interpleader business definition
A legal action in which a plaintiff files a lawsuit that requires two or more parties to litigate competing claims to an asset. For example, two parties claim the right to collect a loan from a borrower who is unsure which party to pay. The borrower files an interpleader action, deposits the disputed funds with the court, and allows the creditors to argue their respective claims.Case Study
Computer company CCI had held the domain name “CLUE.COM" for several years when it was informed by Network Solutions, administrator of Internet domain names, that CCI would have to produce a trademark certification for “CLUE" or accept the assignment of a new domain name. The demand resulted from a claim by game and toy maker Hasbro that CCI's use of the domain name infringed on Hasbro's registered trademark of CLUE, the name of one of the firm's most popular games. Hasbro had already obtained several domain names by this method. Network Solutions was then sued by CCI, which claimed that Hasbro sought to obtain an asset belonging to someone else without paying for it. CCI also sought a restraining order on transfer of the domain name. In an effort to force CCI and Hasbro into litigation against each other, Network Solutions filed an interpleader complaint with the U.S. District Court that, if successful, would permit Network Solutions to step out of the way while Hasbro and CCI fought it out in court. The interpleader complaint proved unsuccessful when the U.S. District Judge dismissed the case.
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