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Transamerica Life Insurance Company v. Gary Shubin

April 12, 2012

TRANSAMERICA LIFE INSURANCE COMPANY, PLAINTIFF,
v.
GARY SHUBIN, ET AL.,
DEFENDANTS.



The opinion of the court was delivered by: Sheila K. Oberto United States Magistrate Judge

ORDER REQUIRING SUPPLEMENTAL BRIEFING AFTER HEARING ON PLAINTIFF'S MOTION FOR DISCHARGE (Docket No. 15)

I. INTRODUCTION

On November 23, 2011, Plaintiff Transamerica Life Insurance Company ("Plaintiff") filed a complaint in interpleader, alleging that it believes it may be subject to multiple conflicting claims concerning the distribution of a Life Insurance Annuity ("Annuity") payable on behalf of Annuitant/Owner Jeri Wood-Shubin ("Wood-Shubin"). (Doc. 2). On February 23, 2012, Plaintiff filed a Motion for Order of Discharge and Award of Costs and Attorney Fees, seeking (1) to be discharged as the stakeholder in this interpleader action, (2) an award of costs and attorney's fees from the proceeds of the Annuity, and (3) to deposit the net balance of the Annuity with the Court. (Doc. 15.)

A hearing was held regarding Plaintiff's motion on April 11, 2012, before Magistrate Judge Sheila K. Oberto. Pursuant to the matters raised at the hearing, the Court ORDERS Plaintiff to provide supplemental briefing and information on the issues indicated below.

II. DISCUSSION

A. Operative Pleading in the State Court Action

Plaintiff bases its interpleader action on the assertion that it has a real and legitimate fear of multiple litigation with regard to claims against the Annuity. Plaintiff's Director of Post Operations, Tracy Martin ("Martin"), declares that at the time of Wood-Shubin's death there were three Annuity beneficiaries -- Defendants James Shubin ("James"), Gary Shubin ("Gary"), and Roberto Garcia ("Garcia" or, collectively, "Defendants"). (Martin Decl., Doc. 16, ¶ 3.) Exhibits to the complaint indicate that Wood-Shubin added Garcia as a beneficiary on July 31, 2008. (Doc. 2-1, pp. 8-10.) Wood-Shubin died on June 29, 2011. (Doc. 2, ¶ 5.) On August 25, 2011, Evelyn Lauderdale, as Trustee of the Jeri L. Shubin 2007 Trust, filed a first amended complaint against Garcia in Fresno County Superior Court, Case No. 11CECG02841, for fraud (intentional misrepresentation), emotional distress, elder abuse, conversion, specific performance, and for an accounting, alleging that Garcia unduly influenced Wood-Shubin due to her dementia and diminished mental and physical capacity. (Doc. 2-1, pp. 26-51; Doc. 18, Exh. 2, pp. 6-31.)

Plaintiff contends that, after reviewing the state court lawsuit, "it appears that the time frame during which the alleged undue influence occurred coincides with the last beneficiary change for the annuity at issue." (Martin Decl., Doc. 16, ¶ 5.) Plaintiff is concerned that "if it paid the annuity out as per the most recent beneficiary statement and it was later established that Mr. Garcia had in fact unduly influenced Ms. Shubin, there was a risk that, at least as to [Mr. Garcia's] portion of the annuity, Transamerica would be at risk of double payment." (Martin Decl., Doc. 16, ¶ 6.)

Plaintiff provided this Court with a copy of the first amended complaint filed in the state court action; however, a review of the Fresno County Superior Court's website indicates that a second amended complaint was filed on December 23, 2011. Plaintiff is thus ORDERED to provide this Court with a copy of the operative complaint in the state court case.

Further, Plaintiff is ORDERED to provide a supplemental brief that explains if there are any changes in the second amended complaint that affect Plaintiff's assertion in this action that Plaintiff could be potentially liable if it pays out a portion of the Annuity to Garcia based on the current beneficiary designation. Plaintiff should clearly set forth how the current dispute against Garcia in Fresno County Superior Court supports Plaintiff's assertion that it at risk of multiple litigation or multiple liability. Plaintiff should also establish whether the Annuity is part of or separate from the state court action, and how a decision in the state court action could affect distribution of the Annuity, i.e., whether there is any challenge as to the Annuity by the Trustee of Wood-Shubin's estate in the state court action.

B. Stipulation as to the Portion of the Annuity to be Deposited with the Clerk of the Court

Plaintiff indicates that the current value of the Annuity is approximately $342,000. (Martin Decl., Doc. 16, ¶ 3.) Plaintiff sought to deposit the full amount of the Annuity, less attorney's fees and costs, with the Clerk of the Court so that the Court would then determine distribution of the funds. (See Doc. 17, 6:1-4; Martin Decl., Doc. 16, ¶ 7.) However, Plaintiff has not established that there is a dispute as to the full amount of the Annuity, and conceded at the hearing that there is no dispute concerning two-thirds of the Annuity -- the amount that is designated to James Shubin and Gary Shubin.

At the hearing, counsel for Plaintiff and Garcia agreed that the only amount potentially in dispute is the one-third share of the Annuity payable to Garcia, plus any proportional share from James Shubin and Gary Shubin of Plaintiff's attorney's fees and costs. Counsel for Plaintiff and Garcia indicated that they would stipulate that Plaintiff should deposit with the Clerk of the Court only the one-third share of the Annuity payable to Garcia, plus any portion of Plaintiff's attorney's fees determined by the Court to be owed ...


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