Minn. Federal Judge Denies Motions to Compel Arbitration in $20.5 Million Interpleader Action

MINNEAPOLIS — A Minnesota federal judge has refused to compel arbitration of claims and counterclaims in an interpleader action involving $20.5 million in excess deductible collateral held by an insurer in a workers’ compensation program, ruling that they do not fall within the scope of the program agreements’ arbitration clause.

In a Feb. 23 opinion, Judge John R. Tunheim of the U.S. District Court for the District of Minnesota also denied the parties’ respective motions to dismiss the claims.

In 2015, Benchmark Insurance Co. and SUNZ Insurance Co. partnered to administer an insurance program for large- deductible workers’ compensation policies. …