120 N.E.3d 614
Ind. Ct. App.2019Background
- Consumers (Sanders, Vida, Sheppard) filed a class action alleging Michiana charged undisclosed, non‑negotiated document preparation fees ("Doc Fees") exceeding actual preparation costs on vehicle sales.
- Complaint referenced Indiana Motor Vehicle Dealer Services Act § 9-32-13-7 (which prohibits undisclosed doc fees) but plaintiffs conceded that statute does not provide a private right of action.
- Plaintiffs instead sued under the Indiana Deceptive Consumer Sales Act ("Consumer Act"), alleging Michiana committed "unfair, abusive, or deceptive" acts by omission/non‑disclosure.
- Michiana moved to dismiss under T.R. 12(B)(6), arguing (1) plaintiffs failed to plead a deceptive act within the Consumer Act and (2) plaintiffs improperly sought to enforce a statute enforced only by the Secretary of State.
- The trial court denied the motion, relying on the Consumer Act’s amended "catch‑all" in I.C. § 24-5-0.5-3(a) (added after Lawson v. Hale) that encompasses omissions; this interlocutory order was appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Complaint states a deceptive act under the Consumer Act | Plaintiffs: charging undisclosed, nonnegotiated Doc Fees is an "unfair, abusive, or deceptive" act/omission under § 24-5-0.5-3(a) | Michiana: allegations track a statute (§ 9-32-13-7) that has no private cause of action and do not fit the Consumer Act’s enumerated categories | Court: Denied dismissal — § 24-5-0.5-3(a)’s broad catch‑all includes omissions and can cover conduct even if addressed elsewhere in statute book |
| Whether plaintiffs adequately pleaded an "incurable" deceptive scheme (intent to defraud) requiring fraud‑level specificity | Plaintiffs: alleged uncured and incurable deceptive acts; pleadings were sufficient at notice stage | Michiana: claiming plaintiffs must plead fraud with T.R. 9(B) particularity to show scheme/intent | Court: General allegations of uncured/incurable acts suffice to survive 12(B)(6); Rule 9(B) particularity not fatal at pleading stage given information asymmetry |
| Whether post‑Lawson amendment changed scope of actionable omissions under Consumer Act | Plaintiffs: amendment added a catch‑all permitting omission claims | Michiana: argued Lawson remains binding and omissions not covered | Court: Amendment (effective 2014) added subsection (a) so omissions/non‑disclosures can be deceptive acts under the Consumer Act |
| Whether alleging conduct overlapping with a Secretary of State‑enforced statute bars Consumer Act claim | Plaintiffs: conduct may violate multiple statutes; Consumer Act is independently applicable | Michiana: plaintiffs attempt to bootstrap private enforcement of § 9-32-13-7 | Court: Overlap does not bar a Consumer Act claim; violation of another statute is not per se a Consumer Act violation but may be actionable under Consumer Act’s broad language |
Key Cases Cited
- Kitchell v. Franklin, 997 N.E.2d 1020 (Ind. 2013) (standard for T.R. 12(B)(6) review)
- Lawson v. Hale, 902 N.E.2d 267 (Ind. Ct. App. 2009) (pre‑amendment holding that nondisclosure did not fall within narrowly defined Consumer Act categories)
- Kesling v. Hubler Nissan, Inc., 997 N.E.2d 327 (Ind. 2013) (characterizing Consumer Act as remedial and to be liberally construed)
- Cahoon v. Cummings, 734 N.E.2d 535 (Ind. 2000) (permitting alternative and inconsistent pleading theories)