An interpleader is a way for a party who holds property (a stakeholder) to initiate a suit between all claimants, who are parties claiming a right to that property.
Interpleader is a civil procedure device that allows a plaintiff or a defendant to initiate a lawsuit in order to compel two or more other parties to litigate a dispute. An interpleader action originates when the plaintiff holds property on behalf of another, but does not know to whom the property should be transferred.
Suddenly in an interpleader lawsuit? Learn how does interpleader work, protect your inheritance, and what to do as a claimant.
interpleader | Wex | US Law | LII / Legal Information Institute
Interpleader lets a party holding disputed funds deposit them with a court and step aside while claimants sort out who's entitled to the money. An interpleader action lets someone holding money or property step out of a fight between people who all claim to own it.
In an interpleader action, a party who knows two or more other parties are making a claim on some asset controlled by the party can ask the court to decide who has what rights to the asset, deposit the asset into the custody of the court or a third party and remove itself from the litigation.
An interpleader is a legal procedure used when multiple parties claim the same money, property, or right, and the person holding it (called the stakeholder) wants the court to decide who truly owns it.
In federal court, a stakeholder has two distinct “doors” they can walk through to start an interpleader action. While they achieve the same basic goal, they have different technical requirements. Understanding the difference is crucial for any attorney deciding how to file the case.