmovants,
the Court finds that the best course is to
deny the summary judgment motion without prejudice to Martinez's right to
refile such a motion after additional facts are developed in this matter.
13
citations omitted).
Moreover,
"whether a person does in fact aid
or abet another in the commission of a crime is a question which may
be determined by circumstances as well as by direct evidence."
(internal quotation marks and citations omitted)
Consequently,
particularly
at
this
Id.
(emphasis added).
pre-discovery
stage,
there
remains a genuine issue of material fact as to whether Martinez is
barred from recovering his portion of the Death Benefits as an "aider
or abettor."6
Even if Martinez is not a "slayer" as defined by the Virginia
slayer statute, he may still be barred from recovering life insurance
proceeds based on the "ancient common law doctrine that no man shall
be allowed to profit by his own wrong."
Life Ins. Co. of Va. v.
Cashatt, 206 F. Supp. 410, 411 (E.D. Va. 1962) .
Notably, a provision
in the Virginia Code separate from the slayer statute embodies this
doctrine,
expressly stating that
the slayer statute
"shall be
construed broadly in order to effect the policy of the Commonwealth
6 It appears from public court records from the Chesapeake Circuit Court
that, subsequent to the briefing in this case, both Martinez and his
girlfriend, Airika Liljegren, have entered into "Alford pleas" as to the
state court murder charges, with Liljegren pleading to the Insured's
murder, and Martinez pleading to the husband's murder.
Case Nos.
CR14000113
(Martinez)
and
CR14000111
(Liljegren),
available
at
http://ewsocisl.courts.state.va.us/CJISWeb/circuit.j sp.
Moreover,
Martinez appears to have entered an Alford plea as to a firearm charge and
two charges for the post-killing unlawful transportation of the Insured's
body and her husband' s body. Id. As explained above, the limited record,
viewed in the non-movants'
favor,
is insufficient to demonstrate that
Martinez did not participate, encourage, or approve of his girlfriend's
deadly attack on the Insured, which occurred during an argument between
Martinez and the
Insured.
14
that no person shall be allowed to profit by his own wrong" and that
codification of the slayer statute does not override common law
rights and remedies that prevent a person from profiting from an
unlawful killing.
Va. Code § 64.2-2511 (2012).
Based on the forgoing,
to include the pre-discovery lack of
clarity in the record as to the details of the Insured's killing,
Martinez fails to demonstrate the absence of disputed material facts,
and his summary judgment motion is therefore denied on this ground.
C. Request for an Evidentiary Hearing
Martinez's summary judgment briefing alternatively requests an
evidentiary hearing
to
determine
whether Allstate
adequate investigation into the facts
death.
performed an
surrounding the Insured's
For the reasons stated in Ellett's brief in opposition to
summary judgment, ECF No. 9, at 5-6, the Court denies such request.
See 7 Wright, supra, § 1704 (indicating that "extended inquiry at
a preliminary stage into the stakeholder' s motives usually will prove
fruitless").
IV.
Conclusion
For the reasons discussed above, Martinez's motion for summary
judgment is DENIED without prejudice to his right to refile such
motion at the appropriate time.
The Court awaits further motion
from Allstate as to the deposit of funds in the Court's registry
15
and/or the filing of any other appropriate motion by any party to
this
case.
The Clerk is DIRECTED to send a copy of this Opinion and Order
to all
counsel
IT
IS
SO
of
record.
ORDERED
M
Mark S. Davis
United States District Judge
United States District Judge
Norfolk,
Virginia
February J
, 2015
16
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