Schojan v. Papa John's International Inc.
2014 U.S. Dist. LEXIS 100319
| M.D. Fla. | 2014Background
- Plaintiffs filed a putative class action in state court alleging Papa John’s charged and collected sales tax on a separately stated $3.00 delivery fee in violation of Florida law; case removed under CAFA.
- Plaintiffs seek recovery for alleged overcollection (negligence and injunctive relief) and contend delivery fees are not part of the taxable “sales price.”
- Papa John’s moved to dismiss or stay, arguing multiple defenses: Florida statutory bar to purchaser recovery, the voluntary payment doctrine, requirement to pursue administrative refunds, and that the Department of Revenue has primary jurisdiction.
- Plaintiffs responded that (1) affirmative defenses cannot be resolved on a Rule 12(b)(6) motion, (2) voluntary payment is fact-intensive and inapplicable where the payment was unlawful or involuntary, (3) administrative refund procedures do not apply to end consumers, and (4) Department of Revenue guidance is unnecessary because the law and administrative rules already bar taxing separately stated, avoidable delivery charges.
- The court held oral argument and denied the motion to dismiss (and denied a stay), allowing Papa John’s to answer.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Fla. Stat. §213.756 bars purchaser claims against a retailer when retailer remitted collected taxes | §213.756 is an affirmative defense; plaintiffs need not plead against it; statute does not automatically dismiss claims or prohibit injunctive relief | §213.756 precludes recovery from a retailer where collected taxes were remitted to the state (defense apparent on face of case) | Court: Plaintiffs need not anticipate affirmative defenses; dismissal denied on this ground |
| Whether the voluntary payment doctrine bars recovery | Payments were involuntary or unlawful; doctrine requires fact-intensive inquiry and exceptions may apply | Plaintiffs paid with knowledge of facts and thus voluntarily paid; doctrine bars recovery | Court: Doctrine raises factual issues inappropriate for dismissal; denial of dismissal |
| Whether plaintiffs must exhaust administrative refund procedures before suing | Plaintiffs cannot pursue Department refunds because administrative rules require refund claims by the dealer who paid the Department, not by end consumers | Plaintiffs must seek administrative refunds under §215.26 before litigating | Court: Administrative scheme does not permit consumers to seek Dept. refunds; no administrative remedy for these plaintiffs; dismissal denied |
| Whether primary jurisdiction requires stay pending Dept. of Revenue determination | Department rules and case law already make delivery fees nontaxable when separately stated and avoidable; no stay needed | Tax interpretation is within Dept. expertise; stay preserves uniformity and agency determination | Court: Administrative rule and precedent address the issue; primary jurisdiction stay not warranted; denial of stay |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (plaintiff must plead factual content to state a plausible claim)
- Ashcroft v. Iqbal, 556 U.S. 662 (complaints must contain more than threadbare legal conclusions)
- Boyes v. Shell Oil Prods. Co., 199 F.3d 1260 (11th Cir.) (doctrine of primary jurisdiction and agency expertise)
- La Grasta v. First Union Sec., 358 F.3d 840 (11th Cir. 2004) (plaintiffs need not negate affirmative defenses in complaint)
- Broward County v. Mattel, 397 So.2d 457 (Fla. 4th DCA) (illegal tax collections may be recoverable when payment is involuntary)