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Metropolitan Life Insurance v. United States

August 8, 2008

METROPOLITAN LIFE INSURANCE, PLAINTIFF,
v.
UNITED STATES OF AMERICA; BETTY MARTINEZ*FN1 ; STRATCAP INVESTMENTS, INC., DEFENDANTS.



The opinion of the court was delivered by: Gary L. Sharpe U.S. District Judge

MEMORANDUM-DECISION AND ORDER

I. Introduction

This case arises from a dispute between an annuity owner, the United States, and the annuitant, Betty Martinez. Pending are motions for reconsideration filed by both Metropolitan Life Insurance and the United States, and a motion to dismiss filed by Stratcap Investment, Inc., in lieu of an answer. MetLife and the United States assert that the court was misinformed during the April 3, 2008, motion return. They urge the court to reconsider its previous decision, grant a stay as to all State and Federal proceedings affecting disposition of the funds that are the subject of this interpleader action; order that MetLife deposit the payments at issue in to the court's registry; issue an order directing Stratcap*fn2 to return funds to MetLife and/or deposit those funds into the court's registry, pending resolution of the merits of the interpleader action; and discharge MetLife from any further liability relating to the annuity benefits. In addition, MetLife request attorney's fees.

The motions for reconsideration are granted as follows: (1) MetLife is ordered to deposit all annuity benefits into the registry of the court; (2) all State and Federal court proceedings for the payments at issue are stayed; (3) MetLife is discharged from any further liability relating to the annuity benefits; (4) Stratcap is hereby ordered to return the funds received while this motion has been pending into the registry of the court. However, MetLife's request for attorneys fees is denied with leave to renew on a more complete record. Finally, Stratcap's motion to dismiss is denied.

II. Background

Betty Martinez, a settling Federal Tort Claim Act plaintiff, assigned her rights to annuity payments, owned by the United States, to Stratcap. On January 8, 2008, MetLife filed an interpleader complaint against the United States, Stratcap and Betty Martinez. On February 22, the United States filed an answer including counterclaims for declaratory relief against Stratcap and Martinez. (Dkt. No. 10).

On March 28, MetLife filed a motion for a preliminary injunction seeking, inter alia,a stay of a State court proceeding, and an order discharging it from liability and directing deposit of the payment at issue. On April 3, during an oral return, the court declined to stay the State court action. On April 18, again by order to show cause, MetLife filed a motion for reconsideration. (Dkt. No. 27). That same day, the United States filed a motion for reconsideration. (Dkt. No. 25). On April 21, Stratcap filed a motion to dismiss in lieu of an answer. (Dkt. No. 28). Despite a deadline to do so, Martinez has not yet answered.

Recently, Judge Kramer, Schenectady County Surrogate's Court, issued a second order directing that MetLife pay Stratcap the payment at issue. MetLife has now paid Stratcap. MetLife has appealed Judge Kramer's second order.

III. Discussion

A. Standard of Review

1. Motion for reconsideration

The standard of review applicable to a motion fo r reconsideration is well-established, and need not be repeated here. See, e.g., Lust v. Joyce, No. 05-cv-613, 2007 WL 3353214, at * 1 (N.D.N.Y. Nov. 9, 2007). Naturally, a court may grant a motion for reconsideration "to correct a clear error of law or prevent manifest injustice." C-TC 9th Ave. P'Ship v. Norton Co. (In re C-TC 9th Ave. P'Ship), 182 B.R. 1, 3 (N.D.N.Y. 1995).

B. Applicable law

1. Interpleader ...


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